For decades, Japan has been the land of cheap money. Interest rates sat near zero, sometimes even below, while other countries offered much higher returns. That gap created what traders call the “carry trade.” The logic is simple: borrow yen at almost no cost, swap it into dollars, and invest in US bonds paying 4-5%. The difference becomes your profit.
For more than a decade, money was cheap — maybe too cheap?! Now that era is gone. Rates and bond yields have jumped back to levels we last saw before the financial crisis, and the adjustment is shaking things up.
Oil has this ability to grab the centre stage. A big swing in crude prices can reset inflation expectations almost overnight, unsettle central banks, and shuffle stock-market winners and losers. Think back to 2022. Crude shot up as economies reopened and supply chains buckled, feeding one of the sharpest inflation spikes in decades. The Energy sector loved it. Tech, not so much. Which makes you wonder if oil is really pulling the strings, or just playing a noisy side role?
Gold has long been a go-to for those looking to hedge against inflation or simply sleep better when markets get shaky. But here’s the question: what happens when interest rates, especially real, inflation-adjusted ones start heading north?
Rate cuts usually get investors excited. Lower interest rates, easier credit, and more breathing room for consumers and businesses alike. But what if inflation’s still hanging around, not falling, not rising dramatically either, just... maybe stubborn?
