Given all the problems emerging market traders are facing this year, it would hardly be surprising if many saw "the South Korea cheat" as the solution.
European Central Bank (ECB) president Christine Lagarde, US Federal Reserve chair Jerome Powell, Bank of England governor Andrew Bailey and Bank of Japan governor Haruhiko Kuroda came together (virtually) on 29 September to answer these questions in an hour-long discussion on global economic prospects entitled ‘Beyond the pandemic: the future of monetary policy’ during the ECB Forum on Central Banking.
Not only does central bank policy remain supportive for equities but a lot of investor cash is also still sitting in money market accounts. This could yet end up in equities given the poor outlook for bonds.
‘Financial market measures of inflation expectations suggest that the near-term strength in inflation is expected to be transitory.’ Much as many economists and the Fed in the U.S. have suggested.
With the recent economic and earnings news so good, why then have markets made little progress just recently? The answer seems to be quite simple – a lot of good news was already in the price.
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