If you expect global central banks to unwind stimulus next year, you’re probably wrong. In fact, the world’s monetary policy makers are set to open the cash spigot by the most in four years in 2015. Major central banks will together add almost three times more liquidity next year than they did in 2014, according to Credit Suisse Group AG analysts.
Even with the U.S. Federal Reserve and Bank of England having wrapped up their bond buying, the strategists led by Andrew Garthwaite estimate the balance sheets of the four top central banks will grow 13 percent next year, or $1.3 trillion, after this year’s 5 percent expansion.
They assume the Bank of Japan will account for $855 billion via quantitative easing and the European Central Bank will increase its assets by about half the 1 trillion of euros it’s aiming for. If the ECB hits its target then the swelling globally will be $1.9 trillion or 18 percent.
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