My prediction is that the US Fed will raise rates this December, the low interest rates in Europe will survive for at least another year and China will decrease its rates.

Yellen commented on the positive performance of the US economy and raised the likelihood of rate rises in December. The markets certainly do not like the news, but did not react violently. This shows, markets know that the decision of raising rates will be made by the Fed eventually. Moreover, I believe the European central banks will not follow the US Fed after it decides to raise rates. The European economy has not fully recovered to its previous level before 2007. The current FTSE 100 index is at the same level of it was in late 2007. The Greek issue has not been resolved, and more problems are hitting the EU economy. Britain will vote on whether Britain will leave the EU or not. The refugees from Syria are flooding into Europe; in addition, the Volkswagen emission scandal is hitting the European car industry as well as the European stock markets. With all of these concerns, I expect that the European central banks will decide to maintain low rates for at least another year. China does not have zero interest rates and I think China is likely to move in that direction. The China's 13th Five Year Plan states the target of the Chinese economy is to grow at a steady and relatively fast rate. This means the central government wants to stop the growth rate falling and decreasing interest rates can be a very effective monetary tool. Therefore, I think China will decrease interest rates to stimulate its economy.

In conclusion, my prediction is that the US Fed will raise rates this December, the low interest rates in Europe will survive for at least another year and China will decrease its rates.