A U.S. interest rate hike is still probably coming in October or December despite some conflicting economic signals, a top Federal Reserve official said on Friday, reinforcing the central bank's message over the last few weeks.
Global investors pulled an estimated $40 billion from emerging market assets in the third quarter, according to data from the Institute of International Finance, making it the worst quarter since the end of 2008.
Not raising rates took many by surprise. After all, our economy is plugging along and rates have never been held this low for so long, etc., etc. I am sure there is some sound concern regarding what is going on in China and elsewhere, as there should be, as a justification for not raising them. But is there more here than meets the eye?
When the Federal Reserve didn’t raise interest rates on Thursday, investors should have thought of two people. First, they should have felt terrible for the maintenance man who—on one-by-one—has to yank down all of the green celebratory balloons from the CNBC studio rafters that were supposed to symbolically drop when the central bank would raise interest rates.
Crude oil prices were under pressure after Mario Draghi magic seemed too eased off. Oh, sure, after Mario Draghi said he was disappointed with growth and the lack of inflation, oil got a bounce. Yet, when Asian and European stocks gave up the gains, oil prices falter until a headline came out about those Chinese Military ships that are moving off of the coast of Alaska.
The global stock market rout of the past week was sparked by concerns over a possible interest rate rise by the U.S. Federal Reserve and not by the devaluation of China's yuan currency, a senior Chinese central bank official told Reuters on Thursday.