December 19, 2022
United States:
Highest Interest Rates in 15 Years Are Derailing the American Dream
The highest interest rates in 15 years are delaying home dreams, putting business plans on ice and forcing many Americans to agree to loan terms that would have been unimaginable just nine months ago.
Most of all, the surge in borrowing costs is punishing the cash-poor. And it’s about to get worse as the Federal Reserve carries on with its anti-inflation campaign and keeps hiking rates next year.
Europe:
UK Bond Investors Rush to Exit Before Bank of England Debt Sales
UK bonds slumped on speculation a wave of extra supply will drive down prices as the Bank of England prepares to push on selling its sovereign holdings at the start of the new year.
Yields on 10-year gilts jumped as much as 13 basis points to 3.46% on Monday, the highest since early November. Yields on the debt have fallen only once in the past eight sessions. The fresh bout of weakness follows the central bank’s announcement that it will kick off short-maturity note sales starting Jan. 9 as it seeks to reduce the pile of bonds it amassed over the years to keep a lid on borrowing costs. Long-maturity sales will begin three weeks later.
Asia:
BOJ to Sit Tight as Markets Weigh Post-Kuroda Path
The Bank of Japan is expected to keep monetary stimulus unchanged at Governor Haruhiko Kuroda’s third from last policy meeting this week, as investors seek clues for the central bank’s path beyond Kuroda’s term.
The BOJ is forecast to leave its negative interest rate and yield curve control program unchanged at the end of a two-day gathering Tuesday, according to all 47 economists surveyed by Bloomberg.
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