The IMF has just upped its forecast for global growth by one-tenth of a percentage point to 3.6% and 3.7% respectively for this year and the next. The message from the supranational organisation is relatively positive: over 75% of the world is seeing an acceleration in its rate of growth.
ECB monetary normalisation
Intermoney | There is little in the way of significant economic data due out in Europe today, so the main focus will be on the minutes of the ECB’s last meeting.
The minutes of the ECB’s July meeting published on Thursday reflected the central bank’s concern about the strength of the euro, but also a degree of caution regarding continued weak inflation data, analysts say.
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.
José Luis M. Campuzano (Spanish Banking Association) | It’s been balance sheet adjustments and the worsening of the deliquency rate which have been mainly responsible for the deterioration in banking margins over the last few years. It’s important for the ECB to establish a clear strategy for monetary normalisation for the future.
There are various ways of measuring the volatility of equities, but for me the most representative are: a) what is known in the Anglo-Saxon world as the fear index, VIX, and b) the ample range formed by the intra-day movement of an asset price. In other words the difference between the maximum and minimum level of a share price or index within the same day. As Víctor Peiro from GVC Gaesco points, if we look at the performance of this volatility index, both for the US and European indices, we can see we are close to record lows.
J.L.M. Campuzano (Spanish Banking Association) | According to IMF data, the pace of growth of productive investment has slown in economies which are emerging and in the process of developing from levels of 10% in 2010 to 3.6% at the moment.
José Luis M. Campuzano (Spanish Banking Association) | Citi flags that the US/Euro Area monetary conditions have noticeably narrowed since the start of the year. Financial conditions have relaxed in the US and tightened in the Eurozone mainly due to the trend in the relative exchange rate.
J.L.M. Campuzano | On Thursday, the ECB confirmed what many analysts were expecting: the limit on expansive monetary measures has now probably been reached, without this meaning there will be an immediate reversal. And the reason for this? Simply that the risks are more balanced now.