Markets Archives - Page 513 of 782

U.S. Consumers Win on Strong Dollar, Weak Euro

Continued strength in the U.S. dollar and weakness in the euro expects to benefit U.S. consumers, who can buy more with their dollar-denominated paychecks.

A slew of new reports from economists at several investment banks, including Goldman Sachs and JPMorgan, indicate that lower prices are coming to many goods categories, particularly from goods imported from Europe and Asia. One report noted that clothing, which is the most imported category by far, could see prices fall in 2015 thanks to cheaper energy costs and a stronger dollar.

Factors Surrounding Indonesia’s Interest Rate Cut

Bank Indonesia (BI) surprised everyone when it eased monetary policy at its February meeting. Moving into line with global trends, it cut the policy interest rate by 25 basis points to 7.5 percent, even though analysts had predicted no change. While the change is surprising, it has a sound rationale but is not without risk.

Stronger Dollar Hurting US Exporters

The US Dollar continued appreciating over the last several months and most see this as a positive for the American economy. But, a number of prominent US CFOs, recently surveyed by Duke University, have pointed out a down side to this upturn. The increased value of the dollar is actually making it harder for US exporters, and could hamper their investment plans for the next year.

Foreign Investors Slowly Turn their Backs on China

Nokia is shifting operations from China to Vietnam because sales of the Lumia smartphone have not increased domestically, forcing the company to slash 9,000 jobs. Analysts point to a larger trend of foreign companies turning away from the Chinese.

China’s Economic Crossroad

China’s GDP growth rate is decelerating, due to international headwinds, property markets and local debt. Nevertheless, China’s long-term potential remains impressive, as reflected by the new growth target.

As the 5,000 members of the two sessions – the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) – listened to Premier Li Keqiang in Beijing, the message was clear.

Indonesia’s Jokowi Heads Overseas and Leaves Domestic Tensions Behind

Indonesian President, Joko Widodo’s (Jokowi) decision to embark on his first official overseas visit has been overshadowed by domestic controversy. The planned meet-and-greet with the leaders of Malaysia, Brunei and the Philippines seemed to be a way of escaping the domestic tensions between two of the country’s key law-enforcement institutions: the police (Polri) and the anti-corruption commission (KPK).

Asian Development Bank Loans Vietnam $230M

The Vietnamese government and the ADB agreed to a $230M loan package to make the country more competitive worldwide. The loan means to boost economic development in such areas as finance and public administration.

In an effort to recover from the worldwide financial calamity, Vietnamese officials look to the future by growing the economy for the long-term. Tomoyuki Kimura of the ADB said the Southeast Asian country hopes to integrate into the international community by becoming a formidable economic competitor.

Vietnam Economy Rises

Budget Deficit Falls Further as Obamacare Culls Healthcare Costs

A new study by the CBO projects a smaller budget deficit thanks to lower spending on health insurance due to the Affordable Care Act, or Obamacare.

The report saw a decline in the budget deficit of $455 billion, or 13% of the total budget in 2014. Projected Federal government spending in 2015 remains uncertain, but President Obama has submitted a budget requesting $3.9 trillion in spending, or an increase of just over 10% from the prior year.

News Headlines from the Emerging Markets for the Upcoming Week

EM is starting the week on its back foot, continuing the trend seen for most of this past month. The dollar is making multi-year highs against many EM currencies, including BRL, COP, MXN, TRY, ZAR, IDR, and SGD. MSCI EM continues to sell off, while EM local currency bond yields are moving higher. The EM backdrop is likely to remain negative.

Turks Rush to U.S. Dollars as Lira Continues to Sink

Turkish authorities are pointing fingers at one another and scrambling to try to keep investors from rushing to the U.S. Dollar over the Turkish Lira. The Turkish Lira has plunged several times in recent weeks, bringing it to historic lows. This has left the Turkish President and Central Bank at odds with one another and investors skeptical about the long-term health of the Lira.