The impact of Federal Reserve's interest rate cut on virtual
Publish: 2021-03-22 14:19:33
1. The impact of the Federal Reserve's interest rate cut on the U.S. economy
the interest rate cut caused a sharp reaction in the U.S. securities market< On September 18, 2007, the Dow Jones Instrial Average jumped 336 points to 13739.39, the biggest daily gain in five years since October 15, 2002; The standard & Poor's 500 index jumped 43 points to 1519.78, up 2.9%; The Nasdaq composite index jumped 70 points to 2651.66, up 2.7%. The reason why the market reacted violently was that the Federal Reserve cut interest rate by 50 basis points, which exceeded the market's general expectation in policy adjustment. According to the survey of blog, nearly 80% of economists and market participants predicted that the Federal Reserve would only cut the benchmark interest rate by 25 basis points
the interest rate cut will have a lagging expansionary impact on the real economy of the United States< The stimulating effect of interest rate cut on US economic growth is reflected in five aspects: first, lower interest rate will rece investment cost and enhance investment demand, and investment expansion will make up for the lack of growth power brought by sluggish consumption; Second, the rection of interest rate will rece the pressure of mortgage lenders, restrain the rising default rate of the housing market, and prevent the "subprime mortgage crisis" from worsening; Third, lower interest rates will further ease the credit crunch and rece the financing difficulties of proction activities and enterprise expansion; Fourth, lower interest rates will support the depreciation of the US dollar exchange rate and stimulate export growth; Fifthly, the rection of interest rate will enhance the market expectation and restrain the shrinkage of economic activities e to lack of confidence
affected by the policy lag, the size of this stimulus is different in the short, medium and long term (within one year in the short term, two to three years in the medium term, and four to five years in the long term). In the short run, the expansion effect of loose monetary policy will graally appear. At the beginning of the interest rate cut, the real effect is relatively limited, and the strength of the financial market will mainly come from the confidence recovery brought by the interest rate cut. Starting from the second quarter, GDP growth will be moderated by sluggish consumption. In the medium term, cutting interest rates can help the US economy avoid a recession. In the long run, the impact of interest rate cut on the real economy will be very limited. The adjustment of price mechanism will make the effect of interest rate cut basically reflected in the increase of liquidity and inflation pressure. On the whole, the Fed's interest rate cut will help the US economic growth in the short and medium term, and it is less likely that the subprime crisis will bring about a "Great Depression" type US economic crisis
we use 146 groups of data from the first quarter of 1971 to the second quarter of 2007 to analyze the long-term relationship between real economic growth and monetary policy in the United States. The results show that the impact of the decline of the Federal Reserve's benchmark interest rate or the increase of money supply on the real economy of the United States will be fully apparent after three quarters, This means that the external time lag of US monetary policy is three quarters, and the impact on the real economy is small at the beginning of the policy change, but after 10 quarters, the impact of monetary policy change on the real economy will slowly disappear. It can be predicted that the interest rate cut will make the U.S. economy rebound in the second quarter of 2008
the rection of interest rate will make the US dollar continue to depreciate
the 50 basis point interest rate cut and the loose monetary policy orientation confirmed by it will make the US dollar exchange rate continue to weaken, and this weakening is the overall weakening of the US dollar relative to other major currencies. The sharp interest rate cut by the Federal Reserve has caused a strong reaction in the foreign exchange market. On September 24, 2007, the U.S. dollar index hit a new low of 78.313, which has dropped by 35.3% compared with the high of 121.0 set on July 6, 2001. The sharp decline of the US dollar index is the overall performance of the collective appreciation of the weighted currencies against the US dollar. Further analysis shows that the devaluation of the US dollar is not limited to the short term. There are four reasons: first, according to the interest rate parity theory determined by the equilibrium exchange rate, the capital outflow caused by the change of interest rate spread will lead to the devaluation of the US currency, and the US interest rate policy will be more relaxed than other economies, which will lead to the weakening of the US dollar; Second, according to the theory of basic factors determined by equilibrium exchange rate, the strength of economic fundamentals is the basis of strong currency value, and the expected bearish growth of US economy in the "subprime mortgage crisis" will bring depreciation power to us dollar exchange rate; Third, according to the balance of payments theory determined by the equilibrium exchange rate, the government can rece the debt burden and trade deficit through currency depreciation. The long-term "double deficit" of the United States will lead to the basic trend of the depreciation of the US dollar; Fourth, according to the portfolio balance theory determined by the equilibrium exchange rate, under the influence of the subprime crisis, the rection of international investors' holdings of US dollar assets will aggravate the weakening of US dollar<
the impact of the Federal Reserve's interest rate cut on international finance
the interest rate cut will have a negative impact on the stability of the international monetary system
the continued depreciation of the US dollar will inevitably lead to the decline of its position in the world monetary system, thus increasing the uncertainty in the sharp rise of oil and gold prices. Further analysis, on behalf of the "international monetary system, the international monetary and financial institutions and the international monetary order formed by custom and historical evolution", the international monetary system The international monetary system includes three levels of connotation: reserve assets security, exchange rate system stability and effective balance of payments adjustment. The depreciation of the US dollar and the high fluctuation of oil and gold prices will worsen these three levels of connotation and bring negative impact on the stability of the international monetary system
the Federal Reserve's interest rate cut also has a great impact on the international commodity market
the international gold price has broken through the historical high of US $730 / oz on May 12, 2006, and rose to US $739.3/oz on September 21, 2007, up 191% from the low of US $253.85/oz on February 16, 2001. The international oil price has entered a new round of soaring stage in the game between supply and demand. On September 21, 2007, the oil price once reached a high of 82.40 US dollars per barrel, up 65.9% from the low of 49.66 US dollars on May 24, 2005< It is worth noting that the instability of the international monetary system is not limited to the short term. Because gold and US dollar play the role of value storage at the same time, the depreciation of US dollar will make the substitution of gold more obvious; Since most of the oil price currencies are US dollars, the depreciation of US dollars will also support the rise of oil prices. We use 589 sets of data of US dollar index, gold price and oil price from June 23, 2005 to September 25, 2007 to analyze. The results show that the fluctuation of gold price in recent two years is greatly affected by the depreciation of US dollar, while the fluctuation of oil price shows strong autonomy and is also related to the value of US dollar. Therefore, the depreciation of US dollar, together with the high fluctuation of gold price and oil price, will enhance the medium and long-term uncertainty of the international monetary system and create conditions for the large-scale flow of international speculative capital<
the impact of the Federal Reserve's interest rate cut on China's economy
the interest rate cut will rece the negative impact of the decline in U.S. demand on China's exports
the above analysis shows that the growth of U.S. demand for Chinese exports will slow down in the short term, but it is unlikely to decline significantly. China's exports have maintained a rapid growth in this century, and the development trend of market diversification has reced the dependence of China's exports on the U.S. market. The proportion of China's exports to the U.S. has dropped from about 21% in 2005 and 2006 to less than 20% in recent months. In July 2007, this figure has dropped to 18.96%, the lowest since the beginning of this century. The Fed's interest rate cut will stimulate us economic growth and curb the rapid decline of US import demand. In August 2007, when the "subprime mortgage crisis" occurred, China's export growth was not significantly affected. The monthly export value of US $111.36 billion hit a record high, an increase of 22.7% compared with us $107.73 billion in July. Under the influence of the Federal Reserve's interest rate cut, this high growth trend will continue to maintain
the Fed's interest rate cut will not change the trend of prudent tightening of China's monetary policy
after the release of the Fed's decision to cut interest rates, a large number of market analysts believe that the orderly tightening of China's monetary policy has been affected by external "constraints". They believe that the previous interest rate increase of the Central Bank of China was carried out under the background of the high interest rate in the United States and the large interest rate gap between China and the United States, The deviation of interest rate policy between China and the United States will restrict China's further monetary tightening while narrowing the interest rate gap. We think that this kind of analysis is biased, and we still maintain our previous judgment on the direction of China's monetary policy: "the focus of macro-control is to curb the acceleration of high financial growth, and effectively prevent economic growth from being too fast to overheating. Macro control will be further strengthened, and the central bank may raise interest rates once or twice this year."
from the perspective of Sino US economy, there are two main reasons: first, the lack of internal balance in China is more urgent than the lack of external balance, especially since 2007, the high level of macro-economic and financial growth has accelerated, CPI and credit growth of financial institutions are faster, and the pressure of further tightening monetary policy has increased; Second, the flow of international hot money is not very sensitive to the change of interest rate gap between China and the United States, but more important to the gains brought by the appreciation of RMB, China's stock prices and house prices
the liquidity released by the Fed's interest rate cut brings double risks to China
the excess liquidity brought about by the sharp interest rate cut by the Federal Reserve and the expected further easing of monetary policy in the future is likely to flow into the Chinese market with higher expected returns. This change of international capital flow will bring double risks to China's economy
first of all, the pressure of RMB appreciation and financial opening will be further strengthened. As China's capital account has not yet been fully opened, international capital will further require China's financial reform to speed up under the background of enlarging the investment value of China's market. In addition, the entry of international hot money through various channels will bring greater market pressure on RMB appreciation, especially under the predictable continuous depreciation of the US dollar< Secondly, the risk of "irrational prosperity" in China's stock market and real estate market will be further increased. China's stock market and real estate market are likely to be more active in speculative forces and constantly developing in the form of asset bubbles, and enhance the cyclical risks of China's sustained economic growth in the context of the market's internal risk control. From the data, China's real estate market has attracted a lot of foreign direct investment. In 2006, the monthly average investment of foreign capital in China's real estate instry was less than 800 million US dollars, but in the first eight months of 2007, it approached or exceeded 1 billion US dollars. In August 2007, the figure reached 1.47 billion US dollars, a year-on-year increase of 221%. At the same time, the proportion of real estate investment in China's total foreign direct investment jumped from 0.085% in early 2006 to 27.6% in August 2007<
commercial banks need to pay attention to the following aspects:
-- pay attention to the foreign currency asset management problems caused by the continuous depreciation of the US dollar. Under the background that the shareholders and market subjects of commercial banks are more concerned about the impact of "subprime debt storm" on the income of Chinese banks, the management of foreign currency assets of commercial banks needs to adjust the asset portfolio in time to prevent possible losses, and prudently rece the impact on fixed income
the interest rate cut caused a sharp reaction in the U.S. securities market< On September 18, 2007, the Dow Jones Instrial Average jumped 336 points to 13739.39, the biggest daily gain in five years since October 15, 2002; The standard & Poor's 500 index jumped 43 points to 1519.78, up 2.9%; The Nasdaq composite index jumped 70 points to 2651.66, up 2.7%. The reason why the market reacted violently was that the Federal Reserve cut interest rate by 50 basis points, which exceeded the market's general expectation in policy adjustment. According to the survey of blog, nearly 80% of economists and market participants predicted that the Federal Reserve would only cut the benchmark interest rate by 25 basis points
the interest rate cut will have a lagging expansionary impact on the real economy of the United States< The stimulating effect of interest rate cut on US economic growth is reflected in five aspects: first, lower interest rate will rece investment cost and enhance investment demand, and investment expansion will make up for the lack of growth power brought by sluggish consumption; Second, the rection of interest rate will rece the pressure of mortgage lenders, restrain the rising default rate of the housing market, and prevent the "subprime mortgage crisis" from worsening; Third, lower interest rates will further ease the credit crunch and rece the financing difficulties of proction activities and enterprise expansion; Fourth, lower interest rates will support the depreciation of the US dollar exchange rate and stimulate export growth; Fifthly, the rection of interest rate will enhance the market expectation and restrain the shrinkage of economic activities e to lack of confidence
affected by the policy lag, the size of this stimulus is different in the short, medium and long term (within one year in the short term, two to three years in the medium term, and four to five years in the long term). In the short run, the expansion effect of loose monetary policy will graally appear. At the beginning of the interest rate cut, the real effect is relatively limited, and the strength of the financial market will mainly come from the confidence recovery brought by the interest rate cut. Starting from the second quarter, GDP growth will be moderated by sluggish consumption. In the medium term, cutting interest rates can help the US economy avoid a recession. In the long run, the impact of interest rate cut on the real economy will be very limited. The adjustment of price mechanism will make the effect of interest rate cut basically reflected in the increase of liquidity and inflation pressure. On the whole, the Fed's interest rate cut will help the US economic growth in the short and medium term, and it is less likely that the subprime crisis will bring about a "Great Depression" type US economic crisis
we use 146 groups of data from the first quarter of 1971 to the second quarter of 2007 to analyze the long-term relationship between real economic growth and monetary policy in the United States. The results show that the impact of the decline of the Federal Reserve's benchmark interest rate or the increase of money supply on the real economy of the United States will be fully apparent after three quarters, This means that the external time lag of US monetary policy is three quarters, and the impact on the real economy is small at the beginning of the policy change, but after 10 quarters, the impact of monetary policy change on the real economy will slowly disappear. It can be predicted that the interest rate cut will make the U.S. economy rebound in the second quarter of 2008
the rection of interest rate will make the US dollar continue to depreciate
the 50 basis point interest rate cut and the loose monetary policy orientation confirmed by it will make the US dollar exchange rate continue to weaken, and this weakening is the overall weakening of the US dollar relative to other major currencies. The sharp interest rate cut by the Federal Reserve has caused a strong reaction in the foreign exchange market. On September 24, 2007, the U.S. dollar index hit a new low of 78.313, which has dropped by 35.3% compared with the high of 121.0 set on July 6, 2001. The sharp decline of the US dollar index is the overall performance of the collective appreciation of the weighted currencies against the US dollar. Further analysis shows that the devaluation of the US dollar is not limited to the short term. There are four reasons: first, according to the interest rate parity theory determined by the equilibrium exchange rate, the capital outflow caused by the change of interest rate spread will lead to the devaluation of the US currency, and the US interest rate policy will be more relaxed than other economies, which will lead to the weakening of the US dollar; Second, according to the theory of basic factors determined by equilibrium exchange rate, the strength of economic fundamentals is the basis of strong currency value, and the expected bearish growth of US economy in the "subprime mortgage crisis" will bring depreciation power to us dollar exchange rate; Third, according to the balance of payments theory determined by the equilibrium exchange rate, the government can rece the debt burden and trade deficit through currency depreciation. The long-term "double deficit" of the United States will lead to the basic trend of the depreciation of the US dollar; Fourth, according to the portfolio balance theory determined by the equilibrium exchange rate, under the influence of the subprime crisis, the rection of international investors' holdings of US dollar assets will aggravate the weakening of US dollar<
the impact of the Federal Reserve's interest rate cut on international finance
the interest rate cut will have a negative impact on the stability of the international monetary system
the continued depreciation of the US dollar will inevitably lead to the decline of its position in the world monetary system, thus increasing the uncertainty in the sharp rise of oil and gold prices. Further analysis, on behalf of the "international monetary system, the international monetary and financial institutions and the international monetary order formed by custom and historical evolution", the international monetary system The international monetary system includes three levels of connotation: reserve assets security, exchange rate system stability and effective balance of payments adjustment. The depreciation of the US dollar and the high fluctuation of oil and gold prices will worsen these three levels of connotation and bring negative impact on the stability of the international monetary system
the Federal Reserve's interest rate cut also has a great impact on the international commodity market
the international gold price has broken through the historical high of US $730 / oz on May 12, 2006, and rose to US $739.3/oz on September 21, 2007, up 191% from the low of US $253.85/oz on February 16, 2001. The international oil price has entered a new round of soaring stage in the game between supply and demand. On September 21, 2007, the oil price once reached a high of 82.40 US dollars per barrel, up 65.9% from the low of 49.66 US dollars on May 24, 2005< It is worth noting that the instability of the international monetary system is not limited to the short term. Because gold and US dollar play the role of value storage at the same time, the depreciation of US dollar will make the substitution of gold more obvious; Since most of the oil price currencies are US dollars, the depreciation of US dollars will also support the rise of oil prices. We use 589 sets of data of US dollar index, gold price and oil price from June 23, 2005 to September 25, 2007 to analyze. The results show that the fluctuation of gold price in recent two years is greatly affected by the depreciation of US dollar, while the fluctuation of oil price shows strong autonomy and is also related to the value of US dollar. Therefore, the depreciation of US dollar, together with the high fluctuation of gold price and oil price, will enhance the medium and long-term uncertainty of the international monetary system and create conditions for the large-scale flow of international speculative capital<
the impact of the Federal Reserve's interest rate cut on China's economy
the interest rate cut will rece the negative impact of the decline in U.S. demand on China's exports
the above analysis shows that the growth of U.S. demand for Chinese exports will slow down in the short term, but it is unlikely to decline significantly. China's exports have maintained a rapid growth in this century, and the development trend of market diversification has reced the dependence of China's exports on the U.S. market. The proportion of China's exports to the U.S. has dropped from about 21% in 2005 and 2006 to less than 20% in recent months. In July 2007, this figure has dropped to 18.96%, the lowest since the beginning of this century. The Fed's interest rate cut will stimulate us economic growth and curb the rapid decline of US import demand. In August 2007, when the "subprime mortgage crisis" occurred, China's export growth was not significantly affected. The monthly export value of US $111.36 billion hit a record high, an increase of 22.7% compared with us $107.73 billion in July. Under the influence of the Federal Reserve's interest rate cut, this high growth trend will continue to maintain
the Fed's interest rate cut will not change the trend of prudent tightening of China's monetary policy
after the release of the Fed's decision to cut interest rates, a large number of market analysts believe that the orderly tightening of China's monetary policy has been affected by external "constraints". They believe that the previous interest rate increase of the Central Bank of China was carried out under the background of the high interest rate in the United States and the large interest rate gap between China and the United States, The deviation of interest rate policy between China and the United States will restrict China's further monetary tightening while narrowing the interest rate gap. We think that this kind of analysis is biased, and we still maintain our previous judgment on the direction of China's monetary policy: "the focus of macro-control is to curb the acceleration of high financial growth, and effectively prevent economic growth from being too fast to overheating. Macro control will be further strengthened, and the central bank may raise interest rates once or twice this year."
from the perspective of Sino US economy, there are two main reasons: first, the lack of internal balance in China is more urgent than the lack of external balance, especially since 2007, the high level of macro-economic and financial growth has accelerated, CPI and credit growth of financial institutions are faster, and the pressure of further tightening monetary policy has increased; Second, the flow of international hot money is not very sensitive to the change of interest rate gap between China and the United States, but more important to the gains brought by the appreciation of RMB, China's stock prices and house prices
the liquidity released by the Fed's interest rate cut brings double risks to China
the excess liquidity brought about by the sharp interest rate cut by the Federal Reserve and the expected further easing of monetary policy in the future is likely to flow into the Chinese market with higher expected returns. This change of international capital flow will bring double risks to China's economy
first of all, the pressure of RMB appreciation and financial opening will be further strengthened. As China's capital account has not yet been fully opened, international capital will further require China's financial reform to speed up under the background of enlarging the investment value of China's market. In addition, the entry of international hot money through various channels will bring greater market pressure on RMB appreciation, especially under the predictable continuous depreciation of the US dollar< Secondly, the risk of "irrational prosperity" in China's stock market and real estate market will be further increased. China's stock market and real estate market are likely to be more active in speculative forces and constantly developing in the form of asset bubbles, and enhance the cyclical risks of China's sustained economic growth in the context of the market's internal risk control. From the data, China's real estate market has attracted a lot of foreign direct investment. In 2006, the monthly average investment of foreign capital in China's real estate instry was less than 800 million US dollars, but in the first eight months of 2007, it approached or exceeded 1 billion US dollars. In August 2007, the figure reached 1.47 billion US dollars, a year-on-year increase of 221%. At the same time, the proportion of real estate investment in China's total foreign direct investment jumped from 0.085% in early 2006 to 27.6% in August 2007<
commercial banks need to pay attention to the following aspects:
-- pay attention to the foreign currency asset management problems caused by the continuous depreciation of the US dollar. Under the background that the shareholders and market subjects of commercial banks are more concerned about the impact of "subprime debt storm" on the income of Chinese banks, the management of foreign currency assets of commercial banks needs to adjust the asset portfolio in time to prevent possible losses, and prudently rece the impact on fixed income
2. In fact, it is mainly through the exchange rate impact of the US dollar on other currencies, in the form of import and export, capital circulation and other major aspects.
3.
If the US Federal Reserve decides the time of interest rate increase and implements the measures of interest rate increase, it will be a long-term good situation for the US dollar. Therefore, the price of the US dollar should rise, and other basket currencies will face downward pressure, including the RMB
the exchange rate of emerging markets may suffer a sharp drop, but the large price fluctuation will bring a lot of profit opportunities for investors who speculate in foreign exchange. Therefore, it is critical to pay attention to the policy changes of the Federal Reserve's interest rate increase
as the Central Bank of the United States, the Federal Reserve obtains power from the United States Congress. It is regarded as an independent central bank, because its resolutions do not need to be approved by the president or any senior member of the legislature of the United States, it does not accept funding from the United States Congress, and its members' term of office also spans multiple presidential and congressional terms. Its financial independence is guaranteed by its huge profitability, mainly e to its ownership of government bonds
it returns billions of dollars to the government every year. Of course, the Federal Reserve is subject to the supervision of the US Congress, which regularly observes its activities and changes its functions through legislation. At the same time, the Fed must work within the overall framework of economic and financial policies established by the government
4. The logic behind
's previous interest rate hikes is that in order to break the bubble, there will be a pressure recing valve. It is likely that soon after the first rate cut of the Federal Reserve in the second half of 2019 - early 2020, a global financial crisis will happen. p>
for China and other countries, the pressure of RMB appreciation and financial opening up is further strengthened, which is good for the price trend of gold and other commodities, good for China's import, bad for China's export and good for the stock market
5.
the interest rate cut by the Federal Reserve is the federal benchmark rate. It is the rediscount rate of the Federal Reserve to the commercial banks. The federal reserve rate is directly related to the financing cost of the banks. It has a strong guiding role for the interest rate of the American banks, so it indirectly affects the interest rate level of the entire American banking instry
the impact of the Federal Reserve's interest rate cut:
1. If the Federal Reserve cuts interest rates, the interests of depositors will be reced, so the deposits will be used as other investments to fill the originally deserved interests. The number of borrowers increased and the amount increased. That is to say, through this way, we can stimulate economic growth and domestic demand
extended data:
if the deposit interest rate is reced, the people will appropriately increase the living consumption expenditure, which will play a certain role in boosting domestic demand, and will also make the people use more bank deposits for consumption and investment
for the real estate instry, high monetary price and high capital pressure are the two main contradictions. Interest rate rection will promote the purchase of house buyers, especially for the indivials and families who buy houses, the pressure of housing loan will become smaller, the market may usher in a new round of purchase tide, and the capital pressure of real estate enterprises will be eased
in addition, the interest rate cut may put in more funds, which will cause the expectation of RMB devaluation to a certain extent, which is concive to the export of foreign trade enterprises, especially for the enterprises of medium and high-end procts
at the same time, the decline of money price will rece the operating cost of enterprises and the financing cost of the stock market, which will stimulate more capital flow to the stock market and contribute to the sustained bull market
6. If the US Federal Reserve decides the time of interest rate increase and implements the measures of interest rate increase, it will be a long-term good situation for the US dollar. Therefore, the price of the US dollar should rise, and other basket currencies will face downward pressure, including the RMB. The exchange rate of emerging markets may suffer a sharp drop, but the large price fluctuation will bring a lot of profit opportunities for investors who speculate in foreign exchange. Therefore, it is critical to pay attention to the policy changes of the Federal Reserve's interest rate increase
the first impact of the Federal Reserve's interest rate increase is the foreign exchange market, and the second is the precious metal market and other trading markets. But will the Federal Reserve raise interest rates? Although the probability is very small, there is also the possibility that the Federal Reserve will not raise interest rates. Among the unfavorable factors for the US dollar, the world economy, except the US, continues to decline, especially the implementation of quantitative easing policy in Europe and Japan. These factors are not concive to the dollar's interest rate increase.
the first impact of the Federal Reserve's interest rate increase is the foreign exchange market, and the second is the precious metal market and other trading markets. But will the Federal Reserve raise interest rates? Although the probability is very small, there is also the possibility that the Federal Reserve will not raise interest rates. Among the unfavorable factors for the US dollar, the world economy, except the US, continues to decline, especially the implementation of quantitative easing policy in Europe and Japan. These factors are not concive to the dollar's interest rate increase.
7. After the Federal Reserve cuts interest rates, the cost of using the US dollar will be reced. Since the US dollar is an international common reserve currency and can be freely convertible, more US dollars will be converted into convertible currencies or commodities without interest rection. Everyone will sell US dollars, leading to the depreciation of the US dollar
the rection of interest rate leads to the decline of the US dollar exchange rate and the devaluation of other countries' currencies. Because international trade is mostly settled in US dollars, the purchasing power of the corresponding US dollar denominated goods decreases. The money in the hands of Americans depreciates and the prices of imported goods rise relatively. As a result, the import capacity of the United States decreases, and the prices of US goods also priced in US dollars decrease relative to other countries' currencies, which improves its competitiveness, So it's good for export.
the rection of interest rate leads to the decline of the US dollar exchange rate and the devaluation of other countries' currencies. Because international trade is mostly settled in US dollars, the purchasing power of the corresponding US dollar denominated goods decreases. The money in the hands of Americans depreciates and the prices of imported goods rise relatively. As a result, the import capacity of the United States decreases, and the prices of US goods also priced in US dollars decrease relative to other countries' currencies, which improves its competitiveness, So it's good for export.
8. In fact, it leads to the decrease of US imports and the increase of US exports.
the rection of interest rate leads to the decrease of US dollar exchange rate and the devaluation of other countries' currencies. Because international trade is mostly settled in US dollars, the purchasing power of US dollar is reced, the money in the hands of Americans is devalued, and the price of imported goods is relatively increased, so the import capacity of the United States is reced, Similarly, the price of American goods denominated in US dollars is lower than that of other countries' currencies, and their competitiveness is improved, which is concive to exports
the rection of interest rate leads to the decrease of US dollar exchange rate and the devaluation of other countries' currencies. Because international trade is mostly settled in US dollars, the purchasing power of US dollar is reced, the money in the hands of Americans is devalued, and the price of imported goods is relatively increased, so the import capacity of the United States is reced, Similarly, the price of American goods denominated in US dollars is lower than that of other countries' currencies, and their competitiveness is improved, which is concive to exports
9. The pressure of people's devaluation will be relieved
the interest rate increase policy adopted by the Federal Reserve will intensify the pressure of capital outflow in China, and the pressure of RMB devaluation will be even greater. On the other hand, once the Federal Reserve adopts the interest rate rection policy, the pressure of capital outflow from China is expected to be eased, and the trend of RMB depreciation is expected to be postponed
it is worth noting that some analysis points out that in order to stimulate exports, the people's Bank of China actually hopes that the RMB will depreciate steadily, but the pace of depreciation should not be too fast. Therefore, once the Federal Reserve cuts interest rates and the RMB exchange rate rises, the central bank's response is really a mystery
asset bubble burst or postpone
asset bubbles mentioned here, mainly referring to the property price being fired and the stock price suspected to be overestimated. That is to say, combined with the above analysis, after the Federal Reserve increases interest rates, the profit tendency of capital will guide funds to stay in China's real estate market, stock market and other markets
even if the market reaction is more intense, more funds may flow into China's real estate market and stock market. At that time, it is not the delay of the real estate slump trend, but the possibility of the real estate market and stock market soaring again< As mentioned earlier, in order to stimulate exports, the people's Bank of China actually hopes that the RMB will depreciate steadily to a certain extent. On the other hand, once the US Federal Reserve cuts interest rates and the RMB is forced to appreciate in disguised form, China's export business, which is already in a downward trend, will be more difficult
of course, the top management is vigorously promoting innovation to improve the international competitiveness of China's export commodities. Whether China's export business will continue to shrink or "make a comeback" in the future is still unclear.
the interest rate increase policy adopted by the Federal Reserve will intensify the pressure of capital outflow in China, and the pressure of RMB devaluation will be even greater. On the other hand, once the Federal Reserve adopts the interest rate rection policy, the pressure of capital outflow from China is expected to be eased, and the trend of RMB depreciation is expected to be postponed
it is worth noting that some analysis points out that in order to stimulate exports, the people's Bank of China actually hopes that the RMB will depreciate steadily, but the pace of depreciation should not be too fast. Therefore, once the Federal Reserve cuts interest rates and the RMB exchange rate rises, the central bank's response is really a mystery
asset bubble burst or postpone
asset bubbles mentioned here, mainly referring to the property price being fired and the stock price suspected to be overestimated. That is to say, combined with the above analysis, after the Federal Reserve increases interest rates, the profit tendency of capital will guide funds to stay in China's real estate market, stock market and other markets
even if the market reaction is more intense, more funds may flow into China's real estate market and stock market. At that time, it is not the delay of the real estate slump trend, but the possibility of the real estate market and stock market soaring again< As mentioned earlier, in order to stimulate exports, the people's Bank of China actually hopes that the RMB will depreciate steadily to a certain extent. On the other hand, once the US Federal Reserve cuts interest rates and the RMB is forced to appreciate in disguised form, China's export business, which is already in a downward trend, will be more difficult
of course, the top management is vigorously promoting innovation to improve the international competitiveness of China's export commodities. Whether China's export business will continue to shrink or "make a comeback" in the future is still unclear.
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