12 October 2012

Poll: How Long Do You Think Extremely Low Rates Can Persist?

Posted In: Economics

Despite the Fed’s recent announcement of open-ended QE and Europe’s recent announcement by the European Central Bank of printing money for bond purchases, professional investors still think that today’s super-low interest rate environment will continue for some time. In a poll conducted earlier this week in the CFA Institute Financial NewsBrief, we asked professional investors how long they thought today’s extremely low rates could persist.

How long do you think extremely low rates can persist?

The most popular answer was 2–4 more years, chosen by nearly 43% of respondents. Coming in a close second was 1–2 more years, chosen by 40% of respondents. The least popular choice was 5 or more years, reaching a tally of only 19% of respondents. So, if our respondents are a good proxy for the market, then the market appears to believe low rates will persist for approximately 3–4 more years (on average). If you think rates may change sooner, there’s an investment thesis to explore. Happy hunting.

Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.

Tags: central banks, Polls, Quantitative Easing, US Federal Reserve

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About the Author(s)

Ron Rimkus, CFA

Ron Rimkus, CFA, was Director of Economics & Alternative Assets at CFA Institute, where he wrote about economics, monetary policy, currencies, global macro, behavioral finance, fixed income and alternative investments, such as gold and bitcoin (among other things). Previously, he served as SVP and Director of Large-cap Equity Products for BB&T Asset Management, where he led a team of research analysts, 300 regional portfolio managers, client service specialists, and marketing staff. He also served as a Senior Vice President and Lead Portfolio Manager of large-cap equity products at Mesirow Financial. Rimkus earned a BA degree in economics from Brown University and his MBA from the Anderson School of Management at UCLA. Topical Expertise: Alternative Investments · Economics