Policy Impacts on Equities, Economy; Low Expectations for High Interest Rates Sep 30, 2021 View in your browser Fiscal, Monetary Policy Impacts; Expectations for Interest Rates By Blu Putnam, Chief Economist Erik Norland, Senior Economist CME Group Will Ending QE Impact Stocks and Bonds? Fiscal policy initiatives helped cushion pandemic’s disruption of economy. Direct payments helped consumer spending recover sooner than during Great Recession. Fed tapering of asset purchases not expected to impact economy or inflation. Withdrawal of quantitative easing could impact equities and bonds over time. Watch video Will High Debt Put a Lid on Interest Rate Hikes? Investors not expecting interest rates in U.S. and Europe to rise quickly. Rates not expected to top 2% in U.S. through 2026, nor rise to zero in Europe till 2026 or later. Investors seem to share central banks’ view that inflation might be transitory. Debt levels that soared during pandemic could keep a lid on interest rates. Watch video SEE MORE ANNOUNCEMENTS
