Investors should prepare for the steepest rate hikes since 2006

(Dec 12): Wall Street economists are telling investors to brace for the biggest tightening of monetary policy in more than a decade.

With the world economy heading into its strongest period since 2011, Citigroup and JPMorgan Chase & Co. predict average interest rates across advanced economies will climb to at least 1% next year in what would be the largest increase since 2006.

As for the quantitative easing that marks its 10th anniversary in the US next year, Bloomberg Economics predicts net asset purchases by the main central banks will fall to a monthly US$18 billion ($24.3 billion) at the end of 2018, from US$126 billion in September, and turn negative during the first half of 2019.

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