Rates in the US will remain low. Good at first for stocks, probably for the dollar

December traders did not materialize, years rates are still low. In the politics of very low years of rates he intended
US Central Bank will continue. The dollar in December strengthened thanks to speculation that rates in the US will rise significantly faster. But this now turns out to be a more optimistic scene.

While in December, trade expectations about the early rise in annual rates in the United States gained momentum, the first week of January sent this speculation in the financial markets back on ice for a while. This was due not only to the US Federal Reserve Bank (Fed) Ben Bernanke, but also to the unfavorable economic data, which at the end of the week drank from the labor market.

Ben Bernanek’s first speech in the new year made it clear that the US Federal Reserve intended to continue its policy of very short-term rates, despite the concerns of some economists that this policy could lead to further inflatable price bubbles.

In response to his words, very positive stock indices around the world reacted immediately from the arrest of the week, because they were the first stocks, their price has risen by a dozen percent since last year, thanks to the Fed’s loose monetary policy.

It was a bag and the results from the American labor market, which in his words added to the real thing. The December employment in the United States was unpleasantly surprised when the US economy saw 85,000 jobs, which was the result, not as it had in the previous month.

Unemployment remained unchanged at 10%, but overall, the December results did not leave a good impression. A number of traders hoped that at the end of last year, for the first time in two years, the US economy could re-create more jobs than it saw in a month. It did not happen.

Because the market plays a key role in US central banks’ decision-making on rates, the Fed cannot be expected to make any preparations for its gradual tightening of currency taps at its next meeting.

Unemployment is still high and not declining, but banks do not want to return the private sector and a large number of complaints, as consumer demand will do, as the effects of government stimuli begin to fade.

What does this mean for the markets in the near future? For the owners of the event, it does not have to be the first thing. Concerns about rates and liquidity withdrawal will not be on the agenda for the day being, which can greatly prevent the price of shares and other risky assets from coming under aggressive selling pressure.

On the contrary, those who have their disputes in dollars can get into trouble. The whole of December strengthened me thanks to speculation that rates in the USA will grow significantly faster, which is now proving to be an optimistic scene. This was confirmed by the fact that the dollar, in response to public results from the labor market, came under strong selling pressure and weakened both on the euro and to other world currencies.

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