Calm before a Fed storm?

14 September, 2015

The week has arrived where in a few days time we will see an end to the debate over whether the Fed is prepared to commence its tightening cycle this month or at a later date. There is still a minority that is of the view that the FOMC will announce a hike this Thursday, but it’s hard to see how a hike now will help investors given all that the financial markets have been though in the past few weeks, in particular emerging markets. The decision itself is arguably more important for the markets than anything else we’ve seen so far in 2015, namely the ECB’s launch of QE and near exit of Greece from the Eurozone, as this will be the first time the world’s biggest economy will see a tightening of monetary policy of nine years. It’s not just the US economy that will be affected and it’s no secret that emerging markets will see the knock effect as their currencies have suffered considerable weakness against the US dollar in recent weeks.

Today is quiet on the economic data front and investors seem content for now as we near Thursday’s decision, with European equities a little higher on the open. Data releases become more poignant as the week goes on with UK inflation data tomorrow a highlight where the Y on Y rate could dip back into deflation territory.


Source link  
Market shows demand for yielding assets

The market shows demand for yielding assets, which in turn supports demand for the stocks and currencies of emerging markets. The main...

Yuan and Dollar as a weapon in trade wars

The US Nonfarm Payrolls on Friday could even be called boring: the report showed the preservation of a completely healthy labour market...

Disappointment with Fed and tariffs

Trump announced 10% tariffs on Chinese goods worth $300 billion since September 1, thus ending the US-China trade truce after disappointingly...


Fed pushes down stocks

Markets have started the week under pressure. Expectations that the Federal Reserve will cut interest rates by 50 points in July collapsed...

Gold updates new 6-years highs

Gold benefits from a combination of two factors: lower interest rates in debt markets and continuing hopes that the global economy...

Markets recede from the recent highs

A strong Nonfarm Payrolls caused pressure on the stock markets, reducing the chances of the interest rates lowering by the Fed in the upcoming months...


Gold resumes rally, pushing past $1400

Gold prices resumed a push higher on Monday, as flows into the precious metal continued on improved prospects for easier monetary policy from...

Gold rises as markets slip

Market caution continues to support gold. Quotes of this metal rose to $1337, repeatedly trying to push above this year highs at the 1340-1360 area...

Trump says Brexit should happen

President Donald Trump promised the U.K. a "phenomenal trade deal" Tuesday, on the second day of his state visit to Britain...

  


Share it on:   or