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International financial news

International financial news

[US President Trump: The Fed’s action on interest rate cuts is too slow, leaving us at a disadvantage when competing with other countries. When it comes to negative interest rates, Trump says he wants negative interest rates.

[Fed Huck: The Fed should "maintain the status quo" and pay attention to the US economy]
Philadelphia Fed President Huck said he opposed the Fed’s interest rate cut last month, and officials should now wait and see what’s going on before acting. Regarding how much support the Fed policy provides for the economy, Huck said, I think we will remain neutral. That's why I support the fact that I don't move. If the policy is slightly loose, I can accept it. It won't be night because the inflation rate is 10 or 20 basis points lower than the target, but if inflation expectations begin to fall, he will be worried; for him, the threshold for implementing negative interest rates will be "very high." (Note: Huck has no voting rights in the FOMC this year)

[Saudi Energy Minister Abdul-Aziz: We are implementing plans to promote demand for crude oil, Saudi Arabia is committed to creating 9 million barrels per day of additional crude oil demand worldwide]

[Fed Barking: The US labor market is still tight]

Richmond Fed President Balkin said that although more workers can join the workforce, the US job market is still "tightening."



News and Data



U.S. President Trump Speaks 



RBNZ Interest Rate Decision



RBNZ Rate Statement 



RBNZ Press Conference 



CPI (YoY) (Oct)

Summary of investment bank views

Rabobank Bank of the Netherlands: New Zealand Federal Reserve may cut official cash rate (OCR) to 0.75%

New Zealand’s announcement of a rate cut at Wednesday’s meeting seems to be a good one, as New Zealand’s data suggests that inflation expectations are weakening. If the New Zealand Federal Reserve cuts interest rates tomorrow, it will support the Dutch cooperative bank's view that the New Zealand dollar will fall to 0.60 in 12 months. Previously, despite the criticism of the market, the New Zealand Federal Reserve, as the first country in the G10 central bank to act, carried out a preventive rate cut, and the rate of 50 basis points in August was also greater than market expectations. Frequently out of market expectations, its interest rate cuts have doubts about the impact of the New Zealand dollar. (The current position of the New Zealand dollar has fallen by 8% from the March high)

ANZ Bank: New Zealand Federal Reserve may cut interest rates on Wednesday, but it is not too farewell

ANZ issued a research report that the New Zealand Federal Reserve may cut interest rates on Wednesday, but it should not be excessively dovish. The market currently prefers a 25-basis point rate cut, which is in line with our expectations. But the RBNZ's forward-looking guidance is the focus of attention and will provide guidance for future interest rate paths.

Overall, the data does not show that the New Zealand Federal Reserve needs extreme doves, but the situation may be more complicated, and the New Zealand Federal Reserve is expected to leave room for interest rate cuts. However, there is no need to release a further rate cut signal. However, if the rush to close the interest rate cut may lead to excessive hawkish reaction in the market, the financial situation will be tightened, especially the next meeting of the New Zealand Federal Reserve that may decide to wait until 2020.

Credit Suisse Chief Economist: The Fed will not cut interest rates next year

Sweeney, chief economist and chief investment officer of Credit Suisse, predicts that the Fed will not continue to cut interest rates in 2020, and US GDP growth will be slightly below 2%, and it is unlikely that a recession will occur. In order to alleviate the downturn in manufacturing and investment, the Fed has carried out three insurance interest rate cuts this year. Investors are worried that the job market will deteriorate rapidly. We don’t think so, but it is expected that the job market will gradually weaken. It may rise by about 0.1 to 0.2 percentage points, GDP growth will be slightly lower than 2%, but it will not be too low, and the Fed will not continue to cut interest rates.

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