26 March 2021 President Erdogan's decision to sack Turkey's central bank governor Naci Agbal last week following the CBRT's decision to raise interest rates 200bp has increased volatility in EM currency markets. Is this just the latest episode of Turkish political intrigue? Alternatively, given both Brazil and Russia also lifted key rates, has a more [...]
Global Fiscal Policy: Keep the Pedal to the Metal
16 March 2021 In the past week, the Biden Adminstration passed its historic American Rescue Plan (ARP) and UK Chancellor Rishi Sunak unveiled his budgetary program for the coming years. The message from both is clear, the immediate priority is to provide Covid-related relief to household and businesses. Concerns about rising public sector debt would [...]
Global Money: Will Boom Go Bust?
7 March 2021 We have all marvelled at the dramatic expansion of the US Federal Reserve's balance sheet following both the Global Financial Crisis (GFC) and the Covid pandemic. And, the Chart illustrates quantitative easing (QE) policies have had a similar impact on the asset holdings of central banks worldwide (thanks to Yardeni Research for [...]
Will Inflation End the Party?
28 February 2021 There's a whiff of inflation in the air: commodities are soaring, bond yields are rising, and yield curves are steepening. And, while these trends actually began last Summer (and despite Federal Reserve Chairman Powell's reassuring comments in Congress), equity market volatility is increasing. In the period ahead, financial markets will confront several [...]