What's going on?

Investors were surprised on Wednesday when India, New Zealand, and Thailand�s central banks all followed in the US�s footsteps and lowered their interest rates.

What does this mean?

Like the US, India and New Zealand were both widely expected to announce economy-boosting rate cuts that would make borrowing cheaper. But unlike the US, they announced bigger cuts than anyone saw coming… (tweet this)

India�s central bank, in fact, lowered the country�s interest rates to their lowest in nine years. �Hold my beer,� said New Zealand, which lowered rates to an all-time low (by double the amount expected). �Hold my beer,� added Thailand, which � caught between a strong currency that makes its exports more expensive and a US-China trade war that�s slowing down cross-border purchasing � lowered its rates when economists hadn�t expected any move at all.

Why should I care?

For markets: Preparing to land.

The US�s decision to lower rates appears to have provided covering fire for other economies � particularly emerging markets � to do the same. If they�d cut rates when the US�s were still rising, the subsequent fall in their currencies might�ve made it difficult to afford as many imports � limiting any real-world benefits of the rate cut. And now, as several economies simultaneously try to boost their growth, investors may fret more about eventual recessions � selling off stocks and buying up safer, low-returning government bonds like they did on Wednesday.

For you personally: Central banks can be divas.

When a major central bank lowers interest rates, it�s basically saying it won�t let you earn as high a return if your money�s sitting in �safe� investments (like cash or short-term government bonds). It’s hoping you�ll decide to invest in a more �productive� way � by buying stocks, for example, or by lending money to an infrastructure fund which can help grow the economy by building things like airports.