Timing your Interest rate hedge
Markets react instantaneously to changes in key economic variables and well in advance of official changes in policy which typically occur following set meetings. By the time, central banks make their decisions, the markets have already had time to adjust. Waiting for a confirmation from central banks quote often leads to increased costs. The combination of rising inflation, faltering growth and fully valued equity and bond markets provide the potential for increased volatility in FX and interest rate markets over 2022. The adjustments we have seen to the market’s expectation for the future path in interest rates may not be complete. Financial risks, unlike business risk, can be managed away by hedging. It’s time to ensure that the financial risks you are exposed to are acceptable. Read more about how interest rate swaps and interest rate caps can protect you against raising rates (SONIA & LIBOR).