Rate cuts on the cards for South-east Asia once US Fed starts easing cycle

MAJOR central banks across South-east Asia are expected to hold interest rates steady in the near term, keeping an eagle eye on their waning currencies while awaiting the US Federal Reserve’s next move in the global chess game of monetary policy.

By and large, Asean central banks are unlikely to slash rates ahead of the world’s largest central bank, as the move could risk further currency weakness and capital outflows.

The Fed left interest rates unchanged at its recent March meeting, while top officials said in April they are in “no rush” to trim rates.