Thursday 28 Mar 2024
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KUALA LUMPUR (Nov 2): AmBank Research said in line with its expectation, the US Fed held its benchmark interest rate target between 1.00% - 1.25% in the latest FOMC meeting and maintained its positive language on the current state of the economy.

In a note today, AmBank group chief economist Anthony Dass said with the economy growing around 3% and unemployment at 4.2%, with very easy monetary conditions and a modest uptick in inflation expectations, everything leads to show the Fed will be raising rates in December.

He said despite the efforts to tighten policy, economic conditions have remained loose and the stock market continues to rally.

“This seems to cause some concern on the lack of impact the Fed's moves and raised fear that delaying tightening could promote asset bubbles and financial instability.

“We expect the Fed to further tightening rates in 2018, projecting a 2-3 rate hikes.

“We reiterate our 2017 full year USD/ringgit average at 4.31 -33, with the intraday swing around 4.10-12 while our year-end projection at 4.12-15. For 2018, we project the USD/MYR at 4.205 with our year end period target at 3.95 and intraday swing 3.93-95,” he said.

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