Page 20 - Us Fed News Today

It is quite a resilience that nothing broke despite rates rising this high after prolonged pause at 0%. But this time, the reaction function of the US Fed may not take us to zero. What makes this situation different from those in the past?

The continuing pause by RBI on rates is no surprise. We expect rate cuts only in the first quarter of the next year

With FPI flows expected to sustain, there is a strong possibility that the Sensex and Nifty could outperform midcap and smallcap indices, as global investors have a penchant for large-caps

A daily rundown of the economic reports and corporate earnings that will be grabbing the market’s attention in the week ahead

The year 2023 provided investors with valuable macroeconomic lessons that have significant implications on investment strategies.

The RBI meeting began on December 6 to review the country’s monetary policy

El-Erian said the Fed may well tolerate higher inflation instead of pushing the economy into recession to hit its 2% target. But he also said investors are over-reacting by pricing in sharp rate cuts. Market prices have swung wildly in recent days as traders bet on a drop in borrowing costs amid signs that inflation is falling and comments from Fed Chair Jerome Powell that the actions taken so far have pushed policy "well into restrictive territory."

Asian shares advanced as a further US labor-market slowdown reinforced speculation the Federal Reserve will be able to cut interest rates next year to prevent a recession. Benchmark indexes rose over 1% in Japan, the most in three weeks. Stocks in Australia and South Korea also advanced while futures in Hong Kong pointed to gains.

The RBI has been a player on both sides of the market and intervening as a seller and buyer depending on the situation. That said, the bias has been to soak up inflows into domestic markets, preventing an appreciation of the rupee.

Brokerage house B&K Securities sees an around 10 percent upside potential in benchmark Nifty in the next 12 months but flows could take the Nifty much higher