17 minutes ago
According to Deutsche Bank, the Bank of Korea is expected to start cutting interest rates early next year
The Bank of Korea is expected to start cutting its interest rate early next year, said Juliana Lee, head of APAC economic research at Deutsche Bank.
Lee added that she expects the central bank’s policy shift to be in line with that of the US Federal Reserve.
“There are some signs that exports have bottomed out on the decline, but as for the recovery, we don’t expect to see it until the fourth quarter, so we’re more bearish on growth than on midpoint,” Lee told Bank CNBC’s “Squawk Box Asia”.
Lee added that she expects the South Korean won to remain broadly unchanged until the central bank starts cutting interest rates.
– Jihye Lee
31 minutes ago
The Bank of Korea keeps interest rates on hold for the third straight day
The Bank of Korea kept interest rates on hold at 3.50% for the third straight day on Thursday.
The decision came in line with a consensus forecast from economists polled by Portal, who expected the central bank to pause.
The central bank governor told CNBC earlier this month it was “premature” to discuss a rate cut, citing inflation rates in the country are still above the Bank of Korea’s 2% target.
South Korea is expected to release its May consumer price index next Friday.
32 minutes ago
Indonesia is expected to keep rates on hold for the third time
Indonesia’s central bank is expected to keep its 7-day reverse repo rate at 5.75%, according to an economist polled by Portal.
The economists also forecast that the central bank will keep the interest rate on the deposit facility at 5.00% and the interest rate on the loan facility also at 6.50%.
For Bank Indonesia, the move would be the third consecutive pause as the country posted an inflation rate of more than 4% in April. The country will release its inflation rate for May next month.
Before an hour
South Korea’s producer price index rose 1.6% in April
South Korea’s producer price index rose 1.6% yoy in April, down from a 3.3% rise in the previous month.
Government data showed the country’s producer price index fell 0.1% month-on-month after posting 0.1% growth in March.
The PPI is a measure of the price change that domestic producers receive for their goods and services.
The South Korean won weakened 0.11% to 1,319.66 against the US dollar on Thursday morning.
– Jihye Lee
7 hours ago
Fed officials unsure whether more rate hikes are needed, minutes show
The Fed minutes showed that participants were “uncertain” about raising rates for the 11th time at their June meeting.
According to the minutes, the Fed now appeared to be in two camps. A group that included “some” members believed that progress on reducing inflation was “unacceptably slow” and would require further hikes. The other, supported by “several” FOMC members, saw slowing economic growth where “further policy tightening after this meeting may not be necessary”.
The record does not identify individual members, nor does it put specific numbers on “some” or “several”. However, in Fed parlance, “some” means more than “several”.
On balance, the minutes indicated that the Fed would be closely monitoring the incoming data to decide whether to hike rates again on June 14th.
— Jeff Cox, John Melloy
Correction: In Fed parlance, “some” means more than “several”. In an earlier version, the difference was incorrectly stated.
9 hours ago
Fed’s Waller stresses “flexibility” for June rate decision
Addressing a three-pronged question facing US central bankers, Federal Reserve Governor Christopher Waller said it was simply too early to tell which decision was the right one. Data from the coming weeks ahead of the June 13-14 meeting will decide which path is the right one, he said.
While Waller insisted the Fed needs to “remain flexible” on whether to hike, pause or skip June to hike rates in July, Waller expressed doubts that the Fed could fight the Inflation has gone as far as it takes.
“I don’t expect the data coming in over the next few months to make it clear that we’ve hit the terminal rate,” Waller said in prepared remarks for a speech in Santa Barbara, California.
“And I’m not in favor of halting rate hikes unless we get clear evidence of inflation moving towards our 2% target. But whether we should raise or skip at the June meeting will depend on how the data rolls in over the next three weeks.” he added.
– Jeff Cox
9 hours ago
House Speaker McCarthy reiterated his confidence in averting a default
House Speaker Kevin McCarthy reiterated that negotiators should find a solution on the debt ceiling, even as lawmakers struggle to agree on basic spending.
“We will not default on payments,” he said during a press conference on Wednesday. “We will solve this problem. I’ll stick with it until we make it. But let’s face it. We had to spend less than last year. It’s not my fault the Democrats can’t give their spending a boost.”
— Samantha Subin, Sarah Min
14 hours ago
The negotiators will meet again on Wednesday morning
Negotiators from both sides of the debt ceiling negotiations are expected to meet again on Wednesday morning, Portal reported, citing a source close to them.
Stocks fell on Tuesday after negotiators for President Joe Biden and House Speaker Kevin McCarthy appeared to have failed to make significant progress in talks that day.
It could take a week to work out a deal and get it through Congress, the Portal report said. That raises the stakes to reach an agreement in the next few days before the Treasury Department’s June 1 default deadline.
– John Meloy