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Covid-19 brings the end of US exceptionalism

Jovi Ho
Jovi Ho9/25/2020 06:31 AM GMT+08  • 7 min read
Covid-19 brings the end of US exceptionalism
The shock the pandemic has wrought on the world’s economies could usher in a decade of “de-dollarisation”.
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The Covid-19 pandemic spells the beginning of the end of a deflationary era which started in the 1980s, posits Davis Hall, head of Asia capital markets at Indosuez Wealth Management, as central banks around the world adopt unorthodox monetary policies to weather today’s unprecedented environment.

Speaking from Hong Kong at a video conference hosted by Indosuez Wealth Management, Hall highlights that four key financial institutions have indicated they will tolerate inflation as an outcome of various liquidity and debt provisions.

These include the Federal Open Market Committee, the European Central Bank, the Bank of England and the Reserve Bank of Australia. “They’re going to intentionally allow inflation to overshoot as the only means to hopefully repay all of this debt... But there’s a risk that all of the central banks are too loose for too long,” Hall warns.

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