The bond market’s response to the European Central Bank’s (ECB) latest easing measures was immediate and broadly positive, but the implications for the real economy are harder to gauge.
The latest employment figures will allay concerns that the US economy is stalling. However, we believe the authorities will likely wait until June before hiking interest rates again.
In his regular market comment, James Barrineau says the recent rally in the emerging markets debt relative market looks more soundly-based than similar strength seen in 2014, but investors still need to beware the dollar.
Markets appear to have recovered some of their poise recently. Emerging market debt (EMD) relative specialist James Barrineau, argues that a number of fundamental factors suggest this is more than just appearances.
In a surprise move the Bank of Japan (BoJ) has taken rates into negative territory with a 20 basis point cut to -0.1% for the rate it charges to financial institutions on their current accounts with the central bank.
In the first Schroders Live event of 2016, Bloomberg’s European Markets Editor Mannus Cranny quizzed Keith Wade and Johanna Kyrklund on the most pressing issues facing markets right now. These included matters such as China, the oil price, rate hikes and currency wars.
China’s slowing economy and the weakening oil price have led some investors to believe bigger problems are brewing for financial markets. Gareth Isaac believes that investors should be cautious in 2016, but shouldn’t throw in the towel just yet.
Government stimulus has done little to restore investor confidence and capital flight has accelerated. There remain serious contradictions in policy that need to be addressed.