Mario Draghi reacted to the increased economic risks to the economic outlook with a bold package of monetary easing measures. The extent to which this package in time supports the economy depends in large part on whether it encourages government spending.
Seeking income in a low rate environment has seen investors search for yield in riskier assets. While the risk associated with higher yielding investments can’t be eliminated, we look at three ways in which that risk can be reduced.
The final quarter of 2018 was not good for equity markets. Investors have had to contend with rising US central bank interest rates, a sharp slowdown in eurozone business confidence, weaker Chinese growth and rising geopolitical concerns (including Brexit, Italian politics and the ongoing trade conflict between the US and China).
At the latest Monetary Policy Committee (MPC) press conference, Governor Carney noted that businesses are taking a very cautious approach right now because of the uncertainty around the outcome of the ongoing Brexit negotiations.