Our view on the major currency pairs (US dollar / euro, US dollar / yen, US dollar / Australian dollar) boils down to divergences
in global monetary policies.
Not exact matches
If all goes well
in the European Union, sensible
monetary and fiscal
policies should eventually reduce
global anxieties related to the stability of sovereign debt among certain EU nations.
Eight years after a devastating recession opened an era of loose U.S.
monetary policy, the Federal Reserve was set on Wednesday to raise rates for the first time since 2006,
in a sign the world's largest economy had overcome most of the wounds of the
global financial crisis.
The Fed has been a target of some conservative critics
in the U.S. Congress, who say the bank risked sparking inflation with its easy
monetary policies in response to the
global financial crisis.
However, protectionism, unexpected rapid tightening of
monetary policy in some countries, and geopolitical tensions
in North Korea and the Middle East pose potential risks to
global growth, Kuroda said.
While the Fed has indicated it plans to raise short - term interest rates, the uncertain domestic and
global economies and the still - loosening
monetary policy of central bankers
in other countries suggests that rates could remain very low for a long time still.
«Tighter
global monetary policy is needed
in order to contain inflation pressures and ward off financial stability risks,» the Basel - based central bank of central banks warned
in its most recent annual report.
Staley also argued that
global economic growth and
monetary policy need to re-balance
in order to prevent a distortion
in the markets.
«Rates and inflation, even though they have ticked up, are still at very low levels relative to history,
monetary policy is still easy, said Michael Arone, chief investment strategist at State Street
Global Advisors
in Boston.
The Fed raised its key overnight lending rate
in December for the first time
in nearly a decade, but it has backed away from further
monetary policy tightening this year largely due to a
global economic slowdown and financial market volatility.
«Inflation
in the euro zone is still below target, there's no need to raise rates or to tighten
monetary policy,» Willem Buiter,
global chief economist at Citigroup, said at the World Economic Forum
in Davos.
Switzerland caused havoc on
global markets on January 15 when the Swiss National Bank abruptly shifted its
monetary policy to allow the Swiss franc to increase
in value.
Description: The October 2014
Global Financial Stability Report (GFSR) finds that six years after the start of the crisis, the global economic recovery continues to rely heavily on accommodative monetary policies in advanced econ
Global Financial Stability Report (GFSR) finds that six years after the start of the crisis, the
global economic recovery continues to rely heavily on accommodative monetary policies in advanced econ
global economic recovery continues to rely heavily on accommodative
monetary policies in advanced economies.
This observation is important because it highlights the potential for an evolving
global environment to complicate the challenge of crafting economic
policy, and
in particular,
monetary policy.
In today's rapidly evolving
global economy,
monetary policy makers can not ignore the international dimension.
The fact is that
policy actions — both
monetary and fiscal — taken
in the wake of the
global financial crisis prevented what would have been a second Great Depression.
The
global financial crisis, like the Great Crash of 1929, also reflected widespread regulatory shortcomings and other weaknesses
in a number of countries.1 But it is likely that
monetary policy played at least a contributing role
in encouraging the buildup of leverage and asset prices
in a fragile financial system.
Thus, when I reiterate that U.S.
monetary policy is data dependent, that includes not just the information gleaned from important economic releases such as payroll employment and retail sales, but also how financial market conditions react to economic and financial market developments
in the
global economy.
Perhaps it makes sense to conclude with the more general observation that changes
in the size of
global capital flows and the accompanying imbalances increase the importance of sustaining the credibility of
monetary policy, because they increase the costs of a loss of credibility or a negative shock to credibility.
Our Multi-Asset Solutions CIO Ed Perks, Head of Equities Stephen Dover and Templeton
Global Macro CIO Michael Hasenstab recently recorded a podcast discussing the changing fiscal and
monetary policy conditions
in the year ahead.
Although this shift
in U.S.
monetary policy was inevitable at some point, it seems to have triggered a broad - based sentiment shift
in global markets.
While there are some signs of recognition such as the Fed's reduction
in its estimated neutral rate from 4.5 percent to 3.0 percent during the last 2 years, the IMF's explicit use of the term secular stagnation
in its World Economic Outlook, ECB president Mario Draghi's call for
global coordination and greater use of fiscal
policy, and Japan's indicated interest
in fiscal -
monetary cooperation, policymakers still have not made sufficiently radical adjustments
in their world view to reflect this new reality of a world where generating adequate nominal GDP growth is likely to be the primary macroeconomic
policy challenge for the next decade.
He provided the illusion of competence
in his orchestration of
global monetary policy collusion — so long as no one looked behind the curtain.»
Finally, as a recent report from the Committee on the
Global Financial System (CGFS) describes
in detail, central bank
monetary policies have a clear impact on the volume of repo.
The speech goes on to outline some of the economic surprises that came to pass
in the intervening years, including: the «mining boom mark II»; the further significant rise and then subsequent fall
in Australia's terms of trade; and the search for yield
in global capital markets driven by ongoing ultra-easy
monetary policy in the major economies.
Concerns about
global trade tensions between China and the U.S. and the fear that the stellar earnings could be as good as it gets for stocks are all combining to undermine the sort of confidence that was
in abundance during last year's run of repeated records for equity benchmarks, as the U.S. economy enters it ninth year of expansion and as the Federal Reserve moves to normalize
monetary policy from crisis - era levels.
By Claire Milhench (Reuters)- Investors raised their equity holdings
in April from March's five - year lows, taking the view that the
global stock market rally will continue as long as central banks maintain their loose
monetary policies, a Reuters poll showed on Friday.
In the meantime, gold continues to find support from
global monetary policy and low to negative government bond yields.
Global monetary policy remains broadly accommodative — and
in some areas more and more so — propelling equity markets ever higher and leaving a record amount of sovereign debt around the world (almost US$ 12 trillion by midyear) yielding at or below zero (source: Fitch Ratings, as of 6/29/2016).
This prolonged a surge
in global financial markets over the last two years, occurring against a backdrop of low growth and unusually accommodative
monetary policies in advanced economies.
According to Anna Stupnytska,
global economist at Fidelity International, Jerome Powell's appointment as Fed chair represents
policy continuity
in the near - term and might even result
in a slightly easier
monetary stance than some other contenders for the role.
Also weighing on the dollar was the
global economic upswing that has encouraged central bankers
in Europe and Asia to take the first steps toward normalizing
monetary policy after years of
monetary stimulus.
While base rates kept at or close to zero for almost seven years and three massive asset - buying programs by the Fed have undoubtedly helped stabilize the US (and world) economy during and after the recession that followed the
global financial crisis, the continuation of expansionary
monetary policies is now supporting a growing excess of
global liquidity that has been distorting the market signals sent by stock and bond prices and thus contributing to the growing volatility seen
in recent weeks.
The weaker overall outlook for
global economic growth could prove the decisive factor
in persuading the ECB to further ease
monetary policy in a concerted effort to stop the eurozone's recovery from stalling.
Also
in 2015, divergence
in monetary policies unsettled developed currency markets: the European Central Bank and the Bank of Japan continued quantitative easing programs while the Federal Reserve rhetorically led markets on a long, slow walk to the first increase
in the fed funds rate since the
global financial crisis.
In addition, commodities have struggled under the weight of a stronger dollar, a trend likely to continue given long - term
global trends such as divergent
monetary policies.
At least
in part, this reflects lower - than - expected
global growth and inflation, which has led to a prolonged period of very low interest rates and unconventional
monetary policies in the major economies.
At the same time,
global economic expansion and
monetary policy normalization point to a gradual rise
in bond yields over the next five years.
Like other central banks
in advanced countries, the Bank of Japan (BOJ) adopted an unconventional
monetary policy after the 2007 — 2009
global financial crisis (GFC).
Key
monetary indicators
in the United States, Europe, Japan, and China are flashing signals of an economic slowdown later this year, raising fears of a
global recession
in 2019 and a stock market slump without a shift
in policy.
In fact, the divergences in global economic performance — one of those being that U.S. monetary policy would tighten while European monetary policy would loosen — actually look very much like an explanation for what already happened last yea
In fact, the divergences
in global economic performance — one of those being that U.S. monetary policy would tighten while European monetary policy would loosen — actually look very much like an explanation for what already happened last yea
in global economic performance — one of those being that U.S.
monetary policy would tighten while European
monetary policy would loosen — actually look very much like an explanation for what already happened last year.
The speech starts by setting out three key themes of the Bank's recent communication about Australia's transition from the resources sector boom to more normal economic conditions: that the sheer scale of the boom means that this transition is challenging, and that the broader
global environment compounds the challenge; that a reasonably successful transition is possible given our economy's positive fundamentals and flexibility; and that
monetary policy is doing what it can to help the transition, but that the chances of success would be boosted by a lift
in productivity growth and an increase
in the expected risk - adjusted rate of return on investment.
In particular, it looks at how some of the most prominent changes to central banks» modus operandi have come as they sought to meet their monetary policy mandates in the exceptional circumstances seen during and after the global financial crisis of 200
In particular, it looks at how some of the most prominent changes to central banks» modus operandi have come as they sought to meet their
monetary policy mandates
in the exceptional circumstances seen during and after the global financial crisis of 200
in the exceptional circumstances seen during and after the
global financial crisis of 2008.
As well as this change
in the outlook for
global monetary policy, another prominent theme
in discussions of the
global economy of late has been the slow growth
in wages.
In this video we talk through the global monetary policy outlook and how it ties in with asset allocatio
In this video we talk through the
global monetary policy outlook and how it ties
in with asset allocatio
in with asset allocation.
Global monetary policy has been too easy
in recent years and that is why we have seen such a major run - up
in a wide range of industrial commodity prices.
Franklin Templeton Fixed Income Group talks
monetary policy, European politics
in the April
Global Economic Perspective.
The strategist, Richard Turnill, said it might be possible to view price movements
in blockchain - based cryptocurrencies as influenced by the ultra-easy
monetary policies put
in place by central banks after the 2007 - 2009
global financial crisis.
Governor Stevens showed us his usual, steady hand
in the BANK «s statement as he provided us with a
global view that weighed heavily on Aussie
monetary policy.
BlackRock Inc's (BLK.N)
global chief investment strategist on Tuesday suggested that loose
monetary policy may have aided speculation
in digital currencies like bitcoin, but he said the risk to the broader financial system appears limited.