A tale of two central banks

A tale of two central banks

Focus for investors last week was the US Fed meeting and both stocks and bonds rallied after the event. The interest rate was kept on hold but there were indications from the central bank that it would likely adopt a more accommodative stance next year. Comments from Fed Chair Powell that “you’d want to be reducing restriction on the economy well before 2% so you don’t overshoot” were of particular interest. Along with lower yields and cooling inflation (data last week showed that US Inflation has slowed to 3.1%) – the US economic soft-landing narrative has been given a boost.

In the UK, the 10-Year Gilt yield fell below 3.7% and we await the latest UK CPI report due this Wednesday. Last week the Bank of England kept its interest rate at 5.25%, a 15-year high, and, unlike the Fed, there was no indication that this may come down any time soon.

US Risk Barometer 15th December 2023

Europe Risk Barometer 15th December 2023

Disclaimer: ‘Where the business has expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. The information contained within this communication is believed to be reliable but Realm Investment Management Limited does not warrant its completeness or accuracy.

This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’

Download Our Free Brochure