Geoff Lewis, Global Strategist-capital markets, Manulife Asset Management said he is comfortable with what the central banks world over are doing.
According to him, Bank of England seems to be primarily looking after the objective of its own economy post the Brexit shock. It could be taking out a little insurance.Bank of England cut its bank rate to 0.25 percent and introduced a package of measures designed to provide additional monetary stimulus.
There would be more active fiscal policies from the economies next year; Japan spending will start to kick in from October. So, this BoE move is in the right direction where there is less emphasis on monetary policy and bit more on fiscal policy at a time when there is excess capacity and insufficient aggregate demand, said Lewis in an interview to CNBC-TV18.
When asked if this sloshing of liquidity by central banks would bring in a bubble like situation witnessed in 2008, he said valuations are high and so it is some way from bubble territory.
Talking about US Fed’s intentions, he said it does not look like they are inclined towards quantitative easing but more towards a normal policy. At least he hopes there is no QE from the US Fed.
When asked where his fund would look at putting the excess liquidity that would come in, he said there are still opportunities in the US and in Asia ex-Japan. He would also increase exposure to emerging markets and India remains one of his favourite markets. Indian currently is in a nice space with long-term secular growth in place, and good Central Bank policy. GST is also a milestone achievement which will boost confidence.
For the entire discussion, watch video
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