1) Fed kicks off 2-day meeting, market expects rate hike signal
The U.S. Federal Reserve has begun its two-day meeting on Tuesday, and the market is expecting the central bank to signal for a rate hike as soon as March. The market is also expecting the Fed not to be dovish and will consider other policy tightening to help tackle rising inflation that recently hit a four-decade high.
2) Rates shock could trigger growth shock, says Goldman Sachs
Goldman Sachs said on Tuesday prior to the Fed’s two-day meeting that there is the risk that a rates shock will trigger a growth shock. As the U.S. central bank could raise policy rate as soon as March along with other policy tightening to curb surging inflation rate, Goldman noted that the risk that could trigger a growth shock looks higher, as inflation pressures are much higher than since the 1980s.
3) IMF urges El Salvador to drop plans for legal tender Bitcoin
The International Monetary Fund (IMF) is urging El Salvador to drop its plan to legal tender Bitcoin, saying that there are large risks associated with the use of Bitcoin on financial stability, financial integrity, and consumer protection, as well as the associated fiscal contingent liabilities.
4) IMF cuts global growth in 2022 amid slower economic recovery
The International Monetary Fund (IMF) has cut its global growth forecast for this year amid rising concerns of Covid-19 situation that disrupts supply chains and high inflation that slows economic recovery.
IMF expects 2021 GDP to come in at 5.9%, while cutting its forecast for 2022 growth from 4.9% to 4.4%.
