Economists at TD Securities have adjusted their forecasts for the Reserve Bank of Australia's (RBA) cash rate decisions. While they still anticipate a total of 100 basis points (bps) in rate cuts throughout the easing cycle, they now expect the first 25 bps cut to occur in November, compared to their previous projection of August.
RBA’s Meeting Minutes revealed that the Board deliberated on the possibility of raising rates by 25 basis points (bps) or keeping rates unchanged. While recent data indicated that inflation would return to target within a reasonable timeframe, it was acknowledged that this process would "take some time." Consequently, the board agreed that it was prudent not to rule out another rate hike.
China's Commerce Ministry stated on Monday, "The US's assertion that China has generated 'overcapacity' is inaccurate, highlighting the unilateral and hegemonic actions of the US."
Chinese authorities announced that the Fujian Coast Guard is increasing patrols in waters adjacent to Taiwan's Kinmen islands to effectively uphold operational order in the relevant maritime areas, and ensure the safety of fishermen's lives and property."
Economists at Commerzbank have adjusted their forecast, now expecting the first interest rate cut at the Federal Open Market Committee (FOMC) meeting in June instead of May. This adjustment is attributed to the reduced likelihood of a recession. Consequently, they anticipate a less aggressive easing of monetary policy compared to their previous projections. Instead of eight rate cuts, they now anticipate five, with three expected in 2024 and two in 2025.
President of the New York Fed, John C. Williams, discussed his perspective on the Fed's interest rate stance during an interview with Axios. He suggested that rate cuts could be on the horizon later this year, but emphasized that they would only occur if deemed appropriate. Williams noted that his outlook on the economy remains largely unchanged following the release of January's economic data.
Federal Reserve Governor Christopher J. Waller recently suggested that the Federal Reserve should postpone any rate cuts for at least a few more months to assess whether January's high inflation report was an anomaly.
US President Joe Biden will convene a meeting with the four Congressional leaders at the White House on Tuesday. The focus of the discussions will revolve around passing the bipartisan national security supplemental and ensuring the continued operation of the government. With the shutdown deadline looming on Friday, addressing these matters takes on heightened urgency.
Santander US Capital Markets suggested in a note, as reported by The Wall Street Journal, that the Federal Reserve's FOMC might postpone rate cuts until after the US election. They anticipate that the US economy and inflation will continue to surpass expectations, which could justify delaying monetary easing.
US New Home Sales Change (MoM) grew by 1.5% in January, falling short of the previous growth of 7.2%.
US New Home Sales (MoM) came in at 0.661M in January against the expected 0.680M and 0.664 prior.
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