Central Bankers Can't Beat the Stock Market

THE WEEK: Morningstar columnist Rodney Hobson says that whatever the economic climate, the stock market will continue to surprise 

Rodney Hobson 9 August, 2013 | 9:46AM

New Bank of England Governor Mark Carney seemed to be saying that interest rates will remain at their present level for another three years, which ought to be encouraging for UK equity markets and bad for sterling. Financial markets seemed to assume that he has signalled the next increase in interest rates, and the pound rose while shares fell.

The economy is entering a Goldilocks era where the porridge is not too hot and not too cold

Carney is trying to break the BoE tradition that as little guidance as possible should be given to markets and if guidance does have to be given it should be in nudges and winks that only the economists attending Bank briefings can interpret.

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About Author

Rodney Hobson

Rodney Hobson  is a columnist for Morningstar.co.uk and author of several investing books, including The Dividend Investor and How to Build a Share Portfolio.

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