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”.
INTEREST RATES
Inflation Is Not Dead, It’s Just Changed Course
As long as there is no perfect equivalence between supply and demand, inflation will form part of our system, according to Robeco.
Jackson Hole: Yellen could provide clues on monetary policy; Draghi seen keeping low profile
US Fed chair Janet Yellen and ECB President Mario Draghi will both be speaking at the Jackson Hole conference later this week. They will be under close scrutiny from investors for any clues on future monetary policy decisions. Analysts believe the Fed should matter more than the ECB at this week’s event.
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.
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.
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.
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, 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.
The Cost Of Uncertainty
J.L.M. Campuzano (AEB) | Little by little the markets are stabilising. Liquidity is improving and trading volumes are normalising (although they are still low…what is normal?)