S&P 500 could rise 15% in the second half: Guggenheim’s Scott Minerd

The global chief investment officer at Guggenheim said Monday that he thinks the S&P 500 could rise 15% and approach 3,500 before the end of year, comparing the current market environment to a 1998 rally amid interest rate cuts. And the central banks around the world have basically signaled that they are going to step on the accelerator,” Minerd said. The S&P 500 gained 17% in the first six months of this year, the best first half for the index since 1997. Minerd compared current market conditio


The global chief investment officer at Guggenheim said Monday that he thinks the S&P 500 could rise 15% and approach 3,500 before the end of year, comparing the current market environment to a 1998 rally amid interest rate cuts. And the central banks around the world have basically signaled that they are going to step on the accelerator,” Minerd said. The S&P 500 gained 17% in the first six months of this year, the best first half for the index since 1997. Minerd compared current market conditio
S&P 500 could rise 15% in the second half: Guggenheim’s Scott Minerd Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-15  Authors: jesse pound
Keywords: news, cnbc, companies, months, world, rates, scott, rise, minerd, 15, half, sp, stocks, 500, 1998, end, guggenheims, second, youre


S&P 500 could rise 15% in the second half: Guggenheim's Scott Minerd

The global chief investment officer at Guggenheim said Monday that he thinks the S&P 500 could rise 15% and approach 3,500 before the end of year, comparing the current market environment to a 1998 rally amid interest rate cuts.

Scott Minerd said on CNBC’s “Halftime Report ” that the easier monetary policy from the Federal Reserve and central banks around the world would boost stocks before the end of the year.

“This rally — whether you’re looking at bonds, you’re looking at stocks, high yield, pick whatever you want — is all being driven by liquidity. And the central banks around the world have basically signaled that they are going to step on the accelerator,” Minerd said.

The S&P 500 gained 17% in the first six months of this year, the best first half for the index since 1997. However, the Fed is widely expected to cut interest rates at the end of the month, as domestic inflation and wage growth have not accelerated in recent months and international economic growth has slowed.

Minerd compared current market conditions to 1998, when the Fed cut rates in three consecutive months amid concerns about an economic crisis in Asia. The S&P 500 rose more than 28% in the last four months of that year.

“All you have to do is look at a replay of the post-Asia crisis back in 1998, and you get stocks at the kinds of levels that I’m talking about,” Minerd said.


Company: cnbc, Activity: cnbc, Date: 2019-07-15  Authors: jesse pound
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Gold holds firm above $1,400 as markets look past robust US data

Spot gold rose 0.9% to $1,415.53 per ounce. U.S. gold futures rose 0.4% to settle at $1412.20 per ounce. “If gold closes below $1,400 level on a Friday, (it) could be a blow to the bulls. Fed policymakers are scheduled to meet on July 30-31, where investors will look for further cues on monetary policy easing. A recent import duty hike further dented waning interest in an Indian market hit by a surge in local rates


Spot gold rose 0.9% to $1,415.53 per ounce. U.S. gold futures rose 0.4% to settle at $1412.20 per ounce. “If gold closes below $1,400 level on a Friday, (it) could be a blow to the bulls. Fed policymakers are scheduled to meet on July 30-31, where investors will look for further cues on monetary policy easing. A recent import duty hike further dented waning interest in an Indian market hit by a surge in local rates
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Gold holds firm above $1,400 as markets look past robust US data

Gold prices rose on Friday as investors shrugged off concerns that stronger-than-expected consumer inflation in the United States could influence the U.S. central bank’s decision on aggressive monetary policy easing.

Spot gold rose 0.9% to $1,415.53 per ounce. U.S. gold futures rose 0.4% to settle at $1412.20 per ounce.

“Inflation data came out a little bit hotter than expected. It seems every day that the probability of rate cut versus keeping rates unchanged is flip-flap. There are uncertainties around that,” said Phillip Streible, senior commodities strategist at RJO Futures.

“If gold closes below $1,400 level on a Friday, (it) could be a blow to the bulls. I see a resistance level of $1,441 if there is enough demand for gold.”

The core U.S. consumer price index, excluding food and energy, rose 0.3% in June, data showed on Thursday, the largest increase since January 2018. The U.S. Federal Reserve had last month downgraded its inflation projection for the year to 1.5% from the 1.8% projected in March.

Bullion rates were quick to slump following the data, shedding nearly 1% in the latter part of its session, with the dollar erasing some losses.

However, the stronger-than-expected reading failed to shake convictions that the Fed will start cutting interest rates at a policy meeting later this month, with money markets still indicating one rate cut at the end of July and a cumulative 64 basis points in cuts by the end of 2019.

Against a basket of currencies, the dollar was lower for a third straight day, down 0.1%.

Market attention will be focused on comments by Chicago Fed President Charles Evans later in the session and New York Fed President John Williams on Monday, which will provide a chance to gauge how dovish the U.S. central bank will be.

Fed policymakers are scheduled to meet on July 30-31, where investors will look for further cues on monetary policy easing.

In the physical market, gold buying stalled in top Asian hubs this week as consumers sold back bullion to cash in on the steep price rally.

A recent import duty hike further dented waning interest in an Indian market hit by a surge in local rates


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The Fed ‘put’ could insulate stocks from trade wars, send the Dow to 28,000

The thinking is that there is a ‘Fed put’ on the stock market, meaning with the Fed ready to cut interest rates, how much downside could there be for the market? Fed Chair Jerome Powell’s dovish comments this week sparked a stock market rally Wednesday and part of Thursday, driving the three major indices to new highs. Economists widely expect the Fed to cut interest rates at its July meeting by at least 25 basis points, or a quarter point. Highly indebted companies, including many smaller firms


The thinking is that there is a ‘Fed put’ on the stock market, meaning with the Fed ready to cut interest rates, how much downside could there be for the market? Fed Chair Jerome Powell’s dovish comments this week sparked a stock market rally Wednesday and part of Thursday, driving the three major indices to new highs. Economists widely expect the Fed to cut interest rates at its July meeting by at least 25 basis points, or a quarter point. Highly indebted companies, including many smaller firms
The Fed ‘put’ could insulate stocks from trade wars, send the Dow to 28,000 Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-11  Authors: patti domm
Keywords: news, cnbc, companies, 28000, market, wars, rate, interest, send, stock, earnings, rates, fed, quarter, insulate, stocks, trade, dow


The Fed 'put' could insulate stocks from trade wars, send the Dow to 28,000

Traders work on the floor at the New York Stock Exchange. Brendan McDermid | Reuters

With a potentially negative earnings season looming, investors see easy Fed policy as the security blanket the stock market needs as it breaks to new highs. The thinking is that there is a ‘Fed put’ on the stock market, meaning with the Fed ready to cut interest rates, how much downside could there be for the market? But that question gets trickier with the stock market carving out new highs, and an upcoming earnings season that is forecast to see profits decline. The Fed “is the factor,” said Michael Farr of Farr, Miller & Washington. “If you don’t have organic earnings growth and improving balance sheets, what else is going to drive prices?” Fed Chair Jerome Powell’s dovish comments this week sparked a stock market rally Wednesday and part of Thursday, driving the three major indices to new highs. Stocks were off their highs Thursday afternoon, after indices briefly breached big round milestones. The S&P 500 rose above 3,000 for the first time ever Wednesday, and the Dow topped 27,000 Thursday. Many Wall Street analysts have their year end targets set around 3,000 or below, and the average target of analysts surveyed by CNBC is 2,950.

Economists widely expect the Fed to cut interest rates at its July meeting by at least 25 basis points, or a quarter point. The fed funds target rate range is currently 2.25% to 2.50%. Investors in the fed fund futures market are pricing in a little more than a full quarter point cut for July, but nearly three 25 basis point cuts by the end of the year. “My thought is if rates don’t fall, stock prices will,” said Sam Stovall, chief investment strategist at CFRA. If the Fed does not take action to cut interest rates at at its next meeting, on July 31, Stovall said the market could head for a correction pretty quickly. Stocks have been rising ahead of the Fed’s expected action, and history shows they could keep on rising once the Fed starts the rate-cutting cycle. Stovall said the S&P 500, since World War II, has risen 10.3% on average in the six months after the Fed starts cutting rates, and then 14% by the end of the first year. Beyond the Fed, strategists said the stock market needs to see steady economic data and the trade war to be resolved between the U.S. and China to make a big leap forward. “I think the market is trying to decipher now how many rate cuts and how much and whether the first one will be an important inoculation. Clearly the Fed sees the global slowdown coupled with uncertainty with the tariffs as a significant downside risk,” said Quincy Krosby, chief market strategist at Prudential Financial. Net benefits to stocks from lower interest rates could be a weaker dollar, which would filter through as a positive to the earnings of S&P 500 companies with overseas sales. Highly indebted companies, including many smaller firms, would also see a lift from lower interest rates. “If the Fed is here and the tariff issues are resolved, the markets can continue moving higher. There is no doubt there will be pullbacks. But nonetheless, the Fed will help…It will weaken the dollar. It will be helpful for all markets. It will be helpful for emerging markets. It will be helpful for the Chinese. And U.S. exporters,” said Krosby. “Right now for the market, if they’re going to lower rates and there’s no further deterioration in the economy, that is the best back drop for markets.”

But the roll out of corporate earnings next week could be a challenge. Stovall said S&P 500 earnings are collectively expected to decline 1.7% for the second quarter, after rising 2.5% in the first quarter. Earnings are key to the way the market values stocks, and with the earnings season starting next week, bad news could come out not only in the second quarter reports but in forecasts. Companies could certainly be glum as they detail the impact of tariffs, global weakness and even dollar strength on their bottom lines.

Rate-cutting cycles and stocks

Industrial supply company, Fastenal, for instance, reported Thursday that it was able to raise prices to offset tariffs on products sourced from China, but the increases were not enough to offset rising costs. But analysts expect like last quarter, companies have guided too low on their profit outlooks, and earnings may surprise to the upside. “On the whole, given the fact that earnings expectations are so subdued, it’s not likely to be an aggregate market negative,” said Julian Emanuel, chief equity and derivative strategist at BTIG. “It’s going to be an environment, where it’s good for some stocks, bad for others.” On top of that, the Fed’s rate cutting can only help a market that has already run up ahead of the Fed’s action.

Emanuel said cyclical parts of the market could benefit more from lower interest rates, including energy and financials. The Fed had been criticized for its last rate hike in December, when stocks sold off, the outlook for growth began to fade and trade wars weighed on business confidence. But the Fed paused its rate hikes early in the year, and began in earnest to make the shift toward an easier policy when trade friction between the U.S. and China heated up in May. Big moves have already been seen in the real rates market. Treasury yields, which move opposite bond prices, have dropped dramatically. The benchmark 10-year Treasury yield went from a 2019 high of 2.799% to a low of 1.93%. It was at 2.12% Thursday. That yield influences mortgages and other lending rates. Just the recent rise in long term rates, shows that the market believes the Fed will succeed in fending off a recession, Emanuel said. “If you look at the entire year, the fact that the Fed pivoted as it did on Jan. 4 to be on balance supportive of the market, it’s very important,” said Emanuel. “And it’s all the more important given the developing expectation there is no quick fix for the trade war and the whole idea that earnings growth is subdued.”

What about global economy?


Company: cnbc, Activity: cnbc, Date: 2019-07-11  Authors: patti domm
Keywords: news, cnbc, companies, 28000, market, wars, rate, interest, send, stock, earnings, rates, fed, quarter, insulate, stocks, trade, dow


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Investor Michael Farr: The Fed could be building a bubble if it cuts rates

Pundits assert a rate cut is needed as “insurance” against a potential downturn in the economy foretold by the ongoing yield curve inversion. The last nine recessions have been preceded by yield curve inversions. Yet over that time there have been ten yield curve inversions. In 1965/66 the yield curve inverted and there was not a recession immediately following. So why is Powell being accosted by the President and the markets demanding rate cuts?


Pundits assert a rate cut is needed as “insurance” against a potential downturn in the economy foretold by the ongoing yield curve inversion. The last nine recessions have been preceded by yield curve inversions. Yet over that time there have been ten yield curve inversions. In 1965/66 the yield curve inverted and there was not a recession immediately following. So why is Powell being accosted by the President and the markets demanding rate cuts?
Investor Michael Farr: The Fed could be building a bubble if it cuts rates Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-11  Authors: michael k farr
Keywords: news, cnbc, companies, president, monetary, economy, curve, building, rate, farr, fed, michael, bubble, yield, policy, markets, investor, cuts, reserve, powell, rates


Investor Michael Farr: The Fed could be building a bubble if it cuts rates

Federal Reserve Chairman Jerome Powell testifies during a House Financial Services Committee hearing on “Monetary Policy and the State of the Economy” in Washington, July 10, 2019.

All eyes in the financial world turned to Capitol Hill this week as Federal Reserve Chair Jerome Powell gave his semi-annual testimony. In his opening statement Powell said, “It appears that uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook. Inflation pressures remain muted.”

What the markets heard was, “Ice cream for breakfast! Candy for everyone!”

The markets clearly believe a rate-cut regime is just around the corner, but is that, in the long-run, the best for the economy?

Pundits assert a rate cut is needed as “insurance” against a potential downturn in the economy foretold by the ongoing yield curve inversion. Although the widely watched 2- to 10-year part of the curve is still positive (though narrowing and now about 20 basis points) the 3-month T-bill has yielded more than the 10 year T-note for seven consecutive weeks after briefly inverting in March. The last nine recessions have been preceded by yield curve inversions. Yet over that time there have been ten yield curve inversions. In 1965/66 the yield curve inverted and there was not a recession immediately following.

History does not repeat itself, but there are similarities to today. Powell may be well advised to follow the path of his predecessor, William McChesney Martin, who stood firm against a president demanding monetary policy easing, and ultimately Chair Martin presided over the longest economic expansion in US history up to that time.

Presently, prices are stable and we are effectively at full employment: the dual mandate of the Fed. So why is Powell being accosted by the President and the markets demanding rate cuts? Shouldn’t we throw a parade and declare victory?


Company: cnbc, Activity: cnbc, Date: 2019-07-11  Authors: michael k farr
Keywords: news, cnbc, companies, president, monetary, economy, curve, building, rate, farr, fed, michael, bubble, yield, policy, markets, investor, cuts, reserve, powell, rates


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Gold eases after surprise US CPI jump, holds above $1,400

U.S. gold futures for August delivery were up 0.26% to $1,408.8 per ounce. Gold prices had touched a one-week high of $1,426 earlier in the session. The U.S. Federal Reserve last month downgraded its inflation projection for 2019 to 1.5% from the 1.8% projected in March. Policymakers from the U.S. central bank are scheduled to meet on July 30-31, where investors will look for further cues on monetary policy easing. Indicative of investor sentiment, holdings of SPDR Gold Trust, the world’s larges


U.S. gold futures for August delivery were up 0.26% to $1,408.8 per ounce. Gold prices had touched a one-week high of $1,426 earlier in the session. The U.S. Federal Reserve last month downgraded its inflation projection for 2019 to 1.5% from the 1.8% projected in March. Policymakers from the U.S. central bank are scheduled to meet on July 30-31, where investors will look for further cues on monetary policy easing. Indicative of investor sentiment, holdings of SPDR Gold Trust, the world’s larges
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Gold eases after surprise US CPI jump, holds above $1,400

Gold prices fell on Thursday, erasing gains made early in the day after stronger-than-expected consumer inflation in the United States cast doubts whether the U.S. central bank will cut interest rates as aggressively as expected.

Spot gold dipped 0.85% to $1,406.8 per ounce, dropping nearly $6 after U.S. consumer prices demonstrated a pick-up in underlying inflation, increasing in June by the most in nearly 1-1/2 years.

U.S. gold futures for August delivery were up 0.26% to $1,408.8 per ounce.

Gold prices had touched a one-week high of $1,426 earlier in the session.

The U.S. Federal Reserve last month downgraded its inflation projection for 2019 to 1.5% from the 1.8% projected in March. However, this may probably not change expectations the bank will cut interest rates this month.

“We saw todays inflation data – the markets started to back off today because it challenges the need for additional rate cuts,” said Chris Gaffney, president of world markets at TIAA Bank, calling bullion’s decline a knee-jerk reaction.

“(Thursday’s move) is just an adjustment of the fact that maybe it had gone up a little fast yesterday, but is still holding nicely above $1,400, and it looks like we going to continue holding above $1,400.”

Spot gold rose 1.5% on Wednesday after Fed Chair Jerome Powell’s dovish remarks, where he confirmed the U.S. economy was still under threat from disappointing factory activity, tame inflation and a simmering trade war, and said the Fed stood ready to “act as appropriate.”

This statement weighed on the dollar. The U.S. currency against major other currencies extended declines for a second session.

Policymakers from the U.S. central bank are scheduled to meet on July 30-31, where investors will look for further cues on monetary policy easing.

Gold rallied to a six-year peak of $1,438.63 an ounce last month, largely on the back of expectations of rate cuts by key central banks amid concerns over the global economy.

“A break above $1,438 may lead to further buying orders with $1,500 being the next level traders looking to target,” Hussein Sayed, chief market strategist at FXTM, wrote in a note.

Indicative of investor sentiment, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.8% on Wednesday.

Amongst other precious metals, palladium erased gains and dipped 1.4% to $1,567.01 per ounce, having earlier hit a high of $1,605.52.

Silver was down 0.1% to $15.22, while spot platinum gained 0.3% to $827.25 per ounce.


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Here’s who benefits from the Fed cutting interest rates

3 Hours AgoTo view this site, you need to have JavaScript enabled in your browser, and either the Flash Plugin or an HTML5-Video enabled browser. Download the latest Flash player and try again. Sallie Krawcheck, Co-founder and CEO of Ellevest says the rate cuts can be good for some but bad for others.


3 Hours AgoTo view this site, you need to have JavaScript enabled in your browser, and either the Flash Plugin or an HTML5-Video enabled browser. Download the latest Flash player and try again. Sallie Krawcheck, Co-founder and CEO of Ellevest says the rate cuts can be good for some but bad for others.
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Here's who benefits from the Fed cutting interest rates

3 Hours Ago

To view this site, you need to have JavaScript enabled in your browser, and either the Flash Plugin or an HTML5-Video enabled browser. Download the latest Flash player and try again.

Sallie Krawcheck, Co-founder and CEO of Ellevest says the rate cuts can be good for some but bad for others.


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Dollar slammed after Powell’s bleak US outlook

The greenback hit session lows versus the euro and yen after Powell’s comments, which reinforced expectations the Fed will cut interest rates for the first time in a decade at its next monetary policy meeting later this month. “We had previously anticipated that those positive developments would convince the Fed to delay that rate cut until September.” The Fed minutes of the June policy meeting released on Wednesday as well echoed Powell’s comments to Congress. Charlie Ripley, senior investment


The greenback hit session lows versus the euro and yen after Powell’s comments, which reinforced expectations the Fed will cut interest rates for the first time in a decade at its next monetary policy meeting later this month. “We had previously anticipated that those positive developments would convince the Fed to delay that rate cut until September.” The Fed minutes of the June policy meeting released on Wednesday as well echoed Powell’s comments to Congress. Charlie Ripley, senior investment
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Dollar slammed after Powell's bleak US outlook

The dollar retreated on Wednesday after Federal Reserve Chairman Jerome Powell struck a downbeat tone in congressional testimony, saying trade uncertainties and concerns about the global outlook continued to exert pressure on the U.S. economy.

The greenback hit session lows versus the euro and yen after Powell’s comments, which reinforced expectations the Fed will cut interest rates for the first time in a decade at its next monetary policy meeting later this month.

In prepared remarks to a congressional committee, Powell said the Fed stands ready to “act as appropriate” to sustain a decade-long expansion.

He also contrasted the Fed’s “baseline outlook” of continued U.S. growth against a considerable set of risks – including persistently weak inflation, slower growth in other major economies, and a downturn in business investment driven by uncertainty over just how long the Trump administration’s trade war with China and other countries will last.

“Powell’s semi-annual testimony to Congress indicates that despite the trade truce following the recent G20 meeting and the strength of employment growth in June, the Fed intends to push ahead with a rate cut at the FOMC meeting at the end of this month,” said Paul Ashworth, chief U.S. economist, at Capital Economics. “We had previously anticipated that those positive developments would convince the Fed to delay that rate cut until September.”

Expectations for a 50-basis-point rate cut at the July meeting have evaporated, but investors still expect a 25 basis-point cut due to weak inflation and worries about growing business fallout from the U.S.-China trade war. The Fed minutes of the June policy meeting released on Wednesday as well echoed Powell’s comments to Congress.

In their June 18-19 meeting, which introduced the near-term possibility of a rate cut, multiple policymakers said rates should come down to “cushion the effects” of a U.S. trade war and to firm up inflation that is failing to meet the central bank’s 2%-a-year target, according to minutes from that meeting released on Wednesday.

Charlie Ripley, senior investment strategist at Allianz Investment Management said the Fed minutes backed expectations of a near-term rate cut.

“The idea of ‘insurance’ rate cuts may be a difficult proposition for some policy makers to grasp, but markets are signaling that a decline in policy rates is required in order to sustain the current economic expansion,” he added.

In afternoon trading, the dollar index slid 0.4% to 97.097. Against the yen, the dollar fell 0.4% to 108.43, dropping 0.5% against the Swiss franc to 0.9892 franc. The euro, meanwhile, rose 0.4% to $1.1252.


Company: cnbc, Activity: cnbc, Date: 2019-07-10
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How your money might be affected if the Fed cuts interest rates

A rate cut could hurt savers with high-yield accountsThe federal funds rate is used as the benchmark for many consumer interest rates. Variable credit card interest rates are tied to the prime rate, for example, which is closely related to the federal funds rate, Hamrick says. The Fed does not directly set mortgage rates, but cutting the benchmark rate could still impact your mortgage. “But a drop in the fed funds rate will contribute to mortgage rates remaining low into the future.” If you hold


A rate cut could hurt savers with high-yield accountsThe federal funds rate is used as the benchmark for many consumer interest rates. Variable credit card interest rates are tied to the prime rate, for example, which is closely related to the federal funds rate, Hamrick says. The Fed does not directly set mortgage rates, but cutting the benchmark rate could still impact your mortgage. “But a drop in the fed funds rate will contribute to mortgage rates remaining low into the future.” If you hold
How your money might be affected if the Fed cuts interest rates Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-10  Authors: alicia adamczyk
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How your money might be affected if the Fed cuts interest rates

Jerome Powell, chairman of the U.S. Federal Reserve, said that downside risks to the economy remain with trade wars softening business investment and weak inflation.

Federal Reserve Chairman Jerome Powell said Wednesday that the U.S.’s uncertain economic outlook could lead the central bank to cut its benchmark short-term interest rate later this month. Experts say the cut would likely be a modest quarter of a percentage point. The rate cut would be a result of a confluence of factors, including uncertainty over a U.S-China trade war and a slowing economy. How would a rate cut — the first since 2008 — impact the average consumer? While it’s hard to predict, generally, a rate cut is “good for borrowers, bad for savers, and mixed for investors,” Sallie Krawcheck, co-founder and CEO of Ellevest and former Wall Street executive, tells CNBC Make It.

A rate cut could hurt savers with high-yield accounts

The federal funds rate is used as the benchmark for many consumer interest rates. Already, some banks — including Ally and Marcus by Goldman Sachs — have cut yields on some of their retail products, including savings accounts, in anticipation of the central bank’s actions. Experts say savers can also expect CD rates to fall ahead of the Fed’s decision. The exact impact is still unknown, says Mark Hamrick, Bankrate.com senior economic analyst. Although savings account APYs might decrease, he says, many traditional banks never increased them significantly anyway; the national average rate is still 0.10%.

A rate cut helps borrowers with credit card debt

An interest rate cut is bad news for savers, “but it is something of an unexpected gift for borrowers and investors,” says Hamrick. Variable credit card interest rates are tied to the prime rate, for example, which is closely related to the federal funds rate, Hamrick says. So, with the federal funds rate dropping, a card holder could see a drop in their APR within a billing cycle or two, which means smaller monthly payments. Credit card interest rates are currently at a record high, so any breathing room would be a boon to those carrying credit card debt. Still, a slight cut won’t save borrowers much when they are facing double-digit interest rates; it’s important to make a plan to pay off any balance as soon as possible.

Mortgages are more complicated

Mortgage rates are a bit trickier, says Hamrick. The Fed does not directly set mortgage rates, but cutting the benchmark rate could still impact your mortgage. Investors typically rush to the relative safety of bonds when the economy falters. As a result, recent lower bond yields have led to substantially lower mortgage rates since the end of 2018. Cutting rates could potentially reverse that, Hamrick says, as it signals an improving economy. On another front, Skylar Olsen, Zillow’s director of economic research, tells CNBC Make It that other economic factors have more influence on mortgage rates. “The typical 30-year mortgage rate is responding more to uncertainties on a global stage due to trade war concerns and early stage softening in the economy in general than in the fed funds rate,” says Olsen. “But a drop in the fed funds rate will contribute to mortgage rates remaining low into the future.”

Some other loans might be impacted

Consumers with home equity lines of credit would also benefit from lower interest rates, while auto loans should not be materially affected by the change. Federal student loan rates are set by the Department of Education each year, based on the 10-year Treasury note, and are expected to fall next year. Private loan rates might be variable, and therefore could be indirectly influenced by the Fed’s decision. If you hold private loans, it could be worth exploring refinancing options if the Fed drops interest rates.

Overall the effects are mixed


Company: cnbc, Activity: cnbc, Date: 2019-07-10  Authors: alicia adamczyk
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Analysts say some emerging market currencies look appealing as the Fed weighs rate cuts

Investors should be looking to buy emerging market currencies against the U.S. dollar, two analysts told CNBC on Monday. Those calls come as the U.S. Federal Reserve appears to be seriously considering cutting U.S. interest rates. “We do think there is a basket of emerging market currencies that look appealing as the Fed is poised now to begin cutting rates as opposed to raising rates, ” he told CNBC’s “Street Signs. ” The term “carry trade” refers to a strategy in which investors borrow in a cu


Investors should be looking to buy emerging market currencies against the U.S. dollar, two analysts told CNBC on Monday. Those calls come as the U.S. Federal Reserve appears to be seriously considering cutting U.S. interest rates. “We do think there is a basket of emerging market currencies that look appealing as the Fed is poised now to begin cutting rates as opposed to raising rates, ” he told CNBC’s “Street Signs. ” The term “carry trade” refers to a strategy in which investors borrow in a cu
Analysts say some emerging market currencies look appealing as the Fed weighs rate cuts Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-09  Authors: abigail ng
Keywords: news, cnbc, companies, emerging, rates, rate, say, weighs, dollar, market, told, appealing, currency, think, interest, looking, cuts, fed, look, currencies


Analysts say some emerging market currencies look appealing as the Fed weighs rate cuts

Investors should be looking to buy emerging market currencies against the U.S. dollar, two analysts told CNBC on Monday.

Those calls come as the U.S. Federal Reserve appears to be seriously considering cutting U.S. interest rates. As dollar-based investments begin to yield less interest, that may weaken the greenback against the currencies of higher-interest countries — including many in the developing world.

“What we see now is that the dollar is probably topped out against a number of the emerging market currencies, ” said Mike Ryan, chief investment officer for the Americas at UBS Global Wealth Management.

“We do think there is a basket of emerging market currencies that look appealing as the Fed is poised now to begin cutting rates as opposed to raising rates, ” he told CNBC’s “Street Signs. ”

This does not signal broad-based U.S. dollar weakness, he added, noting that other developed-country central banks are also looking to pivot on rate policy.

Khoon Goh, head of Asia research at ANZ Bank, echoed that view.

“We already have the (Australian and New Zealand central banks) easing, so I think we’re in this situation where carry trades will very much come back into vogue, ” he told CNBC’s “Squawk Box. ”

The term “carry trade” refers to a strategy in which investors borrow in a currency with low interest rates in order to purchase assets in a currency with higher interest rates. That way, they can earn from their investments in another currency while paying less interest on the amount borrowed.

Goh said ANZ continues to favor some currencies in Asia such as the Indian rupee and the Indonesian rupiah. Benchmark interest rates in India and Indonesia are 5.75% and 6%, respectively, compared to the Fed’s target between 2.25% and 2.5%, according to Trading Economics.

The picture in terms of the U.S. dollar index is “a little bit more muddy,” but it’s clearer for high-yielding currencies of countries with a “compelling growth story” or scope for economic reforms that will spur foreign inflows, he added.


Company: cnbc, Activity: cnbc, Date: 2019-07-09  Authors: abigail ng
Keywords: news, cnbc, companies, emerging, rates, rate, say, weighs, dollar, market, told, appealing, currency, think, interest, looking, cuts, fed, look, currencies


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The housing market is about to shift in a bad way for buyers

Competition in the housing market finally began to cool this year, as listings multiplied and price gains moderated. The housing shortage that fueled competition and resulted in sky-high price gains throughout 2017 and the first half of 2018 is on the horizon yet again. Supply is soon expected to drop and potentially hit a new record low, according to realtor.com, after increasing in the second half of last year. Inventory gains began to slow this year from 6.4% growth in January to 5.8% in Febr


Competition in the housing market finally began to cool this year, as listings multiplied and price gains moderated. The housing shortage that fueled competition and resulted in sky-high price gains throughout 2017 and the first half of 2018 is on the horizon yet again. Supply is soon expected to drop and potentially hit a new record low, according to realtor.com, after increasing in the second half of last year. Inventory gains began to slow this year from 6.4% growth in January to 5.8% in Febr
The housing market is about to shift in a bad way for buyers Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-09  Authors: diana olick
Keywords: news, cnbc, companies, housing, inventory, buyers, rates, low, months, market, competition, according, gains, price, record, bad, shift, hit, way


The housing market is about to shift in a bad way for buyers

Competition in the housing market finally began to cool this year, as listings multiplied and price gains moderated. Bidding wars became less frequent and spring sales perked up a bit. Well, forget that. The heat is on yet again.

The housing shortage that fueled competition and resulted in sky-high price gains throughout 2017 and the first half of 2018 is on the horizon yet again. Supply is soon expected to drop and potentially hit a new record low, according to realtor.com, after increasing in the second half of last year.

The number of for-sale listings was up 2.8% annually in June, but that was down from May’s 2.9% gain. Inventory gains began to slow this year from 6.4% growth in January to 5.8% in February. Gains continued to slow throughout the spring and supply is now expected to flatten over the next three months and could hit its first decline in October of this year, according to realtor.com

“It was only 18 months ago that the number of homes for sale hit its lowest level in recorded history and sparked the fiercest competition among buyers we’ve ever seen. If the trend we’re seeing continues, overall inventory could near record lows by early next year,” said Danielle Hale, chief economist for realtor.com. “So far there’s been a lackluster response to low mortgage rates, but if they do spark fresh buyer interest later in the year, U.S. inventory could set new record lows this winter.”

Part of the issue is that fewer owners are now listing their homes for sale, and there are several reasons why.

“It’s likely a combination of rate-lock, recently decreased consumer confidence and older generations choosing to age in place,” added Hale.

Mortgage rates are still pretty low, but so many homeowners refinanced their loans when rates were even lower that moving would mean paying more for the same mortgage, on top of paying more for a move-up home. Even those sellers who want to downsize would be moving into a pricier market.

Home price gains had been shrinking, but the gains increased again in June for the first time in 14 months, according to CoreLogic.


Company: cnbc, Activity: cnbc, Date: 2019-07-09  Authors: diana olick
Keywords: news, cnbc, companies, housing, inventory, buyers, rates, low, months, market, competition, according, gains, price, record, bad, shift, hit, way


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