BlackRock sees big risk of U.S. easing pandemic support too soon

Emerging markets also faced a greater risk of a policy mistake

  
A sign for BlackRock Inc hangs above their building in New York U.S., July 16, 2018.

A sign for BlackRock Inc hangs above their building in New York U.S., July 16, 2018.

REUTERS/Lucas Jackson

LONDON- There is a significant risk that the policy response to the coronavirus crisis in the United States could be scaled back too soon, BlackRock Investment Institute's global chief investment strategist Mike Pyle said on Monday.

Pyle said that although there had been a strong U.S. fiscal and monetary policy response to COVID-19, there were concerns about the outlook.

"There are significant risks around the U.S. retrenching (policy support) too soon," he said during a presentation on the BlackRock Investment Institute's mid-year outlook.

Pyle said the firm was cautious on emerging markets because of a reduced capacity on the policy front to respond to the coronavirus shock compared with more developed economies, as well as a challenging public health dimension, especially in Latin America.

Scott Thiel, chief fixed income strategist at the BII, said emerging markets also faced a greater risk of a policy mistake.

(Reporting by Karin Stroehecker and Dhara Ranasinghe, editing by Huw Jones) ((Dhara.Ranasinghe@thomsonreuters.com; +442075422684;))