Today, George Bell, Portfolio Manager, looks at the latest initiatives in China for lending and the property market in a bid to support economic activity. With a plan to lower rates in short and medium term lending as well as a cut to required bank reserves, this amounts to an equivalent 140 billion US dollars into the economy. Moving to the US and we see a positive perspective from corporate America with strong reports from the Services sector, however there still remains a weakness in manufacturing and potential uncertainty around the outcome of the election.

As we look to the week ahead, Paul Durrans, Investment Director, looks at the recent decision from the Federal Reserve to lower interest rates and some of the key US economic data that will be coming through this week. This week, members of the Federal Reserve voting committee will be giving their perspectives on the health of the US economy and the strength of labour markets. In recent months investors have moved on from inflation concerns to economic growth uncertainty. Key economic data points this week, such as consumer confidence, will give a good gauge of the strength of the economy.

This week, Paul Durrans, Investment Director and Joe Forward, Investment Analyst, look at the diverging decisions between two major central banks. The Federal Reserve, this week decided to cut interest rates by 0.5% whilst the Bank of England almost unanimously voted to hold rates unchanged at 5%. Paul and Joe discuss the key takeaways, the market reaction and expectations for future monetary policy.

Today, Kevin Kidney, Head of Asset Allocation, covers the Federal Reserve’s decision to cut interest rates in the US by 0.5%. Other Central Banks will now take note with the US beginning with a large cut, and market expectations to reduce interest rates below 3% by this time next year. 

Paul Durrans, Investment Director, looks at the upcoming interest rate decision that the Bank of England will make tomorrow and the economic factors that will be weighed. Will they continue the cutting cycle or hold rates where they are? In the US the interest rate cut is highly expected and the question is more by how much? The lowering of interest rates over the next 12 months will be dependent on US labor markets and the broader economy. 

Today our Portfolio Manager, Matt Henderson, provides commentary on the market holding a 72% expectation that the Federal Reserve will cut US interest rates by 0.5% this week. With further insight into how equities and yields are reacting and what could this mean for markets in the future and more importantly, your money?

Jeff Casson, Chief Investment Officer, looks to the week ahead with the upcoming release of data across global markets. The Federal Reserve faces a decision on interest rates cuts and whether it will be a 0.25% cut as markets expect or a 0.5% cut. In contrast, the Bank of England which meets later this week and is expected to hold interest rates after an initial cut in August as inflation numbers are expected to trend higher. After market volatility following their shift in policy, the Bank of Japan expects to hold while keeping an eye on the data to understand whether further cuts can be on the cards later this year.

George Bell, Portfolio Manager and Faye Graham, Investment analyst, look at what was a positive week for equities and bonds with some real strength in the data from most major markets. The European Central Bank delivered on expectations of a second interest rate cut which now sits at 3.5%. In the US the market has a firm view that we will see an interest rate cut from the Federal Reserve on September 18th, this would mark the start of the cutting cycle with an expectation of seeing rates at around 3% by this time next year. With some market reaction to the Presidential debate, we get commentary on the key areas which may have caused movement. We finish on the UK where with near historic lows of unemployment in the labour market demonstrate a resilience which is important in preventing a drawdown on economic expansion.

Today, Sebastian Mackay, Investment Director, looks at the August inflation data for the US and its implication for imminent interest rate decisions. There’s still a question of whether it will be a 0.25% or a 0.5% cut but regardless of the Federal Reserve’s decision, this cut is just the beginning of what is expected to be a cycle of cuts that takes interest rates down to below 3% by the end of 2025. For a global context, the European Central Bank meets today with an expectation of a further 0.25% cut and the Bank of England meet next week where even though there is a no cut expectation, a further one or two cuts are expected before the end of the year. In summary the overall global direction for equity markets is currently one of positivity.

George Bell, Portfolio Manager, talks about the US inflation report releasing later today and what key aspects could mean for interest rate policy. Of particular interest to the Federal Reserve will be the core inflation reading. We also get a health check on the UK from reports in this morning that point to a stalling of the economy with zero growth registered in July.