Bond markets move in long – secular – cycles, with at least five since the 1870s After a bull market since 1982, we are now likely headed for a multi-decade bear market However, bond yields are unlikely to reach levels seen from the 1970s to the mid-1990s Bond markets, like…
Digital currencies – sometimes called cryptocurrencies – are suddenly much in the news. What is behind this, and what is the future for this new form of finance?
With the US Federal Reserve widely expected to start the process of shrinking its balance sheet in the next few months – a process that has been christened Quantitative Tightening or QT – we consider the consequences for economies and markets of the approaching normalisation.
Central banks have always said that the unconventional monetary policy measures they have introduced in recent years are temporary, and they have been keen to restore policy to “normality” when the time is right. As that time approaches, the urgent question is what the great unwind will entail and how they will carry it out.
For much of the last 8 years, there has been an active debate on what central banks were doing to combat the threat of a second Great Recession. But as the period of extreme monetary policy draws to a close, the discussion is beginning to look forward, and to what the future policy framework for central banking should be.
Should central banks shrink their swollen balance sheets? And, if they do, how should it be done and how far should it go? In the two months since we last addressed this subject the debate has developed further.