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The Short View: Will the Fed’s gamble pay off?

By Philip Coggan, Investment Editor

Published: August 9 2006 19:09 | Last updated: August 9 2006 19:09

Investors have not quite known what to make of the Federal Reserve’s latest decision. Equities rose on the news, only to fall subsequently; the dollar fell, only to rise. Treasury bond yields moved modestly higher.

The markets got the pause in rates they had been expecting but not the “closure” beloved of psychological dramas. As the Fed made clear, if the data deteriorate, further rate rises could occur.

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