‘We’re being fed a line’: investors vexed by central bank influence

Buy-siders say central bank communications policies have broken the link between markets and political risk

Federal Reserve
Salient Partners' Ben Hunt says the link between political risk and market volatility is subdued by opinion presented as fact by figures of authority, such as the Fed

When Donald Trump threatened to “totally destroy” North Korea in his first address to the United Nations general assembly last month, US equity markets barely stirred. The episode was good for a 30 basis point drop in the S&P 500, but the index quickly recovered. 

It is not just the threat of nuclear war to which the benchmarks are seemingly immune. Political events that might once have threatened to upend the status quo – the 2016 US presidential election, the Italian constitutional referendum

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