Earlier this week we discussed a chart from Citi’s Hanz Lorenzen, which we said may be the “scariest chart for central banks” and showed the projected collapse in central bank “impulse” in coming years as a result of balance sheet contraction, and which – if history is any indication – would drag down not only future inflation but also risk assets. As Citi put it “the principal transmission channel to the real economy has been… lifting asset prices” to which our response was that this has required continuous CB balance sheet growth, and with the Fed, ECB and BOJ all poised to “renormalize” over the next year, the global monetary impulse is set to turn negative in the coming year.
This post was published at Zero Hedge on Jun 16, 2017.
Follow on Twitter
Recent Comments