[January 29, 2015]

A.M.BestTV: Economic Outlook Speakers See More Low Rates Ahead

This ^A.M.BestTV episode covers the recent Prudential Financial, Inc. (Prudential) Annual Market Outlook and Briefing Conference, where speakers said the era of low returns will likely continue for the foreseeable future, with energy prices and the strength of the dollar also shaping the economic environment.

Michael Lillard, chief investment officer at Prudential Fixed Income, expects the U.S. Federal Reserve (the Fed) to actually raise interest rates this year; however, not substantially.

"Prudential is not expecting the Fed to raise interest rates very much, maybe only from 0% to 1%, which will not actually move long-term rates very much," said Lillard. "In fact, long-term rates may actually decrease; thus, giving us a flattening of the yield curve. If this happens it may help the global economy, since the dollar would be stronger."

James Gillard, vice president at A.M. Best, sees a mixed outlook for the global economy. "The United States will lead the way with its strong growth when compared to the rest of the world. On the other hand, European countries are going to continue to struggle with stagnant growth, high unemployment and fiscal austerity really dampening their prospects," said Gillard. More of Gillard's assessment of the global economy will be available in the February edition of "First Monday."

Also appearing in this episode:

• John Praveen, chief investment strategist at Prudential International Investment Advisers;
• Edward Keon, portfolio manager at Quantitative Management Associates; and
• Robert Tipp, chief investment strategist at Prudential Fixed Income.

Click here to view the entire video program: http://www.ambest.com/v.asp?v=ecoutloo115.

Recent episodes of ^A.M.BestTV include:

• XL CEO McGavick Honored as Insurance Leader of the Year: The recent 20th Annual Insurance Leader of the Year Awards Dinner held in New York, NY, by the School of Risk Management at St. John's University, honored this year's award recipient Michael McGavick, chief executive officer at XL Group and school board member: http://www.ambest.com/v.asp?v=leader115.
• Catastrophe Bonds "Lite" Off to a Fast Start in 2015: A surge in smaller catastrophe bonds is bringing new capital to insurance coverages formerly unreached by securitization. In the meantime, issuance of all catastrophe bonds appears headed for new heights: http://www.ambest.com/v.asp?v=catbonds115.
• Executives Hopeful About 2015, But Challenges Loom: Industry leaders at the Property/Casualty Insurance Joint Forum stated that during 2015 the industry should continue to grow; however, it could be limited by the general economy: http://www.ambest.com/v.asp?v=pcforum115.
• FM Global Group's New CEO Says Africa is the New Growth Area: The new Chief Executive Officer at FM Global Group, Thomas Lawson, believes multinational clients have become more active in Africa, particularly in the power and mining sectors: http://www.ambest.com/v.asp?v=lawson115.

^A.M.BestTV covers exclusive A.M. Best information and reports, targeted topics and key developments in the (re)insurance industry every Monday, Wednesday and Friday. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html. View ^A.M.BestTV episodes at http://www.ambest.tv.

A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

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