How to Prepare for Rising Interest Rate

So, it is final that FED increased interest rate by 25 basis points on last Wednesday and you could easily find news and comments on the impact of stocks and economy with this rate hike.  But at least the rate hike is seen as vote of confidence in US economy which has witness increasing inflation and job growth and of course market react positively on this.

Our immediate thinking will be, of course the cost of borrowingwill increase as bank will price in higher loan rate, and this lead me to think further that will bank be benefited with higher loan cost eventually. Meantime ,some analyst are more cautious on that because our banks are facing loan crisis from O&G sector hence may not be so sanquine on bank’s future earning.

Some are more optimistic about “ Consumer discretionary goods “ related stocks as better job …


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