Monday, November 17, 2014

Nouriel Roubini doesnt expect Fed to raise rates soon

Dr Doom thinks the Fed will play it safe with potential rate hikes

Even if growth, inflation and employment data are at the right level to start hiking, the Fed would like to wait a little bit longer just to make sure that if they start hiking with the liftoff, they're not going to abort and go back to zero because otherwise they lose their credibility. There will be a hard landing of the economy. So better be safe rather than sorry.

Why Roubini thinks the other central bank policies could affect US Fed decisions-

Suppose the rest of the world is worse than the Fed expects and suppose the dollar appreciates by another 5 to 7 percent, trade-weighted, at that point the impact on U.S. growth and on U.S. inflation could be worse than the Fed is currently expecting. That could lead the Fed to start later and much more slowly.