How a Fed Rate Hike Would Impact Global Economy

The video discusses the potential impacts of the Federal Reserve raising interest rates by 25 basis points over two years, predicting a global GDP reduction. It highlights the negative effects on China and benefits for Saudi Arabia. The video also examines the impact of a 10% increase in oil prices, noting minimal global activity changes but varied effects on consumers and producers. Lastly, it explores the significant consequences of a 1% reduction in China's growth, particularly affecting its trading partners.

What is the expected global GDP reduction if the Fed raises rates by 25 basis points over the next two years?

• 0.4% total, 0.2% per year

• 0.6% total, 0.3% per year

• 0.8% total, 0.4% per year

• 1.0% total, 0.5% per year

Which country is expected to benefit from the Fed's rate hike?

• China

• Saudi Arabia

• India

• Brazil

How would a 10% increase in oil prices affect global activity?

• Significant positive impact

• Minimal impact

• No impact

• Significant negative impact

What has been the unexpected effect of lower oil prices over the past months?

• Increased global economic growth

• Positive impact on oil consumers

• Negative net effects

• Stability in oil markets

What is the potential impact of a 1% reduction in China's growth on global GDP?

• Up to 0.5% reduction

• No impact

• Up to 1% reduction

• Minimal impact