Banks Will Err On Side Of Caution


    Central banks will err on side of caution and if they start hiking interest rates, it will be done very slowly and carefully, says Chris Kresic, head of fixed income at Jarislowsky Fraser. Speaking at its ‘2014 Institutional Investment Forum,’ he said there is a bias to be easy, not too tight, when it comes to rates. On the secular side of things, developed markets are in a slower growth environment and have been for a few decades because of high debt levels. It is taking more and more debt to get less and less growth in part due to the mix of debt. If it was used for consumption, all that means is future consumption was brought forward. And while there is quantity of debt, it is not necessarily quality debt.