The perspectives are bad and the scholarships exceed the records: the BRI points to “disconnected” investors and the risk of a new “Internet bubble”

Securities markets have been significantly recovered in recent months, particularly in the United States, to the point of appearing “disconnected” from economic uncertainties, the Bank of International Regulations (BRI) warned Monday.

If the rebound in the stock market has been more modest in Europe, the US market has quickly reached its losses since the shock of customs tasks in early April, this institution considered as the central bank of the central banks.

The increase in stock markets was brought by technological values ​​and the enthusiasm for artificial intelligence and the valuations have seized, to the point of approaching the “not far” levels of those affected “in the peak” of the Internet bubble from the beginning of the 2000s, writes in its quarterly report.

The perspectives to soften monetary policies and budgetary generosity in the United States and Germany have also fed the optimism of investors.

“Difficult arbitrary” for central banks

However, this appetite for risky investments appears in contradiction with macroeconomic concerns and fears of inflation resurgence, he warns.

In its quarterly report, the Basel -based institution has published a study that warns that certain central banks can face “complex” options against customs tasks.

Some may not “simultaneously stabilize” inflation and growth, according to this study, which means that they will have to carry out “difficult arbitrations.”

A remarkable impact of customs tasks

Customs duties make “in principle” the effect of a shock on the country’s offer imposes them, with the repercussions to make prices increase. On the other hand, for the countries that are observed, they have the effect of a “shock on demand”, which tends to reduce economic activity but also reduce inflation, explain to the authors of the study.

But other parameters come into play, such as impact on supply chains, the weight of economic relations with the United States or sector disparities.

Therefore, in “practice”, the repercussions of customs tasks are, therefore, complex to evaluate, according to the authors of the study, who point out, however, that customs duties should have a significant impact on the United States and their main commercial partners, such as Canada and Mexico.