Avinash Persaud: “We’re Seeing the Final Phase of the Rally”

The first round of quantitative easing by central banks was effective in unfreezing financial markets, explains Avinash Persaud, Emeritus Professor of Gresham College and Chairman of Elara Capital and Intelligence Capital. But later rounds focused on long-dated bonds were largely impotent. As a result, he contends, QE has merely played the role of a very expensive interest rate signal and its tapering suggests the rate cycle is turning.

“Globally, the bond market decline has only just begun,” Persaud told delegates at the fourth India Investment Conference in Mumbai. “For stocks, we’re seeing the final phase of the rally.” Unless growth rebounds in India, he added, the Indian rupee and stock market will experience renewed downward pressure.

You can watch Persaud’s full presentation recorded on 17 January 2014 below. In the talk, he builds on an op-ed that he recently wrote for the Financial Times entitled “An expensive way to speak truth to financial markets.” 

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