Tuesday, 17 November 2015

Some macro insights today

A few macro insights today...

Attack impact – Constancio of the ECB noted the Paris terrorism ‘can compound all the problems that we were already facing’ with the economy.  Praet the ECB chief economist noted ‘it’s clear these sort of events do not help restoring confidence in the recovery, so this is something we will watch’. Noteworthy too that terrorism is the primary concern for US voters for the first time this year, tying with the Economy (via Rtrs/Ipsos).  Whilst the equity markets have been relatively calm the euro is currently at c. $1.0659, its weakest valuation on an intraday basis since April 15.  Meanwhile - of course - the DXY (US dollar trade weighted) is so close that round number 100 resistance point...



Greece – reports that ‘negotiations with institutions concluded. There is an agreement’.  Details should emerge of this and confirmation of additional bailout monies being forwarded should follow. And now the real actions can start (the implementation of structural reforms). 

UK housing market – ‘The average buyer no longer has an average income’.  Interesting report here

Russia ‘has proposed a restructuring of the US$3bn bond owed to it by Ukraine’ although a deal sounds dependent on a debt guarantee from the IMF.  And the potential terms of a restructuring?  Not a full 2016 repayment but three annual repayments from 2016.  Given the tension between Russia/Ukraine kind would show tensions calming down.

Asia - China's central bank raises yuan reference rate for the first time in 11 days.  Australia’s ASX 200 index had its biggest  gain since Aug 25, rising 2.29%.  Chinese market a bit more volatile with Dalian Iron Ore is breaking below recent support levels (again). 

Emerging markets – wow, EM private sector debt build from today's Financial Times:



Commodities vs equities - got to be thinking that the former area is where the value is...


(h/t @eurofaultlines)

Meanwhile that key commodity currency Aussie $ doing a little better relative…


China – 20 successive days of foreign investor sales…and so the A/H premium pushed strongly up!  Of course a distortion...

 

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