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October 30th, 2024
In the September market update, Dr Vivian Xu, Quantitative Research Consultant from Frontier.
Capital Markets and Asset Allocation team, talks about the U.S Federal Reserve’s rate cut. Dr Xu says it wasn’t a surprise given the market had been pricing in a cut, but there was some debate about how many basis points it would be. She said it’s early in the cycle of easing, and due to inflation in the U.S coming down, the U.S. Federal Reserve has room for aggressive easing. The Fed. has historically been criticised for cutting too late, which is also a factor.
The question now, she says, is how far and how fast the Fed will cut to achieve the soft landing scenario they hope for.
Mixed signals from the labour market will be a factor. Historically interest rate cuts are good for growth assets, and the US rate cutting cycle may have effects on the global economy, particularly on U.S trading partners like Japan and China.
With Wayne Sullivan, Director of Marketing and Business Development.
Disclaimer
Frontier Advisors provides asset consultancy services to the Trustee. The Trustee also engages Frontier Advisors to provide market and investments updates to members of First Super.
Frontier Advisors is responsible for the information in this presentation.
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