In February, acquisitions by Chinese investors in Germany reached a new dimension. A Chinese multi-millionaire has become the biggest shareholder in Daimler AG. The entrance of the influential Li Shufu into the world of Mercedes is proof of the scary Chinese presence in German companies (Deutsche Bank, the robots manufacturer Kuka and in many high tech firms).
The new oil futures contract should therefore be seen “as a puzzle piece within the targeted internationalisation of the yuan”, comment from Julius Baer. The Chinese government is still a long way from the big goal of establishing the yuan as a leading reserve currency.
Yukon Huang via Caixin | Despite a litany of warnings from experts and some of his own advisors, U.S. President Donald Trump is determined to pursue a series of counterproductive, protectionist measures. Many observers realize that China is the ultimate target of such measures.
“Separating political noise from market signals in an era of Tweetstorms, unconventional leadership, and low public trust has possibly never been more challenging”, says Tina M. Fordham, chief global political analyst at Citi. Will geopolitical risks grow in their potential to impact markets following the withdrawal of Quantitative Easing (QE)?
CaixaBank Research | In Spain, the richest 1% of the population earns 8.6% of the country’s income while this figure reaches 20.8% in the US. Are such high levels of inequality desirable or detrimental? Ultimately such a question must be answered by each country according to its own social preferences and values.
In his first press conference, Jerome Powell baffled both the experts and the markets. After reading the hawkish introductory statement, he defused all fears for a harsh and swift monetary tightening.
Degussa | Gold is a “good” that has a truly global demand, and its price is determined by numerous factors. One of those is the market interest rate. The reason is obvius: Gold does not have an “inherent interest rate”. The holders of gold have to bear “opportunity costs”.
Just a couple of years ago, deflation was a concern for US economists. And, although it’s true that this threat has almost disappeared, rises in prices have shown themselves to be surprisingly elusive.
Inspired by game theory, JP Morgan’s analaysts Marko Kolanovic and Bram Kaplan have analysed February 2018 market turmoil against the one that ocurred in August 2015 as both sell-offs had a striking similarity. The conclusion is that if equities follow 2015 flow patterns, new market highs may come soon.
We need to be aware of the existence of regulations over and above the well-known Taylor Law, starting with this regulation adjusted to establishing a downward limit on rates of 0%, which is very important in the US Fed’s case.