Recent global economic data and announcements of rate cuts are setting the stage for reductions in borrowing costs for the second half of the year and into 2025. China’s surprise rate cut, along with expected cuts in Canada this summer, could lower borrowing costs by the end of the year. In the United States, markets are pricing in a “near 100% chance” of a rate cut in September, which could initiate a downward trend over the next 12-18 months. These lower rates are likely to boost housing demand and remodeling, auto purchases, and business investment.
To read more:
- https://www.reuters.com/markets/us/fed-cut-rates-twice-this-year-with-first-move-september-economists-say-2024-07-23/
- https://www.bloomberg.com/news/articles/2024-07-22/pboc-cuts-seven-day-reverse-repo-rate-to-1-7-to-support-economy?embedded-checkout=true
- https://www.fxstreet.com/news/canada-interest-rate-decision-preview-bank-of-canada-eyes-another-rate-cut-on-easing-inflation-expectation-202407240800
