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Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Chip McVickar who wrote (1237)	2/11/1999 9:24:00 AM
From: Henry Volquardsen	Read Replies (1) \| Respond to of 3536

Chip, Definitely just the natural rhythms of the market. US interest rates have been under some upward pressure because of the economic environment. US economic growth has been strong, strong enough that the market would expect the Fed to be adopting a bias towards tightening. The one contrary factor had been the Fed's demonstrated concern about the weakness in the emerging markets. Recently we have seen some encouraging signs out of Asia that those economies may be set to show some growth again. Also the recent Brazil situation showed some positives. First there were no knock on effects to other emerging markets, the concern remained contained to Brazil. Second, Brazil itself appears to have weathered the storm. So with a calming, for the moment, of emerging market concerns and strong US growth the market starts to fret about the Fed reversing last year's eases. FWIW I don't think this will be a long lasting rise in rates, more of a first and second quarter thing. I believe we will see rates lower in the second half.