Investors Await Jerome Powell’s Remarks on Potential Interest Rate Cuts
Investors around the world are eagerly waiting for Federal Reserve Chair Jerome Powell’s upcoming remarks, which could provide crucial insights into the possibility of interest rate cuts. Powell had previously hinted that borrowing costs may remain elevated for a longer period due to sluggish progress on inflation and a robust labor market.
Recent price data has shown persistent underlying inflation, which is likely to keep the Fed chief’s stance unchanged. As the Federal Reserve gears up for its rate decision on Wednesday, it is widely expected that borrowing costs will be held at a high level.
Expectations for rate cuts have been pushed back to 2024, with investors betting on at most two cuts by the end of the year. The monthly jobs report will also play a key role in providing clarity on the US labor market.
Meanwhile, Euro-zone data is expected to show that inflation has stopped slowing and that the economy is on a growth trajectory. China will release its official purchasing manager index data, shedding light on the strength of its economic expansion.
Investors will also closely monitor Japan’s industrial output data, South Korea’s consumer inflation data, and Turkey’s progress in slowing consumer-price growth. Additionally, this week will see monetary decisions from Malawi, the Czech Republic, and Norway.
Mexico’s first-quarter output data may show a slight contraction, while Brazil is gearing up to release various economic reports. Chile will release a slew of March indicators, while Peru’s inflation report may indicate that prices are back in the target range.
In Colombia, the central bank is expected to extend its easing cycle with a rate cut as steady disinflation persists. With so many important economic updates scheduled for this week, markets are poised for potential fluctuations based on the outcomes of these reports.
