The Fed led other Central Banks into a hold mode on interest rates. The Central Banks appear to be co-ordinating their monetary policy, with a couple of exceptions. The Fed declined the opportunity to cut rates further, citing a strong economy, while the Bank of England, Swedish Riksban, PBoC and the Bank of England all followed suit. The Swiss National Bank (SNB) cut rates 25 basis points, to 0.25%, reengaging their historical independent monetary pathway. Central Banks all cited global trade risks, with the imposition of the new US tariff policy, but the drama appears to have calmed. The US Dollar gained on the Fed’s inaction, with the EUR trading just above 1.0800, while the GBP holds below 1.3000.The Australian employment data was softer than expected and heralded further weakness in the currency, falling back below 0.6300, while the NZD dipped below 0.5750. Local markets will be watching the latest NZ Trade data, while Japanese inflation data is expected to confirm further falls. The Bank of Japan appears confidence that inflation is tamed.
