Blain’s Morning Porridge, July 13
‘Never mind manoeuvers, always go at them.’
Methinks we worry too much.
Canada hiked interest rates for first time since 2010 yesterday. The Loonies (Canadians, and not a term meaning they are moon-struck idiots, but a reference to their dollar coin) tend to track the US quite closely – the BoC follows the Fed. The next phase will be the sequential follow on by the rest of the globe’s central banks as they each step in line. The last few weeks confirm global central bank policy in now on a hawkish tack – it’s about ending extraordinary monetary experimentation, normalisation and higher rates. So bond prices have fallen and yields are higher. Get over it.
There are still many flies in the ointment – most notably wage inflation just ain’t apparent – but its happening. The only questions are when and how fast.
Bear in mind: Janet Yellen’s testimony yesterday confirms the Fed’s pace of interest rates rises will be: ‘Lower for Longer’!
This post was published at Zero Hedge on Jul 13, 2017.