‘No longer in need of life support’: Industry reacts to Japan’s first rate hike in 17 years
Move seen as ‘extremely significant’ for global markets
Move seen as ‘extremely significant’ for global markets
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Speaking at the annual Jackson Hole symposium, Federal Reserve Chair Janet Yellen said the solid performance of the United States labour market and current economic outlook mean the case for an increase in the federal funds rate has ‘strengthened in recent months.’
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The Federal Reserve’s decision to hold interest rates on Wednesday night accompanied by dovish rhetoric suggested the first rise of 2016 will not come until the summer.
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Despite seven years on the zero bound, bond market reaction to the Fed’s first rate hike in nine years was pretty muted, which is what the FOMC would have been going for.
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About the right amount of ‘dovishness’ seems to be the initial verdict from market commentators pronouncing on what had been billed as the biggest event in financial markets since the collapse of Lehman Brothers.
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The last time the Federal Reserve raised interest rates, Daniel Craig had just taken on the mantle of James Bond and Sylvester Stallone had just successfully resurrected the Rocky franchise from the ignominy of 1990’s Rocky V.
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If the Fed start raising rates on Wednesday, which is almost a foregone conclusion, what will the accompanying statement say?
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The UK slipped in to deflation in September, the Office for National Statistics said on Tuesday. But, while the number came in slightly lower than many economists had predicted, but many are more focused on how it is likely to change going forward.
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Few things on markets have been more thoroughly debated in recent memory than the exact timing of the first rate hike by the Fed.
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Mark Carney has, according to the Sunday Times, told fund managers to prepare for a mass sell-off in stocks and bonds that could be triggered by a Bank of England rate hike.
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The Fed is going to have to raise rates and do so this year, says Andrew Warwick, portfolio manager in the BlackRock, multi-asset strategies group, but it will move very cautiously.
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The impact of a stronger dollar on growth and job creation in the US seemed a significant part of the reason behind the International Monetary Fund’s warning to the US Federal Reserve it should delay raising rates until next year.
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