Thursday, December 10, 2015

How will US and EU stock markets react to an increase in interest rates?

Opinions are differing on this. It seems that stock markets generally will see an increase in interest rates as positive news as it indicates the Fed believes the economy is strong enough to tighten monetary policy. It also ought to increase bank margins between loans and deposits.

However naturally, increasing rates means increasing value of debt, making it more expensive for companies to borrow.

How do we think markets would take the news?



Submitted December 10, 2015 at 09:16AM by AliT128 http://ift.tt/1IHdOc2

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