Friday Morning Coffee Nr. 62: On Steriods

210619 Friday Morning Coffee

Friday Morning Coffee Nr. 62: On Steriods

This week equity and bond markets have been fueled again by dovish comments from central banks. First, outgoing ECB President Mario Draghi made it clear that additional stimulus will be needed “in the absence of any improvement” to the outlook for growth and inflation. Fed Chairman Powell commented Wednesday “while the baseline outlook remains favorable, the question is whether these uncertainties will continue to weigh on the outlook and thus call for additional monetary policy accommodation’’. Both central banks are raising the prospect of further rate cuts in light of what is being called now the Trumpian Uncertainty, namely the concerns of an escalation of trade wars and other political disruptions.