The Corner | April 29, 2015 | Is the eurozone’s private sector finally turning a corner? For the first time in three years, lending to households and firms rose in March (0.1% y-o-y), European Central Bank data showed on Wednesday, partly thanks to the QE iniciative.
MADRID | April 26, 2015 | By Luis Arroyo | After effusively congratulating the progress of the Spanish economy in his last press conference, Draghi said that some labor reforms are missing. Let’s connect the dots: the ECB’s president is attributing himself the merit of recovery with his expansionary monetary policy, while the demerit that this is not stronger is attributed to Madrid, which is not undertaking enough reforms.
LONDON | April 21, 2015 | Barclays | The ECB remains committed to deliver its QE target of a more than €1.1trn balance sheet expansion through asset purchases and sought to dispel fears over asset scarcity.
MADRID | April 20, 2015 | By JP Marín Arrese | Governments in developed countries openly bet on monetary stimulus for getting their economies back on track. The US massive liquidity injection stood as the hallmark for similar moves by Japan and Europe. Yet, the IMF voices concern that running global governance on money tools leads to a liquidity glut while demand and output remain largely subdued.
The Corner | April 14, 2015 | On Wednesday’s press conference, Mario Draghi is likely to indicate that ECB QE has got off to a good start operationally and price action terms in the market. Barclays analysts think cautious near-term trading is required in EGB spreads, given poor liquidity and lingering Greek worries.
MADRID | April 9, 2015 | By JP Marín Arrese | As the recovery pace of the US economy softens, FED policy makers are growing increasingly reluctant to raise rates too early. The March FOMC minutes released yesterday reveal they could only agree on deleting “patience” when referring to the foreseen tightening of the monetary stance. Members seem split on the timing, with many openly advocating postponing the move until the end of this year or even into 2016.
Asoka Wöhrmann (Deutsche AWM) | Negative interest rates are new economic territory. However, as yet, there is no sign of a major cash exodus to avoid sub-zero yields.
WASHINGTON D.C. | March 18, 2015 | By Pablo Pardo | On December 19, 2008, George W. Bush announced that the US would allocate $13.4 billion to rescue General Motors. Between April 22 and June 1, 2009, Barack Obama provided the company with $36.1. In the end, the state ended up with a 61% of the stake of what is still the second largest car manufacturer in the world.
MADRID | March 15, 2015 | By JP Marín Arrese | The markets have discounted an unchallenged drift upwards of the US currency, after the ECB embarked on its ambitious asset-buying scheme. Yet few anticipated the move might come so soon and reach such a rapid pace. As the Euro turns its retreat into a disorderly rout, emerging economies like Brazil are falling under unbearable pressure. The dollar’s swift upsurge has pounded global markets.
MADRID | March 10, 2015 | By Luis Arroyo | Six years after the Federal Reserve and the Bank of England launched their QE programmes, the ECB proceeded on Monday. Will Mario Draghi at least have the same partial success as his peers? That is, being able to slowly revive the economy and restore hope that the situation is getting back on track. In the graph above, see how five EZ governments are already borrowing at super low rates.