If the scenario of a Bolsonaro victory is fulfilled in the second round, analyst Paul Greer from Fidelity expects that highly necessary fiscal reform of Brazil will be extremely difficult to achieve given that he will have to work with the centralist parties and the PT to approve any law.
Signs of a future increase in inflation are becoming increasingly visible. Natixis IM explains some of these global clues. First it is US long-term inflation outlook, which is currently situated around 2-3% and trending clearly higher.
The government of India took control of Infrastructure Leasing & Financials Services (IL&FS) last week in order to ensure its liquidity and solvency as well as to preserve stability in the financial system. For analysts at Julius Baer, “this should alleviate concerns on the money, debt and capital markets but does not equate to a bail out.”
On Sunday 7 October, all Brazilians between the ages of 18 and 70 are being called to the polls to elect their next President .”This is an important election because the future administration will have the responsibility to tackle Brazil’s growing fiscal imbalances, and this will require challenging structural reforms”, analysts at AXA IM say.
There is news which has global resonance and influence because its importance. Such is the case with the increase in the minimum wages of Amazon employees by around 2$ to 15$/hour (a bit more than 13 euros). The measure will enter into effect on 1 November. According to Alphavalue´s analysts, “this not only blocks the competition (Walmart), but also confirms the shortage of manpower in the US”.
via The Conversation | NAFTA is out but the United States-Mexico-Canada-Agreement (USMCA) is in. But how different is USMCA from NAFTA? Who loses and who wins?
The 10-year US Treasury yield has risen to above 3.20%, the highest level in more than seven years. As commented by Jeroen Blockland from Robeco, “few investors anticipated that US yields would rise to these levels and this is currently causing a bit of volatility”.
In 2017, the global aggregate value of M&A deals amounted to $3.66tr, predicted to increase to $4.4tr in 2018. This year, in the US alone, the first six months of the year registered a balance $2.5Tr, up 40% on 2017, with megadeals in excess of $10bn constituting some 38% of the total.
The US and Canada have reached a trade agreement which will replace the existing NAFTA (North American Free Trade Agreement). This new deal shows the ability of the US administration to negotiate and secure new trade agreements, although it is very unlikely to reach one with China given the geopolitical rivalry between both countries.
Multiple rounds of quantitative easing and liquidity injections resulted in more than a four-fold increase in the aggregate G4 central banks balance sheet in the last decade. This experience has many worried about a “quantitative tightening ” trade. Here analysts at BoAML argue that those worries can be put off for another day.