M&G's Richard Woolnough has said the spectre of deflation emerging across Europe is a positive in the current environment, adding central banks should be comfortable with this development.
The manager of the country's largest retail fixed income portfolio, the £18.8bn M&G Optimal Income fund, said investors need not worry about deflation as a negative event. That is despite increasing warnings that the eurozone in particular, where inflation fell to a four-year low of 0.5% last month, is in danger of falling into a deflationary spiral. In the UK, too, inflation is now undershooting the Bank of England's 2% target for the first time in four years. But Woolnough said: "I do not think deflation is bad. I think it is good. For example, if someone came and did some work o...
To continue reading this article...
Join Investment Week for free
Signup and gain exclusive members-only insights - all free of charge!
- Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
- Get ahead of regulatory and technological changes affecting fund management
- Important and breaking news stories selected by the editors delivered straight to your inbox each day
- Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
- Be the first to hear about our extensive events schedule and awards programmes
