US Federal Reserve (US Fed)

Central banks are the fall guys

SINGAPORE (Aug 2): Central-bank independence is back in the news. In the United States, President Donald Trump has been berating the Federal Reserve for keeping interest rates too high, and has reportedly explored the possibility of forcing out Fed Chair Jerome Powell. In Turkey, President Recep Tayyip Erdoğan has fired the central-bank governor. The new governor is now pursuing sharp rate cuts. And these are hardly the only examples of populist governments setting their sights on central banks in recent months.

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Dovish Fed hints at rate cuts ahead; Astrea V PE bonds not as popular as predecessor

SINGAPORE (June 24): As expected, the US Federal Reserve kept interest rates unchanged at between 2.25% and 2.5%, following the conclusion of the Federal Open Market Committee (FOMC) meeting on June 18 and 19. This came amid growing economic uncertainty and risks despite a largely robust US economy so far this year.

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Fed scraps patient approach and opens door to potential rate cut

(June 20): The Federal Reserve signalled it was ready to lower interest rates for the first time since 2008, citing “uncertainties” that have increased the case for a cut as officials seek to prolong the near-record US economic expansion.

While Chairman Jerome Powell and fellow central bankers left their key rate in a range of 2.25% to 2.5% on Wednesday, they dropped a reference in their statement to being “patient” on borrowing costs and forecast a larger miss of their 2% inflation target this year.

Banks kept at 'overweight' by UOB on Fed's dovish stance, dividend yield

SINGAPORE (Jan 18): UOB Kay Hian is maintaining Singapore’s banking sector at “overweight” after the US Fed calmed the nerves of investors with its dovish disposition, which subsequently generated a relief rally.

“We maintain ‘buy’ for both DBS and OCBC, although we prefer OCBC,” says analyst Jonathan Koh in a Friday report. The research house has target prices of $28.50 and $13.82 respectively.

The impact of higher interest rates on regional banks and property

SINGAPORE (Oct 4): At its last meeting in September, the US Federal Reserve hiked rates by 25bps and warned that rate increases are likely to persist well into next year.

With US headline inflation hovering above 2.5%, unemployment rate at below 4% and oil prices creeping up, the Fed has sufficient reasons to take its funds rate higher to fend off overheating risks.

This means USD rates are poised to drift higher as monetary policy turns restrictive over the coming quarters.

Bernanke admits Fed made mistakes combating financial crisis 10 years ago

WASHINGTON (Sept 13): Former Federal Reserve Chairman Ben Bernanke acknowledged that policy makers made two critical errors fighting the financial crisis a decade ago: They failed to see it coming with such force then underestimated how much economic damage it would cause later.

"Nobody saw how widespread and devastating the crisis itself would be," he said in a short video discussing the results of a 90-page paper on the subject released on Thursday.

The Fed delivers a hike and a message: Bloomberg View

(March 16): The Federal Reserve did more today than increase its benchmark interest rates by a quarter-point, only the third hike in more than 10 years -- it also took an important step forward in a gradual policy transition.

Hoping for what I have labelled earlier a “beautiful normalisation” of rates, the central bank is moving beyond strict data-dependency and becoming more comfortable about leading markets rather than following them.

The Fed, a bad parent; the market, a spoilt brat: Nanyang B-school Professor

SINGAPORE (Sept 19): Investors will be scrutinising what changes the US Fed might make following its meeting tomorrow, but from the perspective of associate professor Lee Boon Keng at Nanyang Business School, the bigger issue isn’t where the rates are going, but the US Fed’s very own credibility.

“It is more about the leadership it is on the verge of losing because it does not have the gumption to raise interest rate, yet again, this week,” says Lee.

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