Fed likely to hike interest rates this week but here’s why low rates may stick around

The Federal Reserve will most likely raise interest rates this week for the first time in nearly a decade. To understand what it means — and doesn’t mean — consider a previous year in which interest rates were on the rise. In 1920, borrowing costs soared to their highest levels since the end of the […]

Fed officials explicitly said they might raise short-term interest rates in December

Federal Reserve officials explicitly said they might raise short-term interest rates in December, pushing back against investors who have bet that the central bank wouldn’t move this year. The message appeared to have the desired effect. Before the Fed released its policy statement Wednesday, traders in futures markets put about a 1-in-3 probability on a […]

World economy risks another crash unless they continue to support growth with low interest rates: IMF

The International Monetary Fund concluded its annual meeting in Lima with a warning to central bankers that the world economy risks another crash unless they continue to support growth with low interest rates. The Washington-based lender of last resort said in its final communiqué that uncertainty and financial market volatility have increased, and medium-term growth […]

Central banks cannot keep pumping cheap credit into series of asset bubbles

Like children clinging to their parents, stock market traders turned to their central banks last week as they sought protection from the frightening economic figures coming out of China. Surely, they asked, the central banks would ward off the approaching bogeymen, as they had so many times since the 2008 crash. The US Federal Reserve […]

China stock market keeps crashing, loses all 2015 gains

China’s stock markets are suffering from massive volatility and investors are running scared. If you’re just catching up to it, here’s what you need to know. Last updated: August 25, 7:00 am ET (11:00 am GMT). 1) China stepped up its efforts to boost the economy on Tuesday, cutting interest rates and allowing banks to […]

China unexpectedly devalues yuan to 3-year low

FRANKFURT—China’s unexpected move Tuesday to devalue its currency highlights a growing trend among policy makers in Europe and beyond: the importance of exchange rates as a means to juice economic growth and keep inflation from weakening too much. It also underscores how sensitive central bankers are to each other’s monetary policies. In China’s case, expectations […]

Fed could offer new hints on rate hike timing

Federal Reserve officials are likely to emerge from their policy meeting Wednesday with short-term interest rates still pinned near zero, though they could send fresh hints that they’re getting closer to raising rates. Fed Chairwoman Janet Yellen emphasized in congressional testimony earlier this month she expects the central bank to start lifting its benchmark federal-funds rate at some point before year-end…

Analysis: Greece rescue deal explained

ATHENS, Greece – Greece reached a preliminary deal Monday for a third multi-billion euro bailout from its fellow members in the 19-country eurozone. The deal includes tough economic measures that Greece will need to pass into law quickly before it can get any new loans. A statement from the summit of euro leaders says these […]

Wall Street plummets about 2% as Greece debt crisis weighs in

BEIJING — U.S. markets slid more than 1 percent Monday afternoon as investors reacted to the latest chapter in Greece’s financial saga. But the U.S. indexes were down less than other global markets. The Standard & Poors 500 index and Dow Jones industrial average were down about 1.5 percent and 1.8 percent respectively. The losses deepened during the afternoon, but still suggest that American markets may be more measured in their response to Greece’s woes than other global markets. European and Asian indices were down more than 2 percent Monday, and Japan’s Nikkei closed 2.9 percent lower…

Fed chair Yellen favors only one rate hike in 2015

The question of how quickly the Federal Reserve should raise rates is dividing normally like-minded policymakers at the U.S. central bank, pitting those who favor two hikes this year against a growing number of those who want to stop at just one. That shift, and the very real possibility that Fed Chair Janet Yellen may be one of the five who now prefer a single rate hike in 2015 rather than among an equal number who prefer two…

Greece’s close to default as debt talks fail

Greece and its creditors stuck to their positions on Monday after the collapse of talks aimed at preventing a default and possible euro exit, while Germany’s EU commissioner said it was time to prepare for a “state of emergency”. Prime Minister Alexis Tsipras ignored pleas from European leaders to act fast. Instead he blamed creditors for the collapse of the cash-for-reform talks on Sunday, the biggest setback in long-running negotiations to secure more aid for Greece…

Fed should delay rate hike until wages, inflation pick up: IMF

The U.S. Federal Reserve should delay a rate hike until the first half of 2016 until there are signs of a pickup in wages and inflation, the International Monetary Fund said in its annual assessment of the economy on Thursday. The fund’s report comes amid signs that some rate setters at the U.S. central bank are also pushing for rate hikes to be delayed until there are clearer signs of a sustained recovery. U.S. data has been mixed and the economy shrank 0.7 percent in the first quarter…

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