Fed Sets The Scene

January 2004 | Market Strategy

With the strong economic data emanating from the US of late, it was only a matter of time before the Fed changed their dovish tune. Although the Federal Reserve left interest rates on hold last night, the accompanying statement from Chairman Greenspan signalled that the easing cycle is certainly over. Given his desire, though, not to overly shock global financial markets, Greenspan's decision to drop the "keeping rates low for a considerable period" phrase, emphasising instead that he can be patient before tightening policy, has laid the groundwork for a higher cost of borrowing later in the year. That said,

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