Speaker 1: You're listening to AC N A podcast.
Speaker 1: Welcome back to Money talks. We have a fresh slate
Speaker 1: of personal finance topics that will help you save and
Speaker 1: invest your money properly. I'm your host Andrea Heng. And
Speaker 1: before we introduce our guest, I want to talk about
Speaker 1: some money related news that may affect you. So I
Speaker 1: wrote in my editor Tiffany Ang to come chat with me.
Speaker 1: It's a new segment. We call I on the money.
Speaker 1: Hello, everybody. So let's get straight to the headlines are
Speaker 1: obviously being the first week of January. Happy New Year.
Speaker 1: Happy New Year. Happy New Year, everyone. Well, it's not
Speaker 1: just a new year. Actually, we've got a new GST
Speaker 1: we have. That's right. So in the New Year comes
Speaker 1: a new year present. 9% GST. That's correct. So, 9%
Speaker 1: GST if you don't already know that's our goods and
Speaker 1: services tax, it increased from 8% to 9%.
Speaker 1: It's been in every single conversation that I've had since
Speaker 1: the start of this year and it's only been a week. Right. Yeah. Yeah. Actually,
Speaker 1: I'm curious. Did you make any big purchases before the
Speaker 1: clock struck? 12, you know, I actually did, I bought
Speaker 1: a TV. Not bad. So we were like 1%. The
Speaker 1: GST actually was the impetus for us to buy a TV.
Speaker 1: So here's the story. We don't have,
Speaker 1: we have a TV. We've lived in this house for
Speaker 1: a year, not had a TV. So we decided, oh,
Speaker 1: you know what if we want to buy a TV?
Speaker 1: And we've been mulling it for some time, we better
Speaker 1: do it before the extra 1%. GST kicks in. So
Speaker 1: that's what I did. Did you buy anything big ticket
Speaker 1: before the GST kicked in? No, I didn't actually because
Speaker 1: I have everything that I need at the moment. So
Speaker 1: that's GST big, big headline. We also got some
Speaker 1: nicer news. It is to help cushion the increase in
Speaker 1: GST and the rising cost of living everything is going up.
Speaker 1: So did our CDC vouchers 500 up from 300. I
Speaker 1: think that's really generous and I can't wait to spend it.
Speaker 1: But you know what? I had this conversation with my
Speaker 1: co-host on the morning show at CN A 938, Joel Chua.
Speaker 1: And you know what? We're going to donate ours. Oh,
Speaker 1: that's nice. Yeah, because here's the thing. I forgot to
Speaker 1: spend the rest of mine. That's what I was gonna
Speaker 1: ask you what happened, what happened to last year's Trench
Speaker 1: for you. So I spent, strangely, people find it easier
Speaker 1: to spend the supermarket ones and the Hawker ones. And
Speaker 1: that's what you did.
Speaker 1: I, I like the supermarket ones. It was hard for
Speaker 1: me to finish spending the Hawker Center one. Right. So, strangely,
Speaker 1: the opposite happened with me. I was, I was able
Speaker 1: to finish the Hawker ones. First. I spent maybe about
Speaker 1: half of the supermarket ones and then I left the
Speaker 1: remaining 75 or whatever else that was left behind.
Speaker 1: And I didn't realize that I forgot, completely, forgot there
Speaker 1: was an expiry date until I saw on Instagram three
Speaker 1: of my friends they said they spent New Year's Eve
Speaker 1: at the supermarket. Well, the good news this year is
Speaker 1: that you can spend at more participating merchants. Yes, I
Speaker 1: think the list is something like 23,000 merchants now. So
Speaker 1: you can go to, you know, pretty much your Heartland shops,
Speaker 1: have a check, see if they have that CDC voucher,
Speaker 1: you know, poster, there was ac N A article that
Speaker 1: said a lot of our uncles and aunties, they were,
Speaker 1: you know, buying new phones, new phone cases just before
Speaker 1: 31st of December. Yeah. So I think a lot of
Speaker 1: aunties will go get their perms, you know, their hair
Speaker 1: perms right before Chinese New Year. So, you know, you
Speaker 1: don't actually only have to spend it on food. You
Speaker 1: can support any of these Heartland shops, any of these
Speaker 1: participating merchants. Well, it's not just about Singapore. We want
Speaker 1: to talk about some international movements. That's right. So you know, ok,
Speaker 1: which company beat Tesla as the top maker of electric vehicles.
Speaker 1: It is Byd, the Chinese brand, I kind of saw
Speaker 1: this coming because yeah, because Byd China has been really
Speaker 1: ramping up their electric vehicle industry. A lot of national
Speaker 1: efforts poured into this industry. At the same time, Tesla
Speaker 1: has its own problems, just some stats, right? So Byd
Speaker 1: took over the crown with almost 40,000
Speaker 1: more cars in the fourth quarter of last year. In total,
Speaker 1: it sold more than 3 million passenger vehicles last year.
Speaker 1: I mean, this is full and hybrid V combined. So
Speaker 1: that's interesting whether it's time as an investor to take
Speaker 1: a look at Byd in your stock portfolio. If you're
Speaker 1: looking into the space to diversify your portfolio, there could
Speaker 1: be potential for it, but of course, always do your homework.
Speaker 1: You can always ask your financial advisor what he or
Speaker 1: she thinks and off you go.
Speaker 1: Now before we get started, I want to check in
Speaker 1: on you. I want to know how has money talks
Speaker 1: helped you in 2023? We would really love to know.
Speaker 1: So drop us a note in the comments. I cannot
Speaker 1: wait to see what you tell us. Well, personally, for me,
Speaker 1: it's been a very educational year as host of money
Speaker 1: talks. I've learned so much from our guests from spending
Speaker 1: hacks on credit cards and groceries to investing in unusual
Speaker 1: portfolios to learning tips from the pros on how to
Speaker 1: optimize my CPF biggest lesson for me, how to get
Speaker 1: out of an IP if I really wanted to get
Speaker 1: out of one, another, thing I learned was how to
Speaker 1: take advantage of higher interest rates that we saw in 2023.
Speaker 1: Yeah, sure. It made things expensive. But I found out
Speaker 1: that there were in fact ways that this could be
Speaker 1: useful to me. But the verdict is out from the
Speaker 1: US Federal Reserve, that's the American Central Bank in case
Speaker 1: you didn't know they're very likely to stop hiking interest
Speaker 1: rates and 2024 is the year we will finally start
Speaker 1: seeing
Speaker 1: rate cuts. Ok. So in the first place, what do
Speaker 1: interest rates have to do with inflation? Does it mean
Speaker 1: we'll see an easing of prices? Let's get some help
Speaker 1: making sense of all of this. And that person is
Speaker 1: Eddie Low chief investment officer at May Bank Singapore. He's
Speaker 1: in the studio with me on the Money Talks podcast. Welcome, Eddie. Hi,
Speaker 1: I'm
Speaker 1: so first of all give us a 101 on interest rates. Ok.
Speaker 1: What happens when they move? Why are so many things
Speaker 1: affected by them? I think
Speaker 2: if you look at interest rates, it affects us at
Speaker 2: different levels on the individual personal basis, right? Obviously, depositors
Speaker 2: are happy when interest rates are higher because you get
Speaker 2: actually more for your deposits, your time deposits, correct?
Speaker 2: Not so happy for those who are actually having mortgage loans, right?
Speaker 2: Because you need to pay more interest. Then on the
Speaker 2: market side, obviously, it also has implications not necessarily that
Speaker 2: good for bonds which tend to underperform in the era
Speaker 2: of rising interest rates, right? As for equities, it depends
Speaker 2: really certain interest rate, sensitive sectors or markets will be
Speaker 2: affected
Speaker 2: others less
Speaker 1: so, right. What are some examples of those sectors? I
Speaker 1: think
Speaker 2: in Singapore, what is very common is actually Singapore S yes,
Speaker 2: we have actually seen how Singapore rates have actually been
Speaker 2: negatively impacted when interest rates were rising
Speaker 1: and which sectors benefited from the high interest rates.
Speaker 2: I think in the normal economy where there's still growth, actually,
Speaker 2: the banking sector tends to benefit from a rising interest
Speaker 2: rate environment because you sort of like get the expansion
Speaker 2: in interest margins while your loan growth, you know, is
Speaker 2: still somewhat healthy because economy is still chugging along. Yeah.
Speaker 1: Yeah, that's an interesting observation, right? The economy went on
Speaker 1: even though things got more expensive. It was almost as
Speaker 1: if the high interest rate
Speaker 1: didn't scare.
Speaker 2: It depends on where you are looking at. Obviously what
Speaker 2: really triggered this spike in interest rates over the 12
Speaker 2: to 18 months was really the very high inflation that
Speaker 2: we have witnessed, not just in Singapore but in other
Speaker 2: parts of the world US Europe, right? And the US
Speaker 2: FED had to combat inflation by really hiking interest rates
Speaker 2: very rapidly and that actually negatively affected.
Speaker 2: Not so much on the economy, but actually the markets,
Speaker 2: both equities and bonds because the pace of rate hikes
Speaker 2: was very
Speaker 1: fast. Yeah, it was quite aggressive, very, very
Speaker 2: aggressive. And that is something that investors do not
Speaker 1: like. Right. Ok. So high consumption, not necessarily a good
Speaker 1: thing for investors.
Speaker 2: Well, it depends on what drove the inflation in the
Speaker 2: first place. Right. Right. And I think we came out
Speaker 2: from a very unprecedented time where we had COVID, right.
Speaker 2: So when the economy started to reopen, obviously there's this
Speaker 2: pent up demand,
Speaker 1: the revenge everything. Yes,
Speaker 2: but at the same time, supply wasn't keeping up so
Speaker 2: that it took time to come back online. Exactly. So
Speaker 2: that actually drove higher inflation. But we did see inflation
Speaker 2: coming down this year. Combination of high interest rates as
Speaker 2: well as normalizing supply chain. How
Speaker 1: is it that interest rates have anything to do with inflation?
Speaker 1: How is it that the US decided? Ok.
Speaker 1: In order to curb inflation to dampen inflation, I'm gonna
Speaker 1: aggressively hike interest rates. What's that link
Speaker 2: there? Right. Right. So I think inflation can be supply
Speaker 2: driven
Speaker 2: all demand driven. So the inflation that witnessed over the past,
Speaker 2: I don't know, 12 to 18 months is probably a combination,
Speaker 2: a bit of both. So the interest rate part is
Speaker 2: actually to tackle the demand. Right. So when you have
Speaker 2: higher interest rates, cost of money becomes higher. Sure. So
Speaker 2: theoretically it's going to dampen demand, you know, where people
Speaker 2: think twice about spending a little bit more.
Speaker 2: Sometimes there's a lag effect. It is not like immediate,
Speaker 2: the rate hikes do not have an immediate impact on
Speaker 2: demand economy. That's why it took time actually for inflation
Speaker 2: to come
Speaker 1: off. Right? Ok, I understand now. So let's fast forward
Speaker 1: to what's happening now. The latest news is that the feds,
Speaker 1: they signaled three cuts in 2024. So tell me this
Speaker 1: is overall good news, right? What happens now?
Speaker 2: Well, if you look at the market reaction to the
Speaker 2: very Dovish fed statements recently, definitely good news for investors. Yeah,
Speaker 2: we are anticipating like the fed, there will be three
Speaker 2: rate cuts starting sometime in second half. Ok?
Speaker 2: But some of the market participants are even more aggressive
Speaker 2: pricing in a rate cut in the first half and
Speaker 2: maybe 100 basis points or even more. That means four
Speaker 2: or five rate cuts. So in our view, that's maybe
Speaker 2: a little bit too aggressive because, well, yes, indeed, we
Speaker 2: saw inflation
Speaker 2: moderating. It is still actually a bit higher. A tad
Speaker 2: higher
Speaker 1: things are still
Speaker 2: expensive. Yeah. Yeah, and it's like 3% fat is targeting 2%.
Speaker 2: So is still not exactly back to normal yet. So
Speaker 2: I think the timing of rate cuts is really uncertain
Speaker 2: and the fed will really be very data dependent. So
Speaker 2: it's a bit premature to say, ok, now I'm seeing
Speaker 2: inflation moderating at 3.1% and therefore the,
Speaker 2: that is going to cut rates in first quarter, too early.
Speaker 2: It's
Speaker 1: excitement. Right. I'm putting it down to just
Speaker 2: markets can overreact to time. But I think I also
Speaker 2: wanted to point out there are actually also factors to consider. Right.
Speaker 2: That could keep inflation maybe a little bit higher for longer.
Speaker 2: I think on a fundamental basis, if you look at
Speaker 2: the US again because I think that's a key economy
Speaker 2: that's driving global markets. US, unemployment is still very
Speaker 2: low compared to historical levels
Speaker 1: means more people have jobs, more
Speaker 2: people have jobs and wages are still going higher, right?
Speaker 2: So that's going to lend some upward pressure on inflation.
Speaker 1: Yeah, because when people have jobs, they have the means
Speaker 1: to spend
Speaker 2: exactly at the same time if you've noticed on the
Speaker 2: geopolitical side, some of the trade, like for example, the
Speaker 2: Red Sea, yes, some of the geopolitical tensions is causing
Speaker 2: rerouting of trade routes that could actually lead
Speaker 2: to higher shipping costs and therefore indirectly inflation, it's going
Speaker 2: to lead to higher costs and then therefore higher inflation, right?
Speaker 2: So that's a more on the supply side. And therefore
Speaker 2: these combination of factors could add to the uncertainty about
Speaker 2: the inflation trajectory,
Speaker 1: right? Why do the rate cuts need to be done
Speaker 1: in such a measured way? Because at the risk of
Speaker 1: sounding naive, couldn't they just slash it one time and say, OK,
Speaker 1: one time go 25
Speaker 1: basis points, 100 basis points and then bring it down
Speaker 1: at least to a level that the feds think everyone
Speaker 1: is agreeable to
Speaker 2: good question. So I think to answer that question, I
Speaker 2: think two points here to make, I think one is
Speaker 2: the fed has been accused of hiking rates too late.
Speaker 2: So they do not want to be accused of repeating
Speaker 2: the mistake again by cutting rates too early. Therefore, they
Speaker 2: are very cautious
Speaker 2: in making any rate cuts. And I think they will
Speaker 2: maintain that very cautious stance. And also if you take
Speaker 2: a step back for those who, who are a bit older,
Speaker 2: if you look at the seventies, right? There was also
Speaker 2: a similar episode where inflation was very high and then
Speaker 2: the FED had to hide interest rate to tame inflation.
Speaker 2: But then they actually, once they saw inflation coming off,
Speaker 2: they actually cut interest rates and that led to a
Speaker 2: resurgence in inflation.
Speaker 1: So it was a pendulum swing. Yes, exactly.
Speaker 2: So, so I think the fed now if you look
Speaker 2: at fair Chair Power, I don't think he was
Speaker 2: to go in.
Speaker 1: So you mentioned in an environment of higher interest rate
Speaker 1: benefits one group and it doesn't benefit another group when
Speaker 1: it comes to falling interest rates, which if all goes well.
Speaker 1: And Jay Powell says, ok, we can start cutting rates
Speaker 1: now and we do see those falling interest rates who
Speaker 1: would it benefit?
Speaker 2: Well, obviously those servicing their loans, their mortgage mortgages, I
Speaker 2: think they will be happier because yeah, at least you
Speaker 2: don't have to pay as much interest right from an
Speaker 2: investor standpoint. I think it will benefit both equity and
Speaker 2: bond investors because if you look at bonds, there is
Speaker 2: this negative
Speaker 2: correlation between bond prices and interest rates when interest rate
Speaker 2: goes higher, bond prices go lower and vice versa. So
Speaker 2: I think it would be a very conducive environment for
Speaker 2: fixed income. Ok? But at the same time for equities,
Speaker 2: as long as growth stays up, interest rate coming off
Speaker 2: will also benefit equity investors. At the same time,
Speaker 2: in particular, more interest rate sensitive sectors. For example, that
Speaker 2: Singapore reads that we mentioned earlier on some of the
Speaker 2: growth sectors which the valuation can also be sensitive to
Speaker 2: interest rates, usually higher interest rates negatively impact the valuation
Speaker 2: of these growth stocks. So if interest rate were to
Speaker 2: come off, right, then it will be deemed as positive
Speaker 2: for these
Speaker 1: growth stocks. Ok. That's excellent stuff. I'm glad you brought
Speaker 1: that up because this is the part of the
Speaker 1: where I wanted to tackle how interest rate movements affect
Speaker 1: our portfolios. So what role did high interest rates play
Speaker 1: for our investments? I remember investors were flocking to things
Speaker 1: like your 10 year treasuries, your Singapore government bonds, high
Speaker 1: yield instruments. Was this why everyone was flocking to these
Speaker 1: high yield products? And then when the interest rates start
Speaker 1: to fall,
Speaker 1: what do I do now? That I'm in these portfolio instruments, right?
Speaker 2: I think definitely we saw very strong flow cash deposits,
Speaker 2: fixed deposits because of the very high interest rate environment
Speaker 2: and investors are flowing to these instruments because also partly
Speaker 2: because of the macro uncertainty. So they are not so sure, right.
Speaker 2: So the best way is to stay short term,
Speaker 2: go to cash, go to deposits, go to money market
Speaker 2: funds where the level of risk is low, right? But
Speaker 2: if we get a falling interest rate, what happens is
Speaker 2: these short term deposits when they mature,
Speaker 2: you may not be able to get back into them
Speaker 2: at the same level of rate. So that is actually
Speaker 2: increasing a reinvestment risk, right? It's always good to have
Speaker 2: some cash buffer, you know, downside protection for advice. But,
Speaker 2: but I think given the fact that we, you know,
Speaker 2: our base case is
Speaker 2: really for a soft landing for inflation to moderate for
Speaker 2: fed to start cutting rates. I think it's time to
Speaker 2: really redeploy some of this cash into bonds and equities, right?
Speaker 2: But obviously, I think on the bond side, we still
Speaker 2: want to stay with quality,
Speaker 2: right? So you want to have more exposure into investment
Speaker 2: grade bonds where the default risk tends to be a
Speaker 2: bit lower save versus high yield credit. So just don't
Speaker 2: just go blindly chasing after
Speaker 1: higher interest rate
Speaker 2: or high high bonds because sometimes there's this risk with
Speaker 2: what trade off. And
Speaker 1: I'm glad that you brought that up. Also, it, it's
Speaker 1: worth clarifying. So you're saying not necessarily stop looking at
Speaker 1: your higher yield products, but it's time to start thinking
Speaker 1: about moving into other refinancing, taking the extra cash and
Speaker 1: pumping it into other safer bets like your bonds or
Speaker 1: rather
Speaker 2: actually not necessarily a safer bets because we are actually
Speaker 2: advocating or suggesting clients to move out of the so
Speaker 2: called very low risk cash deposits, which are high yielding
Speaker 2: at this moment, but may not be as high yielding
Speaker 2: 12 months down the
Speaker 1: road. That's the thing. So I'm glad you said that
Speaker 1: my question was going to be, when do we start pivoting?
Speaker 2: I think we could start actually looking at it right
Speaker 2: now because investors will be looking ahead. So for while
Speaker 2: you say you may decide to stay in cash for now,
Speaker 2: 12 months down the road,
Speaker 2: the other investments like bonds and equities may become more expensive,
Speaker 2: the prices may have actually.
Speaker 1: So buying in low when bonds are not looking great
Speaker 1: now would be a good
Speaker 2: move, right? In the sense that bond prices, we think
Speaker 2: that there are still pockets of value within the bonds
Speaker 2: and as well as equity space.
Speaker 2: Um So bonds, I mentioned investment grade bonds, I think
Speaker 2: that is still the place to be in. And you know,
Speaker 2: they are actually pretty defensive as well, especially if you
Speaker 2: stick with the higher quality names, right where the default
Speaker 2: risk is, you know, relatively low. Ok. Obviously not, not
Speaker 2: as safe as cash,
Speaker 2: but I think it's worthwhile taking the additional bit of risk.
Speaker 2: You
Speaker 1: know how there's that adage right time in the market
Speaker 1: and not timing the market. This sounds a little bit
Speaker 1: like the opposite, just a little bit. This is where
Speaker 1: timing does matter
Speaker 1: a little bit because if you stay too long with
Speaker 1: your low risk products, you might actually lose out on
Speaker 1: stuff that might be attractive later on or more expensive
Speaker 1: later on down the road. Right.
Speaker 2: Frankly, I would actually turn it around to say that timing,
Speaker 2: the market is always very difficult. Right. So, although we
Speaker 2: try to be tactical
Speaker 2: about things to move things, shift things around, but we, we,
Speaker 2: we think that it's actually important to maintain a core portfolio,
Speaker 2: a mixture of cash bonds and equities because while we
Speaker 2: try our best, very best to predict where the economies
Speaker 2: are going, where the markets are going. Nobody can really,
Speaker 1: nobody has, nobody has the real, not even Jay Powell,
Speaker 2: but it just, just maybe a case in point, case
Speaker 2: in point is if you look at the beginning of
Speaker 2: 2023 consensus are actually all predicting a US recession. Yeah. Right. Exactly.
Speaker 2: A very bearish outlook and 12 months down the road,
Speaker 2: we did not get the US recession
Speaker 2: and equity markets did very well for markets not too
Speaker 2: badly as well.
Speaker 1: I mean, they seem to have weathered, everything that was
Speaker 1: thrown their way. I mean, I remember talking about the
Speaker 1: big R word as if you know, oh, we need
Speaker 1: to be scared of this. Now today you can mention
Speaker 1: the R word and no one really bets an eyelid,
Speaker 1: not so much,
Speaker 2: which actually raises another concern as well because I think
Speaker 2: the economy is not exactly without this.
Speaker 2: We still have to bear in mind that as we mentioned,
Speaker 2: inflation may not come down one straight line. We are
Speaker 2: actually anticipating global growth, including that of us
Speaker 2: to soften in 2024. And then coupled with the fact
Speaker 2: that apart from geopolitics, we also have major elections coming
Speaker 2: on in
Speaker 1: changing of the Guard in so many places in
Speaker 2: Asia, as well as in Indonesia, right. So you know,
Speaker 2: these political elections sometimes can create marker uncertainty. So we
Speaker 2: need to be conscious of the fact that volatility could
Speaker 2: still spike from time to time.
Speaker 2: So the best approach again for us is really to
Speaker 2: spread your bets, avoid over concentration in any pockets, then
Speaker 2: you probably will have a smoother ride as
Speaker 1: smooth as can be as smooth as can be. Ok.
Speaker 1: So the one part that I think really affects us
Speaker 1: all one way or another in a very uncertain environment,
Speaker 1: especially to do with the interest rates, we're not sure,
Speaker 1: you know what kind of journey is going to be
Speaker 1: like
Speaker 1: our debts. So what would you advise in terms of
Speaker 1: managing things like our mortgage loans, our car loans, all
Speaker 1: our owings that are pegged to interest rates. Would you
Speaker 1: advise refinancing? And there's also that question about whether to
Speaker 1: go with
Speaker 1: fixed or floating rates. Right. Well,
Speaker 2: maybe before we go to whether to refinance, maybe I
Speaker 2: could share some of our projections in terms of interest rates. Right.
Speaker 2: We are expecting the US fed. Yeah, to cut rate
Speaker 2: three times in 2024 starting some somewhere in the second half.
Speaker 2: So Singapore benchmark rates, interest rates are likely to follow
Speaker 2: in the same direction magnitude could differ slightly, right. So
Speaker 2: for example, one of the key benchmark rates that we
Speaker 2: track is the three months. So where I think a
Speaker 2: lot of mortgage rates,
Speaker 2: loans are packed to this new benchmark rate as well,
Speaker 2: we are actually projecting so a three months or to
Speaker 2: decline from 3.8% to 3.25%. Ok. Right. So what this
Speaker 2: means if you say refinance now and lock in for
Speaker 2: say three year rate, depending on what the rate is,
Speaker 2: you may potentially lose out
Speaker 2: on the lower rates that's going to be coming in
Speaker 2: in 12 months, right. So, so that's the trajectory. So theoretically,
Speaker 2: I know friends around me that I talked to, they
Speaker 2: are also thinking about whether to refinance some of them
Speaker 2: will refinance and keep it to a very shorter turn.
Speaker 2: So they have the flexibility precisely to refinance at the
Speaker 2: lower rate should you know this low interest rate thinking
Speaker 2: expectation do materialize. Yeah. Correct. Right. So, so I think
Speaker 2: that's one school of thought, right? But overall,
Speaker 2: I would say that in terms of debt management is
Speaker 2: still the same,
Speaker 2: but the fundamental basis is also you need to apart
Speaker 2: from just refinancing fixed rate and what not, but you
Speaker 2: still need to watch your own debt levels, of course,
Speaker 2: and manage it according to your income because what's comfortable
Speaker 2: for you, what is comfortable for you? The last thing
Speaker 2: you want is actually to have two high debt levels
Speaker 2: that you will struggle to keep up with in terms
Speaker 2: of interest payments and loan
Speaker 1: repayments. So that question then about fixed versus floating rates, right?
Speaker 1: Moving forward.
Speaker 1: But what should we do? Especially when there's that uncertainty there,
Speaker 1: if you
Speaker 2: do have the expectation that rates are coming down, right?
Speaker 2: I would say that you would probably want to stick
Speaker 2: with shorter or floating interest rate. So you float down together,
Speaker 2: so
Speaker 1: yourself flexibility and the comfort to move around a
Speaker 2: little correct, the shorter tenure will give you the flexibility
Speaker 2: and then the floating will give you the benefit of
Speaker 2: enjoying that lower rates. Should it materialize?
Speaker 1: Eddie? It's been a real pleasure to have you on
Speaker 1: money talks, you've given us so much to think about.
Speaker 1: And more importantly, you've clarified quite a number of snags
Speaker 1: for us when it comes to interest rates. So thank
Speaker 1: you very much for clearing the fog around interest rates
Speaker 1: and giving us an idea of what to do this year.
Speaker 1: My pleasure
Speaker 1: and of course, a big thank you to you listener.
Speaker 1: Do us a favor. Hey, after this, let us know
Speaker 1: what you think about this episode. You can find us
Speaker 1: on Apple Podcast. We're also on Spotify and guess what?
Speaker 1: We're also on youtube as well. The team behind Money
Speaker 1: Talks is Joanne Chan Tiffany Ang Christina Robert Saint and
Speaker 1: I'm Andrea Heng.