Archive

December 18, 2024
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Thailand: Policy Rate Held At 2.25% (Consensus 2.25%) in Dec-24

  • The Bank of Thailand unanimously maintained the policy rate at 2.25%, aligning with consensus expectations, citing alignment with economic potential and inflation within target expectations.
  • Economic growth projections for 2024–2025 remain steady, but uneven sectoral recovery, particularly in manufacturing and SMEs, presents ongoing risks to sustainable recovery.
  • Global economic uncertainties, credit growth trends, and the efficacy of government debt-relief programmes in supporting domestic demand and financial stability will influence future policy decisions.

December 18, 2024
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US: 25bp Rate Cut To 4.5% (Consensus 4.5%) in Dec-24

  • The Federal Reserve reduced its policy rate by 25 basis points to a range of 4.25%-4.50% in December, as expected, continuing its calibrated approach to easing monetary conditions.
  • While inflation has eased, with headline PCE at 2.5%, core inflation remains elevated at 2.8%, requiring the Fed to balance the risks of under- or over-adjusting policy rates.
  • Central projections of a 3.9% federal funds rate in 2025 suggest limited scope for further cuts. Labour market trends, inflationary pressures, and broader economic risks will guide future decisions.

December 18, 2024
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Indonesia: Policy Rate Held At 6.0% (Consensus 6.0%) in Dec-24

  • Bank Indonesia held the BI-Rate at 6.00%, consistent with expectations, focusing on exchange rate stability and inflation control within the 2.5% ±1% target range amid heightened global uncertainty.
  • Strengthened pro-market monetary operations and macroprudential measures aim to attract foreign capital inflows and support credit growth in priority sectors, sustaining financial stability and growth momentum.
  • Future policy adjustments will depend on inflation dynamics, external shocks, and capital flow trends, as global risks, such as slower Fed rate cuts and rising US yields, constrain monetary policy flexibility.

December 17, 2024
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Chile: 25bp Rate Cut To 5.0% (Consensus 5.0%) in Dec-24

  • The Central Bank of Chile reduced its policy rate by 25 basis points to 5%, meeting market expectations and maintaining a gradual approach to monetary easing amid weak domestic demand and rising external uncertainties.
  • Global factors, including US economic resilience, higher long-term interest rates, and China's continued weakness, have strengthened the US dollar and pressured copper and oil prices, influencing Chile's trade and inflation dynamics.
  • Domestic challenges, such as weak private consumption, limited job creation, and peso depreciation, could shape the pace of future rate cuts, with the central bank remaining data-dependent and focused on achieving its 3% inflation target over the medium term.