My investment outlook for September
I caught up with BBC TV Asia Business Report today to speak to their global audience about recent moves in interest rates and what we can expect over the next few months.
In the conversation, I touched on last week’s comments in the United States and the fact that rates are likely to continue rising in the short term before they slow down and potentially come back next year.
One of the most important things that a central bank has is its credbility. Once the credibility of a central bank goes out the door, so too will the currency and local economy.
Therefore its very important for the US Federal Reserve and all other developed economies to back their words up with actions. They need to maintain credbility at all costs.
Inflation will be brought under control and next year we’ll be talking about rates potentially falling as economic growth slows down. Like always, investors need to think 5-10 years minimum, not weeks or months.