Financial markets are all but ruling out any further interest rate cuts from the Reserve Bank of Australia as the world’s most powerful central bank, the US Federal Reserve, tips it will be lifting rates three times during next year.
The Fed’s first rate hike in 12 months comes as investors bet that the global economy is at last putting the global financial crisis behind it and looking forward to a Donald Trump-led boom in 2017.
Both US and Australian share markets have risen by about 9 per cent since Mr Trump’s election last month, in anticipation of the tax cuts and infrastructure spending he promised to fire economic growth.
Advertisement
The full text of this article is available to MacroBusiness subscribers
Cancel at any time through our billing provider, Stripe
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
Advertisement