Macro Strategy Views Podcast: Why Europe is not Japan

In our weekly podcast, Macro Strategy Views, we discuss the similarities and differences between the eurozone and Japan in terms of the outlook for interest rates. Global Head of FI&C Research, Thomas Harr, chairs today’s podcast while our eurozone economist, Aila Mihr, joins him. Both the eurozone and Japan acted too timidly in their crises in terms of monetary policy and banking sector clean up and some countries, e.g. Italy, look much worse than Japan. However, low inflation appears to have become less entrenched in the eurozone than in Japan. Moreover, structural drivers of low interest rates, such as demographics and low trend growth, are less severe in the eurozone than in Japan.