Are Central Banks Caught in a Rate Trap?

Kitco News -- After successfully boosting global equity markets with countless trillions of dollars, are central banks finally admitting their policies are failing? 'Indeed, central banks are caught in a rate trap,' says Gerald Celente, founder of the popular newsletter, Trends Journal. 'If they raise rates, already slowing economies will further recede while stock markets and housing sectors relying on cheap money will falter. Should central banks lower rates, they risk currency depreciation and money outflows,' he said on Wednesday. Celente points to the Bank of Japan, 'despite high expectations that the BOJ would stimulate its nation's foundering economy by driving interest rates further into negative territory, and that Prime Minister Shinzo Abe would fire his third Abenomic stimulus arrow, both missed the target. On the news that the BOJ held rates and the stimulus arrow was far smaller than markets anticipated, the NIKKEI trended closer to bear territory and Asian markets moved lower.'

This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.