Macro Perspectives—Finding the Path to Normal

What’s next for the economies and markets following the recent banking sector turmoil? Head of Franklin Templeton Institute Stephen Dover shares his key takeaways from a panel discussion with the company’s economists.

As central banks wrestle with how to respond to volatile economic data and banking turmoil, while also fighting inflation, Franklin Templeton’s economists provided their perspectives on what’s next for economic growth, interest rates, inflation and fixed income markets.

Our panel discussion included John Bellows, Portfolio Manager, Western Asset Management; Sonal Desai, Chief Investment Officer, Franklin Templeton Fixed Income; Michael Hasenstab, Chief Investment Officer, Templeton Global Macro; Gene Podkaminer, Director of Research, Franklin Templeton Investment Solutions; and Francis Scotland, Director of Research, Brandywine Global.

Below are my key takeaways from the discussion:

  • Very little has changed in the forward outlook from last quarter to this quarter, despite the tumultuous feel of events. If anything, the case for fixed income has strengthened and plays an even more pivotal role in portfolios. The estimates of the top rates that the Fed Reserve (Fed) will target have come down a little but remain very similar to prior estimates.