Too-Easy Money Is Making It Too Hard to Gauge Markets, BIS Says
- Unprecedented stimulus seen causing price anomalies in assets
- BIS calls on governments to cut reliance on monetary policy
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Easy-money policies and unprecedented monetary stimulus have started to backfire in global financial markets.
That’s the opinion of the Bank for International Settlements. It says that historically low interest rates and bond-buying programs -- which have sent yields below zero on more than $8 trillion of government bonds, a record amount -- are causing anomalies in asset values. One example is that small price differences in related securities or assets, which banks traditionally eliminated through arbitrage, are persisting more often.