Emerging economies reduce policy interest rates one after another
The central bank of India, Thailand and New Zealand decided to cut the policy interest rate one after another in response to the growing global economic slowdown due to the prolonged trade friction between the United States and China. Central banks in each country are increasingly wary of intensifying conflicts between the United States and China.
The Reserve Bank, the central bank in India, held a meeting to decide monetary policy on the 7th and decided to lower the policy interest rate from 5.75% to 5.4%.
For the fourth time since the start of the policy rate cut, this is the largest reduction, and President Das has stated in the statement that “the uncertainty about the future of the global economy has spread, More economic stimulus measures are needed in the country. "
The Thai central bank also decided to cut its interest rate from 1.75% to 1.5% for the first time in about four years and three months on the 7th, due to the decrease in exports due to the effects of trade friction between the United States and China. .
In addition, the Reserve Bank of New Zealand, the central bank of New Zealand, has decided to lower the policy rate from 1.5% to a record low of 1%, and interest rate cuts continued in emerging countries.
The reason why the central banks of each country, especially emerging countries, are moving toward rate cuts, is that the US has shifted its monetary policy toward rate cuts, which eases risks such as currency depreciation associated with rate cuts and makes it easier for monetary easing.
However, the conflict between the United States and China over trade and foreign exchange is only deepening, and each country is increasingly wary of the impact on its own economy.