Fixed Income Update 22 Aug 2024
KBVS WEEKLY FIXED INCOME UPDATE
Thursday, 22 August 2024
Next Fed Rate Cut, 25 bps or 50 bps?
- The likelihood of a Fed Rate cut has increased following remarks by Minneapolis Fed President Neel Kashkari on Monday (Aug 19), stating that it would be appropriate to consider a rate cut in September due to rising risks in the labor market. This sentiment was echoed by San Francisco Fed President Mary Daly and Chicago Fed President Austan Goolsbee in separate statements, signaling a possible move next month.
- Meanwhile, the global trend of central banks lowering their benchmark interest rates continues, as evidenced by last week's rate cut by the RBNZ, followed by similar actions from Sweden's Riksbank and the Bank of Jamaica this week.
- On the domestic front, the increase in incoming bids during the government bond auction on Aug 20, '24, has been a positive development for the local fixed-income market.
Regards,
Fikri C Permana - KBVS Research