RBC forecasts for US, UK, and Australian interest rate decision during 2019

7 Jan 2019 08:54 AM

RBC lowered its US interest rate hike four times to twice in 2019 after the Fed's last meeting, maybe the first hike in second quarter. While the US economy is likely to continue to grow almost 3% this year, the more pessimistic signals from Powell's press conference after the meeting indicate that the Federal Reserve is unlikely to go any further until if the real economy maintains its momentum to a large extent.

As for the UK, Bank experts expect the BOE to raise interest rates only once in 2019 against its previous forecast of twice. The British economy may be affected by the high uncertainty caused by the Brexit developments.

Finally, for Australia, RBC expects the RBA to continue to pursue expansionary monetary policy as the downside risks to the economy continue to make it difficult for the Bank to make such a decision at the moment.

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