A lot is riding on the August U.S. jobs report – a good chunk of justification for the first Federal Reserve interest rate rise in nearly a decade and a lot of face-saving at the world’s most powerful central bank.
For all its single-minded focus on lowering inflation, India's central bank may be forced to acknowledge slowing growth in Asia's third largest economy by cutting interest rates -- probably faster than it expected.
Financial markets have all but shut the door to a Federal Reserve rate hike in September, following a rout in stocks, currencies and commodities this past week, but economy watchers are only now warming up to the idea -- in public at least.
from Morning Bid with David Gaffen:
The July meeting was never meant to be much of a thing with the Federal Reserve, and that’s exactly how it’s worked out. The Fed seems like it is still targeting a modest increase in rates in September, with – as many strategists have already noted – the real action to come later on down the road, as Janet Yellen and others have argued that the first move isn’t the one to really worry about.
The U.S. and British central banks are scrambling to be the first of the majors to raise interest rates after a long period of unprecedented monetary generosity. It won't happen immediately but both Janet Yellen, who chairs the U.S. Federal Reserve, and Bank of England Governor Mark Carney say there will be a hike this year (Yellen) or around the end of the year (Carney). Might this be a bit of a rush? Not everything in the world economy is as sanguine as the U.S. and British economies purport to be.
As the U.S. Federal Reserve edges closer to its first interest hike in nearly a decade, its critics are lining up into one of two camps: either the Fed is hopelessly behind the curve, and will have to grapple with runaway inflation very soon; or the Fed seems overzealous in wanting to get interest rates back to what it would call a normal level and instead should wait until late this year or next before hiking.
Brazil's relentless series of interest rates hikes is successfully lowering inflation expectations - despite recent signs to the contrary, from lottery to tomato prices.