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Divergence remains the theme - BBH

FXStreet (Barcelona) - Analysts at Brown Brothers Harriman explained that anticipation over interest rate changes is the main force shaping the investment climate.

Key Quotes:

With the US Federal Reserve and Bank of England (BOE) poised to hike rates in 2015, and the European Central Bank (ECB) and Bank of Japan (BOJ) poised to continue their unorthodox monetary policy, we are entering a de-synchronized global business cycle.

“Throw in the potential differences in magnitude and duration of rate changes, and any future global expansion will be characterized by a great divergence in global economies”.

“This de-synchronization has been confused by the unexpected contraction in Q1 2014 US GDP and stalled growth in the US housing market. Across the pond, the political uncertainty posed by the Scottish referendum overshadowed the UK’s constructive fundamentals and the likelihood that the BOE begins to lift rates in Q1 2015”.

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