China Extends Gold Buying Streak as Reserves Surge Despite Volatile Prices 
Bank of Japan Signals Readiness for Near-Term Rate Hike as Inflation Nears Target 
Gold and Silver Prices Rebound After Volatile Week Triggered by Fed Nomination 
Dollar Steadies Ahead of ECB and BoE Decisions as Markets Turn Risk-Off 
South Korea’s Weak Won Struggles as Retail Investors Pour Money Into U.S. Stocks 
Silver Prices Plunge in Asian Trade as Dollar Strength Triggers Fresh Precious Metals Sell-Off 
Singapore Budget 2026 Set for Fiscal Prudence as Growth Remains Resilient 
Thailand Inflation Remains Negative for 10th Straight Month in January 
U.S. Stock Futures Slide as Tech Rout Deepens on Amazon Capex Shock 
Asian Stocks Slip as Tech Rout Deepens, Japan Steadies Ahead of Election 
Gold Prices Slide Below $5,000 as Strong Dollar and Central Bank Outlook Weigh on Metals 
RBI Holds Repo Rate at 5.25% as India’s Growth Outlook Strengthens After U.S. Trade Deal 
Australia’s December Trade Surplus Expands but Falls Short of Expectations 
Vietnam’s Trade Surplus With US Jumps as Exports Surge and China Imports Hit Record 
Asian Markets Slip as AI Spending Fears Shake Tech, Wall Street Futures Rebound 
Oil Prices Slide on US-Iran Talks, Dollar Strength and Profit-Taking Pressure 
During its remaining policy meetings this year, the Federal Reserve is expected to downshift to smaller interest rate cuts. However, a sharp downturn in the labor market could prompt the central bank to implement a more significant Federal Reserve rate cut to protect the economy, according to analysts.
"Despite the faster-than-expected first cut, the tone of the meeting, subsequent communications, and recent U.S. economic data lead us to expect two 25 basis point cuts into year-end," analysts at Morgan Stanley wrote on Wednesday.
A larger Federal Reserve rate cut remains on the table, as weaker employment data could cause the Fed to adjust its policy more aggressively. Analysts warn that job gains falling below 100,000 could pose a challenge to the forecast for two 25 basis point cuts. The September payrolls report, expected this Friday, is predicted to show an addition of 144,000 jobs, slightly up from August’s 142,000, with the unemployment rate holding steady at 4.2%.
Labor Market Holds Key to Future Federal Reserve Rate Cut Decisions
The Federal Reserve rate cut in September, a 50 basis point reduction, surprised many experts who anticipated a smaller 25 basis point cut at the start of the easing cycle. Since then, Federal Reserve officials have consistently emphasized that labor market conditions will significantly shape decisions regarding further rate reductions.
“A surprise to the weak side... would pull me much further into really needing another dramatic move,” said Raphael Bostic, President of the Atlanta Fed, in a Reuters interview.
Fed Chair Jerome Powell, in a speech on Monday, tempered expectations of another large Federal Reserve rate cut, suggesting the likelihood of two more 25 basis point reductions “if the economy performs as expected.”
While the labor market shows signs of slowing, robust consumer spending offers reassurance to Fed officials that a "soft landing" for the economy is possible without entering a recession. In August, consumer spending rose as expected, especially in the service sector, tracking at 3.1% growth for the third quarter.
Morgan Stanley expects a broad deceleration of the economy towards year-end but believes a recession is unlikely. The bank projects real GDP growth at 2.2% for the fourth quarter compared to the same period last year. Meanwhile, inflation continues to moderate, with the core personal consumption expenditures price index — the Fed’s preferred gauge — aligning with a 2.6% forecast for 2024.
