Markets Archives - Page 548 of 782

The Bad Economic Hits Keep Coming in Europe

The US dollar is trading broadly higher as the divergence thesis gains ground with the latest batch of disappointing euro area data. Soft UK BRC sales and price indices suggest that Britain is being pulled closer to the euro area than the US. Separately, for the second time this month, the People’s Bank of China has cut its 14-day repo rate. These global headwinds are seen a potentially delaying the beginning of the normalization of US monetary policy, and are spurring a leg up in the bond market rally, with 10-year Treasury yields dropping to 2.20%.

Italy on Sale, Finland Threatened as ECB fights Germany on Disinflation Fix

Finland has lost its most recent credit rating due to eurozone instability and more Italian assets are being sold to Chinese investors as instability accelerates in the European Union and the ECB fails to convince Germany of the need for quantitative easing.

Economic News from the Emerging Markets in the Coming Week

A better mood in equity markets and a softer dollar at the start of the week gives us some hope for a bounce in EM assets, even if short lived. While the focus remains on major markets for now, several local stories – mostly of which political – will continue to play a large role in country-specific performance.

More about ‘Abenomics’ in Japan and it’s Potential

After two decades of stagnant growth and the Fukushima triple disaster, Japan appears more confident both domestically and internationally. The economy has been inflated, much-needed social change is being discussed with some progress being made, and international diplomacy is once again active.

Slower growth is to be expected with an ultra-modern economy that has a shrinking population. And Japan has continued to contribute to the peace and stability of the region, underpinned by the US-Japan alliance and the Article 9 peace clause of its constitution.

High Taxes in Italy Stall Economic Rebound

For some time now, the tax system in Italy has been growing increasingly inefficient and costly. Since the economic crisis in the country, the burden of this poor system has fallen on business owners and workers, according to a new study. According to a report offered by ‘World Bank Doing Business’, the economic crisis response in Italy has severely impacted workers, instead of focusing on public spending cuts. The study underlined that, in relation to taxes, Italy has 138th easiest taxes to pay, in comparison to France at number 52, and the UK at 14th.

Lessons from Japan’s ‘Abenomics’

One of the striking things about the past few decades of Japan’s economic history has been the fact that textbook macroeconomics could have predicted most of it. Back in the late 1990s, this was a controversial point of view. Many people spoke about the ‘specialness’ of the Japanese economy, just as they have about the ‘specialness’ of recent monetary policy. This over-complication seems unnecessary. In the political economy of reform, as in macroeconomics, we can learn a lot from the Japanese experience.

Attracting Foreign Talent Means Overcoming the Japanese Language Barrier

In May 2014, the Japanese government announced its plan to attract ‘foreign talent’ as part of a campaign to further economic growth. The plan consists of three key points.

First is a review of the Technical Intern Training System. This will be done by strengthening management and supervision of the system, widening the job categories covered by the system, extending the training period from the current period of three years to a maximum of five years and expanding the admission quota.

India Needs to Pursue Meaningful Free Trade Agreements

When India began negotiations with ASEAN in 2004 for a free trade agreement (FTA) covering the goods sector, it marked a major step in the evolution of the country’s engagement with the global economy.

Competition in the Oil Market and the Dollar Confound the Markets

The dollar retains a firm undertone after yesterday’s recovery in the North American session from the week’s lows. For the first time in months, the dollar has lost ground against all the major currencies this week.

The Japanese yen is the strongest, gaining about 1.7% against the dollar, helped by tumbling equity prices. It is not so much that the S&P 500 is off 0.92% over the past five sessions. It is the complete reversal of Wednesday’s gains that dealt a body blow to market psychology.

Emerging Markets Over the Last Week

(1) The second round of the Brazilian elections is off to an exciting start

(2) The situation in Turkey is becoming tenser as ISIS advances on Kurdish towns in Syria near border

(3) The ruble continues to push through all-time highs

(4) The Polish central bank cut rates for the first time since July 2013

(5) Hong Kong democracy protests have died down, but the situation remains fluid