MONETARY POLICY – UNITED STATES

Economists raise chances of QE

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Original article by David Rogers
The Australian – Page: 17 & 27 : 26-Sep-19

UBS’s chief economist George Tharenou says there is a growing possibility that the Reserve Bank of Australia will have to resort to unconventional monetary policy options. He says the US Federal Reserve is likely to reduce official interest rates by another one per cent over the next year, as US economic growth slows due to the latest round of tariff hikes. This in turn will put pressure on the RBA to further ease monetary policy, and potentially resort to measures such as quantitative easing. Tharenou expects the RBA to reduce the cash rate to just 0.25 per cent by May 2020.

CORPORATES
RESERVE BANK OF AUSTRALIA, UBS HOLDINGS PTY LTD, UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT

US Fed rate cut gives Reserve Bank cover

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Original article by Vesna Poljak, Luke Housego
The Australian Financial Review – Page: 1 & 31 : 2-Aug-19

Andrew Canobi of Franklin Templeton says the US Federal Reserve is still widely tipped to announce two further interest rate cuts over the next year. However, he says the central bank is likely to pursue less aggressive monetary policy easing than had been recently forecast, after chairman Jerome Powell signalled that the rate cut on 1 August will not be the start of "a long series of rate cuts". The more hawkish tone from the Federal Reserve will be welcomed by the Reserve Bank of Australia, as it should reduce any upward pressure on the Australian dollar.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, FRANKLIN TEMPLETON ASSET MANAGEMENT LIMITED, RESERVE BANK OF AUSTRALIA

Fed chair prepares ground for July rate cut

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Original article by Nick Timiraos
The Australian – Page: 27 : 12-Jul-19

Wall Street and the yield on 10-year US government bonds rose on 11 July after Federal Reserve chairman Jerome Powell indicated that the cash rate is likely to be reduced at the end of the month. Powell has told the US Congress that trade tensions and concerns about the global economy continue to weigh on the US economic outlook, while the inflation rate may remain weak for some time. Financial markets have priced in a rate of at least 25 basis points when the central bank meets on 30-31 July.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD

US economy facing headwinds: Fed

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Original article by Eric Johnston
The Australian – Page: 17 & 28 : 26-Mar-19

Federal Reserve Bank of Chicago president Charles Evans forecasts that US economic growth in 2019 will be within the range of 1.75 per cent to two per cent. Meanwhile, financial markets have priced in a 60 per cent chance that the US Federal Reserve will reduce official interest rates, but Evans expects rates to rise, although not until the second half of 2020. Evans has also downplayed the risk to the US economy and financial markets if Britain’s exit from the European Union is "disorderly".

CORPORATES
FEDERAL RESERVE BANK OF CHICAGO, UNITED STATES. FEDERAL RESERVE BOARD, STANDARD AND POOR’S ASX 200 INDEX, NIKKEI 225 INDEX, CREDIT SUISSE AG

Patient Fed backs off rate hikes

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Original article by Vesna Poljak
The Australian Financial Review – Page: 1 & 12 : 22-Mar-19

The Federal Reserve is now widely tipped to leave the cash rate unchanged until 2020, after it adopted a more dovish stance at its latest monetary policy meeting. The central bank has dampened expectations of two interest rate increases in 2019, with chairman Jerome Powell indicating that the cash rate may be left on hold for some time. Meanwhile, the Federal Reserve’s stance has heightened speculation regarding the timing of any rate cut by the Reserve Bank of Australia.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, RESERVE BANK OF AUSTRALIA, BANK OF AMERICA CORPORATION, STANDARD AND POOR’S 500 INDEX

Fed puts the brakes on interest rates

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Original article by Nick Timiraos
The Australian – Page: 28 : 1-Feb-19

Wall Street rallied and US bond yields fell after the Federal Reserve left the cash rate on hold at its first monetary policy meeting for 2019 and signalled that further rate rises are off the agenda in the near-term. The central bank had increased the federal funds rate in December and flagged two rate rises in 2019. Federal Reserve chairman Jerome Powell has identified a number of potential risks to the US economy that contributed to the decision to announce an interest rate pause.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, DOW JONES INDUSTRIAL AVERAGE INDEX, GRANT THORNTON INTERNATIONAL

Fed will take a break from rate hikes: Yellen

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Original article by Joyce Moullakis
The Australian – Page: 13 & 18 : 8-Jan-19

The Federal Reserve raised US interest four times in 2018, and former chair Janet Yellen says another one or two rate rises may be necessary to prevent the economy from overheating. However, Yellen has told a conference in China that she does not expect the central bank to tighten monetary policy again immediately. Yellen’s successor Jerome Powell has signalled that the Federal Reserve will be flexible in its approach to monetary policy in 2019.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, UBS AG, AMERICAN ECONOMIC ASSOCIATION, PEOPLE’S BANK OF CHINA, EUROPEAN CENTRAL BANK, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT

Fed rate hike roils global markets

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Original article by David Rogers
The Australian – Page: 15 & 21 : 21-Dec-18

Australia’s benchmark S&P/ASX 200 has shed 9.2 per cent so far in 2018, and 11 per cent during the current quarter. The local market’s 1.3 per cent fall on 20 December was accompanied by large falls across Asia, while the Australian dollar reached a low of $US.7086 and the yield on 10-year Australian bonds fell to 2.3 per cent. Financial markets believe that the US Federal Reserve made a policy mistake in signalling further monetary policy tightening over the next few years and it may have to reduce interest rates within two years.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, PEPPERSTONE FINANCIAL PTY LTD, UNITED STATES. FEDERAL RESERVE BOARD, NIKKEI 225 INDEX, STANDARD AND POOR’S 500 INDEX, BLOOMBERG LP, OANDA AUSTRALIA PTY LTD, MAGELLAN FINANCIAL GROUP LIMITED – ASX MFG, WAM CAPITAL LIMITED – ASX WAM, MORNINGSTAR PTY LTD, PLATYPUS ASSET MANAGEMENT PTY LTD, ECP ASSET MANAGEMENT PTY LTD, HYPERION ASSET MANAGEMENT LIMITED

Fed, markets split on rate outlook – again

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Original article by Sarah Turner
The Australian Financial Review – Page: 29 : 20-Dec-18

Financial markets have diverged from the Federal Reserve regarding the outlook for US interest rates in 2019, ahead of the central bank’s December board meeting. The general consensus of bond investors is that the Fed will not increase interest rates as rapidly as it has flagged in 2019. Meanwhile, analysts say factors such as the US-China trade war and the downturn in the crude oil price are likely to weigh on the Fed’s monetary policy decision for December.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, GRANT SAMUEL FUNDS MANAGEMENT PTY LTD, FEDERATION ASSET MANAGEMENT, BANK OF AMERICA CORPORATION, MERRILL LYNCH AND COMPANY INCORPORATED

US fundamentals strong despite correction

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Original article by David Rogers
The Australian – Page: 18 : 22-Oct-18

The S&P 500 recently shed nearly eight per cent, although it has recovered much of the lost ground and remains five per cent higher than at the start of 2018. Kevin Anderson of State Street has downplayed concerns about the recent pullback by US equities, arguing that Wall Street was largely catching up with the bond market and overseas markets. Anderson expects the US sharemarket to rise in 2019 and he is upbeat about the outlook for the US economy, while he forecasts that the Federal Reserve will lift interest rates to about three per cent in 2019.

CORPORATES
STANDARD AND POOR’S 500 INDEX, UNITED STATES. FEDERAL RESERVE BOARD