news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

the federal reserve building of the united states. xinhua news agency file photo

the federal reserve will announce its latest interest rate decision in the early morning of september 19th, beijing time. the market expects the fed to announce a rate cut at this meeting, with the difference being whether the rate cut will be 25 basis points or 50 basis points. although market expectations for a 50 basis point rate cut have been rising since last friday, considering the fundamentals of the us economy, the possibility of the fed starting this round of rate cuts at a pace of 25 basis points is still high.

as the world's largest economy, changes in u.s. interest rates will have a chain reaction on international financial markets, cross-border capital flows, and monetary policies of other countries. previously, several major economies have started to cut interest rates. with the federal reserve joining the interest rate cut "camp", a new round of monetary easing cycle is on the way. from past experience, when developed economies enter a cycle of interest rate cuts, it is often when global capital continues to flow into emerging markets and equity markets in search of high returns. the u.s. dollar also tends to weaken from strong, and the pressure of currency depreciation and cross-border capital outflows in emerging markets will be alleviated.

however, "you can't step into the same river twice". the new round of interest rate cuts will not repeat the past "script". there are many uncertainties in the current international economic and financial situation. geopolitical conflicts and the reconstruction of the global supply chain system will have an impact on cross-border capital flows and exchange rates. in addition, the speed and magnitude of interest rate cuts will also have different effects on the financial market. in the past two or three years, the fed's interest rate hikes have been faster than market expectations. after the interest rate level has climbed to a high level, it is difficult to say whether the subsequent interest rate cuts will also be "fast in and fast out".