Australia’s rate hike has global stocks in retreat

  • 📰 BDliveSA
  • ⏱ Reading Time:
  • 52 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 24%
  • Publisher: 63%

United States News News

Rsereve Bank of Austraia raised rates by the most in 22 years sparking concern about policy tightening in the lead up to this week's US inflation data and ECB meeting

Reserve Bank of Australia raised rates by the most in 22 years sparking concern about policy tightening in the lead up to this week's US inflation data and ECB meetingCommuters walk past an ANZ Bank branch in Martin Place, Sydney, Australia on June 07 2022. The Reserve Bank of Australia has raised the cash rate by 0.5% to 0.85%. Picture: GETTY IMAGES/BRENDON THORNE

“As seen with the surprise hike in Australia, most central banks want a higher level of rates to cope with inflation. Policymakers want to have some ammunition to use in case there is a slowdown in growth,” said Enrico Vaccari, head of institutional sales at financial services firm Consultinvest. “The vote casts significant doubt about his tenure as leader,” said JPMorgan economist Allan Monks. “Assuming he can buy enough time, the outcome increases the chance that fiscal policy is loosened further in an attempt to turn the situation around. If not, he could yet be forced out with the Conservatives electing a new leader [and hence prime minister],” he added.

“There’ve been a couple of catalysts behind those moves higher, but a key one over the last week-and-a-half has been the perception that near-term recession risks are fading back again, which is set to give central banks the space to continue hiking rates and thus take bond yields higher,” Deutsche Bank strategist Jim Reid said in a note.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 12. in US

United States United States Latest News, United States United States Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Is a market crash just around the corner?This has been a brutal year for stock markets, with the US down 18% so far. But even amid jitters over global inflation, there are still assets that SA investors should be looking at as a place to ride out the storm
Source: FinancialMail - 🏆 20. / 63 Read more »