US interest rates

Share and money markets are now tipping the USA will increase rates sooner rather than later....after 6 years of massive stimulus.

Could this be the bottom of the developed worlds IR cycle? It feels like change is coming and could be a good time to fix now.

Or I could be wrong again ;)
 
hardly.

currency wars are here for the medium term.

how does a country like japan raise rates? new zealand? south korea? exports for SK are dropping like Fe prices - how will making products priced in their currency LESS affordable help them?

it's all pish and wind.
 
Yeah the crazy will see reality and so will the economy IMO. Higher interest rates will mean less investors and it wont make it easier for first home buyers either.
 
People move into cash from equities with higher rates. Chinese won't be happy, their $1.3t in US bonds might have been worth something, but clearly if US IRs go up, that will wipe any gain made and they can default by default without defaulting.
 
Hi

USA and OZ are in two different cycles.

USA: The market in USA is really different to Australia: Interest rates are going to keep going up as home prices have gone up, employment figures have increased. Biggest difference is that there is so many states in the USA with all different laws, tax ruling and employment figures.

Australia: I believe we are heading into a difficult period, employment rate is raising debt to income ratio does not make sense and I am seeing more and more people struggle with a housing deposit.

Interest rates in Australia might drop down another .25 basis points and that's it....
 
From the reading I've been doing - Interest rates aren't going anywhere in the USA. They are still teetering on the brink of financial ruin, and the only thing that has stopped it (for now) is artificial stimulation by the Federal Reserve, and 0% interest rates for seven years!

QE4 is more likely than a .25 rate rise...
 
I think the market is fearing an interest rate rise this year. Probably speculating from the lower US employment rate. Anyway it caused our stock market to fall yesterday enabling some investors to pick up cheaper stock....."buy on the rumour, sell on the fact" as they say.
 
a 25bp rise in the USA?

are you serious?

they're not on Cloud 9 yet - more like 10 basis points.

geez, only the RBA seem to be stuck with imperialistic quarter percenters.
 
a 25bp rise in the USA?

are you serious?

they're not on Cloud 9 yet - more like 10 basis points.

geez, only the RBA seem to be stuck with imperialistic quarter percenters.

Yeah K, stuck in the Australian .25 mindset i guess :)

Anyway - I think that highlights the fragility of it all. Even rumors of a .1bp increase scares the market. I'm no economist, but that just doesn't sit right with me..Is there really that much difference between 0% and 0.1%?
 
Yeah K, stuck in the Australian .25 mindset i guess :)

Anyway - I think that highlights the fragility of it all. Even rumors of a .1bp increase scares the market. I'm no economist, but that just doesn't sit right with me..Is there really that much difference between 0% and 0.1%?

Multiply anything by 0% and you still get zero. Multiply a big number by .1% and you end up with a bigger number than zero.

Try it if you don't believe me! :p


pinkboy
 
No question that the US is booming.

To paraphrase Pink Floyd.......a "short, sharp shock" by the Fed is in order.

And when it happens, it will rock the markets.

Expect the unexpected.
 
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