The Reserve Bank of India (RBI) cut its benchmark money rate for the second straight meeting. Reducing its repo rate by 25 bps, down to 6%, the central bank once gripped by political turmoil has certainly shifted gears. Former Governor Urjit Patel was essentially removed (he resigned) in December after feuding with the federal government over his perceived hawkish stance. [...]
In a way, the government shutdown couldn’t have come at a more opportune moment. As workers all throughout the sprawling bureaucracy were furloughed, markets had run into chaos. Even the seemingly invincible stock market was pummeled, a technical bear market emerged on Wall Street as people began to really consider increasingly loud economic risks. There had been noises overseas, troubling [...]
On February 7, the 3-month LIBOR rate (US$) fell sharply. Traders were, as various media outlets reported, stunned. All sorts of excuses were issued, the goal of them cumulatively to deny your lying eyes. Falling LIBOR couldn’t have been the market, especially eurodollar futures, anticipating a rate cut because these same people had been saying (and betting) for nearly two [...]
Don't waste your time worrying about things that are well worried. Well worried. One of the best turns of phrase I've ever heard in this business that has more than its fair share of adages and idioms. It is also one of the first - and best - lessons I learned from my original mentor in this business. The things [...]
Europe is a total mess, no one can (honestly) argue otherwise. But that’s just Germany and France, right? PMI’s in those countries were a disaster. Those reported for the US weren’t really all that bad. Weaker, sure, hardly the obvious sinking especially when compared to German manufacturers. IHS Markit’s flash US Manufacturing Index for March 2019 was 52.5. This was [...]
Confirmation that it wasn’t a shallow Rhine and emissions regulations. Something big is going on in Europe, Germany first. And if the German economy stumbles, particularly its industrial and manufacturing sector, we can reasonably infer its cause – the entire global economy is suffering. As is standard practice, when weak data began showing up last year it was attributed to [...]
According to Germany’s Zentrum für Europäische Wirtschaftsforschung, or ZEW, the slump in the country’s economy has now reached its fourteenth month. The institute’s sentiment index has improved in the last two, but only slightly. As of the latest calculation released today, it stands at -3.6. That’s up from -24.7 back in October, though sentiment had likewise improved at one point [...]
You know things have really changed when Economists start revising their statements more than the data. What’s going on in the global economy has quickly reached a critical stage. This represents a big shift in expectations, a really big one, especially in the mainstream where the words “strong” and “boom” couldn’t have been used any more than they were. If [...]
For much of 2018, the idea of “overseas turmoil” lived up to its name. At least in economic terms. Market-wise, there was a lot domestically to draw anyone’s honest attention. Warnings were everywhere by the end of the year. And that was what has been at issue. Some said Europe and China are on their own, the US is cocooned [...]
German GDP was the smallest of positives in Q4 2018, according to figures released today by DeStatis. Following a -0.2% rate in Q3, no matter how slight the plus sign was written into every headline. Most of them followed along the same format, such as CNBC’s Germany narrowly escapes recession after flat growth in the fourth quarter. That’s entirely premature. [...]
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