English Corner13.07.2017
UK: The Pendulum Has Swung too Far

UK unemployment data add to pressure on BoE, says Mark Nash, head of global bonds, Old Mutual Global Investors.

Since the EU referendum in June last year, the pound has taken the full impact of the weaker outlook for the UK and the Bank of England (BoE) has encouraged this by cutting rates, making the currency even less appealing.

In doing so, the BoE is openly playing the trade-off between the negative impact of inflation rising, which has hurt real incomes, and the positive impact of stimulating the economy and jobs through lower rates.

"Monetary policy cannot prevent the weaker real income growth likely to accompany the transition to new trading arrangements with the EU," said Mark Carney, BoE governor, last month. "But it can influence how this hit to incomes is distributed between job losses and price rises."

This balancing act is now looking decidedly lopsided, as there are clear side effects that come with the record low unemployment that, according to today’s figures, has been achieved.

Inflation is surprising to the upside and, on the back of low interest rates, the consumer savings ratio has fallen to dangerous new lows. Little wonder that some members of the BoE’s Monetary Policy Committee are breaking ranks, believing that the pendulum has swung too far. Higher rates look inevitable in the UK – and sooner than the market thinks, in our view.

Autor: jog

Weitere Meldungen

Switzerland is Average for Fund Investors

19.10.2017 - Morningstar's fifth Global Fund Investor Experience (GFIE) study shows that Switzerland retains an overall grade of Average, with a number of improvements made since the last survey.  Mehr...

Believe the Hype?

18.10.2017 - Grand visions of China’s One Belt One Road (OBOR) infrastructure project continue to make headlines but for now portfolio manager Naomi Waistell, of Newton’s emerging and Asian equity team, is curbing her enthusiasm.  Mehr...

Investing in EM When Interest Rates Rise

12.10.2017 - Emerging markets have seen a pickup in flows so far this year, yet a common concern remains – can they avoid taper tantrum 2.0.? Colm McDonagh, Insight (BNY Mellon), gives an outlook.  Mehr...

Northern Trust becomes Switzerland's largest Fund Administrator

04.10.2017 - Northern Trust announced the closing of its acquisition of UBS Asset Management's fund administration servicing units in Luxembourg and Switzerland.  Mehr...

Julius Baer Group places USD-denominated Additional Tier 1 bond

06.09.2017 - Julius Baer Group has placed perpetual non-cumulative high-trigger Additional Tier 1 (AT1) securities in a debut USD 300 million transaction with institutional and qualified private banking investors in Asia and Europe. The transaction helps to optimise Julius Baer Group’s capital structure.  Mehr...


China verbietet den Handel von Kryptowährungen und der Bitcoinkurs sinkt zwischenzeitlich um 30%. Haben Bitcoins, Ethereum etc. trotzdem eine Zukunft?




Das Ende der Globalisierung?

24.10.2017 16:30 | Zürich
Fund Experts Forum

10. Schweizer Leadership Pensions Forum 2017

25.10.2017 08:30 | Zürich
Financial Times

10. Schweizer Leadership Pensions Forum 2017

25.10.2017 08:30 | Zürich
Financial Times

Bond Investments: Was verheisst die Zinssituation?

31.10.2017 18:30 | Zürich
Friends of Funds

Opportunities 2018: Breaking New Ground

01.11.2017 08:15 | Zürich
Finanz und Wirtschaft Forum
zu allen Events

Indizes Schweiz

In Zusammenarbeit mit  morningstar.ch


Die Marktkurse werden Ihnen von Investing.com Deutschland zur Verfügung gestellt.