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Anonymous

12 Jun 2020

Random

Are rising interest rates going to happen? Should I put money into US bank stocks?

US interest rates are cyclical and the last time i saw it being high was in the 90s. Do you think it will be likely that interest rates increase anytime in the next 20 years? I was thinking with so many money printing being done, inflation is inevitable down the road, so interest rates will go up.

I was thinking of putting some money on US bank stocks that will hedge against this. When inflation rate increase, most stocks fall except financials- then sell bank stocks and buy into other sectors?

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Lin Yun Heng

12 Jun 2020

Senior Analyst at Delphi

If you have been following the news, FED just announced a near zero interest rates until 2022. So at least for now interest rate should be low. The past 10 years we've been in a low interest rate environment, and I personally think that will still be the case until the economy manages to catch up from it's current downturn.

Government these days are addicted to monetary easing which come at the least political capital expense, the moment the economy/stock market start to falter, the central banks come in to cushion the fall.

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