NBR Radio: Currency Talk – How the US Federal Reserve's interest rate decision affects New Zealand
Jason Walls and CMC Markets' Sheldon Slabbert discuss the global currency market news on NBR Radio and on demand on MyNBR Radio.
The US Federal Reserve’s decision to keep rates on hold last week didn’t come as a surprise to CMC Markets trader Sheldon Slabbert.
He says jobs growth in the US economy have not been as strong as the numbers suggest.
“Job creation peaked in November last year, so a declining job growth number has been seen. So, when you scratch under the surface, there is a lot of contradictory information over the real headline number,” he says.
Added to this is “tepid” GDP growth and it's likely third quarter GDP will be revised as well, he says.
In a statement, Fed chairwoman Janet Yellen mentioned emerging markets as a concern, with particular emphases on China.
Inflation – or lack of – still remains a concern for the US economy.
Mr Slabbert says a lot of the Fed’s policies have been stoking deflation and the inflation number it is looking for is not showing up in the inflation numbers yet.
“That is something of big concern to them, and another reason why I don’t think they will be raising rates this year,” he says.
He says the US not lifting rates is not making the Reserve Bank’s job any easier.
“External factors are still a big concern to the Reserve Bank – we may even see a slightly deeper cut that what we had forecasted,” he says.
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NBR Radio
Tue, 22 Sep 2015
Tue, 22 Sep 2015
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NBR Radio: Currency Talk – How the US Federal Reserve's interest rate decision affects New Zealand
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