SINGAPORE (Feb 18): The “less hawkish, more dovish” US Federal Reserve statements since December are likely to limit the upside for the US dollar. In a recent report, economists at Maybank-Kim Eng say: “The risks of further or aggressive tightening in Asean central banks’ monetary policy have diminished. Our baseline view is essentially a stable monetary policy stance in Malaysia, Singapore and the Philippines, and modest interest rate hikes in Indonesia and Thailand in 2019.

“The risk to our view is monetary policy easing and interest rate cuts instead, especially if our bet of a US-China trade deal out of the ongoing talks under the current 90-day trade war ceasefire fails to materialise, resulting in the re-escalation of a US-China trade war, which will be a major negative for the global and Asean economic outlook.”

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