Fed taking political considerations into account - Nomura

Ross J Burland FXStreet

Analysts at Nomura explained that the decision not to hike driven by domestic and international political considerations FOMC members based in Washington and New York are taking into account the political situation in Washington along with factors related to international bodies such as the G7 and the G20.

Key Quotes:

"Political factors arguing against a rate hike include mounting protectionist sentiment in response to the dollar’s strength—a development symbolized by the popularity of presidential candidate Donald Trump—and the sharp slowdown in China’s economy as the CNY has risen along with the dollar.

The emergence of politicians such as Mr Trump and Bernie Sanders in particular has the potential to completely destroy the free-trade-based international order that the US helped establish in the postwar era, signaling a possible return to the state of global economic affairs in the 1930s."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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