Excerpt from: Bonds and Interest Rates CFDs and Spread Bets
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| October 19, 2007 | | Chance of Fed rate increase | Spread betting and contracts for differences on interest rates should take into account the differentials, as well as their effects on other financial instruments. Right now, rate expectations from the U.S. Federal Reserve have shifted to a greater chance of a cut – up to 70 percent. Reuters reports on the effects of interest rates:
If the dollar was the main loser from the shift in rate expectations -- U.S./euro zone yield differentials are now at their narrowest in over three years -- the low-yielding yen was the biggest beneficiary from the rising risk aversion.
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