Markets Tell Fed Tightening Must Stop, Macquarie's Shvets Says
- Debt-laden world cannot withstand higher capital cost: Shvets
- Says Fed will have to halt its tightening in coming months
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Financial markets are flashing a warning to the Federal Reserve that the global economy cannot withstand its monetary tightening, and will in coming months force a halt to the campaign, according to a veteran strategist.
“The problem is the Federal Reserve right now is destroying money” by letting some of its bond holdings mature without replacement, said Viktor Shvets, head of Asia strategy at Macquarie Commodities and Global Markets, a unit of Australia’s biggest investment bank. “They will be forced at some point in time over the next three to six months to stop reducing the size of their balance sheet.”