Israel-Hamas war poses risk of global market contagion, economist says
Mohamed Aly El-Erian, chief economic advisor for Allianz SE, during a Bloomberg Television interview in London, UK, on Monday, Sept. 25, 2023. El-Erian spoke alongside former UK Prime Minister Gordon Brown and economist Michael Spence, his co-authors for their book Permacrisis: A Plan to Fix a Fractured World. Photographer: Chris Ratcliffe/Bloomberg via Getty Images Bloomberg | Bloomberg […]
A surge in global bond yields threatens trouble
It is A brave investor who calls the end of a four-decade trend. But bond yields have risen so far and—in recent weeks—so fast that many market participants now believe the era of low interest rates to be over. Since early August America’s ten-year Treasury yield has traded in excess of 4%, a level unseen […]
U.S. debt downgrade sinks global markets — but economists are not concerned
Traders work on the floor of the New York Stock Exchange, June 29, 2023. Brendan McDermid | Reuters Global stock markets tumbled on Wednesday after ratings agency Fitch downgraded the United States’ long-term credit rating — but top economists say there is nothing to worry about. Fitch announced late on Tuesday that it had cut […]
The Bank of Japan jolts global markets
On July 28th the Bank of Japan (boj) took markets by surprise. At the end of a two-day policy meeting Ueda Kazuo, the central bank’s governor, announced an unexpected change to its increasingly expensive policy of yield-curve control. The boj raised its cap on ten-year government-bond yields, which it defends with regular and sometimes vast […]
What new norm of slower Chinese growth could mean for the global economy
A view of high-rise buildings is seen along the Suzhou Creek in Shanghai, China on July 5, 2023. Ying Tang | NurPhoto | Getty Images The Chinese economy could be facing a prolonged period of lower growth, a prospect which may have global ramifications after 45 years of rapid expansion and globalization. The Chinese government […]
We’ll avoid a global recession, central banks will ‘change the goalposts’
A Now Hiring sign is seen inside a WholeFoods store in New York City. Adam Jeffery | CNBC The global economy will likely avoid a recession and central banks will need to “change the goalposts” on inflation, according to veteran strategist David Roche. With high inflation proving sticky across many major economies, central banks have […]
Gilts lose out in global bond market rally
UK government debt has delivered the worst returns of any major bond market in the first half of this year, as investors bet that the Bank of England will have to increase interest rates to the highest level in a quarter of a century to tame high inflation. An ICE Bank of America index of […]
Global economies are out of sync; 2024 will be a ‘year of contraction’
Hong Kong observation wheel, and the Hong Kong and Shanghai Bank, HSBC building, Victoria harbor, Hong Kong, China. Ucg | Universal Images Group | Getty Images The U.S. will enter a downturn in the fourth quarter, followed by a “year of contraction and a European recession in 2024,” according to HSBC Asset Management. In its […]
Is the global housing slump over?
In Australia house prices have risen for the past three months. In America a widely watched index of housing values has risen by 1.6% from its low in January, and housebuilders’ share prices have done twice as well as the overall stockmarket. In the euro area the property market looks steady. “[M]ost of the drag […]
A Debt Crisis Looming in the Global South?
Yves here. The US has long been indifferent to the effect of its interest rate policies on the rest of the world, even though analysts and even central bankers have warned how destabilizing US interest rate changes are to small economies with large import/export sectors, dollarization, or worse, meaningfully borrowing in dollars. As we wrote […]
