Central Banks: Diminishing returns to monetary policy moves – Rabobank


Rabobank analysts suggests that while there is scope for a reprieve if the US and China make some compromises on trade, the headwinds facing world growth have already brought a series of policy measures from central banks across the globe this year.

Key Quotes

“For G10 countries, however, there is no escaping the fact that only the Fed and possibly the BoC attained any traction at normalising interest rates after the shock of the GFC.”

“With interest rates so low, central banks face the dilemma of diminishing returns to monetary policy moves. For some, the risks associated with house price inflation and high levels of household debt are also a consideration for monetary policy settings.”

“The consequence is that pressure on governments to use fiscal policies to support growth is widening.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD looks heavy after Friday's bearish outside day

EUR/USD risks reporting losses on Monday, having charted a bearish outside day candlestick pattern on Friday. The dollar will likely remain bid with markets no longer expecting the Fed to cut rates before the November 2020 Presidential Elections.

EUR/USD News

GBP/USD recovers Friday’s losses to 1.3150 as Tories top UK election polls

GBP/USD keeps the recovery mode intact near 1.3150 while heading into the London open on Monday. The spot seems to cheer the Tory lead in all the polls for this week’s UK election. 

GBP/USD News

Forex Today: US dollar buoyed by NFP, trade jitters ahead of a Big week

Forex today experienced a sense of caution in Asia this Monday, as Sunday’s dismal Chinese trade data combined with looming US Dec. 15 tariffs overshadowed the latest trade optimism. 

Read more

Gold: Sidelined after biggest daily decline in four weeks

Gold is lacking a clear directional bias in Asia, having registered its biggest single-day decline in four weeks on Friday. China's data may embolden President Trump to take more aggressive measures. 

Gold News

USD/JPY treads water around 108.60 ahead of a Big week

USD/JPY keeps its range around 108.60, as the yen bulls look to take advantage of upbeat Japanese Q3 data. Further, negative Treasury yields and S&P 500 futures weigh down on the spot. All eyes on FOMC and Trump's Dec. 15 tariffs. 

USD/JPY News

Forex MAJORS

Cryptocurrencies

Signatures