INFLATION (FINANCE) – UNITED STATES

Rate cut hopes dashed by US data

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Original article by Cecile Lefort
The Australian Financial Review – Page: 23 : 12-Apr-24

Financial markets have now priced in a 20 per cent chance that the US Federal Reserve will reduce the cash rate in June, compared with 58 per cent prior to the release of the latest inflation data. The figures showed that the inflation rate remains well above the central bank’s target of two per cent; core inflation rose by 0.4 per cent in March and 3.8 per cent in the year to March. Financial markets now expect just one rate cut in 2024. The US inflation data has also prompted Australian investors to scale back their expectations regarding the timing of monetary policy easing by the Reserve Bank.

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

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

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

Fed chief says increasing prices will allow rate rises

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Original article by Nick Timiraos
The Australian – Page: 27 : 14-Jul-17

The general expectation of financial markets is that the Federal Reserve will increase US interest rates again in December 2017. Federal Reserve chair Janet Yellen has told Congress that it is too soon to suggest that the US inflation rate will reach two per cent in coming years. She added that the central bank will maintain its current stand on gradually lifting the cash rate unless inflation remains persistently below its target of two per cent.

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

Fed can’t afford to delay rate hikes: Williams

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Original article by Adam Creighton
The Australian – Page: 21 : 27-Jun-17

Federal Reserve Bank of San Francisco president John Williams says there should be a third rise in US interest rates in 2017, given that the nation now has low inflation and full employment. He warns that failure to increase interest rates could risk overheating the economy, which could in turn result in higher inflation. Williams adds that the Federal Reserve should also begin reducing its balance sheet, which has risen to $US4.5trn.

CORPORATES
FEDERAL RESERVE BANK OF SAN FRANCISCO, UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, RESERVE BANK OF AUSTRALIA, UNIVERSITY OF TECHNOLOGY, SYDNEY

Fed hikes interest rates despite declining inflation, sets plan for balance sheet reduction

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Original article by Jeff Cox
CNBC – Page: Online : 15-Jun-17

The US Federal Reserve has increased official interest rates by 0.25 per cent, following its rate rise in March. The central bank’s new target range is one to 1.25 per cent, while its monetary policy statement indicates that it expects inflation to stabilise but remain below two per cent in the near-term. Meanwhile, its GDP growth forecast has been upgraded from 2.1 per cent to 2.2 per cent, while its forecast for the unemployment rate has been revised downward from 4.5 per cent to 4.3 per cent. The Federal Reserve has also advised that it will begin reducing its balance sheet during 2017, although it has offered no guidance on when this will commence.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE

Betting on US stimulus could come back to bite

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Original article by David Rogers
The Australian – Page: 32 : 14-Feb-17

Sharemarkets have rallied in response to indications from US President Donald Trump of a major announcement on tax policy in coming weeks. Diana Mousina of AMP Capital warns that any move by the Trump administration to back away from its proposed tax cuts for companies and individuals would hit shares and US economic growth. However, an overly aggressive fiscal stimulus package would risk a spike in the inflation rate, which would most likely prompt a rise in interest rates. This in turn could derail the sharemarket rally.

CORPORATES
UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, AMP CAPITAL INVESTORS LIMITED, UNITED STATES. FEDERAL RESERVE BOARD, STANDARD AND POOR’S ASX 200 INDEX, PERPETUAL INVESTMENTS, PACIFIC INVESTMENT MANAGEMENT COMPANY LLC