Wednesday, Oct 28, 2009
Interest rates around the globe set to rise (update)
Bloomberg: Norway Lifts Benchmark Rate, Signals More Increases
Oct. 28 (Bloomberg) -- Norges Bank raised its key interest rate a quarter point from a record low and signaled steeper increases than it previously forecast over the next three years as inflation accelerates and unemployment remains low. The Oslo-based bank raised the overnight deposit rate to 1.5 percent, becoming the first European central bank to reverse its easing cycle since the credit crisis started to abate. Nineteen of 20 economists surveyed by Bloomberg had predicted the move, while one had expected a half-point increase.
Posted by jack c @ 01:59 PM (1569 views) Add Comment
10 Comments
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1. will said...
They're on the up around the World - most will be forced to follow suit soon. So much for 'they will stay low for many more years'.
2. stillthinking said...
This is a nice article on the asset versus wage inflation.
http://seekingalpha.com/article/169386-a-tale-of-two-inflations-how-we-arrived-at-today-s-economy
3. crunchy said...
Fighting inflation with inflation in these times will be interesting. Who will be the best at it or will the globe all hold hands and close their
eyes hoping that will work, or is this just another banking trick.
The next step closer. So many questions.
4. 51ck-6-51x said...
Crunchy said, "eyes hoping that will work, or is this just another banking trick. The next step closer. So many questions."
-
Questions...
Don't know, I don't know such stuff. I just do eyes, ju ju just eyes... just genetic design, just eyes. You Nexus, huh? I design your eyes.
Chew, if only you could see what I've seen with your eyes.
5. crunchy said...
4. 51ck-6-51x
It will all make sense to you one day when you look back through the arc eyes.
For me, this way is so much more fun. HYPERINFLATION FOOD SHORTAGES. Remember that one?
There are lots of others too, you can bet your bottom dollar on that 6's!
6. crunchy said...
By the way 6's were you one of the deflationist not so long ago? lol
7. 51ck-6-51x said...
Crunchy
- yes, late 08, to spring 09 I saw deflationary pressure. So too, it seems did those in power and their reaction has been very strong hasn't it?! - Note, however, that I am against the central control ( without which I still think a period of deflation would have been seen ). Also I do not assert that I am particularly good at predicting such things even though I will happily give it a go. I thought the housing crash would kick off in 2005, that proved to be pretty wrong.
8. uncle tom said...
People seem to forget that governments around the world are clocking up huge budget deficits, and collectively need to borrow far more than would normally be invested in low yielding sovereign debt.
Aside from printing some of the cash; which will ultimately come home as inflation, and interest rates hikes consequent upon the resultant devaluation; it seems inevitable that the thirst for funds will demand the enticement of investors who would normally opt for slightly riskier places for their cash; ones that have better yields.
As many of the world's economies genuinely exit recession (but not the UK..), those with funds have once again plenty of tempting homes to send them to, as an alternative to sovereign debt.
It follows that sovereign (central bank) interest rates must rise.
9. crunchy said...
7. 51ck-6-51x said- "yes, late 08, to spring 09 I saw deflationary pressure. So too, it seems did those in power and their reaction has been
very strong hasn't it?"
Yep! Know thy enemy.
10. fallingbuzzard said...
There's still plenty of deflationary pressure in the UK. The reaction of Brown was laughable, manipulate through VAT. Interesting to see if Cameron will do anything at all to see deflation off, or just let it run its course.