Bill Evans, chief economist at Westpac, suggests that they have pushed back their timing for the next rate cut from the US FOMC from December to March next year.
Key Quotes
“We retain our expectation that there will still be three cuts from the FOMC, with the terminal rate settling at 0.875% by September 2020.”
“Key to this view is that we expect growth in the US to slow to around 1.5%yr in 2020 – well below potential (1.8%) and the FOMC’s current forecast of 2.0%.”
“This rates outlook is in contrast with current market pricing which discounts one more rate cut in this cycle, by September 2020.”
“The statement following the decision to cut rates at the October meeting sends a clear message about the FOMC’s intention to pause near term.”
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