Ongoing dovishness from Central Banks and higher geopolitical risks are the divergent forces driving financial markets at this point.
Central Banks’ tone remains broadly accommodative around the world, continuing to be a mildly supportive factor for risk takers. On the other side, geopolitical risks remain high. Market volatility has been relatively contained despite the escalation of geopolitical tensions coming from the North Korean nuclear tests. This can be attributed to the “safety net” created by Central Banks.
