Why Asian central banks are starting to decouple from the Fed
A wave of interest rate cuts is sweeping across Asia and the Pacific, with central banks in Australia, India, and New Zealand leading the charge. These cuts are notable because they come even as the US Federal Reserve has paused its easing campaign, and go against the historical trend of Asian central banks closely following the Fed's monetary policy.
The easing of monetary policy in Asia is largely driven by moderating inflation and slowing economic growth in the region. While most Asian economies have reduced interest rates since last August, Japan is an exception, normalizing its policy after years of ultra-loose conditions. However, Asian central banks must be cautious not to diverge too sharply from the Fed, as a widening gap could put pressure on Asian currencies.
via SCMP Full Text Feed
A wave of interest rate cuts is sweeping across Asia and the Pacific, with central banks in Australia, India, and New Zealand leading the charge. These cuts are notable because they come even as the US Federal Reserve has paused its easing campaign, and go against the historical trend of Asian central banks closely following the Fed's monetary policy.
The easing of monetary policy in Asia is largely driven by moderating inflation and slowing economic growth in the region. While most Asian economies have reduced interest rates since last August, Japan is an exception, normalizing its policy after years of ultra-loose conditions. However, Asian central banks must be cautious not to diverge too sharply from the Fed, as a widening gap could put pressure on Asian currencies.
via SCMP Full Text Feed
