Trio of Central Banks Surprise Markets With Aggressive Rate Cuts
Three central banks in the Asia-Pacific region lowered interest rates in a surprisingly aggressive fashion Wednesday as the fallout from the U.S.-China trade war intensified, suggesting the global rate-cut cycle will gather steam in the months ahead.
The trade war has hit markets hard in Southeast Asia, a fast-growing region deeply intertwined with global supply chains and dependent on trade with both the U.S. and China.
Two of the central banks that reduced rates Wednesday—India and New Zealand—were among the first to begin easing policy earlier this year and were a precursor to the Federal Reserve’s rate cut in late July, its first since 2008. Thailand’s central bank reduced interest rates Wednesday for the first time this year, reversing a late 2018 increase. The European Central Bank signaled in July that it will consider injecting fresh stimulus when it meets in September.
Reported by WSJ