Central Bank Watch – FOMC Minutes, Canada, Peru and Korea Monetary Policy Meetings

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    Bank of Israel hikes base rate to 4.50% from 4.25%, as expected

    The rate path will be determined in accordance with activity data and the development of inflation
    Economic activity is at a high level and is accompanied by a tight labor market, although there is a moderation in a number of indicators
    Staff forecast of 2.5% growth this year vs 2.8% prior
    Economy to grow 3.5% in 2024 vs 3.5% prior
    Staff forecast benchmark rate at 4.75%
    See inflation at 3.4% this year vs 3.0% prior


    Fed’s Bullard:

    The market is focusing too much on banking strains
    I expect inflation to be stickier and the labor market strong
    Markets ‘should listen to me’ on rate outlook
    The Fed needs rates above 5%


    The Central Bank of Chile kept its benchmark interest rate on hold at 11.25% in its March meeting, keeping borrowing costs at the highest since November 1998.

    The board warned that the economy is adjusting more slowly than expected and inflation is taking longer to come down. Inflation remains still high although it declined in February as headline and core inflation stood at 11.9% and 10.7% respectively, with core inflation has been fairly constant for several months. The Board considers that it will be necessary to keep rates on hold until macroeconomic conditions indicate that the process of inflation convergence to the 3% target has been consolidated.


    Loretta Mester, president and CEO of Federal Reserve Bank Cleveland branch

    Speaking before the Money Marketeers of New York University.

    Headlines via Reuters:

    Fed will need to raise rates above 5% and keep them there for a while
    Tightening monetary policy needed to cool too hot inflation
    How much more the Fed hikes depends on economy and how it reacts
    Tighter financial conditions should create restraint on economy
    Banking sector resilient, stresses appear to have eased since last month
    Fed balance sheet cuts aiding rate-hike cycle
    Fed closely watching banking system for signs of stress
    Expects inflation to ease to 3.75% by end of year, 2% by 2025
    Expects growth to moderate this year
    Expects jobless rate to rise to between 4.5% and 4.75% this year


    Helmholtz Watson

    Heading into Easter four central banks, RBA, RBNZ, RBI and BCCh delivered policy decisions with implications more for regional markets than global mar
    [See the full post at: Central Bank Watch – FOMC Minutes, Canada, Peru and Korea Monetary Policy Meetings]

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