Global Markets Overview is published and updated every month. This includes what has happened in markets, our macroeconomic outlook and price updates on assets such as government bonds, credit and equities.
In this Global Markets Overview
We explore what the end of negative interest rate policy could mean for global economies:
- The Bank of Japan (BoJ) raised its policy rate from-0.1% to 0% to 0.1% – its first hike for 17 years. This marked the end of negative interest rate policy. While doing away with a specific bond yield target, the BoJ opted to continue purchases of government bonds at a similar rate to previously.
- The Swiss National Bank became the first advanced economy central bank to start interest rate cuts – from 1.75% to 1.5% – in the current economic cycle. The country faces very different conditions to other major economies, with core inflation currently at only 1.1%.
- The US Federal Reserve voted to hold rates at 5.25 to 5.5% in their March meeting. New economic projections from committee members were released as well – the median projection for rate cuts this year remained at three. Additionally, Fed chairman Powell noted that the process of slowing quantitative tightening (QT) could start “fairly soon”. Overall, the Fed still expects inflation to fall towards target by the end of this year. Despite this, US bond yields have risen since the beginning of March on the back of strong US economic growth and employment data, although wage growth continues to slow.
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Global Head of Asset Research at WTW
David is the Global Head of Asset Research at WTW, responsible for economic and capital market research. He also is a member of the Investment Assumptions Committee, who help guide investment policy globally.
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