Economic Forecast - Switzerland's government has cut its 2026 economic growth forecast to 0.9%, down from a previous estimate of 1.2% due to the impact of U.S. tariffs [2] - The economy is expected to grow by 1.3% this year, which is considered "significantly below-average" for the country [2] Trade Impact - The U.S. is Switzerland's top export destination, and the country faced a 39% tariff on goods sent to the U.S. after failed negotiations [3] - Key exports include watches, pharmaceuticals, and precious metals, with branded pharma products now subject to 100% tariffs unless produced in the U.S. [4] Economic Challenges - Swiss officials noted that the current trade policy environment presents significant challenges, with additional tariffs burdening export-oriented sectors [6] - The rising Swiss franc, gaining over 12% this year, adds to economic woes by putting downward pressure on prices [7] Risks and Forecast Adjustments - Risks for the Swiss economy are increasing, with exposure to the U.S. market amounting to 4% of GDP [11] - A senior economist revised the growth forecast for 2026 down to 0.8%, indicating a cumulative direct impact of U.S. tariffs on Swiss GDP of about 0.86% in the first two years [11] Recession Outlook - A fall in goods exports and declining investment are expected to lead the Swiss economy into recession in the second half of this year, with GDP projected to fall by 0.2% quarter-to-quarter in Q3 and Q4 [13]

Core Insights - The Swiss government forecasts an economic growth of 1.3% for 2025 and 0.9% for 2026, reflecting a downward revision due to U.S. tariffs impacting the export-driven economy [1] - The government has adjusted the 2026 growth forecast down from 1.2% announced in June, primarily due to the effects of a 39% import tariff imposed by the U.S. in August [1] - The growth predictions have been adjusted to account for the impact of sporting events [1] Economic Impact - The U.S. tariffs are described as one of the most severe measures in President Trump's trade policy overhaul, significantly affecting Swiss economic activities [1] - The overall trade uncertainty has contributed to the downward revision of growth forecasts for Switzerland [1]

Core Viewpoint - The Federal Reserve's September meeting minutes indicate a consensus among members to lower the federal funds rate target range by 25 basis points to between 4% and 4.25% due to signs of economic slowdown and persistent inflation above the 2% target [1] Economic Indicators - Employment growth has shown signs of slowing down, with a slight increase in the unemployment rate and indications of a weakening labor market [1] - Inflation remains slightly above the 2% target, prompting discussions on monetary policy adjustments [1] Economic Growth Forecast - The Federal Reserve has slightly upgraded its economic growth forecasts for the years 2023 to 2028, driven by stronger-than-expected consumer spending and business investment data [1] - Tariff increases are expected to continue exerting upward pressure on inflation this year, with further inflationary impacts anticipated until 2027 when the 2% target may be reached [1]

Core Points - The Federal Reserve's September meeting minutes indicate a consensus among members that economic indicators show a slowdown in job growth and a slight increase in the unemployment rate, reflecting signs of weakness in the labor market [3] - Inflation remains slightly above the 2% target, prompting nearly all members to agree on a 25 basis point reduction in the federal funds rate target range to between 4% and 4.25% [3] - Due to stronger-than-expected consumer spending and business investment data, the Fed has slightly upgraded its economic growth forecasts for this year through 2028 [3] - The Fed anticipates that tariff increases will continue to elevate inflation this year and exert further upward pressure on inflation until 2027, when the 2% target may finally be reached [3]

Core Points - The Federal Reserve's September meeting minutes indicate a consensus among members that economic indicators show a slowdown in job growth and a slight increase in the unemployment rate, suggesting signs of weakness in the labor market [1] - The inflation rate remains slightly above the 2% target, leading nearly all members to agree on a 25 basis point reduction in the federal funds rate target range to between 4% and 4.25% [1] - Due to stronger-than-expected consumer spending and business investment data, the Fed has slightly upgraded its economic growth forecasts for the years 2023 to 2028 [1] - The Fed anticipates that tariff increases will continue to elevate inflation this year and exert further upward pressure on inflation until 2026, with a return to the 2% target expected by 2027 [1]

Core Insights - The World Bank's latest forecast predicts Chile's economic growth rate will reach 2.6% in 2025, slightly above the Chilean government's estimate of 2.5% and within the Central Bank's range of 2.25%-2.75% [1] - The same growth rate of 2.6% is also expected for 2026 [1] - The growth is attributed to increased private consumption and enhanced mineral exports, although there is a noted lag in adopting new technologies [1] - Emerging enterprises entering the market are expected to significantly contribute to productivity growth and job creation, further stimulating economic activity [1] Recommendations and Context - In light of declining global demand, falling commodity prices, increased uncertainty in trade and market access policies, and rising corporate relocations, the World Bank has issued a series of recommendations [1] - The recommendations include calls for internal reforms to attract investment, creating a favorable policy and regulatory environment for businesses [1] - Suggested investments in logistics, energy, and digital infrastructure aim to lower entry barriers, expand financing channels, and improve capital allocation [1]

Core Viewpoint - The Bank of Japan is likely to raise its economic and inflation forecasts in the upcoming quarterly assessment, potentially paving the way for an interest rate hike in October, with a market expectation of about 50% probability for such a move [2][3]. Economic Forecasts - The Bank of Japan is expected to review its current economic growth forecast of 0.6% for the fiscal year and 0.7% for fiscal year 2026 during the meeting on October 29-30 [3]. - Recent data shows that Japan's annualized economic growth rate for the second quarter reached 2.2%, exceeding initial estimates, primarily due to robust consumption [3]. Inflation Projections - The Bank of Japan anticipates a core consumer inflation rate of 2.7% in 2025, followed by a slowdown to 1.8% in 2026 [3]. - The potential inflation rate in Japan is currently estimated at around 1.7%, with a possibility of reaching the Bank's 2% target if the five-year inflation expectations from the short-term business survey rise from 2.3% to 2.5% [4]. Interest Rate Decisions - The Bank of Japan maintained its interest rate at 0.5%, but two committee members proposed raising it to 0.75%, which led to an increase in Japanese government bond yields [3]. - There is a divergence among economists regarding the timing of the next interest rate hike, with expectations ranging from October to January of the following year [4].

Market Overview - The bond market has experienced significant fluctuations, particularly in the 10-year yield, following recent Federal Reserve announcements and press conferences [1][3] - Recent data has shown a decline in short-term yields, influenced by the Fed's updated projections indicating potential rate cuts [3][4] Federal Reserve Insights - The Federal Reserve has cut rates and projected two additional cuts for the year, reflecting a somewhat dovish stance [4] - Economic projections from the Fed indicate stronger growth and a lower unemployment rate compared to previous forecasts [4] Inflation and Labor Market - Inflation remains high but is not accelerating, while there are concerns about a potential slowdown in the labor market [5][10] - The Fed's approach appears to be more about risk management rather than initiating a consistent rate-cutting cycle [5][11] Long-term Yield Outlook - There are mixed expectations regarding long-term yields, with some analysts predicting they may not decrease in tandem with short-term rates [8][9] - Concerns about budget issues and elevated inflation may lead to demands for higher yields from investors [9][10] Conclusion - The Fed's current strategy may support stable long-term yields, suggesting a more cautious approach to monetary policy moving forward [11]

Core Points - The Federal Reserve lowered the target range for the federal funds rate by 25 basis points to between 4.00% and 4.25%, aligning with market expectations [1] - The median forecast from the Federal Reserve indicates a further rate cut of 50 basis points by 2025 [1] - There is a divergence in opinions among Federal Reserve officials regarding future rate cuts, with varying views on the extent and timing of potential reductions [1] Summary by Categories Interest Rate Decisions - The Federal Reserve's decision to lower the federal funds rate target range by 25 basis points is in line with market expectations [1] - The median prediction suggests a cumulative rate cut of 50 basis points by 2025, with differing opinions among officials on the number and magnitude of future cuts [1] Economic Forecasts - The Federal Reserve maintained its inflation and unemployment rate forecasts for the year, projecting a median inflation rate of 3% and an unemployment rate of 4.5% [1] - Economic growth expectations have been revised upward from 1.4% to 1.6% for the year [1] Market Reactions - Following the Federal Reserve's announcement, the DXY dollar index experienced a sharp decline, while non-USD currencies rose collectively [1] - Spot gold prices surged, surpassing $3700 per ounce, and U.S. stock markets initially rose before retreating, indicating increased bets on at least one more rate cut this year [1]

Core Viewpoint - The Kasikorn Research Center has revised Thailand's GDP growth forecast for 2025 upward to 1.8%, citing increased exports of goods, particularly electronics, and a smaller-than-expected slowdown in export growth in the second half of the year, which reduces the risk of a technical recession in Thailand [1] Economic Outlook - The GDP growth forecast for 2025 has been adjusted from 1.5% to 1.8% due to improved export performance [1] - The center highlights ongoing risks to the Thai economy from international trade conditions, a slowdown in tourism, and domestic political factors [1] Monetary Policy - The Kasikorn Research Center anticipates that the Bank of Thailand's Monetary Policy Committee may lower the policy interest rate again this year, influenced by the new government's introduction of short-term economic stimulus measures [1]