July 5, 2022

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Understand why higher interest rates in the United States affect your investment

Understand why higher interest rates in the United States affect your investment

The US ratio is used to value all assets in the world. (Image: REUTERS / Beawiharta)

Inflation United States In May it surpassed ratings at full index and center, and strengthened expectations of serious Fomc Wednesday (15th).

The biggest price rise in 40 years led Fomc to market three more gains, up 0.50 percentage points until September.

Fears of austerity sent global stock markets into a tailspin on Friday. Bags This Monday (13) followed the risk avoidance method.

But, after all, why does the market act in this way to increase interest rates?

As Mauro Rochett, the investment head of Tokoval, recalls, what is happening in the U.S. economy is having an impact on the entire world because the country’s currency is used in foreign trade in all countries.

“The interest rate in the United States is a measure of the risk-free rate, something I manage to pay my money into,” he explains. “When this rate increases, I tend to take more money and apply for that rate.”

The US price is used to price all assets in the world, he points out. “When it rises, it means that I am bringing the flow of any investment at a higher rate to the current value.”

“If I bring a higher rate now, the flow will be smaller Evaluation The fall of assets “, explains the economist.

Global inflation

Rochett says the US Federal Reserve is now raising the rate of return from a series of processes due to the global inflation process.

One of the key processes, he says, is the irregularity of production chains. “We have heard a lot that cell phones are missing due to lack of chip. Production chains, especially in Asia, are plagued by Govt disease, so there is no chip.

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For the Daycoval expert, the inflation process was identified as “probably late” in the United States. “The Fed has been talking about inflation for the last half of the year, but the truth is, the process is clearly not temporary.”

Perceptual change led the US Federal Reserve to quickly cut monetary incentives and begin the process of raising interest rates faster. “Because of the backlog in this process, the central bank should now take the back seat.”

* Reuters with information

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