23 Jun Central banks heading towards the easing exits
Key Points:
- The gradual shift of central banks including the Fed and RBA towards an exit from monetary easing has caused
some volatility in investment markets. - We continue to expect the first RBA rate hike to be in 2023, albeit there is a risk it could come in late 2022.
- However, there are five reasons not to be too concerned: central banks are simply reflecting economic
recovery; monetary policy remains easy; shares rose through the last Fed taper; share bull markets usually
only end when monetary policy is tight; and it’s normal in this phase of the investment cycle for returns to slow.
