Archive - October, 2015

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As predicted, the Federal Reserve kept short-term interest rates unchanged at near zero yesterday but signalled that a rate hike before the turn of the year remains a possibility. As was the case in September, the central bank’s accompanying statement did not explicitly mention concerns over the Chinese economy as a reason not to raise rates for the first time in a decade. Last month they cited turbulent financial markets and uncertain economic developments overseas as reasons fo…

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Chinese shares were up overnight as GDP and retail figures beat expectations, helping to hide the fact that economic growth levels fell below 7% for the first time since 2009. China’s economy expanded quicker than economists forecast in the 3rd quarter as the services sector propped up the world’s second-largest economy. This suggests that monetary and fiscal stimulus is keeping Premier Li Keqiang’s 2015 expansion target within reach ahead of his historic UK visit tod…

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While there is little doubt the BoE vote will result in an unchanged verdict on rates this afternoon, economists will be looking for signs in the minutes as to when the gradual policy tightening might begin. There are a few experts predicting another BoE rate setter is set to join Ian McCafferty to vote for a 25 basis-point hike this time around, however most will be looking for stronger indicators regarding the UK economy in the coming months before doing so. Inflation remains t…

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