In just one week, the US Federal Reserve, the Bank of England and the Bank of Japan all chose to hold interest rates steady, yet none of the decisions were unanimous, and of course, the Fed's new Chair is now steering away from forward guidance altogether. With investors left to navigate rates without the usual signposts, what should they make of this week's decisions, and what comes next?
In this episode of The View Beyond, Bernadette Anderko sits down with David Kohl, Chief Economist at Julius Baer, to unpack the week's central bank decisions. They discuss why the Fed held rates despite markets anticipating a hike, the bond market volatility and dollar weakness that followed Kevin Warsh's press conference, and the outlook for Fed policy into year end. The conversation also covers the Bank of England's split vote and UK rate expectations amid a new political backdrop, as well as examining the Bank of Japan's decision to hold rates while signalling a more hawkish shift alongside yen intervention. Finally, David also offers his insights into why he believes that the ECB will not hike rates at their September meeting.
- (00:00) - Introduction
- (01:04) - The Fed's decision not to hike rates
- (03:00) - Bond market reaction and Kevin Warsh's communication style
- (05:34) - Outlook for Fed rate expectations
- (07:46) - The Bank of England's split decision
- (09:18) - UK rate expectations amid political change
- (11:21) - The Bank of Japan holds rates and hints at hikes
- (15:15) - Expectations for the ECB
- (17:24) - Closing remarks
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What is Moving Markets?
Moving Markets is the home of podcasts at Julius Baer. Here, our expert teams share concise daily market updates in ‘Moving Markets Daily’ which is complemented by ‘Moving Markets: The View Beyond’, a weekly show dedicated to discussing the context, thematic angles, and investment implications behind key topics shaping the news cycle and conversations among our relationship managers and clients.
The information contained in this podcast is marketing material. Opinions expressed do not constitute independent financial/investment research, investment advice, or an offer to buy or sell securities by Julius Baer. Please refer to www.juliusbaer.com/legal/podcasts for important legal information prior to listening to this podcast.