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Is accommodative monetary policy nearing an end? – June market update

The second quarter trend of low volatility and markets edging higher came to an abrupt end in the last week of June. Markets, in particular global bonds, ended the quarter weaker, as comments from Mark Carney and Mario Draghi fuelled speculation that the period of ultra-accommodative monetary policy may be nearing an end.

Centre Chris Godding
13 July 2017

What happened in the markets?

  • While global monetary policy remains accommodative, equity markets were not immune to the sell-off, with UK and European equities notably weaker at the end of June as their respective currencies strengthened following the Central bank comments
  • Elsewhere, the US dollar remained softer despite the US Federal Reserve raising rates at its June meeting as expected. This was supportive of Asia Pacific and Emerging Market equities, which continued to produce positive returns for investors
  • Commodity markets, in particular energy markets, continued to be weighed down by oversupply fears


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