PROJECT M
 

Monetary policy: how to close a can of worms

Policy risk is a known risk by now, but that doesn't mean it affects investment decisions

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Monetary policy: how to close a can of worms

Policy risk is a known risk by now, but that doesn't mean it affects investment decisions

About this report …

The Global RiskMonitor, published annually by Allianz Global Investors, collected responses from 390 business professionals during the summer of 2013. The respondents hold positions such as chief investment officer, chief operating officer, director of research, CEO/managing director and portfolio manager in large financial firms. The current study seeks to understand how current monetary policy could contribute to market bubbles in the coming years, the risks posed to performance by various macroeconomic factors and the effect of regulatory developments on institutions and their decision making. Almost as many are worried about its effect on systemic risk (55%), with 54% concerned that current low interest rates damage the health of retirement savings (multiple answers possible). Said one investor, “Fed and company have yet again built another house of cards.”

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