KUALA LUMPUR, July 30 (Bernama) -- Bursa Malaysia's key index closed at an intraday high today, supported by continued buying interest even as renewed geopolitical tensions and a weaker overnight lead from Wall Street following the US Federal Reserve's (Fed) decision to stand pat on interest rates weighed on broader sentiment. The Fed has decided to hold rates steady for the fifth consecutive meeting, with the Federal Funds Rate unchanged between 3.50 per cent and 3.75 per cent. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.84 points to 1,720.40 from yesterday’s close of 1,715.56. The benchmark index, which opened 1.14 points lower at 1,714.42, hit its lowest level of 1,710.69 in early trade before gaining momentum for the rest of the day. However, the broader market was negative with losers outpacing gainers 581 to 411, while 612 counters were unchanged, 1,173 untraded, and 87 suspended. Turnover declined to 2.49 billion units valued at RM2.25 billion from ...
US Federal Reserve (Fed) Chair Jerome Powell is facing an uphill battle to secure another large interest rate cut, especially as the labor market remains resilient. After the recent half-point rate reduction, which lowered the benchmark lending rate to 4.75%-5%, Powell emphasized the move was a recalibration to keep the labor market strong.
This cut marked a break from the usual gradual approach of the Fed, with some officials supporting it based on inflation data showing that price growth was nearing the Fed’s 2% target.
However, minutes from the meeting revealed that some officials preferred a more cautious 25-basis-point cut, indicating the Fed is not in a rush to cut rates quickly. Powell echoed this sentiment at a recent event, stating, "This is not a committee that feels like it’s in a hurry."
Recent labor market data revealed a 254,000 increase in payrolls and a drop in unemployment to 4.1%, further supporting a measured approach. The Atlanta Fed’s GDP tracker estimates 3.2% annualized growth for Q3, reinforcing the notion that the economy remains strong.
St. Louis Fed President Alberto Musalem cautioned against cutting rates too quickly, noting the risks of easing too much too soon. San Francisco Fed President Mary Daly added that one or two more cuts this year could be expected, depending on economic projections.
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