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Raising Inflation Targets?

At the press conference following the US Federal Reserve (US Fed)’s most recent interest rate decision, Governor Janet Yellen made an admission that marks a significant change in tone from the US Fed.  She acknowledged that the debate over whether to raise inflation targets is “one of the most important questions facing monetary policy”[1], and encouraged further research. While we still believe there is a low chance of the US...

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Harbour Team | Posted on Jun 30, 2017

RBNZ: Inflation, What Inflation?

At yesterday’s Monetary Policy Statement (MPS) release the Reserve Bank of New Zealand (RBNZ)
genuinely surprised financial markets, by assessing that the economic data received since February had a
neutral impact on the appropriate stance of monetary policy. While in the lead up many commentators
had focused on the recent jump in annual Consumer Price Index (CPI) inflation, the RBNZ’s response
could be summed up as “what infl...

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Harbour Team | Posted on May 12, 2017

Beware a 2019 Recession

Some superstitious investors worry about the chance of a global recession in 2017.  They figure that the stockmarket crash in 1987, Asian crisis in 1997 and start of the GFC in 2007 make this the obvious year for troubles in markets.   While it is difficult to find an economist that will forecast a recession, the maturity of the business cycle does warrant some caution.   However, first we need to see more signs of consumer pr...

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Harbour Team | Posted on Apr 7, 2017