False start to the Fed’s rate hike cycle, says Saxo

Greece’s seeming descent into chaos at the end of the 2Q has fashioned an intensely uncertain framework casting markets at the mercy of headline risk. It is with that ever-changing caveat that Saxo Bank, the parent company of Saxo Capital Markets, has published its Q3 Outlook. Saxo’s investment outlook for 3Q 2015 warns investors that while current economic data is not supportive of suggested rate hikes by the U.S. Federal Reserve, they could increase anyway; a move the Fed may eventually regret. The rate hike would be the first in the U.S. since 2006. Such move will put markets in a very challenging environment, says Kay Van-Petersen, Asia Macro Strategist at Saxo Capital Markets. The strategist notes the global economy is experiencing increased dislocations with the US looking to raise rates while most of the rest of the world has an easing bias. “I approach my third quarter trading views with a ‘parking-the-bus’ defensive stance in mind, and an expectation of a considerable correction and adverse moves across asset classes”, Van-Petersen said. To read the full report visit: (VIEW LINK)