Further rate cuts by the Fed hinge on US-China trade – UOB

The likelihood of another rate cut by the Federal Reserve largely depends on the US-China trade developments, suggested Lee Sue Ann, Economist at UOB Group.

Key Quotes

“The Fed has signalled the current policy stance (1.50%-1.75% Fed funds rate) is appropriate and its intention to put policy on pause. The boogieman for Fed policy outlook us still the international trade developments and the caveat for us is that another bout of US-China trade tensions post-Dec FOMC could trigger another 25bps ‘insurance’ rate cut from Powell in early 2020, likely in March”.