The European Central Bank has begun purchasing covered bonds in its latest effort to lift the European economy and save the eurozone from deflation. The ECB is planning to buy as much as 700 billion euros’ worth of bonds in its latest round of quantitative easing.
In September, data about the Welsh economy suggested that the country had seen a rise in employment within the private sector. This rise implied that the rate of job creation was at the highest rate in the history of the survey. However, despite this, the economic upturn seems to have lost its momentum, with output rising at the slowest pace in over a year and a half.
Despite having won the president and vice-president posts respectively, Joko Widodo and Jusuf Kalla will possess little control, if at all, on the formulation of the next Indonesian budget for fiscal year 2015–16. One particular issue that concerns the new administration is the large portion of funds for energy subsidies, particularly fuel subsidies.
Emerging market assets have started off the week mixed, with few clear signals to follow. The major currencies also appear directionless at the moment; though eurozone flash PMIs on Thursday could help put the spotlight back on weakness there.
As long as the dollar strengthening trend does not resume in earnest, EM currencies should be OK. On the equity side, EM is taking the back seat, constrained to a high-beta status. Lower oil prices, if sustained, will help the likes of India and Turkey, though this is yet to be priced in.
Many have hailed Prime Minister Narendra Modi’s maiden speech to the United Nations General Assembly as a historic shift away from the speeches of past Indian heads of government. But in reality, Modi’s speech is more a continuation of the Indian government’s stance on many international issues, albeit with more flourish and charisma, which comes naturally to Modi when he speaks in Hindi.
For Vietnamese youth, a university degree is the entry ticket to the middle class and a promise (often unfulfilled) of an urban professional job. Enrolment in higher education has grown from 162,000 in 1992 to over two million last year, some 25 per cent of the nation’s college-age population. Business, finance and foreign trade degrees are prized, a consequence of the Vietnamese economy’s globalisation.
On 1 July 2014, the Abe government made a cabinet decision to reinterpret the Article 9 peace clause of Japan’s constitution to recognise the exercise of collective self-defence under limited circumstances. While the scope of the proposed changes are an evolution rather than a revolution in Japanese security policy, especially due to the tough negotiations with Abe’s coalition partner New Komeito, furor and misconception have surrounded the move.
When Xi Jinping ascended to the Chinese presidency, he, Premier Li Keqiang and their streamlined seven-person Politburo Standing Committee faced serious economic challenges at home as well as increasingly complex issues to manage abroad.
Domestically, the Bo Xilai affair hovered over the leadership transition ominously, underlining the need to deal with disquiet among the Chinese public over corruption and the relationship between the state and economic power.
After wild swings at midweek (October 15), the US dollar spent the last two sessions of the week consolidating. While we expect the Federal Reserve will not be distracted by the recent market turmoil, or the softening of some market-based measures of inflation expectations, and will announce the finishing of its asset purchases, we recognize that Bullard’s comments cast a greater element of doubt. This doubt may prevent a resumption of the dollar’s uptrend. Broad consolidation is more likely in the days ahead.
Under the leadership of Governor Haruhiko Kuroda, the Bank of Japan (BOJ) in March-April 2013 did a 180-degree turnaround: it declared that it had the monetary policy wherewithal to end Japan’s chronic, mild deflation and secure a rate of inflation of around 2 per cent and announced bold monetary action to that end. For BOJ-watchers this was revolutionary stuff — and it was coming from establishment Japan.
