MarketWatch.com – Matthew Lynn: 4 ways deflation will change the markets A passing dip in prices caused by the collapse in oil prices. A short-term consequence of a depressed economy. The result of fierce price competition between retailers. There are plenty of economists and central bankers across Europe who will dismiss the deflation that is… Continue reading Europe
The Wall Street Journal – China’s First-Quarter Growth Slowest in Six Years at 7% China’s economy started the year on a downbeat note with its slowest quarterly growth rate since 2009, pointing to a further loss of momentum for the world’s second-largest economy. The 7% first-quarter year-over-year growth rate marks a slowdown from 7.3% in… Continue reading China Slows
The Wall Street Journal – Wall Street Rebounds for J.P. Morgan, Wells Fargo in First Quarter Round One: Wall Street. Trading and investment-banking businesses boosted earnings of the U.S.’s two most valuable banks in the first quarter, even as consumers failed to keep pace. The results at J.P. Morgan Chase & Co. and Wells Fargo… Continue reading Strong Quarter For U.S. Banks
The Financial Times – EM need pain of US rate rise to push reform Capital flowed to emerging markets even as fundamentals worsened It has hardly been the stuff of glory. Both emerging market debt and equity markets have posted negative returns over the past year. However, it is only the currency losses against the… Continue reading What Higher U.S. Rates Could Mean For Emerging Markets
<Click on graphic for larger image> In case you missed it, Draghi’s press conference was interrupted by a protestor. <Click on graphic for larger image>
Brookings – Ben Bernanke: Why are interest rates so low, part 4: Term premiums Longer-term interest rates are quite low around the world. Figure 1 below shows ten-year government bond yields since 1990 for the United States, Canada, Germany, the United Kingdom, and Japan. The downward trend is clear. Moreover, further sharp declines in longer-tem… Continue reading Bernanke And Term Premium
The Wall Street Journal – U.S. Retail Sales Up 0.9% in March Sales see biggest monthly gain in a year, but are weaker than economists expected U.S. retail sales rose for the first time in four months in March, but the gain wasn’t enough to offset weaker spending during the winter months. Sales at retailers… Continue reading Retail Sales and Weather
<Click on chart for larger image> Bloomberg.com – U.S. Shale Oil Boom Seen Ending in May Following Price Collapse The shale oil boom that pushed U.S. crude production to the highest level in four decades is grinding to a halt. Output from the prolific tight-rock formations such as North Dakota’s Bakken shale will decline 57,000… Continue reading Price Drives News
<Click on chart for larger image> The Wall Street Journal – As Interest Benchmarks Go Negative, Banks May Have to Pay Borrowers Banks seek guidance as key interest benchmark sliding below zero Negative interest rates in Europe have created a previously inconceivable problem for some banks: they may soon have to pay customers for having… Continue reading Paying Borrowers
Bloomberg.com – Mom-and-Pop Bond Demand Widens Global Supply Gap, JPMorgan Says Bond bears beware: there could be even less debt to go around this year, keeping prices high. “The supply-demand picture for 2015 continues to look supportive for bonds globally,” wrote a team of JPMorgan & Co. strategists led by Nikolaos Panigirtzoglou in London. The… Continue reading A Warning For Bond Bears
<Click on chart for larger image> The Wall Street Journal – Moody’s Adds to Doubts Over Sourcing Bonds for Eurozone QE Moody’s Investors Services has added to the chorus of voices warning the European Central Bank could run out of bonds to buy under its one trillion euro-plus quantitative easing program “by the turn of the… Continue reading More on ECB QE
The Financial Times – Fed official warns ‘flash crash’ could be repeated A senior Federal Reserve official has warned that last autumn’s “flash crash” in US Treasuries could happen again due to the changing nature of the US government debt market, and urged banks, investors and exchanges to adopt a revised set of guidelines in… Continue reading Is Another Flash Crash Coming?