Powell: The downward adjustment of 0.25 PCT is only an adjustment
The US Federal Reserve, as expected by the market, cut interest rates by 0.25% and will end its contraction in August, but Chairman Powell hinted that interest rate cuts are only a “regulation”, not the beginning of a rate cut cycle. The market is disappointed, and the analysis also believes that there is limited support for the Hong Kong stock market and the property market.
After the Fed implements interest rate cuts, according to the latest cost of interest rate futures, the interest rate cuts will drop to about 50% next month. The market expects the Fed to cut interest rates twice this year after the interest rate cut this time. However, the current rate of interest rate cuts has dropped to about 40%.
However, Powell stressed at the press conference that this interest rate cut is a medium-term adjustment of monetary policy, not the beginning of a series of interest rate cuts. Although he added that it does not mean that the interest rate will be cut only once, the market has already cooled down on the US interest rate cut this year.
US interest rate cuts have little effect on Hong Kong stocks
US President Trump subsequently issued a message on Twitter saying that the Fed’s policy was not aggressive and therefore disappointing. The market also believes that the Fed’s interest rate cut strategy is only a short-term adjustment, rather than a long-term policy shift. US stocks plunged overnight, so Hong Kong stocks also closed below 200 points.
For the change of interest rate cut policy, Chen Delin, president of the HKMA, said that the US announced interest rate cuts, reflecting a major change in US monetary policy. It is believed that the short-term will be beneficial to the US economy and asset market, but there are still uncertainties in the medium and long term. Chen also expects that Hong Kong Bank may not immediately follow the pace of US interest rate cuts.
For the direction of interest rate cuts, Tai Hui, chief strategist of JPMorgan Asset Management Asia Pacific, agreed that the Fed chairman’s remarks reflect that there will only be another interest rate cut before the end of this year, and there is no expectation of more interest rate cuts next year. Mark Haefele, chief investment officer of UBS Wealth Management Global, pointed out that the market believes that another two or three interest rate cuts before the end of the year is overly optimistic, mainly because the current US economic performance is relatively stable.
As for the stock market trend in Hong Kong, some market analysts believe that the US interest rate cut will have little impact on the Hong Kong stock market. It is expected that Hong Kong stocks will test the 27,000-point mark and the investors will be deterred because of the uncertain interest rate cuts.
Regarding the impact of the property market, some market analysts believe that since banks in Hong Kong are still quite abundant, it is unlikely that local banks will follow interest rate cuts. Since the property market is dominated by rigid demand, even if the mortgage interest rate is lowered, it will not affect the property market. cast. Some investors believe that in the future, as market supply continues to fall and market demand continues, property prices will only continue to rise.
Real estate stocks are softer, HSI is going down
Although the Fed cut interest rates, but local property stocks were soft, and the medium-term performance of some shares of Changhe Department was not good, Hong Kong stocks went down to the end, fell to 27,495 points, down 282 points, and finally closed at 27,565 points, down 212 points or 0.76. %.