LIVE MARKETS — What is it... back to the 70s or to pre — WWI?
STOXX 600 up 0.5% Tech leads gainers Eurozone bond selloff pauses Wall St futures edge lower Welcome to the home for real-time coverage of markets brought to you reporters. You can share your thoughts with us at WHAT IS IT...BACK TO THE 70s OR TO PRE-WWI? Investors are still confident that AI-related investment will keep buoying equities and that a post-midterm rapprochement between Washington and Tehran will help contain energy prices. But markets could face a rude awakening if either assumption proves misplaced, raising the risk of a toxic mix of slowing growth and persistent inflation. The past few decades have been defined by an activist policy response to economic downturns, with central banks cutting rates and governments ramping up spending to support the economy. “After an era of ever-bigger interventions, these old stabilisers now face major obstacles,” Henry Allen, macro strategist at Deutsche Bank, says, referring to monetary and fiscal stimulus. “On the fiscal side, policy is constrained today by sovereign yields at multi-year highs, alongside the highest debt-to-GDP ratios in several decades,” he adds. “Then on the monetary side, policy is constrained by.
5% Tech leads gainers Eurozone bond selloff pauses Wall St futures edge lower Welcome to the home for real-time coverage of markets brought to you reporters. BACK TO THE 70s OR TO PRE-WWI? Investors are still confident that AI-related investment will keep buoying equities and that a post-midterm rapprochement between Washington and Tehran will help contain energy prices. But markets could face a rude awakening if either assumption proves misplaced, raising the risk of a toxic mix of slowing growth and persistent inflation.
The past few decades have been defined by an activist policy response to economic downturns, with central banks cutting rates and governments ramping up spending to support the economy. “After an era of ever-bigger interventions, these old stabilisers now face major obstacles,” Henry Allen, macro strategist at Deutsche Bank, says, referring to monetary and fiscal stimulus. “On the fiscal side, policy is constrained today by sovereign yields at multi-year highs, alongside the highest debt-to-GDP ratios in several decades,” he adds. ” According to Allen, today's backdrop bears similarities to past periods when economic stabilisers were constrained or left unused.
He cites the 1970s and the pre-World War I era, when the gold standard and balanced-budget orthodoxy sharply limited governments' ability to support growth and smooth economic cycles. (Stefano Rebaudo) *** Earlier On Live Markets Tech Props Up The Stoxx, Construction Drags Click Here Before The Bell: Rising Yields Keep Europe On Edge, French Operators Fall Click Here Our Products Could End All Human Life, Buy Our Shares Click Here