Goldman Says Rising U.S. Rates ‘Boiling the Frog’ of Risk Assets
- Market sees three Fed rate hikes by end 2019 to the bank’s six
- EM fragility could extend to other global risk assets: Goldman
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Rising U.S. interest rates are probably just beginning to roil risk appetite around the world, according to economists at Goldman Sachs Group Inc.
Global investors may be underestimating the headwinds to financial assets posed by U.S. rates, they said. While the real rate on three-month U.S. Treasury bills -- or the nominal rate minus inflation (or inflation expectations) -- remains negative, Goldman forecasts the measure will diverge from other real rates in the developed and developing world over the next year-and-a-half.