The US Fed announced a half-percentage-point-rate cut, which was larger than forecasters had generally anticipated, with updated projections predicting another 50 basis points of easing in 2024. The market is expecting a far more aggressive stance, with bets on another 70 basis points of rate reductions at the Fed’s two remaining meetings this year.
Asian currencies advanced to the strongest level in more than a year after the Federal Reserve kicked off policy easing and signaled further reductions this year.
The Bloomberg Asia Dollar Index rose 0.2% on Thursday, bringing the gauge to the highest since July 2023. The Chinese offshore yuan, Korean won and Indonesian rupiah led the gains.
