Latest / Best of Business / Shane Solly: Harbour Asset Management expert on whether the US Federal Reserve will cut interest rates

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Shane Solly: Harbour Asset Management expert on whether the US Federal Reserve will cut interest rates · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks be follow
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  Speaker 2: So the US FED is meeting later this week. The
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  Speaker 2: question as to whether or not the feed is going
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  Speaker 2: to cut interest rates a lot of pressure, of course,
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  Speaker 2: coming from the White House, and Shane Sally from Harbord
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  Speaker 2: Asset Management is with us this evening. So are they
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  Speaker 2: going to cut US official interest rates?
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  Speaker 3: Shane can a where Jack, Look, investment markets are expecting us,
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  Speaker 3: through a reserve that's the US Central Bank, to relieve
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  Speaker 3: rates unchanged when it meets Wednesday, and the announcement will
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  Speaker 3: come out Thursday. Despite the pressure you've talked about from
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  Speaker 3: Prisident Trump, Fed's cut rates three times since September on
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  Speaker 3: the back of your weeker US job markets. So the
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  Speaker 3: rates around three and a half to three point seventy five.
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  Speaker 3: But now we're seeing US growth lably strong, unemployment rate
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  Speaker 3: that's relaidly low, inflation that's above the Fed's two percent target.
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  Speaker 3: So paus and rates kind of makes more sense than
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  Speaker 3: cutting at the moment. But look, Jack, we're going to
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  Speaker 3: see mister Powe chairpower come under more pressure from prisident
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  Speaker 3: Trump on this's going to have to defend defense independence again,
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  Speaker 3: but the economic data just doesn't support it. Sport cuts the.
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  Speaker 2: Moment, well, he's been quite effective defending the independence and
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  Speaker 2: the feed so far, and I think a lot of
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  Speaker 2: leaders are trying to take a bit of a leaf
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  Speaker 2: out of J. Powe's book at the moment. But be
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  Speaker 2: very interesting to see how we react this week. Of course,
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  Speaker 2: our latest inflation data was a bit higher than expected,
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  Speaker 2: just over three percent, so some of the forecasters are
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  Speaker 2: bringing forward expectations of an official rate increase in the
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  Speaker 2: fourth quarter of this year as opposed to Q one
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  Speaker 2: of twenty twenty seven. So how have investment markets reacted?
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  Speaker 3: Yeah, look, we've actually seen seen the markets are actually
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  Speaker 3: pricing and a reserve bank rate increase by September twenty
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  Speaker 3: six now, and actually see that official cash rate in
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  Speaker 3: three point one three percent in May twenty seven. In
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  Speaker 3: terms of what it's done for financial markets investment markets,
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  Speaker 3: we've seen insence rates pretty much move across the curve
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  Speaker 3: since that data is that. What that means is to
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  Speaker 3: you In New Zealan gum bonds, they're up to three
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  Speaker 3: point three five percent ten year new government bonds at
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  Speaker 3: four point sixty two. That's back to level was where
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  Speaker 3: they were back in July before the Reserve Bank in
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  Speaker 3: New Zealone really put its jandle down on cutting rates.
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  Speaker 3: What it means for you and Iijack is we're going
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  Speaker 3: to see high interest costs for the government, businesses concerners.
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  Speaker 3: We've also seen a bit of a sell off and
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  Speaker 3: add the more interest rates since it departs in Zeon
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  Speaker 3: Shear market, since that inflashment is least today New Zeon
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  Speaker 3: Shar market was only as up zero point one percent,
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  Speaker 3: quite highly impacted trading, so not a lot c there today,
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  Speaker 3: but certainly the market's been a little bit weak off
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  Speaker 3: the back of that higher inflation.
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  Speaker 2: Several commentators have called out a bit of a recovery
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  Speaker 2: in the New Zealand economy. They say it's begun, it's underway.
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  Speaker 2: What's coming up this week to support those expectations.
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  Speaker 3: Yeah, Later this week we've got the as in New
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  Speaker 3: Zealand Business Conference and the AzID Activity outlock for January
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  Speaker 3: that's out on Thursday. And we've also got the ains
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  Speaker 3: in New Zeon consumer confidence out on Friday that's for
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  Speaker 3: January as well. For both those sets of data, we've
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  Speaker 3: actually seen a bit of a reduction in what's called
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  Speaker 3: the now casting GDP forecasts for the fourth quarter, and
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  Speaker 3: nin KAT is actually almost half jacked down to zero
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  Speaker 3: point five percent for the quarter from zero point nine,
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  Speaker 3: mainly on weaker cards spinning. So this as in data
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  Speaker 3: that comes out Tuesday Friday, and it's going to be
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  Speaker 3: really important to give us a data point of for
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  Speaker 3: invested and for police and makers is to within his
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  Speaker 3: own economy is actually getting some traction or it's the
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  Speaker 3: sort of one step, two step forward and then one
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  Speaker 3: back modest improvement.
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  Speaker 2: So silver prices rose above US one hundred bucks an
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  Speaker 2: ounce for the first time ever on Friday.
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  Speaker 3: Why yeah, yeah, it was quite a stunning move. And
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  Speaker 3: silver actually has gone through one hundred and eight dollars
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  Speaker 3: today in Asian trading, and gold that's also gone through
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  Speaker 3: a record as well, gone to five thousand and seventy
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  Speaker 3: five dollars US announce. It's all about investors piling into
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  Speaker 3: these safe havens and amongst this sort of geopolitical terminal
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  Speaker 3: tumor we're seeing globally and set of expectations of US
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  Speaker 3: interest rate movements. So if the feed doesn't cout, maybe
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  Speaker 3: we see a bit of back off, but certainly we've
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  Speaker 3: seen a bit more rolling of markets, with Japanese bonds
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  Speaker 3: particularly being a bit of a role. It's always actually
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  Speaker 3: up two hundred percent in the past year. Issu's a
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  Speaker 3: bit of a challenge in terms of gaining morse, getting
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  Speaker 3: the scale to refine the metal and the supply sort
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  Speaker 3: of just so yeah, it's been on a long run.
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  Speaker 2: And finally Shane Netflix tested its live ambition live streaming
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  Speaker 2: a skyscraper climb from one of the world's best rock
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  Speaker 2: climbers one hundred and one stories. He climbed in Taipei
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  Speaker 2: live on Netflix. No ropes, attached millions of people tuning
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  Speaker 2: in world wide. Does it represent a new kind of
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  Speaker 2: disruption for the media industry.
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  Speaker 3: Well, look, there's gut Alex Hanold. He's a pretty a
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  Speaker 3: legend and climber. He actually climbed this building in an
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  Speaker 3: hour and get you one minutes. And there's a key
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  Speaker 3: word at the universe it was sick or right. Look,
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  Speaker 3: I think it really highlights netflix ongoing pushing the traditional media.
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  Speaker 3: They talk about live media program as a way to
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  Speaker 3: retain existing subscribers and to catch a new subscribers. Talk
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  Speaker 3: about They've done two hundred live events, but most of
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  Speaker 3: it's been things like comedy and but a wrestling mainly
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  Speaker 3: target at US audiences. This is the sort of too
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  Speaker 3: step out into things to appeal to the right wider world,
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  Speaker 3: to certainly creeping into that traditional media. But you can
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  Speaker 3: have that client. I can tell you.
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  Speaker 2: That, Yeah, I love Alex Honnell, couldn't watch it, couldn't
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  Speaker 2: watch it, love free Solo, couldn't watch this though it
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  Speaker 2: was a step too far from me. Thanks so much, Shane,
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  Speaker 2: Appreciate your time. Shane solely from Harvar Asset Management.
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