Another hike by ECB would be quite bizarre

LAST Friday afternoon the gravity of the problems facing equity markets and indeed the overall global economy was demonstrated in stark fashion by the dramatic decision of the US Federal Reserve to cut one of its two key interest rates by 0.5%.

Since that move the markets have become somewhat more relaxed, happier in the knowledge that the US central bank is standing by prepared to do whatever is necessary to rescue the US financial system.

Despite the more relaxed behaviour of the markets this week, it is still early to call the all clear, but with the most important central banker in the world prepared to do whatever is necessary, it is possible to be somewhat more confident about the future.