CENTRAL – UNITED STATES

Fed chief Powell stays put with policy for now

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Original article by David Rogers
The Australian – Page: 27 : 19-Jul-18

US Federal Reserve chairman Jerome Powell has signalled that the central bank will retain its stated policy of increasing interest rates gradually, at least for now. The potential for a full-blown trade war with China appears to be the main reason for Powell’s caveat of "for now". Meanwhile, UBS forecasts that the Reserve Bank of Australia would most likely delay tightening monetary policy until beyond 2020 in the event of a full trade war.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, UBS HOLDINGS PTY LTD, RESERVE BANK OF AUSTRALIA, STANDARD AND POOR’S 500 INDEX

Fed hikes put squeeze on banks

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Original article by Karen Maley
The Australian Financial Review – Page: 1 & 28 : 15-Jun-18

The US Federal Reserve has signalled that two more interest rate increases are likely in 2018, following its second rate rise for the year. The new target range for the federal funds rate is between 1.75% and 2%, while the Reserve Bank of Australia has kept its cash rate at 1.5% for almost two years. The divergence in monetary policy has coincided with rising wholesale borrowing costs for Australia’s major banks, as well as a recent spike in the bank bill swap rate. Shane Oliver of AMP says local banks could potentially respond by increasing their mortgage rates on investment and interest-only loans.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, RESERVE BANK OF AUSTRALIA, AMP LIMITED – ASX AMP, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, FINANCIAL STABILITY BOARD, DEUTSCHE BANK AG, SOCIETE GENERALE SA, BNP PARIBAS SA, GRUPO SANTANDER

Fed holds rates steady, June rise on cards

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Original article by Nick Timiraos
The Australian – Page: 34 : 4-May-18

Data from CME Group shows that most futures market traders expect the US Federal Reserve to increase interest rates in June, after the central bank left the cash rate on hold in May. However, futures traders rate the chances of monetary policy being tightened two more times beyond June at almost 50 per cent. The Federal Reserve has signalled that it will increase the cash rate gradually, despite recent data showing that inflation has reached its target of two per cent.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, JP MORGAN CHASE AND COMPANY, DOW JONES INDUSTRIAL AVERAGE INDEX, NOMURA SECURITIES INTERNATIONAL INCORPORATED, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT

US Fed set to rise further above RBA

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Original article by Vesna Poljak
The Australian Financial Review – Page: 1 & 32 : 23-Mar-18

The yield on US 10-year bonds has eased to 2.86 per cent in response to the Federal Reserve’s move to increase interest rates to 1.75 per cent. Kapstream Capital’s Steve Goldman expects the central bank to increase US rates to 2.5 per cent, adding that this is more likely to be in 2019 rather than 2018. The US federal funds rate is now higher than Australia’s cash rate for the first time since 2000. The interest rate differential is expected to widen, as the Federal Reserve has flagged further rate rises in 2018 and 2019. Most analysts do not expect the Reserve Bank to do so until at least the March 2019 quarter.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, RESERVE BANK OF AUSTRALIA, KAPSTREAM CAPITAL PTY LTD, NOMURA AUSTRALIA LIMITED, UBS GLOBAL ASSET MANAGEMENT (AUSTRALIA) LIMITED

Rate rise likely as CPI starts to edge up

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Original article by Harriet Torry
The Australian – Page: 23 : 16-Feb-18

New figures show that the US has recorded its biggest monthly increase in inflation since March 2005. The larger-than-expected increase in January has increased the likelihood that the Federal Reserve will lift interest rates in March; the central bank considers an inflation rate of two per cent to be an indication of a healthy economy, but it does not want inflation to get much higher than that. Investors took the January inflation figures in their stride, with the Dow Jones closing up around one per cent. Originally published in "The Wall Street Journal".

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, WELLS FARGO AND COMPANY, PPG INDUSTRIES, WALT DISNEY COMPANY, AMAZON.COM INCORPORATED, SHERWIN-WILLIAMS

Investors expect US rate hike path to slow

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Original article by Karen Maley
The Australian Financial Review – Page: 24 : 15-Dec-17

Financial markets had generally expected the US Federal Reserve to increase interest rates in December, but Federal Open Market Committee members Charles Evans and Neel Kashkari voted against tightening monetary policy. The latter had also voted against the previous rate increases in March and June, although Evans had been expected to vote in favour of a rate rise. Meanwhile, the Federal Reserve still expects inflation to remain below its target of two per cent until 2019, while it has reiterated its expectations of three rate rises in 2018.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, FEDERAL RESERVE BANK OF MINNEAPOLIS

RBA can just sit back and watch the Fed

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Original article by Karen Maley
The Australian Financial Review – Page: 30 : 13-Nov-17

The latest monetary policy statements of the Reserve Bank and the Federal Reserve used identical wording to describe the current state of the Australian and US economies. The Federal Reserve is widely tipped to increase official interest rates again in December, which will allow the Reserve Bank to observe the impact of a rate rise in a low-inflation, low wages growth environment before taking any action of its own. There is no pressing need for the Reserve Bank to act, given that the unemployment rate remains well above that of the US and is not expected to fall in the next two years.

CORPORATES
RESERVE BANK OF AUSTRALIA, UNITED STATES. FEDERAL RESERVE BOARD

Donald Trump nominates Jerome Powell as Fed chair

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Original article by Kate Davidson, Peter Nicholas
BBC.com – Page: Online : 3-Nov-17

US President Donald Trump has nominated Jerome Powell to succeed Janet Yellen as chair of the Federal Reserve. He is widely tipped to maintain the Federal Reserve’s current approach to tightening monetary policy, and financial market experts are generally supportive of the decision to select Powell over the other four candidates for the role, who included Yellen. Powell’s appointment must be confirmed by the Senate.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT

Yellen defends Fed’s gradual rate rise plan

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Original article by David Harrison
The Australian – Page: 28 : 28-Sep-17

Financial markets have priced in a 77.9 per cent chance of a rise in US interest rates in December following a speech by Federal Reserve chair Janet Yellen, compared with 72.8 per cent previously. The central bank has flagged one more rate rise in 2017 and further tightening of monetary policy over the next several years. However, Yellen has told a conference that the outlook for inflation will influence how rapidly interest rates are increased. Inflation has remained below the Federal Reserve’s target of two per cent for some time.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, NATIONAL ASSOCIATION FOR BUSINESS ECONOMICS, FEDERAL RESERVE BANK OF NEW YORK, FEDERAL RESERVE BANK OF CHICAGO

Inflation data will be key to whether Fed can hike

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Original article by Brian Chappatta
The Australian Financial Review – Page: 20 : 7-Aug-17

New data shows that a higher-than-expected 209,000 jobs were created in the US during July, while the unemployment rate was at a 16-year low. However, the upcoming release of US inflation data is likely to influence the timing of any change in monetary policy by the Federal Reserve. Bill Gross of the Janus Henderson Global Unconstrained Bond Fund says the central bank is unlikely to increase short-term interest rates until the core inflation rate rises to its target of two per cent.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, JANUS HENDERSON GLOBAL UNCONSTRAINED BOND FUND, BMO CAPITAL MARKETS, BANK OF AMERICA CORPORATION, TD SECURITIES, FEDERAL RESERVE BANK OF NEW YORK, FEDERAL RESERVE BANK OF MINNEAPOLIS