The Reserve Bank of Australia, the European Central Bank, the Bank of Japan, the Bank of England and other interest rates this week, the Fed will also discuss new stimulus measures again in two weeks. The market expects that the above-mentioned central banks will maintain or regain loose monetary policy. At the same time, in order to resist the threat of “secondary recessionâ€, many emerging economies have cut interest rates with high inflationary pressures, and the signs of a new round of loose monetary policy have become increasingly apparent. This round of global loose currency pace is consistent with the expectation that the European and American economies are weak and need no further stimulus. The latest data from the European, American and Japanese countries are showing that the economic growth rate of the Eurozone has slowed to 0.2% in the second quarter, which is not as good as 0.8% in the first quarter. The growth of Germany, the core country, is closer to stagnation. The latest data on the weak US economic recovery is evidenced by data released by the US Department of Labor on September 2, and the number of non-farm payrolls in the US increased to zero in August, the worst record in nearly a year. In addition, the unemployment rate remained at 9.1%. Economists believe that at the new round of policy meetings held from September 20 to 21, the Fed will not only maintain the minimum interest rate, but will also decide to replace short-term securities in its $1.65 trillion portfolio with long-term bonds. In order to further reduce the cost of credit in a comprehensive manner; in Europe, many people are also recommended to cut interest rates to stimulate economic vitality. At the Fed's new round of policy meetings, the cost of using each tool and the benefits it can generate will be discussed in detail. Federal Reserve Chairman Ben Bernanke recently said that the Fed still has a lot of tools that can be used to implement monetary stimulus. According to the minutes of the Federal Reserve's Open Market Committee (FOMC) meeting on August 9, several Fed officials hope to take bolder action and “willing to accept more optimistic policies with more forward-looking guidanceâ€, which shows the third round of quantification. The easing policy will be an optional tool. For European monetary policy, Pacific Investment Management (PIMCO) CEO Erian said that the euro zone's economic recession rate rose to 50%, the European Central Bank may cut interest rates, and economists also called for the European Central Bank to cut interest rates to avoid recession. The European Central Bank will announce the interest rate decision on the 8th. To control inflation, the European Central Bank has raised interest rates by 50 basis points to 1.5% this year. Central Bank President Jean-Claude Trichet told the European Parliament at the end of last month that the central bank is reassessing price risks as the euro zone's economic growth slows. The ECB's shadow committee, composed of 15 economists and investment managers, warned on September 2 that Europe's manufacturing contraction and corporate confidence decline in the second quarter may continue into the third quarter, calling on the European Central Bank to change its interest rate hike strategy. In order to prevent the economy from falling into recession. "I recommend that the European Central Bank cut interest rates by 50 basis points to ensure that the risk of a second economic recession will be reduced. The rate of economic deterioration is fast, warning the central bank should immediately end the rate hike," said Crow, the chief economist at Barclays Capital Europe. By easing monetary policy to stimulate the economy to work, it has attracted market participants' concerns. John Silva, chief economist at Wells Fargo, said: "The main problem at present is that the low interest rate situation has been maintained for three years, but this has not been able to effectively stimulate consumption. If the market does not have demand, the company will not increase. Recruitment. The Fed can indeed reduce the cost of credit, but it can't ask companies to increase recruitment.†Even Bernanke admits that it is difficult to ensure the continued recovery of the US economy with the Fed alone. Bernanke said: "The vast majority of economic policies that ensure long-term growth in the US economy are outside the scope of the Fed's management." According to the plan, US President Barack Obama will present to the US Congress on September 8 that it will stimulate employment and On the same day, Bernanke will also deliver a speech on the economic outlook. Concerns about the ineffectiveness of incentives also apply to Europe, and Harvard professor Federstein believes that a rate cut may not improve the eurozone economy. Federstein believes that the European Central Bank can also follow the Fed to lower interest rates to a certain level, but the situation may not change, because the European Central Bank's ultra-low interest rates have not stopped the manufacturing, construction and consumer demand shrinking. On the 7th, the Bank of Japan will hold a monetary policy meeting and announce interest rate resolutions. The market expects the Bank of Japan to maintain an ultra-low interest rate of zero to 0.1%. Reuters analysis, following the relaxation of the policy last month, the Bank of Japan will wait and see the market changes, this month, the possibility of waiting until October to relax the policy is increased. In the real G20, the two countries have taken the lead in cutting interest rates and the European debt crisis and the signs of slowing down global economic growth. As a result, global stock markets evaporated more than 4 trillion US dollars in August. The emerging markets that had concentrated on cooling the overheated economy have had to follow the policy. The Turkish central bank took the lead in reducing the interest rate to an all-time low of 5.75% on August 4. On August 31, Brazil also announced a rate cut, which may sound alarm for other emerging countries and attract the central bank to follow up to cut interest rates. Mexico has indicated that it may reduce the cost of borrowing. Experts say that Russia also has the conditions to cut interest rates substantially. Brussels International Group (ING) senior European economist Bressky said " recent data has raised the possibility of a global recession. All sectors are counting on the central bank to resort to stimulus measures. The question is whether the central bank wants to adopt this type of Method.†Nomura’s Singaporean economist Barakuri said that in addition to a few countries such as India, which will raise interest rates, Asian central banks will basically “end monetary tightening policy†because “the slowdown will ease Asian countries. Demand pressure on prices." Condington, director of Asian Studies at Holland International Group in Singapore, pointed out that price pressure relief will prompt some central banks to turn to easing policies to stimulate economic growth. Brazil’s unexpected interest rate cut on August 31 is an example. The Brazilian central bank changed its interest rate policy on August 31. It unexpectedly lowered the benchmark interest rate because the global economy “seriously deteriorated†and would have a knock-on effect on the local economy, ending the latest round of interest rate hikes that began at the beginning of this year. The bank also issued a long-form statement saying that the economic slowdown has replaced inflation as the country's main economic worries. The statement said that problems in developed countries will exacerbate the slowdown in growth that has already occurred in Brazil. Remoiss, a Latin American department economist at Goldman Sachs, said: "Nobody expected a rate cut, and the central bank worried that external shocks could cause the economic slowdown to worsen." After the interest rate cut in Brazil, other central banks have also expressed their respective global economic slowdown. Concern. The Mexican central bank decided not to move at the end of August, but at the same time hinted that once the domestic or global economic situation led to a tighter monetary environment, interest rate cuts might be considered. Harry Haran, head of hedge fund group NWIManagement, said Mexico is very likely to cut interest rates. But also said that even if the policy is relaxed, investors may still have opportunities. It is recommended to quickly enter the bond market of some emerging economies before the interest rate cut to wait for profit opportunities. Nomura Securities recently estimated that if the US economic data deteriorates severely, the possibility of a rate cut before the end of Mexico will increase by more than 50%. Robertson, an economist at RenaissanceCapital, expects Brazil to cut interest rates further, and Russia may also have a sharp cut in interest rates. Affecting China's interest rate hike expectations As some overseas economies' monetary policy turns, the domestic market's interest rate hike expectation has dropped significantly in recent days. More experts and institutions believe that, at least in the near term, China's monetary policy should be based on observation. Wang Dashu, a professor at the School of Economics at Peking University, told the Economic Information Daily that China is currently facing a dilemma. On the one hand, the pressure of rising prices is still relatively prominent. It is expected that the consumer price index (CPI) in August will still increase by about 6% year-on-year. From the previous situation, China’s reserve ratio has been raised to a higher level. Type tools do not work well to curb price increases. On the other hand, the international economic recovery is slow, and the domestic economic growth rate is also facing a downturn. It may not be conducive to stable economic growth. "I personally think that this year's price inflation pressure is so big, interest rate hikes are still necessary. But at present, should not be added, we should first look at the economic situation at home and abroad." Wang Dashu said. Zheng Chaoyu, a professor at the School of Economics of Renmin University, believes that he should not raise interest rates. He told the "Economic Information Daily" reporter: China's current price pressure is so high, the public's dissatisfaction with negative interest rates is so high that it is certainly not possible to cut interest rates like Brazil. But raising interest rates is not necessarily a good idea. When China’s economy was overheated, the choice of monetary policy was very simple. Raising interest rates could prevent overheating and control prices. But now China’s economy is still in a recovery phase, and it’s not appropriate to raise interest rates. In particular, China’s interest rates are now higher than in many countries. To be high, raising interest rates may also lead to more hot money inflows. Zheng Chaoyu believes that the difference between China and Western countries is that interest rates are not market-oriented, so they can achieve the same effect as raising interest rates directly by controlling the amount of credit. Liu Xiahui, a researcher at the Institute of Economics of the Chinese Academy of Social Sciences, also predicted to the Economic Information Daily that the price increase may slow down in the second half of the year and that monetary policy may not be further tightened. The agency also holds a similar view. Minsheng Securities believes that it will not raise interest rates in the third quarter. The report issued by the brokerage gives four reasons: First, the one-year deposit rate corresponding to 8.7% of the year-on-year increase of CPI in 2008 is 4.14%. The current relative interest rate is higher than that in 2008, and the rate hike may be overdone. Second, according to the current real interest rate of funds and the affordability of enterprises, the possibility of another interest rate hike is small; the third is the slowdown in domestic demand, the weak economy in Europe and the United States, the decline in exports in the fourth quarter; the fourth is the decline in the domestic CPI trend, the main international The economy still maintains low interest rates and has the potential to re-scale. CIC Securities also expects a lower probability of a rate hike in September. However, the article by Premier Wen Jiabao published on September 1st in Qiushi magazine has caused some differentiation in the market's judgment on whether to raise interest rates in September. For example, Huachuang Securities believes that the article on monetary policy may contain three meanings: the tightness of monetary policy remains unchanged; the foreign economic situation will have an impact on monetary policy formulation; there is still room for off-balance-sheet business supervision, interest rate and exchange rate adjustment. Liu Ligang, director of economic research at Greater Australia in Greater Australia, also believes that China's overall inflationary pressures remain high. The central bank will raise the benchmark interest rate again during the year, but it is difficult to predict whether the rate hike will be in September.
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