21 March 2017: Fragility, populism, uni- or multilateralism and interest rates

Today, on Morning Macro we discuss globalisation, alarmingly long lasting loose monetary policy all over the world, and populism, earlier a fixture in emerging market but now prevalent in Europe and especially in the US.

In part 1, Tom speaks with Societe Generale’s chief currency strategist, Kit Juckes. Kit talked about the risks to the global economy from a widespread feeling of disenfranchisement from globalisation, but says that for now there’s no need for alarm either at the US stance or on the destiny of the European Union. What he is alarmed about is how long the global accommodative monetary policy environment is lasting – arguing that the Fed needs to take on board the warnings of the Bank for International Settlements, and raise rates higher than currently seems likely.

In part 2, Sigrún spoke to Gabriel Sternehead of Global Macro Research at Oxford Economics. Sterne, who has followed the euro crisis closely, pointed out how populism and fragility are linked and certainly relate to Western countries, not just to emerging markets as earlier. In the next big European political event, the French presidential elections, Sterne sees Emmanuel Macron as the likely winner. But even if populism in Europe is retreating, the fear it has created will last a long time, intertwined with the financial crisis.

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Music by longzijun

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