What is the impact of the US and China stock markets on the probability that the US Federal Reserve will raise interest rates by 25% on Thursday?

wallpapers Industry 2020-12-09

The Federal Reserve held a FOMC meeting from September 16 to 17.

This is the most investor focused event of the year, when the Fed will announce whether to raise interest rates for the first time in nearly 10 years.

The world's mainstream financial media have launched bombing coverage of the US Federal Reserve's interest rate meeting in September, and the differences in the forecasts of major authoritative institutions on whether to raise interest rates or not are only rare for many years.

Authority: 5 votes in total, 3 votes predict interest rate increase, and 2 votes mean no interest rate increase.

Interest rate hikers: the European Central Bank, the Bank of Japan and the OECD.

Anti interest rate hikers: the world bank and the International Monetary Fund.

Wall Street investment banks: a total of 18 votes, including 7 votes for those who predict interest rate hikes on Thursday and 11 votes for those who do not.

On the eve of the meeting, overseas economists and analysts still have obvious differences on interest rate increase.

Bank of America Merrill Lynch analysis that the Federal Reserve will announce a 25 basis point increase in interest rates.

But David, the bank's head of global exchange rate and interest rate research, believes that the Fed would be wrong to raise interest rates in September.

Goldman Sachs recently warned that the market is not ready for the Fed's action.

Jan Hatzius, the bank's chief economist, believes that the lack of consensus in the market will be a reason for policymakers to stay calm when they finish the meeting, and the Fed may not raise interest rates until December or even 2016.

The impact of the Fed's rate hike: triggering panic and turmoil in emerging markets, the biggest uncertainty in the global economic and financial markets is when the Fed will raise interest rates.

As soon as the Federal Reserve starts to raise interest rates, it is generally understood by the world as tightening monetary policy.

In this way, under the background of the global easing, it will naturally lead funds to the United States, which will lead to the rise of the US bond market price, the appreciation of the US dollar in the foreign exchange market, the decline of the global stock market, and the risk of capital outflow of various economies.

Kaushik Basu, chief economist of the world bank, said the Fed's choice to raise interest rates at its September meeting would trigger panic and turmoil in emerging markets.

As the leader of emerging markets, China will be able to cope with the impact of the Fed's interest rate hike.

According to a recent analysis of the industry research of China, although China is also affected by the Fed's interest rate hike, its $3.

56 trillion foreign exchange reserve dwarfs all other countries, and China will become one of the countries with the strongest tolerance.

The Fed's interest rate hike is undoubtedly a judgment of fate for commodities and precious metal gold.

If the Fed chooses not to raise interest rates and declares that it is dovey, then gold prices will rise.

As for the extent of gold's rise, it depends on the reaction of the stock market and money market to the Fed's decision.

On the contrary, gold prices will fall sharply.

Bank of Tokyo Mitsubishi UFJ (China) (BTMU) said the Fed's rate hike would remove a major uncertainty facing the Renminbi or help stabilize the RMB exchange rate.

What are the performances of the previous interest rate hikes? For China's stock market, although China, which has not yet opened its capital account, is limited by the impact of interest rate hikes, it is also advisable to explore the history of the deepening globalization.

According to the report, in the first three rounds of interest rate hikes since 1994, the Shanghai Composite Index has fallen within one month after the first interest rate increase, and the performance in the first quarter after the first interest rate increase is also poor.

However, this may be more closely related to China's domestic factors, because in 1994 and 2004, even before the Federal Reserve raised interest rates, the Shanghai composite index was in decline.

However, in 1999, China's stock market rose sharply in the early stage and began to adjust in July.

The Fed's interest rate increase may be one of the catalytic factors.

At present, the A-share market is in the process of continuous shock bottom.

On September 15, both sides of the long and short sides opened a 3000 point defense battle, and eventually the 1000 share limit was still down, and no plate was spared.

however, on September 16, the Shanghai Composite Index closed at 3152.

26 points, a sharp rise of 4.

89%, and a turnover of 282 billion yuan.

The above-mentioned analysts pointed out that compared with the impact of the Fed's interest rate increase, it may be more worth thinking about how investors learn to revere the market and constantly transition to value investment after the A-share market earthquake.

Background: strong reasons to support interest rate hike: first of all, from the analysis of the U.S. employment market, a series of data have confirmed its strong recovery momentum.

Although the number of new non-agricultural employment in August announced last week was significantly lower than expected, fell back to 173000 and fell below the 200000 integer level, but the unemployment rate fell far faster than the market expected, from 5.

3% to 5.

1%, the lowest level since April 2008, and has reached the full employment level considered by the Federal Reserve.

In addition, from the labor market index that yelen pays close attention to, namely, the labor market index, which is highly concerned by Yellen, is falling to 5.

1% According to the latest data released on September 8, the latest data released on September 8 showed that the number of job vacancies in Jul.

was 5.

753 million, much higher than the expected 5.

3 million, a record high, indicating that workers are full of confidence in employment and reflecting the strength of the employment market.

and the lmci index is considered by the Federal Reserve to better reflect the real situation of the labor market than non-agricultural workers.

The lmci in August was 2.

1, high 5.

The above data provide a strong basis and reason for the Federal Reserve to raise interest rates, and the market's call for an increase in interest rates in September is also increasing.

Seven reasons for not raising interest rates: Recently, including former US Treasury Secretary summers, the world bank, the International Monetary Fund (IMF), and even the editorial board of the New York Times have suggested that the Fed should not raise interest rates at its meeting next week.

Recently, Joseph Lavorgna, chief U.S. economist at Deutsche Bank, joined the team.

In his report, he listed seven reasons why the US Federal Reserve will not raise interest rates at its FOMC meeting next week: 1.

The global financial market has been in severe turbulence recently, and the market sentiment is fragile.

For example, the U.S. S & P 500 index fell 11% in six days last month, twice the normal rate of adjustment before the federal funds benchmark rate rose. 2. The Fed's trade weighted dollar index continued to rise.

Although the current US dollar index of the market has declined, the Fed's own dollar index has actually remained high, which will make the Fed worry that the interest rate increase will impact the export industry and suppress inflation. 3. Recently, financial markets generally believe that the possibility of the Federal Reserve to raise interest rates this month is greatly reduced.

The federal interest rate futures show that the possibility of raising interest rates in September is only 30%, compared with 54% a month ago.

If the Fed raises interest rates next week, it will give financial markets an unexpected shock. 4. The Federal Reserve F.

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