INTEREST RATES

Interest rates

Interest Rates As Indicators Of A Change Of Cycle

Miguel Navascués | For some months we have been looking with concern at the spread of interest rates of US 10 minus 2 year bonds as an indicator of an ever closer recession. Indeed, this indicator has been moving towards zero, and if it goes negative – which seems to be the trend- it would signal the threshold of a recession. But I don’t think it is such a precise indicator.


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”.

 




Ewald Nowotny is comfortable with the possibility of an increase in the deposit rate

Fixed Income: A Search For A Safe Haven Or A Question Of Yields?

J.L.M. Campuzano (Spanish Banking Association) | At the end of the day, we have zero or negative real long-term interest rates. Why? The most simple answer has to do with the relation between supply and demand. And everything leads us to think that there is more demand than supply in the fixed income markets.


monetary normalisation

Preparing For The Start Of Monetary Normalisation In Europe

J.L Campuzano (Spanish Banking Association) | What is clear from ECB President Mario Draghi’s speech last Thursday is that investors consider we are closer than farther away from the start of monetary normalisation against a backdrop of economic optimism.


Secular stagnation

What’s happened to the Secular Stagnation thesis?

As the global outlook improves, many people ask what’s happened to Larry Summer’s hypothesis of Secular Stagnation, which says there are clear signs that the economic world has been “cooling down” for decades. And currently, everything seems to make us think that the recovery we have on our doorstep is not going to be strong or long-lasting.


Return of investors yields

A New Humble World and the Return of Yields for Investors

AXA IM | The past year has witnessed something of a turn-around in investors’ perceptions of the economic and financial outlook, chiefly on the back of hopes that the cloud of secular stagnation may be starting to dissipate. In our 2017 outlook, we take a step back from current market jitters and examine the fundamentals behind the present backdrop of ultra-low interest rates and poor economic growth. Simply we challenge the dominant idea that this is the fate of our future as investors.


BoJ, ECB and now BoE: anything is possible with economic policy

Fidelity | In line with expectations, the Bank of England’s monetary policy committe voted unanimously to cut interest rates – for the first time since 2009 – by 0.25%. It also  announced a package of additional measures, such as an extension of the current quantative easing programme (including corporate bond purchases) and a new liquidity line (Term Funding Scheme).


ECB's tapering

ECB, Nothing New: Rates at 0%

The European Central Bank kept its interest rates and policy plans unchanged on Thursday and said the immediate stress caused to markets by Britain’s shock vote to leave the European Union had been contained.