Bill Evans: RBA and Fed head in opposite directions

Friday, 23 March 2018

From Bill Evans at Westpac:

The US Federal Reserve has raised its growth forecasts for 2018 and 2019 just when it appears the RBA might be reconsidering its growth forecasts to the downside. Australian interest rates look set to be a lot lower than US over 2018 and 2019.

The widely expected decision by the US Federal Reserve to raise the federal funds rate from 1.375% to 1.625% marks the first time since January 2001 that the RBA cash rate has been below the federal funds rate.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.