The Fed is heading for another catastrophe - page 9
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One thing is for certain, nearly everyone has had enough of Fed uncertainty
Delegates at the IMF meeting in Lima tell the Fed to get on with raising rates
The WSJ has a good roundup from the IMF meeting in Peru. The main sentiment from Lima is that most of the countries officials are now ready for the Fed to move and it's now the uncertainty of when that's doing the most damage to their markets
Emerging markets have been at the whim of Fed induced market moves for the last few years and many want an end to the uncertainty once and for all. Singapore's deputy prime minister said;
"This year, compared to a year ago, many emerging-market central bank governors and some others were keener that the Fed just get on with it, not because they were keen to see interest rates rise, but because they wanted to reduce uncertainty,"
Germany's Jens Weidmann said that the pain of EM's seeing capital outflow is no reason to delay a US rate hike and that it would be the reaction to a better economy and ultimately good news for the global economy
In addition to his other comments over the weekend, the Fed's Stanley Fischer acknowledged that after conversations this weekend, many emerging market officials feel suitably forewarned that the US is going to hike and want them to get on with it
Not everyone thinks that the first hike will be the end of market uncertainty or volatility. The head of South Africa's central bank, Lesetja Kganyago said uncertainty is the permanent feature now
Perhaps the best analysis comes from Carlos Fernandez Valdovinos, Paraguay's CB head. Speaking about the shifting expectations over FOMC meetings he said;
"Everyone talked about September, then they were talking about December. Right now, here, after this meeting, everyone is talking about January."
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It will be worse than SNB - come on : they are going to clean us
Bullard says equities have returned to normal valuations
Make it stop
Reuters makes more of the October comment with Bullard saying that it will be difficult for the Fed to switch gears after the Sep meeting, and hike in October, after only one extra month of data
Make it stop
- Continued loose FOMC could create future bubbles
- EM's are ready for Fed rate hikes
- China is expected to slow but not have a hard landing
- It's a good sign that the IMF didn't cut their Chinese forecasts
- For Oct FOMC it's tough to make a big decision, then change after another month
- Hikes will be slow and gradual so won't hurt EM's
- Fed vs market liftoff is still a mismatch
- Would expect a predictable move in USD going forward
Reuters makes more of the October comment with Bullard saying that it will be difficult for the Fed to switch gears after the Sep meeting, and hike in October, after only one extra month of dataFOMC (FED) will not change anything. They do not have the orders to change
FOMC (FED) will not change anything. They do not have the orders to change
They do (have an order). Obama told what he was ordered : dollar is too strong (remember the G7)
Re: Bullard says equities have returned to normal valuations They do (have an order). Obama told what he was ordered : dollar is too strong (remember the G7)
if they depend on Obama they are in deep trouble
if they depend on Obama they are in deep trouble
They depend on people worse than Obama : like Zuckenberg and similar ...
They depend on people worse than Obama : like Zuckenberg and similar ...
That is unfortunately true : FED and the politicians are just doing what they are ordered to do
Fed Preview: Hawkish Trick or Dovish Treat? The Federal Reserve will pass up on a rate hike on Wednesday and instead focus on the stark contrasts between economic trends at home and abroad, leaving a window of seven more weeks before the year's final gathering.
Policymakers are expected to pen a more dovish statement on Wednesday relative to their September communique, being aware that economic indicators have shown the US economy is slowing under the pressure of weaker global demand.
They will also have to discuss the latest plans of their colleagues at the People's Bank of China and the European Central Bank and their effect on the global outlook and the dollar.
The ten members of the Federal Open Market Committee, who get to actively shape policy, are likely to find that the post-meeting statement offers only limited space to convey all the nuances of their deliberations, so several will feel the need to step up to the podium in the days following the meeting to explain their thinking.
The minutes from the October gathering, released with a three-week lag, will also hold more valuable insight into the ongoing discussion surrounding the planned increase of the policy rate.
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Today it becomes obvious what do market makers think of FOMC and FED