Kasikorn reckons US Fed will cut policy rate to boost growth
The Kasikorn Research Centre believes the US Federal Reserve (US Fed) meeting on September 17 and 18 will result in a 0.25 per cent interest cut from 2 to 2.25 per cent to 1.75 and 2 per cent.
The research house believes the US economy is still showing slight growth, though the global market’s unpredictability may affect the country’s economy for the rest of the year, which is why the Federal Reserve may consider cutting the interest rate.
The US Fed will also bring down the economic growth target for the rest of this year and next year, Kasikorn said.
If the US Fed decides to cut the interest rate, it will boost the flow of capital into emerging markets like Thailand, though Kasikorn does not believe Thailand’s Monetary Policy Committee (MPC) will reduce interest rates in response to the Fed.
“We believe the MPC will monitor the economy before deciding on cutting the interest rate,” the centre said.
