Will the interest rate cut be seen as prescient salvation or impulsive band-aid in the coming months? The Fed, it seems, were swayed by Frederic Mishkin who, notes The Economist, argued forcefully in a recent speech that central bankers can cushion the impact of falling house prices on the economy, provided they act quickly and …
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Category:Interest Rates and Currencies
EU rates held at 4%
The European Central Bank left interest rates unchanged at 4% on 7 September, but it is not clear that they will not be increased to 4.25% soon. The ECB is reacting to the increase in perceived risk in financial markets, catalysed by the sub-prime meltdown. At the same time as the hold on rates increase, …
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US Fed drops rates from 5.25% to 4.75% – oh dear …
Oh dear … Well, it wasn’t as if it wasn’t expected. Futures were pricing a 100% chance of a drop of 0.25% and a 50% chance of a drop of 0.5%. But I still think it was a dangerous mistake. Inflation is pulling at the rein and the speculative dynamic of stock markets continues to …
Continue reading US Fed drops rates from 5.25% to 4.75% – oh dear …