Fed Set To Cut Rates For 3rd Consecutive Time đ
The Federal Reserve is expected to announce another 25bps cut to the federal funds rate in December 2024, marking the third consecutive reduction, as the disinflation process is progressing more slowly than anticipated, with higher inflation, lower unemployment, and stronger economic growth than previously forecasted.
The article suggests that the Federal Reserve will continue to raise interest rates, which could have a negative impact on the investment portfolio. The continued rate hikes and higher inflation could lead to lower returns for the long positions in equities, bonds, and cryptocurrencies, while the short position in oil and fossil fuels may benefit. Overall, the portfolio is likely to experience a significant negative impact due to the macroeconomic conditions described in the article.
China to Cut Rates Next Year đ
China plans to cut interest rates and reserve requirements next year to boost credit demand and maintain stable economic growth, according to the People's Bank of China research bureau director.
The article suggests that China will implement expansionary monetary policy measures, such as cutting interest rates and reserve requirements, to stimulate the economy. This is likely to have a significant positive impact on the investment portfolio, as it could lead to increased liquidity and investment in the Chinese and global markets, benefiting the long positions in the S&P 500, European, and emerging market indices, as well as the long positions in Chinese companies like Apple, Microsoft, and Meta.
Jamaica Lowers Interest Rate by Another 25 bps đ
The Bank of Jamaica cut its monetary policy rate by 25 basis points to 6% in December 2024, continuing its easing cycle as inflation remained within the target range.
The decision by the Bank of Jamaica to cut its monetary policy rate is a positive development for the investment portfolio, as it indicates a stable and favorable economic environment in Jamaica. The easing of monetary policy, coupled with inflation remaining within the target range, suggests a supportive environment for investments, particularly in the Jamaican market and related assets. While there are some risks acknowledged, the overall impact on the portfolio is moderate and positive, as the portfolio includes exposure to the Jamaican market and broader emerging markets.
Colombia Cuts Rate to 9.5%, Less Than Expected âšī¸
The Central Bank of Colombia reduced its benchmark rate by 25 basis points to 9.5% in December, with inflation easing and GDP growth driven by investment, but exchange rate volatility and global financial conditions limiting room for aggressive rate cuts.
The article provides a mixed outlook for the Colombian economy, with some positive signs such as easing inflation and GDP growth, but also concerns about exchange rate volatility and global financial conditions that could limit the central bank's ability to aggressively cut rates. This could have a moderate impact on the portfolio, as the exposure to the Colombian market is relatively small (1% each for the UAE and Kuwait markets), and the overall impact on the broader global markets may be limited.
Bank of Russia Unexpectedly Holds Rate at 21% đ
The Bank of Russia held its key interest rate unchanged at 21% in December, surprising markets that expected a 200bps hike, citing low credit activity despite rising inflation and a weakening ruble.
The decision by the Bank of Russia to hold interest rates steady despite high inflation and a weakening ruble is likely to have a moderate negative impact on the investment portfolio. The portfolio has significant exposure to global equity markets, including the S&P 500, European markets, and emerging markets, which could be affected by the continued high inflation and currency volatility in Russia. Additionally, the portfolio's exposure to commodities, including oil and fossil fuels, could be impacted by the ongoing economic conditions in Russia.
Banxico Cuts Rates to 10%, Signals Further Easing âšī¸
The Bank of Mexico cut its benchmark rate by 25bps to 10% in December 2024, aligning with global disinflation trends, though inflation remains persistent, particularly in services.
The article discusses the monetary policy decision by the Bank of Mexico, which is neutral for the given investment portfolio. While the rate cut and disinflation trends are positive, the persistent inflation in services and the potential for further rate cuts of greater magnitude could have a moderate impact on the portfolio, as it may affect the performance of the long positions in the Mexican and broader global equity markets.
BoE Leaves Rates Steady âšī¸
The Bank of England kept its benchmark rate steady at 4.75% in December 2024, but three policymakers preferred a 25bps cut to 4.5% due to sluggish demand and a weakening labor market, while the central bank signaled the need for a gradual and prolonged restrictive monetary policy to bring inflation back to the 2% target.
The article suggests that the Bank of England is maintaining a cautious and gradual approach to monetary policy, keeping the benchmark rate unchanged despite some policymakers favoring a rate cut. This neutral stance is unlikely to have a significant impact on the given investment portfolio, which has a diversified exposure across different asset classes and geographies. However, the central bank's emphasis on the need for a prolonged restrictive policy to control inflation could lead to moderate volatility in the portfolio, particularly in the equity and fixed income components.
Taiwan Holds Rates Steady âšī¸
The Central Bank of Taiwan kept its key interest rate unchanged at 2% in December 2024, raised its 2024 GDP growth forecast to 4.25%, and cautioned about potential risks in 2025 due to uncertainties surrounding US trade policies.
The article provides an update on the monetary policy decision and economic outlook from the Central Bank of Taiwan. While the bank raised its GDP growth forecast for 2024, it also cautioned about potential risks in 2025 due to uncertainties around US trade policies. This mixed outlook is likely to have a moderate impact on the given investment portfolio, which includes exposure to both global and regional equity markets as well as commodities. The neutral impact assessment reflects the balanced nature of the news, with both positive and negative elements.
BoE Seen Leaving Rates Steady âšī¸
The Bank of England is expected to hold its benchmark rate at 4.75% in December 2024, balancing inflation and slowing growth, with most investors anticipating two rate cuts in 2023.
The article suggests that the Bank of England will maintain its current benchmark rate, which is neutral for the overall portfolio as it does not indicate a significant change in the interest rate environment. However, the potential for two rate cuts in 2023 could have a moderate impact on the portfolio, as it could affect the performance of fixed-income and interest-rate-sensitive assets.
Philippines Central Bank Cuts Rate by 25bps as Expected âšī¸
The Central Bank of the Philippines lowered its benchmark interest rate by 25 basis points to 5.75% in December 2024, the third consecutive rate cut, as inflation remained within the target range and domestic demand stayed resilient, despite external challenges.
The interest rate cut by the Central Bank of the Philippines is a neutral event for the given investment portfolio, as it does not have a significant direct impact on the majority of the assets. While the lower interest rate could potentially benefit some sectors, such as equities, the overall impact on the diversified portfolio is moderate. The resilient domestic demand and inflation within the target range suggest a stable economic environment, which is generally positive for the portfolio, but the external challenges mentioned could pose some risks. Therefore, the impact is assessed as moderate, with a neutral note.
UAE Lowers Interest Rate, Follows Fed đ
The UAE Central Bank lowered its overnight deposit facility base rate by 25 basis points to 4.40% in December 2024, following the U.S. Federal Reserve's rate cut.
The UAE's rate cut, which is tied to the Fed's reserve rate, is a positive development for the investment portfolio as it indicates a more accommodative monetary policy in the UAE. This could have a moderate positive impact on the portfolio's UAE market and Middle East exposure, as well as potentially benefiting the overall global market performance.
Qatar Reduces Interest Rate by 30bps đ
The Qatar Central Bank lowered its key interest rates, including the lending rate, deposit rate, and repo rate, by 30 basis points, following the US Federal Reserve's 50 basis point cut to its benchmark rate.
The interest rate cuts by the Qatar Central Bank, which are aligned with the US Federal Reserve's policy due to the Qatari riyal's peg to the US dollar, are likely to have a moderately positive impact on the investment portfolio. Lower interest rates generally support economic growth and asset prices, which could benefit the portfolio's equity and cryptocurrency positions.
Georgia Holds Key Rate Steady for 5th Time âšī¸
The National Bank of Georgia kept its key interest rate at 8% in December 2024, reflecting controlled inflation and effective monetary policies, despite strong domestic economic activity and uncertain outlook due to geopolitical risks and rising costs.
The article suggests that the National Bank of Georgia is maintaining a cautious approach to monetary policy, keeping interest rates unchanged despite strong economic growth. This neutral stance is likely to have a moderate impact on the investment portfolio, as it does not indicate any significant changes in the broader economic or market conditions. The portfolio's exposure to various global markets and asset classes may be affected to some degree by the uncertain outlook mentioned in the article, but the overall impact is expected to be limited.
Pakistan Cuts Interest Rates For 5th Time đ
The State Bank of Pakistan reduced its key policy rate by 200bps to 13%, marking the fifth consecutive rate cut this year, aimed at balancing inflationary and external account pressures while fostering sustainable economic growth.
The rate cut by the State Bank of Pakistan is a positive development for the investment portfolio, as it signals a shift towards a more accommodative monetary policy. This could potentially benefit the portfolio's exposure to the Pakistani market, as well as broader emerging market assets. The reduction in borrowing costs may help stimulate economic growth and improve the country's external account position, which could have a moderately positive impact on the overall portfolio performance.
Czech Republic Pauses Easing Cycle as Expected âšī¸
The Czech National Bank kept its key interest rate unchanged at 4% in December 2024, balancing inflation pressures and a strong labor market against a weak economic recovery.
The article indicates that the Czech National Bank maintained its key interest rate, suggesting a neutral monetary policy stance. This is unlikely to have a significant impact on the given investment portfolio, which is diversified across global markets and asset classes. The portfolio's performance would be more influenced by broader economic and market conditions rather than the specific interest rate decision in the Czech Republic.
Norges Bank Leaves Rates Steady, Signals Rate Cut in March âšī¸
The Norges Bank kept its key policy rate unchanged at 4.5% in December 2024, but signaled rates will likely be reduced in March 2025 as the economy cools and inflation falls, though rapid business cost increases may restrain further disinflation.
The article indicates that the Norges Bank is maintaining a restrictive monetary policy to stabilize inflation, but expects to begin easing rates soon as the economy and inflation show signs of cooling. This neutral news is unlikely to have a significant impact on the given investment portfolio, which has a diversified exposure across global markets and asset classes.
North Macedonia Cuts Interest Rate for 3rd Time âšī¸
North Macedonia's central bank lowered its benchmark interest rate by 25 basis points to 5.55%, citing improved economic conditions and an expected average inflation rate of around 3.5% for 2024.
The interest rate cut by North Macedonia's central bank is a neutral event for the given investment portfolio, as it does not have a significant direct impact on the performance of the assets included. While the lower interest rate may have some indirect effects on the broader economic environment, the overall impact on the portfolio is expected to be minimal.
BoJ Holds Rates as Expected âšī¸
The Bank of Japan maintained its key short-term interest rate at around 0.25% during its final meeting of the year, keeping it at the highest level since 2008 and meeting market consensus.
The Bank of Japan's decision to maintain its key interest rate is a neutral event for the given investment portfolio, as it does not significantly impact the performance of the assets included. The portfolio has a diversified exposure across global markets and sectors, and the BoJ's policy decision is unlikely to have a substantial effect on the overall performance of the investments.
Saudi Arabia Cuts Interest Rate by 25 bps, After Fed âšī¸
The Saudi Central Bank reduced its repo and reverse repo rates in December 2024, mirroring the Federal Reserve's policy adjustment of lowering interest rates by 25 basis points.
The article discusses a change in monetary policy by the Saudi Central Bank, which reduced its repo and reverse repo rates in response to the Federal Reserve's interest rate cuts. This is a neutral event for the given investment portfolio, as it does not directly impact the performance of the assets included. The portfolio has a diversified exposure across global markets and asset classes, so a change in Saudi monetary policy is unlikely to have a significant effect on the overall portfolio performance.
Bahrain Cuts Rates by 25% âšī¸
The Central Bank of Bahrain reduced its one-week deposit facility rate and overnight deposit rate by 25 basis points to 5.25% in December 2024, aligning with the U.S. Federal Reserve's similar rate cut to maintain Bahrain's monetary and financial stability amidst global economic shifts.
The rate cut by the Central Bank of Bahrain is a neutral event for the given investment portfolio, as it is primarily focused on Bahrain's domestic monetary policy and is aligned with the U.S. Federal Reserve's actions. Since the portfolio does not have any direct exposure to the Bahraini market or currency, the impact on the overall portfolio is expected to be minimal.
Fed Cuts Rates For 3rd Consecutive Time âšī¸
The Federal Reserve announced another 25 basis point cut to the federal funds rate in December 2024, the third consecutive reduction this year, bringing borrowing costs to the 4.25%-4.5% range, in line with expectations.
The article indicates that the Federal Reserve is continuing its policy of gradual interest rate cuts, which is in line with market expectations. This neutral news is unlikely to have a significant impact on the given investment portfolio, as the portfolio is diversified across various asset classes, including both equities and fixed income.
Albania Holds Key Policy Rate at 2.75% âšī¸
The Bank of Albania kept its policy rate unchanged at 2.75% in December 2024, amid low inflation and robust economic growth.
The article indicates that the Bank of Albania maintained its policy rate, suggesting a stable monetary policy environment. With low inflationary pressures and strong economic growth, the impact on the given investment portfolio is likely to be neutral, as the portfolio does not have significant direct exposure to the Albanian market or its monetary policy.
Central Bank of Azerbaijan Holds Key Rate Steady âšī¸
The Central Bank of Azerbaijan kept its key financing rate at 7.25% in December 2024, maintaining borrowing costs at their lowest level since December 2021 after five straight rate cuts, as actual and projected inflation aligned with the target range of 4Âą2%.
The decision by the Central Bank of Azerbaijan to maintain its key financing rate at 7.25% is a neutral event for the given investment portfolio. While it indicates a stable monetary policy environment in Azerbaijan, the portfolio's exposure to the Azerbaijani market is relatively low (1% each for the UAE and Kuwait markets), and the overall impact on the broader portfolio is expected to be minimal.
Hungary Holds Rate Unchanged as Expected âšī¸
The central bank of Hungary maintained its base rate unchanged at 6.5% for the third straight decision, as domestic industrial activity has slowed, driving the Hungarian GDP to contract annually in the third quarter, while inflation is expected to increase past its tolerance band in early 2025 before starting the disinflation process.
The article indicates that the Hungarian central bank has maintained its base rate unchanged, which is a neutral development for the investment portfolio. While the article mentions a slowdown in domestic industrial activity and GDP contraction, as well as an expected increase in inflation, the central bank's decision to keep rates unchanged suggests that the impact on the portfolio is likely to be limited. The portfolio's exposure to the Hungarian market and broader European markets is relatively small, so the neutral impact assessment is reasonable.
Morocco Trims Key Policy Rate to 2.50% âšī¸
The National Bank of Morocco cut its benchmark interest rate by 25 bps to 2.50% in December 2024, citing low inflation and a moderate economic outlook.
The interest rate cut by the National Bank of Morocco is a neutral event for the given investment portfolio, as it does not have a significant direct impact on the performance of the assets included. The portfolio is diversified across various global markets and sectors, and the interest rate change in Morocco is unlikely to have a material effect on the overall portfolio returns.