‘Patient’ approach in US Rate Hike
Following my previous post on US rate hike, In the recent Federal Reserve meeting, Fed Chair Janet Yellen told a news conference that “patient” meant the policy-setting Federal Open Market Committee was unlikely to hike rates for “at least a couple of meetings,” meaning April of next year at the earliest.
US stock market recovered on Wednesday and Thursday after Fed’s remark hinting that it is not hiking rate as early as first quarter next year, giving market some breath after the oil price plunge that caused panic in the market.
Whether it is first quarter or second quarter next year, interest rate hike is a reality after QE3 ended in October this year. Market would have to adjust and adapt into the fact that US will end its near zero borrowing rate policy soon.