ETF Securities warns on inflation threat from global rise in populism

Brexit triggers disenfranchised vote

ETF Securities has advised investors to protect their portfolios from a potential rise in inflationary pressure resulting from growing support for populist political parties across developed markets.

The group said policies drawn up by populist movements tend to target disenfranchised voters by increasing public expenditure on such areas as wages and employment, which ultimately leads to hyper-inflation. It also found a close relationship between quantitative easing, currently being carried out at unprecedented levels throughout the eurozone, and inequality. This has led to a surge in popularity for European populist parties such as Germany's anti-immigration AfD party and Italy's Five Star Movement. Managers keep faith with Italy ahead of PM Renzi's make-or-break referendum In...