Rate rise a new experience for majority of US traders

London

ECONOMISTS and market participants are already embarking on the guessing game on the next US Federal Reserve rate hike and monetary policies of other central banks. The relief rally which started a day before the long-expected rate rise thus petered out on Friday, and the overall expectation is that markets will remain volatile into the New Year.

"It is a new experience for about two-thirds of traders who have never experienced a rate hike, said Ben Brettell, senior economist at Hargreaves Lansdown, a large quoted UK financial services company, adding that the age of the majority of traders are 30 are under, and the last upward interest rate cycle was from one per cent in 2004 to 5.25 per cent at the end of 2006. Since then, rates were on a downward path and remained around zero from the 2008 to 2009 recession until Wednesday this week.