Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

What Institutional Investors Think About Interest Rates

Institutional investors, interest rates: Institutional investors currently do not anticipate the end of the so-called “easy money policy” to happen soon, according to a survey conducted by Allianz Global Investors. Around 42% of the surveyed decision makers from institutional investors in over 40 countries around the world consider that central banks will begin raising interest rates to their long-term historical averages no sooner than 2016, while 30% foresee a change in 2015, and 28% at an earlier point, Allianz GI said in a statement.

Ben Bernanke

At the same time, the opinions vary even more from a geographical point of view. For example, 56% of European institutional investors, which participated in the survey, consider that the rates will not go up in the next 2.5 years, while in North America and Japan higher rates are expected in 2015 with 48% of Japanese investors and 42% of North American subscribing to this point. Doug Forsyth, CIO of Fixed Income US at Allianz Global Investors had this to say:

 “Although the discussion about tapering that the US Federal Reserve introduced in June does not necessarily entail a regime switch towards rising rates, apparently there is a broadly shared feeling among investors that the economic cycle in the US is ahead the European which could possibly bear higher rates.”

According to Andreas Utermann, Global CIO at Allianz, investors analyze the monetary policy according to their particular regions, which explains the inconsistency in the answers of the surveyed. However, “given the paradigm shift in central banks’ monetary policies around the globe, it is more likely that they will be willingly rather ‘behind the curve’ than ‘ahead of the curve’ since they recognize how low rates are supporting indebted governments to grow out of their debt,” Utermann said.

This uncertainty could mean that investors will react very poorly to a sudden increase in rates, Utermann also warned.

Recommended Reading:

Hedge Fund Bond Strategies: The Trend in 2013 May Surprise You

Hedge Fund Week in Review: Activist Action

How Does Warren Buffett Make Money? This Study Attempts to Answer That Question

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!