Emerging markets are winning the dash for cash after Brexit vote July 27, 2016 Emerging markets are one of the big winners from the UK’s vote to leave the EU as economies have benefitted from an influx of foreign capital. With bond yields crashing in the advanced world following the shock vote for Brexit on 23 June, Standard and Poor’s (S&P) said “yield-hungry investors” had flocked to more exotic [...]
US Federal Reserve paves the way for pre-election rate rise July 27, 2016 The Federal Reserve signalled the way to an interest rate rise before the US Presidential Election this evening as it heralded the strong pace of the economic recovery. Rate-setters left policy unchanged on this occasion, as expected, but a hike for only the second time since the financial crisis is now a distinct possibility for [...]
Have we seen the end of volatility in the currency markets? July 27, 2016 In the hours after the referendum, sterling suffered its largest ever decline in the era of free-floating currencies. The pound fell from $1.50 just after the polls slammed shut to $1.33 as the count showed the Brexit camp were out in front. Sharp spikes up and down in the value of sterling characterised the referendum campaign. By [...]
EU Commission refuses to call for fines against Spain and Portugal over budget breaches July 27, 2016 The European Commission will not fine Spain and Portugal for breaking the EU's budget rules, despite calls for the EU to take a hard line against the two countries. Spain and Portugal both ran budget deficits which exceeded Eurozone guidelines which prohibit states in the single currency area from running shortfalls of more than three per cent of [...]
Brexit fears? Pah: GDP growth in the second quarter just beat expectations July 27, 2016 The pound briefly rose against the dollar in early trading, after figures from the Office for National Statistics (ONS) showed the UK's economy grew 0.6 per cent in the second quarter, beating expectations. Sterling edged up to $1.3134, from a session low of $1.3106, after growth rose above the 0.5 per cent economists had expected for [...]
Spending growth through shopping vouchers – should central bankers be trying new things? July 26, 2016 Over the last few months the term helicopter money – once only used to mock former Fed chair Helicopter Ben – has become common place. For that we can thank the Bank of Japan and its increasingly desperate attempts to kick start growth, culminating this Friday with its latest policy meeting. Many economists are expecting the Bank of Japan [...]
Brexit won’t kill the EU: It’s more likely to be a long-term blessing July 26, 2016 Britain's vote to leave the European Union has engulfed the kingdom in a political, constitutional and economic storm. But it has also plunged Europe into uncharted waters. It may not be prepared for this challenging, uncertain course. We’ve so far witnessed a striking lack of consensus among policy-makers. This is not only in regards to [...]
US economy unaffected by Brexit vote, but attention turns to presidential election July 26, 2016 Fresh economic data from the US has shown the world's largest economy is feeling little fallout from the UK's vote to leave the EU. Both consumer confidence and business activity in the dominant services sector were "virtually unchanged" between June and July, figures out this afternoon revealed, although caution remained the prevailing sentiment as the US winds [...]
Before the bell: What you need to know before the US market open July 26, 2016 Markets are braced for a raft of tech stock earnings today and later this week and the Japanese yen is surging. Here's what you need to know before the US market open at 2:30pm London time. The pre-market is painting a mixed picture with the S&P down by 0.03 per cent, the Nasdaq is up by 0.16 per [...]
Bank of Japan and Shinzo Abe prepare for next round of stimulus in fight for growth July 26, 2016 Japan's policymakers are gearing up to unleash a new round of massive economic stimulus over the next few weeks in a push to bust the economy out of its low-growth low-inflation malaise. The action will get underway this week in a crunch central bank meeting where markets expect the Bank of Japan (BoJ) to deliver [...]
