"More good data" may Pave the Way for Interest Rate Reductions- Federal Reserve's Powell

According to the CBS News,
Speaking Tuesday morning at a Senate Banking Committee hearing, Powell stressed that the central bank wants to see further progress in bringing the annual inflation rate to about 2% before cutting rates, with the most recent consumer price index at 3.3%. (view original at https://www.cbsnews.com/news/federal-reserve-interest-rate-cut-jerome-powell-senate-hearing/0

Full video on Youtube (Chinese version) – https://youtu.be/OacnBcIkBbU

Personal Opinion:
1. Between 15 to 16 March 2022, the Fed started to increase the FFR to 0.5% from 0.25% and further increased to 1% on 4 May 2022. The final increment reached 5.5% on 26 July 2023. All in all, the Fed had adjusted the FFR up to 11 times. Thus, the monetary tightening has caused the currencies from emerging markets to depreciate beyond their fundamental values.
2. The “good data” may come from the payroll jobs, consumer price index (CPI), etc, to determine the date to cut down the FFR which may benefit the emerging markets.
3. The sectors showing positive impacts are tech, retail, manufacturing, commodities-related, and transportation due to the weakening of USD.

Disclaimer: The above content is not an investment advisory service, and does not purport to tell or suggest which securities or stocks customers should buy or sell for themselves. It should not be assumed that the methods, techniques, or indicators presented above will be profitable or will not result in losses. You should not rely solely on the information in making any investment. Rather, you should use the information only as a starting point for doing additional independent research to allow you to form your own opinion regarding investments

By: Jshen Ng