Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n
At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
\"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
We can observe that interest rates have recently experienced a rapid upward trajectory. The ECB's decision to raise rates to around 4.00%, the highest level in 23 years, demonstrates its commitment to combating inflationary pressures. The steady increase in interest rates reflects the urgency to address rising inflation and maintain price stability.<\/p>\n\n\n\n The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
We can observe that interest rates have recently experienced a rapid upward trajectory. The ECB's decision to raise rates to around 4.00%, the highest level in 23 years, demonstrates its commitment to combating inflationary pressures. The steady increase in interest rates reflects the urgency to address rising inflation and maintain price stability.<\/p>\n\n\n\n The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Rate Hike Trends:<\/strong> We can observe that interest rates have recently experienced a rapid upward trajectory. The ECB's decision to raise rates to around 4.00%, the highest level in 23 years, demonstrates its commitment to combating inflationary pressures. The steady increase in interest rates reflects the urgency to address rising inflation and maintain price stability.<\/p>\n\n\n\n The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Markets have already priced in one more rate hike, anticipating further tightening. If the ECB fails to follow through with additional rate increases, it could create uncertainty and potentially undermine market confidence. Policymakers must balance market expectations with the need to manage inflationary pressures effectively.<\/p>\n\n\n\n Rate Hike Trends:<\/strong> We can observe that interest rates have recently experienced a rapid upward trajectory. The ECB's decision to raise rates to around 4.00%, the highest level in 23 years, demonstrates its commitment to combating inflationary pressures. The steady increase in interest rates reflects the urgency to address rising inflation and maintain price stability.<\/p>\n\n\n\n The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Addressing market concerns:<\/strong> <\/p>\n\n\n\n Markets have already priced in one more rate hike, anticipating further tightening. If the ECB fails to follow through with additional rate increases, it could create uncertainty and potentially undermine market confidence. Policymakers must balance market expectations with the need to manage inflationary pressures effectively.<\/p>\n\n\n\n Rate Hike Trends:<\/strong> We can observe that interest rates have recently experienced a rapid upward trajectory. The ECB's decision to raise rates to around 4.00%, the highest level in 23 years, demonstrates its commitment to combating inflationary pressures. The steady increase in interest rates reflects the urgency to address rising inflation and maintain price stability.<\/p>\n\n\n\n The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
The ECB's primary mandate is maintaining price stability within the Eurozone. The central bank aims to control inflationary pressures by raising interest rates and preventing prices from rising excessively. This approach ensures that the euro's purchasing power remains stable and fosters sustainable economic growth.<\/p>\n\n\n\n Addressing market concerns:<\/strong> <\/p>\n\n\n\n Markets have already priced in one more rate hike, anticipating further tightening. If the ECB fails to follow through with additional rate increases, it could create uncertainty and potentially undermine market confidence. Policymakers must balance market expectations with the need to manage inflationary pressures effectively.<\/p>\n\n\n\n Rate Hike Trends:<\/strong> We can observe that interest rates have recently experienced a rapid upward trajectory. The ECB's decision to raise rates to around 4.00%, the highest level in 23 years, demonstrates its commitment to combating inflationary pressures. The steady increase in interest rates reflects the urgency to address rising inflation and maintain price stability.<\/p>\n\n\n\n The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>United States May Fund Its Deficit By Printing More Money; Could Default By June 1st<\/a><\/p>\n\n\n\n Higher rates encourage saving over spending and make the debt more costly. Companies with bigger credit or other loans with variable interest rates could be in a difficult situation. We expect to see a meaningful slowdown in economic growth and a weakening of the labour market in the United States in the upcoming months. <\/p>\n\n\n\n At the same time, Brian Jacobsen, chief economist at Annex Wealth Management, said<\/a> that the manufacturing and housing sectors are in a recession already. The famous investor Jeremy Grantham warned that the U.S. stock market could experience significant losses soon, and a recommendation is that investors should continue to take a defensive investment approach.<\/p>\n\n\n\n Stocks aren't the only assets that could significantly lose their value. Investors should remember that cryptocurrencies could also be in the situation to make an even bigger fall. The crypto market displayed a high correlation with U.S. equities. If a downtrend is witnessed in the stock market, the same is usually replicated in the crypto-sphere.<\/p>\n\n\n\n See Related:<\/em><\/strong> Bitcoin Is Close To Testing $30,000 Again; Ethereum Revives Bullish Momentum Above $1,800<\/a><\/p>\n","post_title":"The Fed Raises Interest Rates By 25 BPS This Wednesday; Effects On Crypto And Financial Markets","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"the-fed-raises-interest-rates-by-25-bps-this-wednesday-effects-on-crypto-and-financial-markets","to_ping":"","pinged":"","post_modified":"2023-05-04 22:08:47","post_modified_gmt":"2023-05-04 12:08:47","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=11491","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"}],"next":false,"total_page":false},"paged":1,"class":"jblog_block_13"};
Stabilizing prices across the board:<\/strong> <\/p>\n\n\n\n The ECB's primary mandate is maintaining price stability within the Eurozone. The central bank aims to control inflationary pressures by raising interest rates and preventing prices from rising excessively. This approach ensures that the euro's purchasing power remains stable and fosters sustainable economic growth.<\/p>\n\n\n\n Addressing market concerns:<\/strong> <\/p>\n\n\n\n Markets have already priced in one more rate hike, anticipating further tightening. If the ECB fails to follow through with additional rate increases, it could create uncertainty and potentially undermine market confidence. Policymakers must balance market expectations with the need to manage inflationary pressures effectively.<\/p>\n\n\n\n Rate Hike Trends:<\/strong> We can observe that interest rates have recently experienced a rapid upward trajectory. The ECB's decision to raise rates to around 4.00%, the highest level in 23 years, demonstrates its commitment to combating inflationary pressures. The steady increase in interest rates reflects the urgency to address rising inflation and maintain price stability.<\/p>\n\n\n\n The historical interest rate gains highlight the urgency with which policymakers are responding to inflationary pressures. It will be interesting to see how the ECB balances taming inflation and supporting economic growth to ensure a stable and prosperous Eurozone economy.<\/p>\n","post_title":"Inflation Check: The European Central Bank All Set To Hike Interest Rates Yet Again","post_excerpt":"","post_status":"publish","comment_status":"closed","ping_status":"closed","post_password":"","post_name":"inflation-check-the-european-central-bank-all-set-to-hike-interest-rates-yet-again","to_ping":"","pinged":"","post_modified":"2023-06-19 06:43:20","post_modified_gmt":"2023-06-18 20:43:20","post_content_filtered":"","post_parent":0,"guid":"https:\/\/www.thedistributed.co\/?p=12091","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":11491,"post_author":"14","post_date":"2023-05-04 21:53:10","post_date_gmt":"2023-05-04 11:53:10","post_content":"\n As widely expected, the U.S. Central Bank raised interest rates by 25bps this Wednesday. It signalled it could pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political stand-off over the U.S. debt ceiling and monitor the course of inflation. The federal funds rate is now in a range of 5% to 5.25%, which is the highest level since 2006. <\/p>\n\n\n\n The U.S. Central Bank warned that tighter credit conditions for households and businesses are expected to affect economic activity. In the picture below, we can see that even without this rise in interest rates, the federal funds rate was at the highest level since the 2007 financial crisis.<\/p>\n\n\n\n Many analysts and economists are worried that the high-interest rates will push the economy into a recession. It is important to mention that government data showed last week that economic growth in the first quarter slowed sequentially, with real gross domestic product increasing at a 1.1% annual pace, compared with a 2.6% gain in the prior three-month period. With higher interest rates, companies need to spend more money to borrow money to invest in growth. Historically, higher rates lead companies to reduce spending (especially on hiring). <\/p>\n\n\n\n Many companies could face liquidity problems, and economist David Rosenberg has warned that the U.S. economy is facing two big risks. David Rosenberg said<\/a>:<\/p>\n\n\n\n \"We have a possible debt default on our hands and a spreading bank crisis. The banking turmoil that started with Silicon Valley Bank's collapse in March remains unresolved, and First Republic's failure and takeover by CEO Jamie Dimon's JPMorgan has reignited worries about broader financial instability. Moreover, political disagreement about raising the U.S. government's borrowing limit is fanning fears of a debt-ceiling crisis.\"<\/em><\/p>\n\n\n\n See Related: <\/em><\/strong>
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Below is a graph that can assist us in analyzing past interest rate increases in the Eurozone.<\/p>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n
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Below is a graph that can assist us in analyzing past interest rate increases in the Eurozone.<\/p>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n
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Below is a graph that can assist us in analyzing past interest rate increases in the Eurozone.<\/p>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n
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Below is a graph that can assist us in analyzing past interest rate increases in the Eurozone.<\/p>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n
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Below is a graph that can assist us in analyzing past interest rate increases in the Eurozone.<\/p>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n
