Macroeconomic weekly round up: China's eventful week and how will the Fed react?
Jason Walls breaks down the week's biggest news in macroeconomics on NBR Radio, and on demand on MyNBR Radio.
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One of the most volatile weeks on the markets in recent history has continued its roller-coaster ride as the eyes of the world continue to be on global stock markets.
Last Friday, China’s manufacturing index dropped to its lowest level in six years and the Shanghai and Shenzhen stock markets started shedding value, losing more than $US1 trillion in a matter of days.
NBR Reporter Jason Walls says China’s stock markets were unstoppable up until July, then cracks began to appear.
Since then, the market has dropped more than 40%.
But Mr Walls says it’s important to keep things in perspective, as although this is a heavy loss, the Shanghai composite is still up 70% on this time last year.
The effects of the Chinese market have rippled around the world, triggering panic on Wall Street.
Wall Street’s six-year bull run looked to be on a path to correction after six straight days of loss.
But the market bounced back on Wednesday, with the Dow up by almost 4%, the biggest jump since 2011.
The recent market activity has cast more doubt as to whether the US Federal Reserve will hike its interest rate hikes next month.
Mr Walls says markets are pulling back their pricing of a rate hike, with low inflation and low wage growth continuing to be a thorn in the Fed’s side.
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NBR Radio
Fri, 28 Aug 2015
Fri, 28 Aug 2015
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Macroeconomic weekly round up: China's eventful week and how will the Fed react?
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