United States resumes its plans to raise rates – La Nacion (Argentina)

The head of the Federal Reserve said today that the conditions of the economy and the “merit”; What are the implications on Argentina

The definition waited all financial operators in the world came sooner than expected.

his first exhibition in the framework of the summit of central bankers in Jackson Hole (United States), president of the Central Bank (Federal EDF Reserve, for its acronym in English) of that country, Jannet Yellen, said the economy ” he approached the established goals “by the agency of” maximum employment and price stability “which was interpreted by those attending the meeting and the market as an imminent resumption of financial normalization which in Creole means a new rise in the reference interest rate for the economy.

this conclusion also reached the president of the Central Bank (BCRA), Federico Sturzenegger, which takes part in this summit, as he managed to rebuild the nation. “It was overwhelming, even more than I expected,” he said with peers

. Photo: File

so far traders awaited the Fed took that step to year. But now it believed I could do it at the meeting that the monetary policy committee of the body is scheduled for 20 and 21 next month, or in any case in October.

Yellen said that “in light of the continued strong performance of the labor market and our outlook for economic activity and inflation, I think it has strengthened the argument for an increase in the rate of federal funds in recent months,” although again clarify that these increases should be “gradual”.

the Fed left the zero rate, which ruled last year and helped redirect the funds massively into emerging markets, risky bets or commodities (as their prices are governed by the dollar, which was devalued by the expansive policy applied by the agency to assist banks) to 2015. But then declined to apply further increases this year due to slowing growth overall, the volatility of international financial markets on worries about the situation in China and the front that opened the Brexit, and inflation data generally modest in the United States.

So the rates that add value the dollar remained since then between 0.25% and 0.50%. Now it expected to rise by a quarter of average point, which is not a substantial contribution to the naked eye increase but take larger in a world increasingly governed by the zero cost of other important or even negative foreign exchange.

After his strong definition Yellen appealed to “the central banker manual” to start relativize their own sayings. It was when he warned that decisions depend on economic conditions can change a lot. “Our ability to predict how the guideline rate is quite limited because monetary policy will need to respond to any problems that may shake the economy,” because “some of these conditions are visible after they occur.”

and he mentioned studies which there is a 70% chance that rates are between 0% and 3.25% by the end of 2017, would expand a range between 0 and 4.5% at the end of 2018.

the reaction shown by the markets so far seems to suggest that

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