Tag : ECB

Eurozone: Blinded by the light?

Eurozone economic growth is robust. This dynamism is shared amongst its members. However, important structural differences remain. The favourable cyclical environment calls for an economic policy to boost potential GDP growth and strengthen the resilience.

 

ECB: Sintra’s syntax

The market reaction to the introductory speech of Mario Draghi at the ECB conference in Sintra was strong
This reflects a high degree of unease about the prospect of a policy normalisation.

 

Endogenous risks loom on the economic horizon

Replace ‘blue sky’ with ‘robust growth’ and ‘umbrellas’ with ‘economic policy instruments’ and you have a description of the global economic environment: robust growth but, if a downturn would come, very little manoeuvring room for fiscal and monetary policies to stimulate growth. All the more reason to keep a watchful eye on the horizon, and to prepare for clouds to appear.

 

The hopes and uncertainty of a new era

A festive spirit has swept Wall Street as investors anticipate tax cuts for both households and companies, and to a lesser extent, greater spending, notably on infrastructure. In contrast, the bond market has slumped.

 

The thin line between complacency and clairvoyance

Blind, complacent, cool-headed, driven by moral hazard, clairvoyant? Or should we follow the example of the Bank for International Settlements and call it “dissonant”? Which term best describes this summer’s market behaviour?

 

New monetary season

For the financial markets, summer’s end is often the occasion for deep-felt upheavals. This summer, investors left on vacation filled with trepidation about the economic impact of Brexit, about robust job creations in the US and how they might change monetary policy prospects, and about the outcome of European banks’ stress tests.

 

Higher oil prices: good news or bad?

On 20 January, Brent crude oil was trading at USD27.88 a barrel (EUR25.52), the lowest price this year. Prices recently rebounded to USD50 (EUR44.70). Without trying to forecast future oil pricing trends – which, as shown by the experience of 2015, are even more difficult to predict than other economic variables – it is worthwhile to consider the consequences of higher prices

 

Meetings at the summit

In the Eurozone, China and the UK, purchasing manager indexes for the manufacturing sector declined in February. In the United States, in contrast, the manufacturing ISM rose but still held below 50, the level separating industrial expansion from contraction.

 

Currency markets weigh on central bank autonomy

This chart shows the evolution of the euro, the yen and the US dollar since the start of the year as well as the evolution of 10 year government bond yields in Germany, Japan and the US.

 
 
Menu