Commentary on Rising Interest Rates

Commentary on Rising Interest Rates

The Federal Reserve (Fed) recently raised its benchmark interest rate by 0.25%, with one more hike planned for the rest of the year. However, the Fed has shifted its strategy after the failure of Silicon Valley Bank and is no longer aiming to raise rates by 0.5% to control inflation. Although the rate hike on Wednesday may not be the last, it is likely that the rate-hiking cycle is ending. Despite market turbulence, it is essential to have a consistent investment philosophy to weather the ups and downs and ultimately achieve healthy returns. Waiting for the "right time" to invest is a mistake as there is never a perfect time, and it can cause you to miss out on market growth. The key to a successful investment journey is to remain disciplined, maintain a long-term perspective, and look beyond short-term concerns.

Sharing in point form from feedbacks:

  • The Federal Reserve (Fed) raised its benchmark interest rate by 0.25%, with one more hike planned for the rest of the year.
  • The Fed has abandoned its previous strategy of raising rates by 0.5% to control inflation following the failure of Silicon Valley Bank.
  • Although Wednesday's rate hike may not be the last, the cycle of rate increases is coming to an end.
  • It's important to have a consistent investment philosophy that can withstand market turbulence and provide healthy returns over time.
  • Waiting for the "right time" to invest is not advisable, as there is never a perfect time, and it can cause you to miss out on market growth.
  • To have a successful investment journey, it is crucial to maintain discipline, keep a long-term perspective, and look beyond short-term concerns.

Source:

  1. Reuters: Indian rupee firms as Fed hints hiking cycle near its end
  2. Bloomberg: Traders Worldwide Herald End to Rate Hikes After US Bank Run
  3. The Business Times: Banking turmoil : Stay invested, this too shall pass
  4. The Straits Times: The rate-hiking cycle is near its end
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