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Authors

  • Neil Williams
    By debating the size of their balance sheets, central banks are showing for only the second time since 2008 that they may be worrying about our addiction to QE.
  • Eoin Murray
    With things turning brighter - for more reasons than one this spring - Eoin and Neil discuss how strong economic recovery will be, whether further stimulus is required, what could go wrong, and where now for policy and markets.
  • December 17, 2020
    Macroeconomics and Risk
    Eoin Murray
    Join Eoin Murray, Head of Investment, and Neil Williams, Senior Economic Adviser, for a lively discussion as they look to 2021 and beyond.
  • December 15, 2020
    Macroeconomics and Risk
    Neil Williams
    In his latest Economic Outlook, Senior Economic Adviser Neil Williams summarises his expectations for the global economy in five main points.
  • September 23, 2020
    Macroeconomics and Risk
    Neil Williams
    Neil Williams examines the impact that various pandemic-related stimulus packages have had on both global government debt and the efficacy of monetary and fiscal tools available to policy-makers.
  • Neil Williams
    The US and UK are already running highly negative interest rates, when QE is considered, according to a report by the International business of Federated Hermes.
  • Ingrid Holmes
    Why stimulus measures should be combined with efforts to tackle climate change
  • Neil Williams
    In hard macro terms, the tragic spread of the coronavirus provides another argument for keeping policy rates close to the floor, and the ‘punch bowl’ of central-bank liquidity filled.
  • December 11, 2019
    Macroeconomics and Risk
    Neil Williams
    This marks the tenth anniversary of our quarterly Economic outlook.
  • Neil Williams
    In his latest Quarterly Economic Outlook, Neil Williams, Senior Economic Adviser to Hermes Investment Management, argues that markets are still taking a ‘glass half full’ view of the macro outlook, with little real consideration of the new risk emerging. Until now, this has made sense, with speculation the US would open the fiscal box having justified ‘reflation trades’. However, while better for growth (see chart 1), markets are ignoring the darker cloud looming. Rather than financial distrust, we may need to brace for political distrust with the threat of beggar-thy neighbour policies - from the US to anti-European populism - rising. 2018 could be a ‘year of two halves’... In which case, 2018 could be a year of two halves, where stimulus- euphoria gradually gives way to stagflation concern. Helpfully, the trade-off is that policy rates stay lower than many expect. As chart 2 attests, the world’s appetite for international trade has, as a share of GDP, more than doubled in the past 50 years. Nevertheless, without care, the unhelpful jigsaw piece of retaliatory protectionism from the 1930s, might come crashing into place. In 1930, it was triggered by the Smoot-Hawley reforms that raised US tariffs to up to 20% on over 20,000 imported goods. This hit the US’s relatively small number of trading partners, most notably Canada and Europe, and prolonged the depression.
  • November 30, 2017
    Macroeconomics and Risk
    Neil Williams
    •While 2017 was again dominated by geopolitical risk, none of that was allowed to seep into financial markets. Reflation trades prevail. Yet, the frustration for central banks is that recoveries are failing to generate enough inflation to trigger their usual reaction functions. •If they truly want to get their ‘powder’ back, in terms of reclaiming policy rates while core inflation stays tame, the spirit, if not the letter, of the Fed’s dual mandate may make sense for others too. •While this may be deemed ‘hawkish’, it would be more than offset if we need to brace for more political distrust: with the threat of beggar-thy-neighbour policies - from the US to an upsurge of anti-European populism - a major risk still unpriced by markets. •Amid these forces, our macro outlook is based on five core beliefs. First, despite ‘muscle flexing’, the road to normalisation will be long & slow. Real rates will stay negative, with ‘peak’ rates ending up below what we’re used to. The question is how to drain the liquidity ‘sink’ without unintended consequences.
  • November 3, 2017
    Macroeconomics and Risk
    Neil Williams
    As the BoE raised rates for the first time in a decade the pound plunged and we saw the worst day for sterling since the post-Brexit plummet. Will sterling continue to struggle? And are there more rate hikes on the horizon? Neil Williams, Group Chief Economist at Hermes Investment Management, gives his take on the Bank of England Inflation Report and says the hike was a one-off muscle flex from the BoE giving them more powder to use in an economic slowdown.