In an event in London overnight, Minneapolis Fed President Neel Kashkari stated that the likelihood of raising interest rates again is “quite low,” although he emphasized, “I don’t want to take anything off the table.”
Kashkari pointed out that “wage growth is still quite robust relative to ultimately what we think would be consistent with the 2% inflation target,” suggesting that the labor market remains strong. He emphasized the need for a careful assessment of the downward pressure being placed on demand before making any further policy decisions.
When discussing his input for the upcoming dot plot, Kashkari expressed the importance of having comprehensive data before drawing any conclusions. However, he assured that “it certainly won’t be more than two cuts” this year, as he had projected in the last dot plot.
Australia’s Westpac Leading Index rises to -0.01%, some signs of stabilization
Australia Westpac Leading Index improved slightly in April, rising from -0.08% to -0.01%. Westpac noted that the index is once again indicating some stabilization in growth momentum. However, the improvement in growth is expected to be modest.
Westpac forecasts GDP to grow at an annual pace of 1.9% in the second half of the year, up from 1.3% in the first half. Despite this uptick, the growth rate remains below Australia’s trend, which is estimated to be around 2.5% per year with some moderation in population growth.
Full Australia Westpac leading index release.