Aurelia Butler

Singapore state fund GIC is directing money towards real estate and other inflation-protecting assets as it prepares for several years of disruption from rising prices.GIC’s management said in an interview with the Financial Times that soaring inflation could reverse gains it had made in recent years and warned that the world could face an extended period of stagflation if policymakers did not take appropriate action.The warning from GIC, whose assets are estimated by analysts to exceed $700bn, reflects the potential impact rising prices could have on institutional investors who have for years capitalised on accommodative monetary policies.The prospect of stagflation is particularly concerning to GIC, whose mandate from the government is to deliver inflation-beating returns over the long term and increase the purchasing power of Singapore’s foreign reserves.“We could be staring at a prolonged period of difficulty. [Stagflation] could last as long as a decade,” said chief executive Lim Chow Kiat, referring to the painful mix of high prices and low growth. Inflation could “reverse a lot of those gains” made by the GIC since it launched in 1981, he said. He would not comment on how many years’ worth of returns he expected could be wiped out.Lim was speaking ahead of the release of GIC’s annual results on Wednesday, which showed that the fund delivered an average annual return of 4.2 per cent above inflation over the past 20 years. This figure, its main performance metric, was a dip from the 4.3 per cent recorded a year earlier.GIC, which does not disclose the total value of its assets, increased its exposure to real estate from eight to 10 per cent of its portfolio in the year to March. Its allocation to equities dropped two percentage points to 30 per cent of its overall investments.The report followed a string of international property acquisitions over the past year, including the Paddington Central office estate in London and at least two providers of student housing in Europe.

Short-term rental properties, such as office buildings and student housing, are less exposed to rising inflation because they can increase prices accordingly, said chief investment officer Jeffrey Jaensubhakij.“We need to work extremely hard to try to find the assets that we think will be able to survive any near repetition” of the prolonged inflation of the 1970s, he said. He said a repeat of this period would be a “worst case” scenario, adding that central banks now have a greater understanding of the problem. More

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The Federal Reserve is set to raise interest rates by 0.75 percentage points for the second time in a row on Wednesday, as it doubles down on its aggressive approach to taming heightened inflation despite early signs the economy is beginning to cool.At the end of its two-day policy meeting, the Federal Open Market Committee is expected to lift its benchmark policy rate to a new target range of 2.25 per cent to 2.50 per cent, in line with officials’ estimates of the long-run “neutral” rate. When inflation is running at 2 per cent, this policy setting is considered to neither stimulate nor restrict growth.The decision, due at 2pm Eastern Time, extends a string of interest rate increases that began in March and have ratcheted up in size as the Fed’s battle to fight inflation has intensified. Following a half-point rate rise in May and the first 0.75 percentage point rise since 1994 last month, Wednesday’s adjustment is set to make this tightening cycle the most aggressive since 1981.With inflation running at its fastest pace in more than four decades, the central bank is poised to continue raising interest rates well into the second half of 2022, with economists split as to whether the Fed will raise rates by another 0.75 percentage points in September or downshift to a half-point adjustment.Having established its “unconditional commitment” to restoring price stability, the Fed is expected to look past any early indications that the economy is beginning to slow at least for now. It has also said that failing to get inflation under control and allowing it to become “entrenched” would be a worse outcome than moving too aggressively.The federal funds rate is projected to reach about 3.5 per cent this year, a level that will more actively constrain economic activity.Most officials believe policy must become “restrictive” in order to damp demand sufficiently to contain consumer price growth.They have also signalled that there needs to be “clear and convincing” evidence that inflation is beginning to slow before the Fed will ease up on its efforts to tighten monetary policy. More specifically, the central bank is looking for a string of decelerating monthly prints — something economists warn may not happen for months, at least in terms of “core” readings, which strip out volatile items such as food and energy.

In June, this category of goods and services recorded an alarming 0.7 per cent jump, led by a sharp uptick in shelter-related expenses and other costs that are likely to remain elevated into the autumn.The Fed is set to meet just one day before the release of the latest gross domestic product figures, which may show a second straight quarter of contracting economic growth in the US. That would meet one of the common criteria for a recession, but officials point to other signs of strength — including the robust labour market — challenging that view.Conflicting economic data points will make the Fed’s job much more difficult as it plots out subsequent policy actions, and raise the pressure to slow down the pace of rate rises soon.Officials still maintain inflation can be brought back down to the Fed’s 2 per cent target without excessive job losses, although they have acknowledged the path to achieve that outcome has become more narrow. More

The writer is the founder of Sahm Consulting and a former Federal Reserve and White House economist Some commentators argue that the US needs a recession to bring inflation down. That thinking hinges on a simplistic model of the economy and a refusal to see Covid and the war in Ukraine as important sources of inflation now. The stakes are too high to rely on such a questionable approach. Yes, inflation is a hardship, and it hits those with the least the hardest. Among American families in the bottom 20 per cent by income, almost 60 per cent of their spending is on food, gasoline and housing. That’s a far bigger fraction than among high income families.The prices of these necessities have risen rapidly since the pandemic began. As a result, the lowest income families, on average, spend more than $300 a month extra to buy the same amount of these necessities.Even so, a recession is worse than inflation. A lost pay cheque or even lost hours would far exceed the extra monthly costs due to inflation. And the chance of losing one’s pay cheque is not the same for everyone. According to research from economist Hilary Hoynes and co-authors, in recessions it is usually higher for men, black and Hispanic workers, young workers and less educated workers. The adverse effects on the unemployed last for years. There’s too much to lose with a recession, especially now.The US unemployment rate is 3.6 per cent, near its 50-year low. Over 450,000 new jobs a month have been created, on average, since the start of the year. Total compensation to all employees is up 15 per cent since the Covid recession began, two percentage points higher than inflation. In contrast, after the Great Recession, inflation outpaced compensation. So, what is the commentators’ case for needing a recession? The labour market is too good, and inflation will come down only if millions lose their jobs. A model developed in the 1950s called the Phillips curve predicts that when unemployment rises, people have less income and spend less. Demand falls faster than supply, and inflation comes down. The higher the inflation, the more severe a recession the model says is needed.There are numerous problems with this prescription. First, while the Phillips curve is intuitive, since the 1970s the data have looked more like a cloud than a curve. That is, there is a weak relationship, if any at all, between actual unemployment and inflation. Economists disagree with what ‘killed’ the Phillips curve, but it is widely understood that alone it is inappropriate for policymaking.

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Then there is another problem with the we-need-a-recession view. It hinges on inflation being demand driven. Specifically, supporters of it blame inflation on the extra demand caused by the American Rescue Plan stimulus package and low interest rates from the Federal Reserve last year. That’s important, because the Phillips curve only makes sense if inflation is demand driven.Again, this argument crashes into reality. Ongoing disruptions from Covid and the war in Ukraine are pushing up inflation, too. Adam Shapiro, an economist at the Federal Reserve Bank of San Francisco, estimates that less than one-third of monthly core inflation, which excludes food and energy, is due to demand. Moreover, monthly core inflation has already stepped down noticeably this year. It remains too high, but the progress is evident. It is appropriate for the Fed to raise rates now. It would be a grave mistake to cause a recession — nor is it intentionally trying to.Furthermore, there is no increase in the unemployment rate that would produce microchips for new cars, end China’s lockdowns, defeat Vladimir Putin, drill oil and build apartments. The Fed raises interest rates and lowers demand, cooling off the labour market. Whether it inadvertently causes a recession or not, higher interest rates would not fix the supply problems and would probably make some worse by discouraging investments.Congress should help ease inflation, too. For example, it could pass legislation to keep health insurance premiums low, reduce tariffs, build affordable housing and fund sustainable energy production. Only a handful of measures would bring down inflation quickly, but they would all pay off in the coming years and make the US economy more resilient in the next crisis.We must aim to protect workers and their families and bring inflation down. These two goals need not be in tension, but it will take more than outdated rules of thumb and a misunderstanding of our economic challenges to do both. We need many things today; a recession is not one of them. More

Postwar inflation reveals itself in the changing prices at a vendor’s stall in France in the late 1940s © US Department of State/PhotoQuest/Getty ImagesInflation is back. Rising prices have placed a “cost of living crisis” at the top of the economic, political and social agenda. Inevitably, this has brought central banks and monetary policy under the spotlight. Yet controversies over both are not new. On the contrary, while the issues change, debate over how monetary and financial stability can best be sustained abides. Though completed before inflation returned, two new books set out sharply conflicting perspectives on underlying issues. In the orthodox corner stands Ben Bernanke, a governor of the Federal Reserve from 2002 and chair from 2006 to 2014, a period that includes the global financial crisis of 2007-09. Arguably, Bernanke is the most influential thinker and practitioner on central banking of our era. His book, 21st Century Monetary Policy, offers a lucid account of the evolution of central banking and the US central bank from the “great inflation” of the late 1960s, 1970s and early 1980s to today and into the future.In the opposite corner stands Edward Chancellor, historian, asset manager, journalist and author. The Price of Time offers a history of interest back to the Babylonians as well as of the debate over the legitimacy of demanding it at all. Mainly, however, it is a polemic against everything Bernanke stands for. For Chancellor, the rate of interest is “the price of time” — the rate at which the money one expects to receive or pay in future should be adjusted into today’s. Under the influence of people such as Bernanke, he asserts, interest rates have been far too low for far too long, with ruinous results. Behind each of them stands a different guru. For Bernanke, it is John Maynard Keynes, the pioneering British economist. As he notes: “Keynesian economics, in a modernised form, remains the central paradigm at the Fed and other central banks.” The main aim of monetary policy, then, is to achieve and sustain full employment. If inflation tends to rise, demand must be too strong; and if it falls too low, demand must be too weak. This, then, makes inflation the best intermediate target of policy. Yet this target must also not be too close to zero: central banks would have too little room to cut rates in response to recession. That is the “trap” into which Japan fell in the 1990s and from which it has had such difficulty escaping.

Bernanke’s book explores three fundamental realities of past decades. The first is the surprisingly weak response of inflation to changes in unemployment in recent years. In the past, low levels of unemployment tended to raise prices faster. The second is “the long-term decline in the normal level of interest rates”, partly because of lower inflation but also because of the long-term decline in real rates of interest. The third is the “increased risk of systemic financial instability” in our world of globalised and liberalised finance.In terms of policy, explains Bernanke, short-term rates of interest came very close to, reached or, in some cases, even fell below zero in the aftermath of the global financial crisis and subsequent eurozone crisis. This drove the Fed and other central banks towards a range of “unconventional” policies, including large-scale asset purchases (generally known as “quantitative easing”) and “forward guidance” on future monetary policy. Overall, Bernanke insists, the Fed has been successful in preventing another Great Depression and returning the US economy to growth. I agree with him.

Chancellor emphatically does not. His guru is Friedrich Hayek, a contemporary of Keynes, leading figure in the Austrian “free-market” school of economics and opponent of central banking. Hayek was also an exponent of the “malinvestment” explanation of depressions, according to which the slump represented the necessary purgation of previous errors.Hayek lost the debate on macroeconomics in the 1930s and moved on to political economy, especially with The Road to Serfdom, published in 1944, which found an acolyte in Margaret Thatcher. Chancellor is a believer in the Hayek of the 1930s, however. He condemns the low interest rates adopted by central banks as the root of almost all economic evils. Ultra-low interest rates are to his mind the malign product of the false credo of inflation targeting. As he complains: “Never mind that zero interest rates discouraged savings and investment, and impaired productivity growth. Never mind that ultra-low interest rates, by keeping zombie companies on life-support, resulted in the survival of the least fit. Never mind that central bank policies contributed to rising inequality, undermined financial stability, encouraged ‘hot money’ capital flows, and fostered numerous asset price bubbles from luxury apartments to cryptocurrencies.” Does this charge sheet make sense? Not much. Low interest rates have substitution and income effects: the former make it attractive to save less, because of the lower returns; but the latter make it necessary to save more, to compensate for the lower returns. Chancellor himself quotes Raghuram Rajan, former governor of the Reserve Bank of India, to the effect that “savers put more money aside as interest rates fall in order to meet the saving they think they will need when they retire”. The outcome of low interest rates for overall saving rates is simply ambiguous.

Again, Chancellor insists that lower rates discourage investment, even though he stresses that they do motivate risk-taking. Why, then, would they not encourage more risk-taking investment? A low interest rate environment is, after all, one in which funding, including equity funding, will be cheap. If good investment opportunities do indeed exist, as Chancellor insists, why would low interest rates be a prohibitive obstacle to funding them?The survival of “zombies” might be a partial explanation. But dynamic businesses should be able to outbid zombie firms for workers, suppliers and customers. Moreover, businesses able to cover their variable costs should survive. True, if one closed down most marginally productive businesses, the productivity of workers who remain employed would rise. But the productivity of the overall workforce would fall, which would be a bad bargain.Again, the argument that low interest rates increase inequality is grossly misleading. Even a doubling of the wealth of billionaires has no real significance to people who own next to nothing. Thus, according to the 2020 US Census, the median net worth of the bottom 20 per cent of US households was minus $6,029 and the median net worth of the next 20 per cent was just $7,263. What matters to such people is not how immensely rich Elon Musk is, but whether they actually have a job. Active responses to recessions by central banks help them achieve this. If Chancellor really cares about inequality, what about campaigning for wealth taxes?Chancellor also has many complaints about the effect of low interest rates on financial instability and fragility. Yet it is unlikely that the modestly higher interest rates he recommends would have saved the world from financial crises. The world of 19th-century America, without central banking, saw plenty of them. That is why the Federal Reserve was created in the early 20th century. What, above all, is the author’s alternative to the low interest rates he despises? A depression. Indeed, he insists that “[t]he broad economy benefits from this dose of salts”. He even goes so far as to cite Andrew Mellon, the treasury secretary of Herbert Hoover, who notoriously advised his boss to “liquidate labour, liquidate stocks, liquidate the farmers, liquidate real estate”. Mellon might have added “liquidate democracy”. In Germany, chancellor Heinrich Brüning managed to achieve just that as he prepared the ground for Hitler. Bubbles are terrible, insists Chancellor. Mass unemployment? Fine.In sum, Chancellor has written an overheated and unbalanced polemic. Yet this does not altogether vindicate Bernanke’s managerialist perspective. William White, a former chief economist of the Bank for International Settlements, and Claudio Borio, who still works there (both cited approvingly by Chancellor) have indeed given us sobering and sometimes prescient warnings about the financial risks that have built up.The fundamental problem is that we have two objectives for policy: stabilising the real economy in the short to medium term and containing financial risks. One cannot hit two goals with one instrument. The choices are either to split the focus of monetary policy between the two goals in some way or to employ other instruments, such as regulation (for managing finance) or fiscal policy (for managing demand). The efficacy of the first, sometimes called “leaning against the wind”, is unclear. Moderate rises in interest rates might even have given us the worst of both worlds — both deflation and persistent financial froth. Yet tighter regulation, though necessary, will create opportunities for arbitrage, as motivated players find ways around it. At the same time, governments have not used active fiscal policy well, which suggests that monetary policy will still be needed to steer the economy.

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More immediately, the question is whether today’s high inflation presages a fundamental shift in the monetary policy environment from one of low inflation to something more like the 1970s. Already, the most recent Fed policy review, with its rear-view mirror focus on the average of past inflation rates, is hopelessly out of date. Yet how far the shocks of the past two and a half years have durably altered the policy environment is unclear.

Bernanke is right: quantitative easing in response to the “Great Recession” did not create the hyperinflation against which so many mistakenly warned. The mistake over inflation was more recent, more understandable and more modest. It consisted of not recognising soon enough the scale of the surge in the supply of broad money in 2020 in response to the Covid-19 crisis, the pervasiveness of supply disruptions and the strength of the recovery.The perfect solution to monetary policy is the holy grail of central banking. But, like the grail, it is unlikely ever to be found. At the same time, the public is not going to accept a return to 19th-century US capitalism, without even central banks. We will continue to manage money and finance, not return to the gold standard or embrace bitcoin and its rivals as the solutions.Today, the inflation targeting supported by Bernanke looks the least bad approach. But the question also remains how best to contain the financial risks emphasised by Chancellor. The biggest concern, we know, is the tendency towards incontinent expansion of credit and so also of debt. Regulation is a part of the solution. But the most important structural source of excessive leverage is the tax deductibility of interest. We should eliminate that now.21st Century Monetary Policy: The Federal Reserve from the Great Inflation to Covid-19 by Ben Bernanke, Norton $35/£24.99, 512 pages The Price of Time: The Real Story of Interest by Edward Chancellor, Allen Lane £25, 432 pagesMartin Wolf is the FT’s chief economics commentatorJoin our online book group on Facebook at FT Books Café More

To appreciate the challenges confronting Sri Lanka’s new president, take the road to Hambantota.At the end of a stretch of jungle in the south of the island sits a convention hall for 1,500 people, a 35,000-seater cricket stadium and a massive “international” airport. All are empty and rotting away in the heat.The infrastructure projects also include a $3.1bn port, which was financed by China and is now controlled by Beijing after the Sri Lankan government incurred heavy losses and gave up on bankrolling it in 2017.Linked by a deserted four-lane highway, critics point to the projects as the pinnacle of wasteful spending by the once-dominant Rajapaksa clan, which borrowed heavily overseas to spend lavishly in their home region of just 600,000 people.But the unpaid debts and mounting maintenance costs also reflect the problems faced by Ranil Wickremesinghe as the incoming president prepares to institute painful reforms to secure an IMF bailout and restructure more than $50bn of external debt.“There’s no fuel so I’ve been cycling 25km every day to get here,” said Bandar, 47, a retired soldier guarding the gate to the $20mn convention hall. The hulking slab of concrete was built with a loan from South Korea and opened by ex-president Mahinda Rajapaksa in 2013.Sitting by a shuttered gate and an electric fence to keep out elephants, Bandar told the Financial Times that he grew bananas, chillies and rice in his village to survive. Since the government banned fertiliser imports last year, his crop yield had dropped by more than two-thirds.Few planes touch down at Hambantota’s international airport © Paula Bronstein/Getty ImagesMahinda’s younger brother, Gotabaya Rajapaksa, was ousted as president this month after fleeing the country amid mass protests over soaring prices, fuel shortages and a plummeting currency.Sri Lanka’s debt talks will be closely watched as a test of how Beijing works with other creditors after lending heavily to developing nations in Asia and Africa, which are now under strain from rising inflation and the fallout from the war in Ukraine.The talks have been held up for weeks due to the turmoil. The deeply unpopular Wickremesinghe should prioritise restoring public order, experts said. But his decision to send in troops to clear a protest site on Thursday night has sparked more protests in Colombo.Nandalal Weerasinghe, the central bank governor, said the government should waste no time in pushing through “several tax measures, several measures to curtail expenditure and restructure state-owned enterprises”.But Weerasinghe warned in an interview with the Financial Times that reforming the lossmaking state electricity company, for example, would mean higher prices.“I realise it’s difficult, but it has to be done. It’s the government’s responsibility to protect the poor and vulnerable who are going to be affected by all these policies,” he said.Experts said that about half of Sri Lankans would be classified as poor by the end of the year, a stunning reversal for the island of 22mn that was until recently classified as an upper-middle income country.The central bank this month raised its standing lending facility rate by 100 basis points to 15.5 per cent in an attempt to curb inflation of 55 per cent.Weerasinghe added that the government should also cut unnecessary public investments and stop importing items such as TVs, cars and mobile phones to preserve hard currency for fuel imports.People wait in a queue to refill liquefied petroleum gas cylinders at a distribution point in Colombo. Sri Lanka is struggling to import fuel © Arun Sankar/AFP/Getty ImagesThe painful reforms are a prerequisite to sealing a $3bn bailout from the IMF, which would unlock another $4bn in financing from the World Bank and the Asian Development Bank.But the severity of the crisis means that Sri Lanka is also seeking up to $1.5bn from its biggest bilateral backers — China, India and Japan — in bridge financing to immediately resume imports of fuel and gas.“That should let us manage for the next three to four months until the IMF package kicks in,” said Weerasinghe.Nishan de Mel, a director at think-tank Verité in Colombo, urged the government to speed up debt talks. “Every month of delay is killing economic functionality and it doesn’t seem like the government has the kind of energy and focus needed to get it moving fast,” he said.Back in Hambantota, about 160km south-east of Colombo, the fallout from the crisis is illustrated by the snaking line of cars waiting for fuel that have blocked the main entrance to the local chamber of commerce.

Inside, Tilar Nadugala, the head of the chamber, warned that small- and medium-sized enterprises, a significant source of employment in rural areas such as Hambantota, “would collapse in two to three months” if interest rates stayed unchanged. This was because “for people who have taken out loans for projects using floating rates, interest rates have jumped from 12 to 25 per cent”, he said.Hambantota’s cricket stadium has hosted just 27 games since opening in 2011, he said, but “the convention hall is even worse. At least at the stadium, you can play a game. The centre could host weddings or concerts but local people can’t afford to rent it out.”Support for the Rajapaksas, whose party still commands a majority in parliament and who have many connections in the region, has melted away. “I’m very happy that Rajapaksa got kicked out. Whoever is in government has no respect for the law,” said tuk-tuk driver Amith Liyanagedara.Liyanagedara had been waiting for 18 days in the queue for fuel, sleeping in his vehicle or on the side of the road because buses had stopped running. He said the projects were “good in theory, but they’re not functioning as intended, while we have no medicine, fuel or fertiliser”.He added that his pregnant wife and their one-year-old son were only eating once per day.When asked about his future, Liyanagedara said he could barely contemplate it. “For me, it’s the same every day,” he said. “I stand in a queue.” More

BENGALURU (Reuters) – The global economy is in the grips of a serious slowdown, with some key economies at high risk of recession and only sparse meaningful cooling in inflation over the next year, according to Reuters polls of economists.Most central banks are only part-way through a still-urgent cycle of interest rate rises as many policymakers make up for a collective error in judgment last year thinking supply chain-related inflation pressures would not last.That carries with it another risk – central banks moving too quickly without taking time to assess damage from the fastest interest rate rises in more than a generation following over a decade of near-zero rates.Despite their aggressive response – in some cases, the most in several decades – inflation has yet to ease in most of the near-50 economies covered in the June 27-July 25 Reuters surveys of more than 500 forecasters around the world.The U.S. Federal Reserve, due to hike rates by another 75 basis points later on Wednesday, is a case in point. Inflation there, currently at a four-decade high of 9.1%, is not expected to cool to the Fed’s 2% target until at least 2024. [ECILT/US]Soaring inflation has turned into a serious cost of living crisis in much of the world, pushing up recession risks.There is already a median 40% chance of recession happening in the world’s largest economy in the coming year, up sharply from three months ago, and those chances have risen for the euro zone and Britain too.”Recessionary dynamics are increasingly evident in our forecast. Notably, we now see several major economies – including the United States and the euro area – slipping into recession. Even so, the timing of these downturns varies, and they are expected to be relatively mild,” noted Nathan Sheets, chief global economist at Citi.”By any metric, the global economy is slowing and prospects are deteriorating. Global recession is, indisputably, a clear and present danger.”Global growth is forecast to slow to 3.0% this year followed by 2.8% next, both downgraded from 3.5% and 3.4% in the last quarterly poll in April. That compares with the International Monetary Fund’s latest forecasts of 3.2% and 2.9%.Of the 48 economies covered, 77% of growth forecasts were downgraded for next year with only 13% left unchanged and 10% upgraded. Graphic: Reuters Poll – 2023 GDP growth revisions, https://fingfx.thomsonreuters.com/gfx/polling/gkplgyeabvb/Reuters%20Poll%20-%202022%20Global%20GDP%20growth%20revisions.png Similarly, inflation forecasts for nearly 90% of the 48 economies were upgraded for next year and over 45% for 2024. That means no quick respite from a cost of living crisis pinching households.Indeed, the vast majority of respondents said it would be at least next year before the crisis eases significantly (86%) with more than a third (39%) saying over a year.Among the top 19 global central banks covered, a slight majority, 11, will see inflation returning to target next year.The remaining eight will not, including some of the biggest ones like the Fed, the European Central Bank, the Bank of England and the Reserve Bank of India. Graphic: Reuters Poll – Global monetary policy and inflation outlook, https://fingfx.thomsonreuters.com/gfx/polling/zjpqkzloypx/Reuters%20Poll%20-%20Global%20monetary%20policy%20and%20inflation%20outlook.png Emerging economy central banks covered by the polls are further through their expected hiking cycle, about three-quarters of the way, on average. This is skewed higher in part by the early and aggressive rate campaign by Brazil’s central bank, one of the first out of the gates.Developed ones, by contrast, are only on average about half-way through, held back in part by the European Central Bank, which only just began raising rates.That means more rate rises still lie ahead.”We are particularly concerned about two developments. First, the shift to aggressive hikes at many central banks. This is an inevitable outcome of moving late. However, it greatly increases the risk of overkill, as there is not time to reassess the impact of the hikes,” noted Ethan Harris, global economist at Bank of America (NYSE:BAC) Securities.”Second, we worry about feedback effects across regions. In particular, recessions in the U.S. tend to impact global confidence and growth even more than warranted by the size of the U.S. economy. Stay tuned.” Graphic: Reuters Poll – Comparison of tightening cycles, https://fingfx.thomsonreuters.com/gfx/polling/dwvkrbmlepm/Reuters%20Poll%20-%20Comparison%20of%20tightening%20cycles.PNG (For other stories from the Reuters global long-term economic outlook polls package) More