[ARTICLE] The US Federal Reserve has maintained its interest rates at 5.25% to 5.5%, the highest in 23 years. This decision comes despite lower-than-expected inflation data for May, increasing speculation about a potential rate cut in the autumn.
Breaking news: The US central bank left borrowing costs on hold at a 23-year high of between 5.25% and 5.5%. Cooler-than-expected consumer price index data for May has increased bets on a cut earlier in the autumn: https://on.ft.com/45oHuHK
Senior Analyst - International Economics at the Central Bank of UAE | CFA Level III Candidate
Cooler-than-expected consumer prices are in favour of a potential rate cut this year. However, the FED still expects the core PCE and CPI to increase marginally by the end of the year from the current level. If the current level wasn’t sufficient confidence for the FED to cut rates, how will the higher expected inflation rates be in favour of a rate cut towards the latter end of the year? He did emphasize on the words “Data driven” and didn’t commit to a rate path. So let’s not get too excited! #Fed #FOMC #Rates #Inflation
Breaking news: The US central bank left borrowing costs on hold at a 23-year high of between 5.25% and 5.5%. Cooler-than-expected consumer price index data for May has increased bets on a cut earlier in the autumn: https://on.ft.com/45oHuHK
The FED has decided to maintain their base rate unchanged, as inflation is still stubbornly above the 2% target. The Bank of England is set to speak on Thursday the 20th of June, with debates on which direction it will take and whether it will align with the US or follow the EU initial cut. Markets have responded well: long term, a lower interest rates environment will be essential for investments in all of real estate, alternatives and equities. #interest #inflation
Breaking news: The US central bank left borrowing costs on hold at a 23-year high of between 5.25% and 5.5%. Cooler-than-expected consumer price index data for May has increased bets on a cut earlier in the autumn: https://on.ft.com/45oHuHK
Over the course of this year, the goalposts have been shifted numerous times. Market participants priced in more than one rate cut at the start of the year. Now, they are pricing in only one rate cut. In spite of the rate cut narrative and some hot economic data prints earlier this year, equities have continued to head higher, led by semiconductors and the Mag7. It is pretty clear that the new narrative is as such: If there are no rate cuts, the market continues to head higher for the foreseeable future. We cannot rule out the possibility that Chair Powell might not "stay the course", which is a phrase he has mentioned numerous times in his press conferences. The Bank of Canada and the European Central Bank have both decided to cut rates even though they were yet to meet their inflation targets. Therefore, cutting prematurely if inflation remains stable and near 2% should not come as a shock to market participants. If I'm asked on the sectors to focus on in the coming few months and years, it would be software, solar and China.
Breaking news: The US central bank left borrowing costs on hold at a 23-year high of between 5.25% and 5.5%. Cooler-than-expected consumer price index data for May has increased bets on a cut earlier in the autumn: https://on.ft.com/45oHuHK
Assistant Manager - Financial Planning & Budgeting - Global Finance Department
Right decision.
Breaking news: The US central bank left borrowing costs on hold at a 23-year high of between 5.25% and 5.5%. Cooler-than-expected consumer price index data for May has increased bets on a cut earlier in the autumn: https://on.ft.com/45oHuHK
Cooler than expected consumer prices are in favour of potential rate cut this year; however, the FED still expects the core PCE and current CPI to increase marginally by the end of the year to the current level. The FED has decided to maintain their base rate unchanged, as inflation is still stubbornly above the 2% target. The market has responded well: long term, a lower interest rates environment will be essential for investments in all of alternatives, real estate and equities.
Breaking news: The US central bank left borrowing costs on hold at a 23-year high of between 5.25% and 5.5%. Cooler-than-expected consumer price index data for May has increased bets on a cut earlier in the autumn: https://on.ft.com/45oHuHK
🏦 As the Federal Reserve convenes for its policy meeting today, the expectation is that interest rates will remain unchanged. This marks the second consecutive meeting where the central bank has chosen to abstain from raising rates during the current tightening cycle. All eyes are on the committee's statement and Chair Jerome Powell's forthcoming press conference, where market participants will be on the lookout for hints concerning the Fed's upcoming decision regarding a possible rate hike in December, the year's last meeting.
The Federal Reserve held interest rates steady in a decision released Wednesday, while also indicating it still expects one more hike before the end of the year and fewer cuts than previously indicated next year. That final increase, if realized, would do it for this cycle, according to projections the central bank released at the end of its two-day meeting. If the Fed goes ahead with the move, it would make a full dozen hikes since the policy tightening began in March 2022. For projections from the Fed’s dot-plot for the remainder of 2023 and 2024, check out the full story 👇
Fed recap: Chair Powell explains why the central bank isn’t ready yet to cut rates: (CNBC) The Federal Reserve held interest rates steady at their current range of 5.25% to 5.5%, but revised its outlook for rate cuts to just one in 2024. Central bank policymakers noted that there has been “modest further progress” toward […] #hedgefund #portfoliomanagement #capital
