Federal reserve maintains interest rates 11th Dec 2019

Key indicators

• Business investments slowed
• Manufacturing has slowed
• Exports has slowed
• Unemployment rate remains at historical low

Employment rate

• Wage increases of 3.7% observed at non supervisory production sectors.
• Flexible deployment of jobs to low cost areas remains a strong downwards pressure.
• Correlation between inflation and unemployment is at 0.1

Repo market concerns

• Repo markets issue being looked into. Reviewing regulations that are hindering repo market operations by major banks
• Will meanwhile continue purchase of treasury bills to provide necessary liquidity

Key long term deflationary pressure on the world economy

• Automation
• Globalization versus trade inhibiting government policies
• Aging population