US Job Data

US job data released by labour department beat earlier forecast by experts of 60,000 jobs being added versus fresh data depicting that jobs that added infact are 90,000. This data can make US federal reserve pause in it's rate cut spree. It's very essential for US central banker to hold it's rates so that dollar can be hold steady against Euro, Yen, Canadian Dollar. If he cuts the rates then it might again unleash huge liquidity to riskier assets, which alredy are extreme inflated levels. Also central banks of US and European countries should slow down the level of printing their currency if they want to have financial markets in healthy shape and avoid bursting of equity and commodity bubble in an abrupt manner.

Fed Rate Cut Or Not?

Will the US federal reserve cut the interest rate in his september 18 meeting, if yes then by how much, is the puzzle that stock markets are grappling with. Any cut above 25 basis points will indicate deep scars left by subprime mortgage mess and subsequent dampening effects on the economy and job losses and thus concern for stocks in the US and on nations which are export dependent on US. Japan is already facing stronger yen problem because of yen carry trade unwinding and its effect on its exports. Asian stocks have shown good resilience and will continue to outperform the US and Europen stocks as money in these developed countries will flow to growing economies(asian) in order to beat low returns available in their home markets.