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4 Feb 2015
Expect more Asian central bank surprises – Nomura
FXStreet (Barcelona) - The Research Team at Nomura, expects more central banks in Asia to follow suit the RBA and surprise with either the timing or size of any monetary policy easing.
Key Quotes
“People’s Bank of China: We forecast 50bp reserve requirement ratio (RRR) cuts in each quarter of 2015 and a 25bp benchmark interest rate cut in Q2, along with more targeted piecemeal easing measures. The surprise could be an interest rate cut or RRR cut ahead of the lunar new year holidays.”
“Bank of Thailand: We expect a 25bp interest rate cut on 11 March and another in Q2.”
“Bank of Korea: We expect 25bp interest rate cuts in April and July, with the risk that they could come earlier.”
“Reserve Bank of India: We expect only one more 25bp interest rate cut this year – in April – but the risk is that there could be more.”
“Bank Indonesia: At this juncture we forecast 50bp of interest rate cuts in Q1 2016, but the risk is that they are brought forward to this year.”
“Monetary Authority of Singapore: The MAS already pre-emptively decreased the slope of its S$NEER policy band and we see a 20-30% probability of a further easing at its semi-annual monetary policy review in April.”
Key Quotes
“People’s Bank of China: We forecast 50bp reserve requirement ratio (RRR) cuts in each quarter of 2015 and a 25bp benchmark interest rate cut in Q2, along with more targeted piecemeal easing measures. The surprise could be an interest rate cut or RRR cut ahead of the lunar new year holidays.”
“Bank of Thailand: We expect a 25bp interest rate cut on 11 March and another in Q2.”
“Bank of Korea: We expect 25bp interest rate cuts in April and July, with the risk that they could come earlier.”
“Reserve Bank of India: We expect only one more 25bp interest rate cut this year – in April – but the risk is that there could be more.”
“Bank Indonesia: At this juncture we forecast 50bp of interest rate cuts in Q1 2016, but the risk is that they are brought forward to this year.”
“Monetary Authority of Singapore: The MAS already pre-emptively decreased the slope of its S$NEER policy band and we see a 20-30% probability of a further easing at its semi-annual monetary policy review in April.”