With 2 ½ months left until Mario Draghi steps down as ECB chief, what will be his legacy? On the one hand, he will be forever remembered for those three words “whatever it takes”, which many people credit for having
Central bank watcher: Time to deliver Fed: make life easy and do 50 ECB: A september to remember PBOC: Easing bij reform?
Fed cuts rates A lack of inflation pressure allows the US Federal Reserve (Fed) to lean against the increased downside risks to growth. While market pricing may prove to be too aggressive, some “insurance” policy easing is very likely The
Sometimes monetary policy is akin to feeding dragons: markets tend to be insatiable, and they may end up burning you. Indeed, there seems to be no end to what the market wants from central banks. We have seen it in
ECB Economic Bulletin, Issue 5 / 2019 Incoming information since the last Governing Council meeting in early June indicates that, while further employment gains and increasing wages continue to underpin the resilience of the economy, softening global growth dynamics and
Rick Rieder and Russ Brownback highlight the investment themes that they think will drive markets and dominate debate within the investment community over the next several months and beyond. Over recent weeks, we have been vocal about five “big themes”
Focus: Trade war US/China, US labor market report President Trump surprised the markets on Thursday with the announcement that USD 300bn in imports from China would be subject to a tariff rate of 10 percent from September 1. This announcement
After an exceptionally strong start to the year, financial markets paused for breath in July, with most asset classes delivering muted returns. The Federal Reserve (the Fed) lowered US interest rates for the first time in 11 years, and the
Weekly Commentary Key points 1 We see government bonds retaining their crucial role as portfolio ballast, even after their yields have plunged. 2 The European Central Bank (ECB) kept interest rates unchanged, but explicitly opened the door to future easing.
Macro / government bonds Even as US government bond yields were little changed in the last week, European yields ratcheted lower, reaching year-to-date and historical lows. They are being supported by ongoing signs of economic malaise and a lack of
USD: Dollar to remain firm Following the ECB meeting in July, a substantial easing of monetary policy is expected in the coming months – not least because we expect a hard Brexit, and this will further dampen the economic outlook
Survey The Eurosystem conducts a quarterly qualitative survey on credit terms and conditions in euro-denominated securities financing transaction and over-the-counter (OTC) derivatives markets. This survey is a follow-up to the recommendation in the Committee on the Global Financial System study
Mike explains the importance of government bonds in building portfolio resilience and share tips on how to do so. We see raising portfolio resilience as a key theme for investors – not only for this year but over a long
Russ discusses how central banks once again have investors’ backs. The global economy continues to struggle with sluggish growth. Trade frictions have not erupted, but nor have they been resolved. Iran just seized a British tanker and BlackRock’s Global Index
A slowdown in global growth, with subdued inflation and dovish central banks (CB) committed to avoiding further economic deceleration, is a trend that, in our view, should remain favourable for bond investors. On one side, this should limit the upside
At the Governing Council meeting, which ended today, the changes were limited, but the markets were prepared for a host of measures at the September meeting. First, the ECB opened the door to a rate cut. The interest rate outlook
Rick Rieder argues that anemic growth in Europe is a longstanding problem that today requires a bold solution. Institutionally, the ECB can offer potentially effective, if unconventional, help. A shorter version of this commentary appeared in the Financial Times on
The US economic slowdown remains modest – the world’s largest economy looks set to avoid a recession in the next 12 months, thanks to the Fed’s monetary easing Eurozone macro data and easing in the US, should lead the ECB
How low can we go? With the European Central Bank (ECB) set to resume quantitative easing, can European high yield spreads return to their lows of the last time around?
The results reported in the July 2019 bank lending survey (BLS) relate to changes observed during the second quarter of 2019 and expectations for the third quarter of 2019. The survey was conducted between 17 June and 2 July 2019.
Mike explains why we have decided to upgrade our call on European assets, from equities to government bonds. We see the European Central Bank (ECB) shifting decisively dovish in coming months, against the backdrop of stabilizing growth outlook and persistent
The New York Fed clarified comments by leader John Williams, causing a dramatic swing in expectations for a July Fed rate cut of 0.50%. The European Central Bank may provide easing details on Thursday. U.S.-Iran tensions and U.S. President Donald
Both M. Draghi (ECB) and J. Powell (US Fed) recently stressed that the price stability and inflation targets are “symmetrical” – a small word that makes a big difference. Inflation values would then have to be above 2% for a
We study how the introduction of a central bank-issued digital currency a§ects interest rates, the level of economic activity, and welfare in an environment where both central bank money and private bank deposits are used in exchange. Banks in our
Despite structural regional challenges, Russ provides insight on several factors that support European equities. With the S&P 500 up nearly 20% year-to-date, U.S. investors can be forgiven for maintaining a home country bias. Consistent with the post-crisis norm, 2019 is
