Oliver's insights

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15 December 2016

The Fed hikes and Trump stimulus in 2017 – implications for investors and Australia
Key points - After a year since the first Fed rate hike in this cycle, the Fed has finally moved the Fed Funds rate up again from a range of 0.25-0.5% to 0.5-0.75%. The move reflects confidence in the ongoing recovery in the US economy. - Given ongoing low wages growth, low inflation and a strong $US doing part of the Fed's job for it, future Fed hikes are likely to remain "gradual" for now but fiscal stimulus under Donald Trump could see it speed up. Expect around three Fed rate hikes in 2017. - It's too early for US monetary tightening to be a cyclical negative for shares, which will also benefit from US fiscal stimulus. - Bonds are oversold and due for a pause, but gradual Fed r
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About Oliver's Insights

Oliver's Insights is a regular update from Dr Shane Oliver, Head of Investment Strategy and Chief Economist, AMP Capital.

In Oliver's Insights, Dr Shane Oliver explores the latest issues regarding financial markets and the economy.

Who is Dr Shane Oliver?

Dr Shane Oliver joined AMP in 1984 as a research officer and in 1994 became AMP's Chief Economist. He now plays a major role in determining AMP Capital's investment strategy and asset allocation. He also provides economic forecasts and analysis to the asset class portfolio managers. As chief economist, he maintains a media profile for AMP Capital on economic and investment market issues.

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