JAKARTA (TheInsiderStories) — Good morning! Federal Reserves (Fed) Governor Jerome Powell stated in front of United States (US) Senate Banking Committee, that his institution will be patient in changing interest rate this year. But he didn’t explain whether the changes is to increase or to cut the reference rate.
He stated: “We are going to be patient. We are going to allow the situation to evolve and allow the data to come in. And I think we are in a very good place to do that.”
Powell rated, a healthy US economy has faced some crosscurrents and conflicting signals. With inflation pressures muted, the Fed kept interest rates unchanged last month.
Powell considered that the economy is growing at a solid pace, though slower than in 2018. The Fed expects US economy will grow 2.3 percent this year from last year 3 percent last year, the fastest annual pace in more than a decade but below President Donald Trump’ target.
Moreover, today the second meeting of Trump and North Korean leader Kim Jong-un start today in Hanoi, Vietnam. The two days meeting its expected will produce the clear commitment from the two leaders on the Korean Peninsula issues.
While, Amid the threat of no deal Brexit risk, Bank of England (BoE) will pour more supports for United Kingdom’ (UK) economy. The central bank Governor Mark Carney said that it doesn’t mean that the BoE will automatically change its interest rate from 0.75 percent, after the UK officially leaves European Union with no deal.
Though, he added that chances for loosening or tightening monetary policy were not equal. As another way to support the economy, BoE will also increase operational frequency from monthly to weekly, in order to fix liquidity. Carney considered the BoE’s action as wise and prudent.
British Prime Minister Theresa May is still on progress for reaching a deal with the EU, as parliament didn’t agree the previous conditions. It is expected that the agreement can be reached before Brexit implementation on March 29. Or for the worst case scenario, UK will leave with no deal.
Yesterday, Indonesian Rupiah hit its strongest position for almost in the last three week below 14,000 against US Dollar. Bank Indonesia said that foreign investors released foreign exchange in State securities market. Moreover, there is a sentiment from US-China trade deal optimism.
In the capital market, foreign investors also spending Rp352.6 billion (US$25.18 million). The Jakarta Composite Index increased by 0.23 percent to 6,540.95.
May you have a profitable day!
Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia