DWS | Although gold is considered a hedge against inflation, what is true that, over the last decade, it has closely followed the evolution of real interest rates: when those fall, the price of gold tends to rise.
Andressa Tezine (Fidelity) | The sharp fall in Argentina´s bonds and international shares, after President Macri´s surprise defeat in Argentine primary elections, could spread to other Latin American and emerging markets while investors look to re-balance their positions.
Shaun Riordan │ The Hong Kong protests have now entered their tenth week. Over the weekend protestors are reported to have fought running battles with the police in the Metro system. The police have had recourse to batons and tear gas. The dangers for Hong Kong´s political and economic future are clear. But the dangers are much broader than Hong Kong. Markets should be watching carefully.
JP Marin-Arrese │ Trump’s volatile mood is wreaking carnage on investors’ confidence. It is a fact that the White House tenant longs to trigger huge uncertainty, even panic, among investors. Yet, by brushing away any hope to strike a truce with China he has outdone himself.
Miguel Navascués | Central banks announcements are better than nothing, but may not be enough. In my opinion, the central message of Keynes is that, for those taking investment decisions, the future cannot be reduced to a risk calculus formula, because there is always a zone of uncertainty (by definition incalculable) which influences spending decisions: consumption, but, above all, productive investment.
By Sara B. Potter, CFA | Signs are multiplying of an industrial activity slowdown. Now that the current U.S. economic expansion is on record as the longest in post-war history (10 years and counting), we are seeing an uptick in the predictions of an inevitable recession.
A soft landing is the Holy Grail of central bankers. The glory that accrues from avoiding the economic costs of a recession by skilful manipulation of interest rates. But do such efforts to avoid, or mitigate, recessions simply store up trouble for the future? Does seeking to avoid a recession simply lead to a worse recession in the future?
JP Marin-Arrese │Any seasoned central banker knows by heart that words rather than measures better serve monetary policy. The material effect any move delivers doesn’t match the impact on expectations and market sentiment an authoritative message conveys.
Iñigo Isardo, Link Analysis│An exchange rate conflict threatens to complicate US-China trade conflict. As we anticipated yesterday, the escalation of tensions in the trade conflict between the US and China impacted negatively on western markets. China has responded with the largest devaluation of its currency the yuan in more than a decade.
Íñigo Isardo (Link Securities) | This week will be affected by the uncertainties of the trade conflict between the US and China after the latest “turn of the screw” introduced by US President Donald Trump into the trade negotiations. Last Thursday Trump announced on Twitter the imposition of 10% tariffs from 1 September on 300 Bn$ of imports from China which so far have not had to pay tariffs.