The biggest financial risk this August – a month particularly prone to financial crises, like the last one which began in August 2007 – is geostrategic: the ongoing misunderstanding between Trump and North Korean leader Pyongyang.
The markets are becoming increasingly sceptical about Trump’s ability to enforce any coherent economic policy mix. Even if his advisors in this field are seasoned bankers, the White House is rapidly losing its grip on critical decision-making areas, such as the budget stance.
There is not much in the way of major macro or corporate data due this week, but markets will be on the alert for any hints from regional Federal Reserve Chiefs’ as to what the US central bank’s next moves will be.
Peng Qinqing and Han Wei via Caixin|In a rare move, China’s foreign exchange regulator named nine banks for violations of foreign exchange regulations amid continued efforts to clamp down capital outflows.
Union Bancaire Privée (UBP) | Most analysts and economists believe global growth will remain solid, despite political and geopolitical uncertainties, in the second half of 2017. Economics and corporate earnings will be the main drivers for the markets.
Kommer van Trigt (Robeco) | The markets are discounting that in the next few months there will be more certainty surrounding the central banks’ normalisation strategy. In its quarterly outlook, Robeco’s Global Fixed Income Macro team says it makes sense for the central banks to begin to normalise their policies.
José Luis M. Campuzano (Spanish Banking Association) | The markets are discounting that in the next few months we will see greater certainty in monetary normalisation strategy. The start of the Fed’s balance sheet adjustment can also provide the rest of the central banks with information on the reversion of quantitative measures.
Atlantic Sentinel | The 2016 election was a turning point in American history. Cultural, political and regional differences have become so vast that the American political system is becoming unsustainable.via