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Interest rates will rise ?

Discussion in 'Forex Daily News & Outlook' started by prav, Jun 25, 2007.

  1. prav

    prav Moderator
    Staff Member

    Apr 28, 2007
    Likes Received:
    The Swiss franc surged o n Friday on renewed speculation the Swiss National Bank will push official interest rates higher, sparking some concern that Central Banks may be trying to disrupt yield-seeking carry trades. Investors hungry for higher returns continued to punish the low-yielding Yen, sending it to a 4 ½ year low against the Dollar and a record high against the Euro. The Swiss government revised up its growth forecasts for this year and next and also its inflation outlook, leading markets to price in a better than 50/50 chance the SNB will raise benchmark rates a 0.5% in September.Markets expect two more euro-zone interest rate hikes in 2007, while the Federal Reserve is expected to stay on hold at 5.25% this year. Sterling and the New Zealand dollar were also beneficiaries of the carry trades, with the Cable approaching $2.0000 for the first time since late April.


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