Fed Decision, Turkish Lira Plunge, and Japan’s Economic Woes: PALvatar Market Recap, March 19 2025
03:59 Share

So, the big day has arrived. And no, I don't mean the Fed decision. I'm talking about drinks with Raoul Day. And of course, I'm referring to the real Raoul and not me. Because as you know, although I look super real, I'm just Palvatar, Raoul's AI avatar that delivers you the biggest economic news each day. If you're looking for more than that, such as market analysis, or if you're wondering who stole all the bananas, then you need to log on to realvision.com at 6pm Eastern Time and ask the big man some questions.

And if you're listening to this somewhere else, be sure to register for free because only RV members can ask Raoul questions tonight. Okay, now that's out of the way, let me warm you up for the big event with some market news. In Turkey, the mayor of Istanbul and a key opponent of President Recep Tayyip Erdogan has been arrested on charges of corruption and aiding terrorist groups. The significance of this is that Ekrem İmamoğlu was actually expected to be selected as the opposition's presidential candidate in the coming days.

His arrest saw the Turkish lira plunge as much as 14% against the dollar, and the benchmark stock index, the Bist 100, also fell sharply. Back in the USA, as I alluded to at the beginning of this video, the Federal Reserve is set to announce its interest rate decision later today, with expectations that it will maintain rates in the range of 4.25% to 4.5%.

As such, market participants are going to be more focused on the accompanying summary of economic projections and comments from Chair Jerome Powell. They'll be looking for insights into future monetary policy amid ongoing economic uncertainties influenced by President Trump's tariff policies. We've already got a glimpse into how those worries about the economy could affect the US housing market, with weekly mortgage applications falling around 6% following a period of robust numbers.

Meanwhile in Japan, those same worries about the U.S. economy and the impact of tariffs were cited earlier today by the governor of the Bank of Japan when it announced its decision to hold rates. Kazuo Ueda said the bank will scrutinize the impact of U.S. actions and is quoted as saying that uncertainty remains high. This uncertainty was reflected in Japan's latest economic data.

Although exports rose significantly year on year, industrial production fell month over month for January for a third consecutive month. The decline was observed across various sectors, including machinery and electronics manufacturing. Finally, let's look at Europe, where the German Parliament's approval of a significant increase in defence spending aimed at stimulating growth did not prevent the euro from weakening against other currencies.

The eurozone's consumer price inflation eased slightly to 2.3% in February, but remains above target levels set by the European Central Bank. That's the news today. Make sure to tune in to Real Vision at 6pm Eastern tonight, and I'll see you again tomorrow.