International News – 19 August 2016
The main focus of international markets this week was the release of the minutes from the Federal Reserve’s latest meeting.
The market reaction was benign to a statement that delivered, in my opinion, a marginally hawkish stance insofar as interest rate rises.
It seems in spite of several members’ beliefs that interest rates should be rising, the market and the remaining Fed members seem inclined to be patient for now. This is increasingly becoming a default and lazy position to hold and smacks of hubris.
The US economy is growing strongly and employment is full. It seems only a matter of time before this complacent view comes undone and US interest rate expectations get a shock of reality.
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