Brexit vote: Will the U.K. stay or go?
In this week’s episode, Chief Investment Strategist Erik Ristuben, who joins host Kate Bauman, discusses the Brexit vote next Thursday in light of this week’s tightening polls and related market volatility. He also shares Russell Investments’ view that in the end the odds of an actual Brexit is unlikely.
In the U.S., Ristuben also highlights key takeaways from this week’s FOMC meeting in which committee members decided not to raise the fed funds rate and lowered expectations for increases through the remainder of 2016 and into 2017.
Ristuben explained that the U.S. economy as a whole is beginning to reaccelerate off very slow growth in Q1, citing the Atlanta Fed’s increased expectations for Q2 U.S. growth of 2.8 percent and recent reports signaling strength in the housing market and positive retail sales. At this point, Russell Investments’ global team of strategists now expects only one rate increase by year-end, most likely in September.
Lastly, the Bank of Japan (BoJ), in a relatively surprising move, chose to do nothing incremental this week in terms of monetary policy. Ristuben explained how the yen, which has strengthened for most of this year, is a headwind to corporate earnings and economic growth, and overall the market is now becoming concerned about the BoJ’s commitment to increasing inflation expectations. That is a watch point as it relates to the Japanese market, he says, but not a huge factor on a global basis.
Be sure to vote in this week’s Twitter poll via @Russell_Invest, asking:
Brexit vote: Will the U.K. stay or will they go?