Aussie rates, Fed minutes and summer unknowns

LONDON, July 1 (Reuters) – Following are five big themes likely to dominate thinking of investors and traders in the coming week.

1/FORWARD THINKING

With markets into the second half of 2021, can the fast and furious run of the last 15 months keep going?

H1 saw some spectacular action: Oil soared 45%, one ‘meme’ stock loved by amateur traders rose more than 2,500%, Brazil’s currency went from zero to hero. But all that stimulus money also means U.S. inflation now annualises at 8% versus an average of just 3% over the last 100 years.

As Donald Rumsfeld, who died on Tuesday, said about something completely different: There are many known unknowns. COVID-19 is one, but BofA reckons only a market crash would now stop the Fed reining in stimulus before year-end.

Considering how much markets love cheap money, Q3 may be a bumpy ride.

– Fast and furious first half of 2021 keeps financial markets at full throttle.

Source: Reuters