Daily Flows
- Significant flows were directed to ‘A’ rated banks, offering well above 5.00% for 9-12 month term deposits.
- Secondary market trading continues for the recent Hollard Sub-debt issuance.
- Investors seeking higher credit quality and seniority acquired the NAB fixed line maturing on 16/11/2026 with a 5.2% coupon.
Fed’s Path Unshaken by Political Changeover
- As expected, the Fed lowered its benchmark rate by 25 basis points, making a subtle change to its statement by removing its previous assurance about inflation reaching the 2% target.
- Avoiding speculation on the potential economic impact of Trump administration policies, the Fed stressed that it will hold off on decisions until there is greater policy clarity.
- While Trump may push for adjustments to the Fed’s structure, any major changes would require Congressional support, which remains a difficult hurdle.
- Powell highlighted the Fed’s outlook for further monetary policy easing, though he emphasised that the path forward will depend on economic data and is uncertain.
- December may bring a pause in rate cuts, depending on upcoming inflation and employment figures, although a cut remains loosely anticipated.
- In contrast, Australia faces a different situation, with trimmed mean inflation remaining well above its target range.
