Now: Fear is Back to the Market

Inflation still the main focus of everyone as policymakers around the world a ready to tighten their policy to achieve their goal. The latest rate hike is from Bank of Canada (BoC) in which has increase the interest rate by 50-basis point from 1.0% to 1.5% on Wednesday. So far, we know that BoC’s inflation target is 2.0% YoY and the current inflation is still far above so it is expected that BoC will do more rate hike in the future.

The rate hike maybe on pause on this September but this doesn’t mean that they are trying to boost the market. In fact, there are many situations regarding economy will be stabilize by this September and they want to see the market reaction first and either that will help reduce some of the current inflation rate. On other hand, James Bullard, one of the FOMC member state that a continuously rate hike by 0.50% per meeting is a good plan for the current economy situation.