September 6, 2024
United States:
Fed’s Williams Says Now Appropriate to Lower Interest Rates
Federal Reserve Bank of New York President John Williams said it is now appropriate for the central bank to reduce interest rates, given progress on lowering inflation and a cooling in the labor market.
Williams said there had been “significant progress” toward the Fed’s dual goals of maintaining stable prices and maximum employment and that the risks to achieving both have moved into “equipoise,” or a state of equilibrium.
Europe:
Key ECB Measure of Wage Growth Slows Before Likely Rate Cut
A key measure of euro-zone wage growth eased — providing further assurance to European Central Bank officials seeking to lower interest rates next week.
Compensation per employee rose by 4.3% in the second quarter — down from 4.8% in the first three months of the year, according to calculations by Bloomberg Economics based on Eurostat data published Friday. In June, the ECB had predicted pay growth of 5.1% for the period.
Asia:
China’s Yield Curve Steepens as PBOC Pushes Back on Bond Rally
China’s sovereign yield curve is steepening, a move that’s likely to be welcomed by authorities, as the threat of intervention prompts traders to slow purchases of longer term bonds.
Debt buying has been more pronounced on the shorter end of the curve this week, which has widened the yield spread between the two- and 10-year bonds to the most since July. The pattern matches the People’s Bank of China’s unprecedented move in August, when it sold long-dated bonds and bought short-maturity debt to curb the rally.
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