It is a daily ritual for millions of Australians, but if you have noticed the price of your morning flat white or soy latte increase, brace yourself — it is likely to get worse.
By the end of the year,...
It is a daily ritual for millions of Australians, but if you have noticed the price of your morning flat white or soy latte increase, brace yourself — it is likely to get worse.
By the end of the year,...
If former President Trump is re-elected, he plans to exert significant control over the Federal Reserve, an independent institution that sets interest rates. This includes the potential for serving as a board member, firing the current chair, and aligning Fed policies with his administration's goals. While these proposals are not official, they raise concerns about political interference in an institution designed to operate independently from political pressure.
Despite economic challenges, the International Monetary Fund raised its global growth forecast slightly to 3.2% in 2024. The IMF notes the economy's resilience, with growth led by advanced economies. However, risks remain, including the downturn in China's economy and potential price spikes due to geopolitical concerns. Inflation is expected to continue falling, but the focus remains on ensuring a soft landing by balancing interest rate policies and fiscal consolidation.
The UK economy grew slightly in February, ending a technical recession. While the GDP is still below its pre-pandemic levels, it shows signs of recovery, with construction output falling but production and services sectors growing. However, inflation remains high, and forecasts for interest rate cuts have been revised due to unexpected price increases in the US. The Bank of England is expected to cut rates four times this year, starting in June.
Investors are adjusting their expectations for future interest rate movements due to recent economic data and the Federal Reserve's policy decisions. The market previously anticipated six rate cuts, but now only three are expected. Inflation remains high, leaving investors uncertain about the timing and extent of rate cuts. A cautious approach is advised, with gradual adjustments to bond portfolios recommended. Domestic U.S. fixed income investments are seen as relatively stable, while international investments may provide opportunities but require careful consideration.
The Swiss National Bank has surprisingly lowered interest rates to 1.5%, becoming the first advanced economy to do so amid persistent inflation. Despite inflation remaining below 2%, the bank projects it to stay low over the next few years, giving them room to ease monetary policy. The move comes as Switzerland's economic growth is expected to be modest in the coming quarters, with uncertainty stemming from weaker activity abroad.
