G20 meeting: expectations of updated Plaza accord to be disappointed

Market hopes for a Plaza-type agreement at the 26-27 February G20 meeting in Shanghai 26-27 February, to help ameliorate the substantial issues facing the global economy and calm market volatility, have been growing. But I’m not expecting any really impactful policy announcements, much as I wasn’t expecting Yellen’s Congressional testimony to be a silver bullet … More G20 meeting: expectations of updated Plaza accord to be disappointed

Yellen will likely find it difficult to calm the sum of the markets fears: fixed income rally and JPY strength to extend

Fed Chair Yellen’s semi-annual testimony occurs at a time of considerable uncertainty about the global economy and substantial financial market volatility.  Oil price and equity price falls, particularly bank stocks, have dominated recent moves as global government bonds have fallen up to 60bp since end-2016 (with 10 year JGBs turning notably negative) and the dollar … More Yellen will likely find it difficult to calm the sum of the markets fears: fixed income rally and JPY strength to extend

ECB confronted by tighter financial conditions, poor data and politician pressures

Today’s headlines have been dominated by the 9-0 MPC decision (which I correctly anticipated, together with the EURGBP rise, see here).  But financial market developments over the past couple of days have also made for some very uncomfortable reading for the ECB – financial conditions have once again tightened despite Draghi’s strong hints at further … More ECB confronted by tighter financial conditions, poor data and politician pressures

BoE: Scary Monsters (and elephants in the room)

This note details my expectations for the latest Bank of England “super Thursday” as well as the (related) implications of Brexit uncertainties (“scary monsters”). The latter have thus far been an elephant in the room in MPC discussions, notwithstanding Carney’s recent comment about funding the UK large current account in Febrile market conditions. The main … More BoE: Scary Monsters (and elephants in the room)