After keeping the global financial markets on roller castor ride for far too long, Fed Chair Janet Yellen took the decision of interest hike which was as expected line of everyone knew she would do and also how much. The Federal Reserve Bank Of USA had taken decision to hike interest rate by 25 Basis Points ( 0.25% ). This is the first rate hike which came after June'2006.
It is very much clear that it makes the life of an investor easier now, but, as they say, the smart ones won't go to bed without looking at the fine print. So here we decode every aspect of the move taken by Federal Reserve Bank Of USA and what Yellen said in her policy announcement.
The Fed has learnt from the taper tantrum, when its unilateral decision wrecked havoc in financial markets the world over. This time around, Janet Yellen prepared the markets well and the result is there for all to see in the cheerful welcome to Fed rate hike across all the Share Markets around the world.
As per Fed's Assessment :-- Policymakers were hoping for a slow rise in rates but one that would keep the Fed ahead of the curve as the economic recovery continues. To keep the economy moving along the growth path it is on, we would like to avoid a situation where we have left so much (monetary) accommodation in place for so long we have to tighten the rates.
Indian economy will get big boost by increasing export of IT Services and other Indian products to United States Of America ( USA ) as their economy had started to improvement gradually and its expected that the improvements will get more steam in next few Qtrs of coming year 2016.
It is very much clear that it makes the life of an investor easier now, but, as they say, the smart ones won't go to bed without looking at the fine print. So here we decode every aspect of the move taken by Federal Reserve Bank Of USA and what Yellen said in her policy announcement.
The weakness and troubles of the US economy from the 2007-2009 financial crisis are gone and it's finally more or less on its own, without any crutches. This is positive especially for India IT, as IT budgets of US companies will expand now and demand will grow. It will also helpful for other exporting sectors of Indian Economy, but China's forex market tricks may slice down much of these benefits from other players.
As per Yellen's assessment:-- "The economic recovery has clearly come a long way, although it is not yet complete. Room for further improvement in the labor market remains, and inflation continues to run below our longer-run objective. The US economy has shown considerable strength. Domestic spending that accounts for 85 percent of aggregate spending in the U.S. economy has continued to hold up; it's grown at a solid pace."
As per Yellen's assessment:-- "The economic recovery has clearly come a long way, although it is not yet complete. Room for further improvement in the labor market remains, and inflation continues to run below our longer-run objective. The US economy has shown considerable strength. Domestic spending that accounts for 85 percent of aggregate spending in the U.S. economy has continued to hold up; it's grown at a solid pace."
The Fed has learnt from the taper tantrum, when its unilateral decision wrecked havoc in financial markets the world over. This time around, Janet Yellen prepared the markets well and the result is there for all to see in the cheerful welcome to Fed rate hike across all the Share Markets around the world.
As per Fed's Assessment :-- Policymakers were hoping for a slow rise in rates but one that would keep the Fed ahead of the curve as the economic recovery continues. To keep the economy moving along the growth path it is on, we would like to avoid a situation where we have left so much (monetary) accommodation in place for so long we have to tighten the rates.
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