Invesco: Three hawks and a dove fly higher for longer

Invesco: Three hawks and a dove fly higher for longer

29 juni 2023

Monetair beleid
hawk hawkish havik

Arnab Das, Head of Macro at Invesco, comments on the panel discussion at today's ECB Forum on Central Banking.

'The ECB held its annual global monetary policy conference this week in Sintra, Portugal. The mood was almost but not quite universally hawkish. As ECB President Madam Lagarde hammered home in her keynote speech: The peak policy rate is likely to be higher and to stay there for longer than the markets had expected. Fed Chair Powell reconfirmed that Fed Funds might go a bit higher and stay higher too and downplayed recession risk. BoE Governor Bailey said what we already knew — the UK needs rates to go higher still.

BoJ Governor Ueda was the dissenting dove alongside three hawks: Rising inflation is a quality problem and should stay higher for longer to be sure that wages rise enough to keep inflation near target.  All of this amounts to good news and bad news: First the bad news — markets are likely to have to adjust from pricing in pivots to a plateau in rates. But let's not lose sight of underlying good news: Inflation is proving more stubborn than expected because the economy is too. Labor markets are tighter, consumer demand stronger and economies more resilient. All this suggests global growth can hold up even with higher rates for longer.'

Gerelateerde berichten