What they did make sense since their economy has been booming for the last 30 years even when they had 5% - 10% interest rate but now their economy has supposedly cooled down a bit they want to stimulate it further by decreasing the interest rate. But our economy in the West has been the opposite, while we were busy feeding China making it great with our money, our economy has actually suffered especially with a pandemic that was started in a country that I am not going to mention here, we needed to lower the interest rate to stimulate the economy but now with inflation looming large, we don't have a choice but to raise the interest rate to keep it down. And according to this article, Xi himself has actually mentioned the global inflation risk, https://www.bloomberg.com/news/vide...arns-of-impact-of-interest-rate-u-turns-video and yet he doesn't appreciate the fact that the West wants to do something about it by raising interest rates? Yeah why? Because China is not doing well supposedly and because China is not doing well, so the world cannot raise interest rates; everybody has to dance to the tune of China and bend over backwards to cater to China's needs and wants and economic condition. The self-centeredness and selfishness is just astounding with no regards for others but their own self interest.
He should warn China to mind its own business and stop interfering US' internal affairs least of it telling an independent institution what to do. It's not the US or the world's problem that this supposed economic slowdown in China will bring potential political risk in China https://www.bloomberg.com/news/arti...larm-on-slowing-economy-as-key-political-risk. Honestly China is the country that had the highest economic growth in the last 30 years; it has grown from a 3rd world country to now the second largest economy in the world and yet it's still fearing political risk just because its economy has slowed down barely even 1%? This just shows how much people love its government. No other countries are complaining except China. It's not just the "western countries" that are raising interests. Many Eastern European countries are raising interest rates too to clamp down on inflation which is actually a greater risk to the global economy. The solution to inflation is not more quantitative easing; it's raising interest rate and at the same time increasing productivity, domestic productivity not cheap imports.
China will begin a series of interest rate easing. This will present a huge dilemma for international markets. It will be something that has never happened before regarding large countries. Central banks in the past have moved in orchestra. China seems to have decoupled almost completely from the US.
China has always decoupled from the US and the West. LOL It only uses the US and the West as an ATM machine. When the US and the West were all doing quantitative easing, China was having 5% - 10% interest rate on its deposit savings accounts. Its central bank Bank of China has never "moved in orchestra" with central banks from the rest of the world. The point is, did US and the West ever complain or "urge and warn" Bank of China regarding its monetary policy and telling China that its hiking up of its interest rate will leave the rest of the world bearing the grunt of the burden from its monetary policy? No so China shouldn't either. And in fact it's never interfered before, dunno why it's so insistent all of sudden. Are there really political risks that are going on right now in China that we don't know about?
Maybe the lie flat movement, maybe the housing crash, maybe the fact you can not drink water from a faucet in China, maybe a combo of them all. By their censorship we would not inow the water is boiling until it starts to spil.
Actually you can if your stomach is strong enough to stand it. But still the fact how China would come onto an economic forum to openly "urge and warn" and interfere with US monetary policies is actually quite worrying. China has never done this before. Aside from this being a political and international protocol faux pas, this is also very very unusual. We never know anything that's true but still can't help wondering what's going on...
My gosh!! Can't believe China's interfering really worked. https://www.federalreserve.gov/monetarypolicy/files/monetary20220126a1.pdf US Federal Reserve, an independent institution that's not even supposed to listen to the POTUS, is now listening to a foreign country. Unbelievable!!
So the dollar might rise in value, oil, Euro, RMB and every Emerging Market currency will lose value. Stock markets of EM's too. Any questions? Ok let's get to work.