Jurrien Timmer, Director of Global Macro, believes the reflation trade is in full force. The only indicator that is not quite moving is the dollar. Inflation expectations, along with nominal yields, are rising. From the perspective of the markets and the Federal Reserve, this is an acceptable development (because real rates will stay negative). Bitcoin and gold continue to interest Jurrien. Gold hasn’t seen much movement: it has been trading sideways for six months. Jurrien believes this is due to real rates; even though they are still negative, they aren’t becoming any more negative. Jurrien believes if big players continue to say they believe in Bitcoin, that will give the rest of investors more confidence.
Recorded on February 8, 2021.