central banks

Central banks' QE was a powerful driver of the economy and markets

Central Banks: Quantitative Tightening, Very Very Frightening?

Multiple rounds of quantitative easing and liquidity injections resulted in more than a four-fold increase in the aggregate G4 central banks balance sheet in the last decade. This experience has many worried about a “quantitative tightening ” trade. Here analysts at BoAML argue that those worries can be put off for another day.


Central banks enrich a select few at the expense of many

Central Banks Enrich A Few At The Expense Of Many

The message unanimously churned out by politicians, central bankers, and ‘mainstream’ economists is that central banks are there for the ‘greater good’.  However, accoding to a market report from Degussa, “unfortunately, nothing could be further from the truth.”


32 out of 59 central banks anticipate raising interest rates in 2018

32 out of 59 central banks anticipate raising interest rates in 2018

J.L.M. Campuzano | The ECB calculates that its extreme expansionary monetary measures have contributed nearly two points to European growth since 2014. The question now is whether the benefits of maintaining them outweigh the risks of prolonging excessively lax financial conditions too long.


China_debt

Debt as the current biggest economic threat

The biggest economic threat today is not the interest rate, nor the exchange rates, nor the possible trade war fuelled by Trump: it’s the debt accumulated by countries across the world. This has increased 12% of GDP since the crisis, totalling 225% of global GDP. Starting with China, followed by Europe and ending up with the US, the threat from the current and future debt is terrifying.


Be careful with the Taylor Law

Be careful with the Taylor Law

We need to be aware of the existence of regulations over and above the well-known Taylor Law, starting with this regulation adjusted to establishing a downward limit on rates of 0%, which is very important in the US Fed’s case.


normalisation of interest rates

Is it time to normalise interest rates?

There’s an idea circulating amongst the central banks or, more accurately, amongst pressure groups in the central banks. The crux of this idea is: “the central banks should normalise interest rates”.

 




Central banks and normalisation policy

Could the central banks dampen the financial markets’ enthusiam?

Kommer van Trigt (Robeco) | The markets are discounting that in the next few months there will be more certainty surrounding the central banks’ normalisation strategy. In its quarterly outlook, Robeco’s Global Fixed Income Macro team says it makes sense for the central banks to begin to normalise their policies.