While the consensus narrative fears of rising inflation triggered equity sales has much to recommend itself, there is a major discrepancy.
Author: Marc Chandler
The short-term solution reached last month to extend the US federal government’s funding expires on Thursday.
What will stop the dollar’s sell-off is not officials. It is not the likelihood of a Fed hike. Rather the market will exhaust itself.
Probably not. As Mnuchin and President Trump have done before, a distinction was drawn between short- and longer-term perspectives.
If China wants to accumulate reserves, it will have to buy US Treasuries, even if not every month. Japanese institutional investors are thought to be attracted by the high yields available in the US Treasury market. But, the wider differentials at short-end make hedging the currency risk more expensive
There is nothing quite like a falling dollar to spur take of the erosion of the greenback’s reserve status. For various reasons, countries have chosen to build reserves. Following the decision to hold or build reserves, the question arises as to what currencies to hold. Here’s a take specifically on the Yuan
The investment climate is being shaped by two powerful forces. First is the very accommodative policy stance. In addition to the accommodative monetary policy, fiscal policy is also supportive.
Italy’s election has the potential for some surprises. The Five Star Movement, which is polling first in surveys, has pledged a referendum on the euro if Brussels does not change its fiscal rules. Berlusoni’s Forza Italia and Salvini’s Northern League are critical of the EU and EMU, but rather than jettison the euro, they talk about having a parallel currency.
Yesterday, China announced one of the most important tax reforms of the past twenty years. It is replacing a business tax on gross revenue for non-manufacturing companies with a VAT. Manufacturing companies have been subject to a VAT approach for a few years. The reform extends it from manufacturing and a few services in a pilot program to industry-wide application. It will now cover construction, real estate, finance and consumer services.
A destabilized Europe adversely impacts the UK within or without the EU. The UK is tied to Europe in ways that leaving the EU will not sever. Ironically, the UK may find it has less sovereignty if it leaves the EU than within it.
By Marc Chandler Through the venomous comments and erosion of trust, the broad framework of what couple prove to be a workable compromise over Greece’s financial crisis may be emerging. This is not to suggest that the eurozone finance ministers meeting will reach any important decision. Indeed, the Greek Prime […]
There is an element that links the terrible human tragedy in the Mediterranean and the ongoing Greek crisis. It is Europe’s over-emphasis on moral hazard.