MADRID | The Corner | As expected, the Fed confirmed the end of its QE3, although the announcement was slightly more restrictive. According to experts at Link Securitites, “while the decision shows that US economic conditions have improved (especially the labour market) and inflation remains at low levels, the message tone was more hawkish.”
MADRID | The Corner | Showing its confidence in the US economic recovery and the jobs market, the Fed announced it will put an end to its bond purchases scheme before the end of this week, the central bank announced after its FOMC two-days meeting on Thursday. Short-term interest rates will remain near zero for a “considerable time”.
SAO PAULO | By Benjamin Cole via Historinhas | No, I do not have dense pages of calculus for the reader, purporting that QE would be ruin or divine salvation, or that minor deflation is the theoretical apex of an economic model.
BEIJING | By Zhou Xin | The positive side of Chinese involvement in Africa is well-known, but a lack of shared values means projects are inefficient and lack vision.
MADRID | By Sean Duffy | A faltering economy, a plummeting currency, skeptical markets and a polarized electorate are just some of the issues observers are focusing on this weekend as Brazilians go to the polls in what has been labeled the tightest election for a generation.
MADRID | The Corner | Which is the real origin of the deflationist pressure that the global economy is facing? A greater desire of saving money than investing at a global scale, experts at Morgan Stanley point out. The eurozone, Japan and the most stable emerging countries have a greater control over their domestic interest rates, whereas China, whose currency is pegged to the USD, will also import deflation -something Beijing won’t like.
SAO PAULO | By Marcus Nunes via Historinhas | It would be pretty depressing, so late in the game, to see “gold medalist” Australia fall into a Swedish-type trap. I hope Mr Lowe is a lone voice: Australian central bank Deputy Governor Philip Lowe urged vigilance on asset prices inflated by record-low interest rates and said government action is needed to encourage companies to invest.
BEIJING | By Liu Ligang via Caixin | Pessimistic voices are saying China’s property market is nearing a Japan-style collapse of the late 1980s, but this ignores the fact urbanization will continue to create demand for homes.
SAO PAULO | By Marcus Nunes via Historinhas | It may sound strange, but that´s what comes to mind when central bankers start playing “alternative roles”. In the case of Sweden things started unraveling when the Riksbank decided to “prick” a housing “bubble”.
BEIJING | By Peter Lundgreen via Caixin | There are a host of reasons to doubt Europe’s growth prospects for this year and next, so investors would be wise to look for opportunities in Asia.