China Raises Rates by 0.25%

by Marilou Moursund on October 20, 2010

in Commodities,currencies,Energy,Foreign Markets

The dollar strengthened yesterday, and commodities and energy traded off as China increased rates by 0.25%.  The Dow was down 165 points, and mostovernight.  The Chinese government is concerned about property speculation and inflation.

We think that China is being prudent in trying to head off an asset bubble.  Their stimulus worked much better than ours, and “tapping on the brakes” makes sense given the spike in commodity prices.

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