Wind direction abrupt change! The Federal Reserve stopped raising interest rates! Interest rate cuts are possible at any time2019-02-09 09:17:23 35 ℃
Author: Qi Junjie looks at finance and economics
Just in the Spring Festival, something happened in the United States. As the gate of global currency, the Federal Reserve changed its attitude and decided to suspend interest rate hikes. Federal Reserve Chairman Powell said that the Federal Reserve would take a wait-and-see attitude to see whether the US economy, including the global economic slowdown and the sequelae of interest rate hikes, would slow down more sharply than expected. Just three weeks ago, former Federal Reserve Chairman Jean-Claude Yellen also said that if the global economic downturn affects the United States, it is likely that the Fed's current interest rate hike cycle will be over. Yellen added this week that the global economic downturn, including in China and Europe, is increasingly threatening U.S. growth. The Fed may have to cut interest rates.
It seems that things in the United States are changing. Trump has repeatedly tweeted to the Federal Reserve, saying that their constant interest rate hikes are putting the United States economy at unknown risk and demanding that the Federal Reserve make adjustments as soon as possible. According to the United States system, the Chairman of the Federal Reserve has the right of self-determination and can absolutely avoid the President. At present, Powell will probably choose to compromise with Trump. On February 4, Powell also met with Trump. They exchanged views on the economy. Powell emphasized that future interest rate changes depend on the performance of economic data, and then mentioned that income inequality and depressed productivity are the biggest challenges for the future economy. In response to this, the major institutions in the market have rushed to adjust their strategies. Now the major US institutions even radically believe that in the next 12 months, the possibility of the Federal Reserve cutting interest rates has increased to one-third, while conservative ones have substantially revised their judgment, believing that in 2019, if interest rates are increased at most once, the wave of interest rate hikes may come to an end. At the end of last year, people also thought that this year's interest rate hike 2-3 times, and next year's one more time, now it seems that the interest rate hike cycle will be greatly reduced.
The main reason why the Federal Reserve has made a 180-degree turnaround is that the economic risk of the United States is increasing. The effect of the previous large-scale tax cuts is not good and the sustainability needs to be discussed. Now the effect has been greatly weakened. In addition, the global trade is in a stalemate due to Trump's twists and the recent decline is particularly fast. From January 18 to February 5, the Baltic Dry Bulk Index once declined. For 13 consecutive days, the range fell by nearly 42%. Compared with the four-year high of 1747 set in July last year, the cumulative decline was nearly 60%, a two-year low. Goldman Sachs predicts that the US economy will be 1 percentage point lower this year than last year, falling below 2.5% from 3.5%, while Morgan analysts also point out that the US growth rate will fall to 2.3% in 2019, and World Bank economists are not optimistic about the US. They think that 2020 is possible. It will fall back into recession. The expectations of the
market are by no means empty. Current US economic data show that inflation risk has been basically relieved and it is almost difficult to exceed the expected value of 2%. Therefore, the need to raise interest rates has not existed. At this time, it is more important to guard against economic risks. The Federal Reserve's rate hikes have slowed down or even shifted to rate cuts, which is great news for us.
First of all, the central bank is alive and the external risk does not exist. Without considering the pressure of the global monetary environment, the pressure of foreign reserves and wealth outflow will be greatly reduced. We can steadfastly broaden our currency and broaden our credit.
Secondly, the synchronization of the world monetary cycle is conducive to our adjustment of the economic cycle, the US dollar dominates the global economy, while the US dollar interest rate dominates the liquidity of the global base currency. If the US dollar is looser, it will be conducive to the recovery of the global economy.
third, the dollar weakened, the risk of China's property market bubble burst also eased, the most direct impact is Hongkong, the dollar does not raise interest rates, Hong Kong dollars can not increase interest rates, Hongkong property market has been preserved, north deep stability.
Fourth, the interest rate hike cycle suddenly ended, exceeding market expectations, for the stock market is certainly super-positive, unexpected things will affect stock prices, this matter will be helpful for the recovery of the market after the year. The U.S. stock market has stabilized, and A shares can at least dismantle a big thunderbolt.
Fifth, it indicates that the United States may also try its best to maintain growth. Since economic risks have increased dramatically, future external friction will converge. Before that, we sat in a squat, so there is nothing to talk about. Now, after a round of speeches and speeches, both of them are almost lying down. For their own interests, they will work together. Even if they are good enough to fight again, they have to solve the immediate problems first.
So, the Fed stopped raising interest rates, which really gave us a sigh of relief. But again, we remind you not to forget the pain when you are scarred, to cherish the golden opportunity, and to solve your own development problems as soon as possible. If your cancer does not hurt in these two days, it does not mean that he has recovered. It is likely that he will return to the light, so you should have a few points in mind, while the Americans are not here. A rare opportunity to make trouble, adjust the industrial structure as soon as possible, strengthen the capital market, but also continue to control and relax, solve the problem of the property market bubble as soon as possible, stop the two days of good life, and go back to real estate, so that the powder keg will only get bigger and bigger.
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