The Dutch pension asset manager's Asia Pacific head of real estate says his team has just had one of its busiest years ever and that 2021 is looking similarly promising.
Instead, central bankers need to adopt ôa selective use of transparencyö if they want to maximize outcomes stemming from their operations, argues Tony Hughes, MoodyÆs Economy.comÆs director of Asia-Pacific economics. (Moody's Corporation acquired Economy.com for $27 million in November 2005)
He points to Japan and the United States as prime examples of countries who should take cover rather than go streaking with their central bank plans.
In the case of Japan, Hughes argues that the BoJÆs policy of ôquantitative easingö and its eagerness to reveal the extent of its thoughts and actions may actually be undermining the nation's success in ending deflation.
ôBy engaging in actions to boost the short-term cost of capital, the BoJ is effectively dampening demand and thus reducing the likelihood of a near-term end to deflation. Despite better data of late, this is in no way a fait accompli,ö Hughes says. ôInstead, the BoJ should just keep its mouth shut, its hands tied and just say and do nothing.ö
As for the US Fed, Hughes reckons that too much transparency has led to market over-confidence in its ability to fight inflation. He points to the flat yield curve that currently prevails in financial markets. Instead, it would be in the FedÆs interests to ôpull up a shroud around at least some aspects of its operationsö to gain greater control over long-term bond rates, argues Hughes.
ôUltimately, market faith in the FedÆs ability to fight inflation must equate with its actual ability, which is partially determined by its ability to affect long-term yields,ö says Hughes. ôConsequently, if faith rises above ability, as seems to be the case at present, and inflationary shocks hit, then inflation will appear and the Fed will be revealed as `a mere mortalÆ.ö
He reasons that the subsequent return of market scepticism in the Fed would allow it to then push up long-term bond yields as a counter to inflation. It could short-circuit this potential inflationary outbreak by opting to be more opaque in its dealings with markets.
Perhaps mum was right.
Record low borrowing costs in Australia are feeding demand for the country's real estate, with domestic and global investors raising their allocations into the sector.
Experts have a diversified view on the appeal of private assets across the region, but one thing's for certain - inflows are rising, particularly into China and the US.
Malaysia's Armed Forces Fund hires new CEO; Canada's Omers appoints Asia capital markets managing director; HSBC Asset Management creates alternatives unit, appoints CIO as its head; Bank of Singapore names global wealth head; Aware Super hires IFA head; Hong Kong names acting head for MPFA; Schroders adding to Asia ESG headcount; and more.
Asian fixed income assets – including Hong Kong dollar (HKD) bonds – are luring growing numbers of global investors who are striving for reliable and consistent returns amid macro uncertainty compounded by rising inflation and rates, according to HSBC Asset Management.