MARKET BAROMETER
An eye view of Stock Market Indicators:
- US Fed Interest Rates: 5.25-5-50Â
No changes. The
US Federal Reserve has held interest rates at a 23-year high, at 5.25%—5.50%. For a 7th consecutive meeting in June 2024, the Federal Reserve left the Fed funds target range steady at 5.25%-5.50%, in line with forecasts. Policymakers do not expect it will be appropriate to reduce rates until they gain greater confidence that inflation is moving sustainably toward 2% (Source: Federal Reserve; trading economics).
- ECB Interest Rates: 4.25Â
Changes. As of June 12, 2024, the ECB governing council decided to lower the three key ECB interest rates by 25 basis
points. The current rates are:
- Deposit facility: 3.75%
- Main refinancing operations: 4.25%
- Marginal lending facility: 4.50%
Based on an updated assessment of the inflation outlook, the dynamics of underlying inflation, and the strength of monetary policy transmission, it
is now appropriate to moderate the degree of monetary policy restriction after nine months of steady holding rates. Since the Governing Council meeting in September 2023, inflation has fallen by more than 2.5 percentage points, and the inflation outlook has improved markedly. Underlying inflation has also eased, reinforcing the signs that price pressures have weakened and inflation expectations have declined at all horizons. Monetary policy has kept financing conditions restrictive. Dampening
demand and keeping inflation expectations well anchored has made a major contribution to bringing inflation back down. These changes reflect the ECB's ongoing efforts to control inflation and ensure it meets the medium-term target of 2%​ (European Central
Bank)​​.
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