Despite the current economic uncertainty, Stefan Angele, head of investment management of Swiss & Global, has predicted no new global recession in the short-term.
Stefan Angele, head of investment management of Swiss & Global, has predicted weak economic global growth – unless there is another financial services crisis.
On his outlook for the world economy, Mr Angele said Swiss & Global’s main scenario was weak economic growth in the industrialised countries but no new global recession.
However during a presentation at Swiss & Global’s Zurich offices this morning (9 November) he said this scenario only held if there was no major shock in the financial sector.
He said monetary policy in the industrialised world was likely to remain expansive. Exceptions to this, according to Mr Angele, may be commodity exporters like Canada or Australia.
Mr Angele said room for monetary and fiscal policy support to stimulate growth was severely restricted as long as debt levels remained high and rates have not normalised.
He said: “Financial crises are nothing new. There have been 11 crises in three decades and the banks have been involved in all of them.
“Normalisation of fiscal policy, i.e. deleveraging of public households, remains a key challenge for many of the leading industrial countries. This must take place. Capital markets will not accept ultra low yields for economies that are just close to bankruptcy any more. Sovereign debt is not sustainable. Down the line problems will occur there.
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