The federal reserve to raise interest rates again meet Alan greenspan Is expected next year, the dollar is still
correspondent Zhang reported in New York
At the end of 2015, the federal reserve to raise interest rates boots to the ground.Despite its path and the time now is still a mystery, but the market certainly believes that the United States as a whole recovery is hard to be affected by the policy: slow but steady.
On December 16, the fed's policy statement and fed chairman Yellen (Janet Yellen) held a news conference, the word "progressive" is used to describe many times rates by 0.25% after the fed's expected tightening path.The revised lattice figure also shows the slower than previously expected to raise interest rates.
Under the influence of the rate hike, the dollar had already passed more than a year of big bull market, the stock after more than a year of wandering, now stood in more than 2000 points.Market is generally believed that U.S. stocks and the dollar under the influence of interest rates will be encouraged, and affect people life in the United States such as the bond market, mortgage asset prices, there is a big wave. U.S. stocks, $, or continue to rise
The market is generally believed that in 2016, the us economic recovery momentum remains the same.IMFForecast economic growth rate of
2.84%, a further 0.27% increase in 2015.The U.S. economic recovery momentum stability, recovery trend will not be due to the tight monetary policy, geopolitical turmoil and political cycle change radically shaken.Look from economic fundamentals absolutely situation, the United States remains the world's most stable economic growth, one of the core recovery in credit quality.
Played well on Wall Street in 2015, the lack of the rise of kinetic energy in the last few years.In addition to market tumbled in August, when most of the rest in annual earnings between the positive and negative. American international group (AIG), managing director and deputy chief economist MoHengYong (Henry Mo), said during the assets changes, U.S. stocks are still expected to be appeared certain to rise.
MoHengYong said drove U.S. stocks rose mainly for several reasons.First of all, current overall U.S. economic data and consumption are relatively very well.
During the fed meeting, officials predict economy will in 2016 and 2018 at an annualised rate of 2.4% and 2.4% respectively expansion, the speed of making economic expansion cycle extended to 10 years. Second, as an important index in the earnings of artificial cost, due to the rise of employment is likely to lead to higher profits.Officials predicted that the unemployment rate is expected in the next three years will remain at 4.7%.These predictions are in conformity with roughly previous
Finally, because in Europe and Japan can continue its loose monetary policy, the dollar assets by asset allocation aspect demand, so the possibility of rising dollar is very big.
From the point of the dollar, its pricing more depends on the bond interest rates and the fed's market expectations."The fed as expected dollar decision will not affect next year."Morgan Stanley currency, commodity and international interest rates research department director John Normand said wrote in a report, "we believe that all the way to the dollar will be bullish in the second quarter of next year, pounds for dollars,The New Zealand dollar(0.6749, 0.0020, 0.30%),The Singapore dollar(1.4116, 0.0007, 0.05%), andt(32.8750, 0.0420, 0.13%) will be higher."
Goldman's foreign exchange analyst Robin Brooks, Michael Cahill and George Cole, predicts that by 2017 at the end of the dollar against major currencies will rise about 14%, because the short-term yield premium to strengthen the appeal of the dollar.
"We don't subscribe to raise interest rates after the dollar bull market will end theory, although the usd rates from past history appeared down. But this kind of longitudinal comparison ignores the fact that the United States recently, the end of the super - QE monetary experiment. In easing, the fed's balance sheet expansion for five times, forward-looking
guide to suppress spreads to stop up. The release of these conditions will make the dollar rose 14% by the end of 2017."Goldman sachs foreign exchange analysts wrote in a report.
China icbc international research, co-head of Cheng Shi think, according to the economic cycle, after raising interest rates, the recovery of the past will not bring too much of a marginal to dollar assets.Relative to Europe, the U.S. stock market level is higher, the surprise is less, relative attractiveness may be inadequate.Dollar will likely be a short header after the federal reserve to raise interest rates for the first time, then undergo a period of depreciation, and then to restore the long-term appreciation trend.
Have encountered "greenspan problem"
Despite the overall positive direction, but the market is still waiting for several key factors.
Goldman sachs is expected, the federal reserve in 2016 will also raise short-term interest rates four times, by the end of the next interest rates will be monetary policy meeting in March next year.
Markets that other interest rates include savings accounts, mortgages, car loans, credit CARDS, corporate debt, whether will rise will depend on how investors, businesses and families to raise interest rates to make reaction.
Although interest rates over the past two days only, such a policy effect is
gradually revealed.As early as before someone analysis, the fed raising interest rates is likely to face "greenspan problem" again. Alan greenspan, refers to the former fed chairman Alan greenspan questions: ten years agoThe central bankTo raise interest rates after long-term yields basic unaffected.At the beginning of 2005, led by the federal reserve Alan greenspan were in this confusion, when the federal reserve raised short-term interest rates, long-term interest rates also steadily in the United States.
Ben bernanke, Mr Greenspan's successor, to explain, saying, it is because some Asian countries and oil producers to save a lot of, can absorb us treasuries.
It is interesting to note that the federal reserve to raise interest rates just after a few hours, the us Treasury rates curve becomes more smooth, short-term treasuries (2 years) and long-term U.S. debt (30-year) spreads narrowed to 200 basis points between the following, a new low 9 months.
Credit and commodities are the two big winners of the QE, and at the same time of the federal reserve to raise interest rates, credit markets also deteriorated significantly, credit spreads continued to expand. Interest rates and credit spreads upward means that debt issuance would be reduced, so that to be used for stock repurchase will also decline.Last week the aaa rating yum, it is because of yum announced
stock repurchase program, and buy back money is likely to be provided by the issuers.
The private bank, Brown Brothers Harriman, (global head of currency strategy at Brown Brothers Harriman), Marc Chandler, expects the fed to start tightening monetary and then the possibility of long-term yields lower, because the countries and regions outside the United States still has extraordinary loose policy, the price is low, weak global growth, inflation is low.