Marcus Ashworth – Head of fixed income at Haitong Securities – joined Nick Batsford and Zak Mir in the Tip TV studio to discuss the sentiment around three of the major central banks; The Federal Reserve, the Bank of England, and the European Central Bank.
Is the world a clearer place after FOMC minutes?
While it may appear to have been a close call, Ashworth doesn’t believe that the Federal Reserve were ever likely to hike rates. His view is that the Fed missed their window of opportunity earlier in the summer, and even 2016 could be unlikely with the US political upheaval.
Will the Bank of England take the helm?
Despite having remained in the shadow of the Fed, Mark Carney has announced that the bank ‘are not in thrall to the Fed’. While Ashworth doesn’t buy into this, he believes that there is still a possibility the BoE could go first, but they’re unlikely to take the risk.
ECB to step up QE?
With the revelation that Europe isn’t hitting its inflation targets, there are plans to accelerate their quantitative easing to add more liquidity. Ashworth said that this will probably continue into 2016, with economists finding reasons to justify it.