20 Mar 2023 International Economy The FOMC meeting on March 21-22, 2023…The Fed is set to raise its policy rate by 0.25 percent The Fed is also expected to signal the recent US bank collapses will not cause broader systemic woes (Business Brief No.3994) คะแนนเฉลี่ย คะแนนเฉลี่ย 5 stars 4 stars 3 stars 2 stars 1 star The US Federal Reserve (Fed) is expected to raise its policy rate by 0.25 percent to 4.75-5.00 percent at the Federal Open Market Committee (FOMC) meeting on March 21-22, 2023, after US inflation pulled back in February but remains elevated. However, amid concerns about news that some US banks faced liquidity problems and were shut down, the Fed would tend to give more consideration to financial market stability, and thus ease off on its aggressive moves. At the same time, it is more likely that the Fed will maintain its key interest rate at 5.00 percent. Following the closure of the troubled banks in the US, the market projects that the Fed may pause hiking the rate at the upcoming FOMC meeting. This is because further rate hikes would increase risks to the US banking sector. However, KResearch holds the view that if the Fed were to slow rate hikes, the move could cause financial market volatility. In particular, such an action could lead to heightened concerns that the Fed considers the bank closures a serious problem, and thus needs to hold rate rises despite persistently high inflationary pressure. In addition, at the upcoming FOMC meeting, the Fed is expected to signal that the impacts of recent US bank failures are still manageable and will not escalate to the point that extensive systemic problems occur in order to shore up confidence and minimize concerns of financial markets. However, as the Fed may focus more on risks to financial market stability, attention must be paid to its signal for further rate hikes, which remain highly uncertain. The future direction will depend on US financial market conditions, inflation and labour market figures, as well as the Fed’s outlook for the economy and inflation. The US central bank's recent, aggressive rate hikes are among the factors that put pressure on the three US banks which faced liquidity problems and were shut down. As evidenced, the Fed's recent policy rate increases have begun to see results in slowing the US economy. Thus, the likelihood that the US economy will enter a technical recession by the end of this year has become more apparent. If the Fed give more weight to economic risks and financial market stability, there is a chance that it would stop rate hikes sooner than expected, or even need to cut the policy rate this year. Annotation This research paper is published for general public. It is made up of various sources. Trustworthy, but the company can not authenticate. reliability The information may be changed at any time without prior notice. Data users need to be careful about the use of information. The Company will not be liable to any user or person for any damages arising from such use. The information in this report does not constitute an offer. Or advice on business decisions Anyhow. International Economy Fed Related Analysis View all 14 Mar 2018 International Economy Thailand must brace for trade disputes between the US, EU and China, etc. (Current Issue No. 2905) The US is pressing ahead with trade measures against trade partners globally. In addition to their new ‘safeguard tariffs’ on imported solar panels and large washing machines imposed early in 2018, and more recently on imported steel and aluminum, the US is now preparing to implement protectionist measures against Chinese products valued at around USD60 billion. This direction will likely add significant pressure to global trade, thus, KResearch views that all eyes should be closely kept on negotiations between the US and EU, both being among the largest economies in the world. Details on those negotiations are expected to be released before the relevant ‘safeguard tariffs’ on steel and aluminum become effective at the end of next week. If the EU and China are exempted from these new tariffs, prevailing anxiety will ease. But to the contrary, without such exemptions, China and the EU may opt to implement their own trade protectionist measures against the US, as well. This situation would likely escalate into further actions and reactions, incurring significant damage to trade that could spill over to other regions of the world.... Read more 0 KB 0 KB 2 Mar 2018 International Economy Planned New US Tariffs on Metal Imports Triggering More Intense Trade Protectionism (Current Issue No. 2903) Throughout 2018, the US administration’s continual pursuit of protectionist trade measures has tended to increase volatility in global trade. Most recently, President Donald Trump announced that new “safeguard” tariffs would be imposed on steel and aluminum imports at 25 percent and 10 percent, respectively. Although no details have been released yet, it seems undeniable that trade with the US will become difficult, going forward.... Read more 0 KB 0 KB 6 Mar 2018 International Economy China’s 2018 Economic Targets Reflect Slower Economic Growth, while Monetary and Fiscal Policies are Still Being Used to Sustain Economic Growth Ahead (Business Brief No.3730) All eyes were on the National People’s Congress, March 5, 2018, because the ruling Communist Party proposed constitutional a... Read more 0 KB 0 KB 26 Jan 2018 International Economy Fed Meeting Expected to Maintain Rate Leaving Room for Increasing Rate Later (Business Brief No.3725) KResearch expects the US Federal Reserve (Fed) to maintain their policy rate at 1.25-1.50 percent during their first round of meeting o... Read more 0 KB 0 KB 26 Dec 2017 International Economy The Philippines: Rising Market of ASEAN (Current Issue No. 2887 Full Ed.) Thai exports to ASEAN-5 (Malaysia, Singapore, Indonesia, the Philippines and Brunei) account for 59.3 percent of our total exports to the entire AS... Read more 0 KB 0 KB 19 Dec 2017 International Economy Chinese Economy Continues Momentum to Yearend Growth next year inches toward balance, Focus on Reforms (Business Brief No.3719) China's latest economic indicators show that the Chinese economy has maintained momentum. Although China’s domestic eco... Read more 0 KB 0 KB View all