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The Federal Reserve is expected to implement a 25 basis point rate cut in December, potentially lowering rates to 4.25% to 4.50%, contingent on inflation and employment data. In contrast, the Bank of England is likely to maintain its rate at 4.75%, balancing inflation control with economic growth.Market volatility is anticipated around both central bank meetings, particularly affecting currency pairs like GBP/USD and interest rate-sensitive sectors. Key economic indicators, including inflation and wage growth, will be crucial in shaping future monetary policy decisions into 2025.
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A look at the day ahead in Asian markets highlights key developments and trends that investors should monitor. Market dynamics are influenced by various economic indicators and geopolitical factors, shaping the trading landscape across the region.
In the latest trading update, a long trade on the Australian dollar against the US dollar faced challenges, nearing a stop loss but ultimately closing with a loss. Despite some negative trades earlier in the year, the overall performance for "Trade of the Week" concluded with a 31.45% return on investment, achieving 21 winning trades against 20 losses while risking only 2% of capital per trade.
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The BRICS alliance is set to expand in 2025, with growing interest from African nations eager to join. This expansion could enhance bilateral trade and local currency settlements, appealing to developing countries seeking alternatives to the US dollar. Additionally, discussions around cryptocurrency adoption are intensifying, with proposals for an electronic payment infrastructure that may position Bitcoin as a viable alternative to the dollar, potentially reshaping global economic dynamics.
All eyes are on the Federal Reserve this week, with Jerome Powell's press conference expected to provide key insights following a projected 25 basis point rate cut. The eurozone's purchasing managers index shows improved business sentiment, while the ifo Business Climate Index and US retail sales figures will also be closely monitored. Additionally, the GDP growth rate and PCE core deflator data later in the week are anticipated to influence market movements.
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The Swiss National Bank (SNB) is lowering the interest factor for sight deposits from 22 to 20, effective February 1, 2025, in response to increased minimum reserve requirements. This adjustment follows a previous reduction from 25 in October and aims to maintain effective monetary policy and support an active money market. Interest on sight deposits up to the limit will continue to be paid at the SNB key rate of 0.50 percent.
The Federal Reserve is expected to implement a 25-basis point rate cut in December, influenced by recent comments from Governor Christopher Waller and market expectations. In contrast, the Bank of England faces persistent inflation challenges, likely maintaining its rate at 4.75% amid a split among its Monetary Policy Committee members. Both central banks' decisions will significantly impact currency and stock markets, with traders advised to monitor economic indicators closely.
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An investment of CHF 100 in UBS shares five years ago would have yielded a current value of CHF 231.54, reflecting a 131.54% increase. On December 16, 2019, UBS shares closed at CHF 12.30, and as of December 13, 2024, the share price rose to CHF 28.48. UBS's market capitalization now stands at CHF 90.78 billion.
China's November retail sales fell short of expectations, influenced by the timing of the singles shopping festival, leading consumers to shift spending towards government-supported areas. This trend mirrors Japan's 1990s spending voucher initiatives, highlighting the need for fiscal policy to address consumer concerns.In South Korea, President Yoon's impeachment moves to the Supreme Court, with a trial set for December 27, potentially reducing the risk of significant labor strikes. Meanwhile, assorted business sentiment polls are anticipated, though skepticism about their accuracy is advised due to the current climate of sensationalism and political polarization.
China's November retail sales fell short of expectations, influenced by the timing of the singles shopping festival, leading consumers to shift spending towards government-supported areas. This trend mirrors Japan's 1990s spending voucher initiatives, highlighting the need for fiscal policy to address consumer concerns.In South Korea, President Yoon's impeachment moves to the Supreme Court, with a trial set for December 27, potentially reducing the risk of significant labor strikes. Meanwhile, assorted business sentiment polls are anticipated, though skepticism about their accuracy is advised due to the current climate of sensationalism and political polarization.
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