Overview: The capital markets continue to tread water as investors await this week’s key events. The first, the FOMC meeting concludes later today. Tomorrow features the UK election, where the race appears to have tightened, and Lagarde’s first ECB meeting at the helm. Global equities continue consolidating the recent gains. Asia Pacific equity markets were mostly …
Overview: Equities are trading lower, and bonds are mixed as the FOMC, UK election, and the US decision on the December 15 tariffs draw near. The MSCI Asia Pacific Index three-day rally ended today as only China and South Korea’s markets rose. Europe’s Dow Jones Stoxx 600 gapped slightly lower at the open. The upside momentum …
Capital Markets: Still Seems to be the Calm before the Storm Read More »
Overview: The important week is off to a slow start. While the MSCI Asia Pacific benchmark extended its gains for a third session, European and US shares are struggling. The Dow Jones Stoxx 600 is consolidating its pre-weekend 1%+ rally, while US shares are trading heavier after rallying for the last three sessions. Benchmark 10-year yields …
China’s Steps-Up Import Substitution Strategy while USMCA Comes Down to the Wire Read More »
The US dollar closed today above CAD1.3500 for the first time since January 2. Despite the setback, the Canadian dollar is the strongest of the major currencies year-to-date with a little less than a one percent gain. The yen, in second, has is up about 0.2% (~JPY109.50). Among emerging market currencies, the Mexican peso’s 2.6% …
Overview: Encouraged by the election results, investors bid up Indian and Australian currencies and equities. Japan offered a pleasant surprise by reporting the world’s third-largest economy expanded in Q1. Most other equity markets in Asia fell, and European stocks have the week with small losses. The US decision to isolate Huawei sent ripples through the suppliers …
Politics Overshadows Economics Today, but Japan’s Economy Unexpectedly Expanded in Q1 Read More »
There were only a few formal disputes under NAFTA 1.0. It says more about the adjudication process than the underlying issues. It was not binding. The Democrats want stronger enforcement provisions in what the NAFTA 2.0. It is understandable. Still, without opening up the agreement, which had been already agreed to by three heads of …
The heads of state may have agreed on the modernization of NAFTA, but the necessary legislative approval may not be forthcoming this year. The US legislative process has been complicated by the fact that the Democrats secured a majority in the House of Representatives last year. The new trade agreement appears to be mostly updating …
Overview: The Canadian dollar and Mexican peso are extending its pre-weekend gains on news that a new NAFTA deal (US-Mexico-Canada Agreement USMCA) has been struck. Against most of the other major and emerging market currencies, the US dollar is firm. China’s mainland and Hong Kong markets are closed for a national holiday. Japanese shares edged higher, …
NAFTA Deal Struck, Softer EMU Mfg PMI, and Firm Greenback Starts Week Read More »
There are three areas that we suspect that many investors are vulnerable to disappointment. NAFTA, trade talks with China, and Powell speech at Jackson Hole on Friday. With problems elsewhere, the Trump Administration has been playing up the likelihood of an agreement as early as today with Mexico, which would be used, apparently to deliver …
Given the US decision to pull out of the Trans-Pacific Partnership trade deal, it was inevitable that the North American Free Trade Agreement would have to be re-opened. The Obama Administration had anticipated that the TPP would have modernized the 24-year old continental trade pact. Given the size of the borders, the uneven development, (GDP …