Fed rate decision, South Korea trade, Australia unemployment, New Zealand GDP

Philippine Central Bank Starch Interest rates fell by 50 basis points to 5.5%, in line with analysts’ expectations in a Reuters poll and lifted the benchmark rate to a 14-year high.

It is likely that Bangko Sentral ng Pilipinas (BSP) will continue to raise interest rates in early 2023, said Muhammed Faiz Nagotha, ASEAN economist at Bank of America Global Research on CNBC’s Squawk Box Asia. US Federal Reserve.

He added that the central bank will continue to raise the benchmark interest rate up to 6%, or 50 basis points, from the current rate.

Charmaine Jacob

Jeremy Siegel, a Wharton School of Business professor on CNBC’s “Signals of Asia,” said the reopening of the Chinese economy is late, but badly needed to control inflationary pressures in the United States.

“For the United States, we import a lot from China, if these supply chains are normalized, it will lead to lower inflation, so I applaud China’s move,” he said. “It is too late, it should have been earlier, but it is needed,” he said.

Siegel added that he expects the US Federal Reserve to raise interest rates again at its February meeting by 25 basis points before pivoting.

– Jihe Lee

China’s industrial production for November grew 2.2%, after seeing a 5% growth in October, according to official data. This is lower than the 3.6% growth forecast in a Reuters survey.

Retail sales fell 5.9% year-on-year, more than expectations for a 3.7% decline in a Reuters survey and a 0.5% decline in the previous month.

– Jihe Lee

JPMorgan expects markets in the Asia-Pacific region to end the week on a cautious note after the Fed raised interest rates by 50 basis points.

“Given the reaction of the US market after the FOMC meeting, we expect Asian markets to end the week on a more cautious note,” Tai Hui, chief market analyst for the firm’s Asia Pacific region, said in a note.

Taye added that a weaker inflation reading is needed before the Fed’s tightening fades, while the region may have more optimism about China’s expected reopening.

“The medium-term prospects for the reopening of the Chinese economy and the resilience of domestic demand in Asia could be a bright spot as the United States and Europe face more growth challenges,” Tai said. “We will need more soft inflation data so the Fed can ease its hawkishness.”

– Jihe Lee

South Korea’s revised trade data for November was flat, official data From the Bank of Korea showed.

Imports grew by 2.7% while exports fell by 14%, in line with the previous month’s readings, resulting in a trade deficit of $6.99 billion, which was slightly lower than the previous month’s reading of $7.01 billion.

Import prices grew by 14.2% year-on-year after experiencing a growth of 19.8% in the previous month. Export prices grew 8.6% in November compared to a year ago, after growing 13.7% in October.

– Jihe Lee

Japan’s exports and imports for November grew more than expected year on year, Official data showed.

Exports rose for the month by 20%, beating expectations of 19.8% in a Reuters survey. Imports increased 30.3 percent, also above expectations of 27 percent in a Reuters poll.

This resulted in a wider-than-expected trade deficit of 2.02 trillion yen ($14.91 billion) after recording 2.16 trillion yen ($15.96 billion) in the previous month.

– Jihe Lee

Investors will have a second chance to participate in the stock market rally after China announced an easing of Covid-19 restrictions, according to Bank of America.

The bank named more than 10 stocks after finding “green shoots of recovery in high-frequency data” that indicated earnings increase in companies exporting to China.

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– Ganesh Rao

Australia’s unemployment rate for November remained at 3.5% year-on-year, in line with expectations from a Reuters poll and flat from the previous month.

Official data from the Australian Bureau of Statistics It showed that the labor participation rate also remained at 66.7%, and the employment-to-population ratio remained at 64.4%.

Monthly working hours increased to 1.89 billion.

– Jihe Lee

The Fed announced that it will raise interest rates by 50 basis points, marking the end of the pattern of 75-point hikes seen in recent months.

Prior to the move, the Fed had raised interest rates by 75 basis points in the past four meetings. The basis point is equal to 0.01%.

A 50 basis point hike was widely expected ahead of the meeting.

It is the final policy decision expected from the central bank in 2022.

– Alex Haring

Federal Reserve Chairman Jerome Powell said on Wednesday that recent positive signs of inflation are not enough for the central bank to moderate interest rate increases.

“It will take significantly more evidence to be confident that inflation is on a sustainable downward trajectory,” Powell said during a press conference after the meeting.

The comments came as the Fed raised its benchmark interest rate by another half percentage point and signaled that at least three-quarters more point in hikes are coming. The decision also comes a day after the consumer price index reading for November rose by just 0.1%, in a sign that inflation may have peaked.

However, Powell said that inflation remains an issue.

“Pricing pressures remain evident across a broad range of goods and services,” Powell added.

– Jeff Cox