The
new proposed tariffs of 25% dragged Asian equities heavily during morning
trade, sending the Hang Seng Index to its lowest level since September 2017.
China’s CSI 300 and Shanghai Composite both fell more than 2.5%, while the Yuan
continued to trade near its one-year low.
Given
the increased trade tensions, investors are keen to know what Chinese
authorities will do next to prevent further heavy falls in equity markets. I
think easing fiscal and monetary policies further will be the key tools for
now. However, it will be interesting to see whether China will start using a
more dangerous weapon against the U.S. and selling large portions of the $1.2
trillion of Treasury Bonds it currently holds.
Such a
threat would lead to a huge spike in Treasury yields, making borrowing costs
higher for the government, corporations and consumers. If China uses this
weapon, we will see panic selling in the U.S. and global equities, but it seems
Chinese authorities are preserving this move for later. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html
As
anticipated, the Federal Reserve kept interest rates unchanged on Wednesday
while maintaining the perception that gradual rate hikes will resume. However,
changes in the statement reflected a more upbeat Federal Reserve, sending the
U.S. Dollar higher. The committee noted that economic activity has been rising
at a strong rate and household spending and business investments have grown
strongly. The slight tweaks in language suggest that we’ll see another rate
hike in September and probably December too.
The
Bank of England will be meeting today and unlike the Fed, markets expect to
finally see a 25-basis point rate hike. However, the rate hike may not
necessarily translate to a higher Pound. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html Although the U.K.’s
economy recovered slightly from the first quarter, Brexit-related uncertainty
has increased significantly.
This
makes today’s decision a tough one. Sterling traders should focus on forward
guidance which is likely to be dovish. If more than one MPC policy member
dissents from raising rates, expect Sterling to fall slightly against the
Dollar. However, if the BoE chooses not to raise rates it would be a big shock
and we could expect a drop of 200 to 300 pips.
Have you heard this? Many
Nigerian exporters have been defrauded of huge amount of money in the process
of exporting commodities to foreign countries. Do you know why? They were not
trained on export operations, management, documentations and the best methods
of payment in export trade. This is terrible!!! Nigerians cannot continue to
lose money to foreigners in the course of export business. Exporters, why don’t
you get a practical manual that teaches the stages of export trade from
processing and packaging of commodities to receipt of payment by the foreign
buyers. It teaches export operations, export management, export documentations
and methods of payment in export trade? It is a contemporary step-by-step guide
to export trade. It tells all the contemporary dynamics in export trade. To get
it, click on the link below:
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