I’m not sure where to post this. This seems like the appropriate forum.
Just now the IMF has urged the Fed to hold off on increasing rates until half of 2016. This seems like significant news to me. Bloomberg Live is saying this is an unprecedented behaviour.
Right now Eur/Usd is on a downward trend. I am curious what the short term implications of such news would have on a downward trend. Is it a strong chance of a reversal?
Anything Greece related causes tremendous movements. So I would just like to understand what this could do.
Can anyone please take the time to properly educate me? Thank you.
Bloomberg is not fully correct, Lagarde has been saying for some time that USD is, as she puts it today, is “moderately overvalued”.
Her reasoning is that countries and companies, especially those in emerging markets, who have loans in USD are feeling the pressure from the higher dollar.
Her exhortation to hold off on rate rises makes economic sense in it’s own right, the bonus, from the IMF’s viewpoint would be any stall on any USD rise.
Second last paragraph sums up the thinking back in March this year - from a speech in Berlin.