— This is the script of CNBC's news report for China's CCTV on December 20, 2018, Thursday.
We can see that the US stock market experiences down trend and the White House repeatedly criticized before the Fed meeting though, the fed still increased interest rates with hard stance. That has shaken financial markets by disappointing expectations that interest rates will not rise this month.
You can see that the Dow Jones industrial average had kept up before the federal reserve held a press conference, but slumped when the fed published its raising interest rates decision and Powell delivered speech, finally closing down more than 350 points, or 1.49%, falling by more than 730 points from an intraday high, that can be said to be a vertical drop of a rollercoaster ride turned down
But greenbacks was pushed up by the dovish fed and retook its loss made before the fed released its announcement. Of course, the fed is not blind to the plunge in markets. Powell alluded to the increasing rates times that maybe reduce. The current raster chart of the fed's outlook shows two rate increases next year, down from three in September. Meanwhile, the fed slightly lowered its forecasts for US GDP and inflation next year, for markets, however, the softening of the fed's tone on next year's rate rise could mean a complete shift in the path of interest rate hikes, with zero rate increases in 2019 not ruled out
Nikko Asset Management
We have thought they would hike for a couple times maybe 2 times in 2018, but its very possible after todays experience, as they could be no hikes in 2019, this minght be their last one.
On the other hand, some Wall Street investors think that the fed should maintain its economy views and keep increasing rates, Powell did nothing wrong.
BUTCHERJOSEPH ASSET MANAGEMENT
You look at his eyes,was he sweating, was he nervous was he anxious, and he wasn't any of that stuff, look i thought he was very very well presented, very confident, he made his case, he said what we gonna do, he stuck to his guts ,he didnt cave to the president, he didnt cave to all the people tell him what to do , so I think actually he did the right thing, look, we have been a decade into this quantative thing, a decade of financial crisis. a decade of the fed in every central bank around the world, you know, prompting up of this market, when the market is going up. nobody said the thing that they love fed, the fed was there, now the fed try to normalize, and all thrown the hits to fed, i thhink its rediculous
The next year fed policy faces uncertainty though, what is certain, however, is that the fed's hawkish rate hikes have sharply increased the pressure on the dollar to rise, while other central Banks have faced more downward pressure on their currencies. So we can see that HK monetary authority announced to raise the discount window base rate by 25 basis points to 2.75% after the fed Announced increases in interest rates. At the same time, Bahrain's central bank, the united Arab emirates' central bank, and Saudi Arabia's central bank have also followed the fed's lead, announcing to hike 25 basis points. We will keep an eye on the following move of the fed.