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Central Bank Rate Cut Race In Full Force

By Dean Popplewell

Previously a covert, but now blatant, open and aggressive central bank monetary policy war is well underway. Over the past few weeks a plethora of central banks from Denmark to New Delhi, to down-under have been contributing to the whole process. All the various asset classes are adjusting to interest rate recalibration due to low inflation, deflation that is leading to lower growth mostly pressured by the -60% fall in energy prices. Central banks are caught behind the curve and are now in reactionary mode. If soft data continues to emerge from the U.S eventually the Fed will be backed into a corner and will be required to save face. To date, they have been very transparent about their intentions to normalize their rate policy, but their foes are making that priority an unnecessary action any time soon. If the U.S economy even hints of wobbling, then the global alarm bells will only get louder very…