August 07, 2024 at 12:24PM
It is not a reaction to fundamental issues with the economy
If confidence in slowing trend of inflation strengthens, rate cuts can continue
The path to inflation target is still bumpy
Even so, a repeat of the Friday and Monday rout in markets risks further tightening in financial conditions and could still prompt central banks into action. Or at least traders will wish for that to happen amid more kicking and screaming to come, that is.
This article was written by Justin Low at www.forexlive.com.
ECB’s Rehn: Recent market turmoil is an overreaction to uncertainty and thin liquidity