Siap-siap! Suku Bunga The Fed Diproyeksi Naik Satu Kali Lagi

Summary

In this insightful discussion, the speaker analyzes the outlook for US interest rates, highlighting the Federal Reserve's strategy of gradually raising rates to combat inflation. The speaker suggests that the Fed is unlikely to raise rates much further, with potential increases only occurring in December, but notes that inflation targets are still far from the 2% goal, possibly only achievable by 2025. Additionally, the speaker reflects on the resilience of the US economy despite high interest rates, the global economic volatility, and Indonesia's delayed response to rate hikes, which may lead to significant market fluctuations in the near future.

Takeaways

• 😀 The Federal Reserve (Fed) is unlikely to raise interest rates significantly more, with only one more possible hike in December, depending on bond market reactions.
• 😀 The US economy remains resilient despite a significant rise in interest rates from 0.25% to 5.25%, with GDP growth exceeding expectations at 4.9%.
• 😀 Bond yields have recently surged, but the current 10-year US Treasury yield of 5% is expected to stabilize, as the market has adjusted to earlier rate hikes.
• 😀 Despite the Fed's aggressive rate hikes, the US economy has shown remarkable strength, defying expectations of a slowdown.
• 😀 The bond yield curve is currently at 5%, which is seen as an equilibrium point, making further rate hikes less likely.
• 😀 Japan's economic policies are becoming more important globally, particularly due to its large holdings of US Treasury bonds. Any changes in Japan's rates could influence US Treasury yields.
• 😀 The long-term inflation target for the Fed remains at 2%, but it is unlikely to reach this target in the near future, with 2025 being a more realistic timeframe.
• 😀 The Fed's response to inflation has been considered delayed, leading to a series of sharp rate hikes, including a 0.25% to 0.75% increase in a short period.
• 😀 US inflation is driven by multiple factors including consumption, energy prices, and housing, requiring continued rate hikes to manage it.
• 😀 Indonesia's economy is facing increased volatility due to its delayed response to global interest rate hikes, which could cause instability in the short term.

Q & A

What is the outlook for U.S. interest rates in the coming months?

The outlook for U.S. interest rates suggests that the Federal Reserve (Fed) may only raise rates once more, potentially in December, though there is a strong chance that rates will remain steady at 5% to 5.25%. Bond yields are already at 5%, which is considered sufficient for the economy.

Why has the U.S. bond yield surged from 3.8% to 5% recently?

The bond yield surged due to the Fed's interest rate hikes from 0.25% at the end of 2022 to 5.25% currently. However, this increase was gradual, with the bond yield taking a couple of months to respond to the interest rate hikes.

What impact does a higher interest rate have on the economy?

Higher interest rates lead to higher borrowing costs, particularly in sectors like mortgages, which can decrease consumer spending. However, the U.S. economy has shown resilience despite these rate hikes, with a GDP growth higher than expected.

What is the expected long-term target for inflation in the U.S.?

The Fed's long-term target for inflation remains at 2%, but this target is unlikely to be achieved in the near future. The inflation rate is expected to stay above 3% until at least 2025.

Why did the Fed act late in raising interest rates?

The Fed was initially slow to raise interest rates, waiting too long to react to inflationary pressures. This resulted in aggressive hikes later on, such as moving from 0.25% to 0.75% increases, which may have caused some perception of panic in the market.

What is the economic condition in Japan and how could it impact the U.S. treasury market?

Japan's bond yields are at their highest in 10 years, and if Japan raises interest rates, it could affect U.S. treasury yields. Japan, now the largest holder of U.S. treasury securities, could influence U.S. yields through changes in its monetary policy.

Will the U.S. Federal Reserve cut interest rates soon?

No, the Fed is unlikely to cut interest rates in the near future as the economy is still strong, with GDP growth surpassing expectations. Cutting rates would risk stoking inflation again.

What does the phrase 'volatility will still be there' mean in the context of the U.S. economy?

It means that market volatility is expected to persist due to high interest rates, as they slow down economic growth but are necessary to keep inflation in check. This will likely lead to fluctuations in market conditions.

How is Indonesia’s response to interest rate hikes different from the U.S.?

Indonesia is lagging in responding to global interest rate hikes and is expected to experience significant market volatility in the near term as it adjusts to these changes.

How do the U.S. and global markets compare in terms of volatility?

Both the U.S. and global markets are expected to be volatile, but the U.S. is in a stronger economic position due to robust GDP growth. In contrast, countries like Indonesia are facing greater volatility due to delayed responses to interest rate hikes.