(As written for My Paper on 22 November 2011. Click here to enlarge)
Last week, the Monetary Authority of Singapore said that the global economy and financial system are at their most fragile state since the 2008 crisis, with the immediate outlook characterised by a high degree of uncertainty.
Not the most encouraging words for traders and investors to hear, but recent data from the various industries seem to agree. Read more…
(As written for My Paper on 8 November 2011. Click here to enlarge)
Last week, 2 major central banks slashed their interest rates by 25 basis points each.
The Reserve Bank of Australia was the first to act, cutting rates from 4.75% to 4.5%. This was followed 2 days later by new ECB chief, Mario Draghi, who surprised everyone by cutting rates from 1.5% to 1.25%.
Rate cuts are normally announced when central banks see that growth prospects are weakening. It was all the more surprising for the ECB, as maintaining price stability is their number one priority. However, inflation is expected to fall in the Eurozone over the next few months.
This caused Draghi to cut rates and focus on staving off a recession instead. Read more…
(As written for My Paper on 1 November 2011. Click here to enlarge)
75.57 was the magic number for the Bank of Japan to step in.
After weaks of jaw-boning the markets, the authorities finally intervened to weaken the currency for the third time this year.
Finance Minister Jun Azumi told reporters yesterday, “I have said many times, if forex moves do not reflect the economic fundamentals and speculative moves last, Japan will take firm measures.”
Once the Bank of Japan sent the rocket blasting at 9.25am yesterday, USD/JPY spiked up more than 300 pips in a matter of 30 minutes. Read more…
