Credibility Test

Credibility Test

I agree, it's a cheap shot, but I couldn't resist it.

Breaking:? EU diplomats agree to use frozen Russian assets to aid Ukraine [Axios]

Breaking:? US set to impose 100% tariff on Chinese electric vehicle imports[FT]

Breaking:? Putin orders tactical nuclear weapons drills in response to Western ‘threats’ [CNN]

Alert:? BRICS: Serbia may turn its back on Europe and turn to China[CryptoDnes]

As Liz Truss knows, lose the trust and confidence of financial markets and you lose your job. In 44 days as UK Prime Minister, she managed to demolish the confidence in capital markets, embarrass the Bank of England, smash the Gilts market, depreciate Sterling by 13% and cost pensioners billions of pounds. The mind boggles at what she could have achieved in a full term.

But is her ghost stalking the capital markets again ?

The foreign exchange (biggest) market is testing the resolve of Japanese authorities and, initially unwittingly, testing the resolve of the US Treasury and Federal Reserve. The biggest and 4th biggest global economies. And the 2 biggest debtor nations in terms of Debt-to -GDP.?

And the stakes are huge...?

Markets testing Bank of Japan and now the FED ?

USD / YEN keeps coming back to test the mettle of the Bank of Japan or technically speaking the Finance Ministry.? The 2 rounds of intervention caused Treasury Secretary Yellen to request publicly that communication with US officials is essential.?

But what's it got to do with her ? Obviously she doesn't want Japan to sell trillion of dollars of US Treasuries in defence of the Yen. Surely Comrade Powell at the FED would be the one to step in here. He can help with swap lines and even participate in concerted central bank intervention. But will they ? Even if Yellen asks them to ? In an election year ??

Aside from the price of USD / YEN and how the Treasury funds itself, the cost of both parties losing credibility with capital markets would be immense. And currencies crises would spread across the world.

As investors watch from the sidelines, there is growing sense of unease.

Maybe it's the ghost of Liz Truss !

USD / YEN Daily
USD / YEN Daily

?Watch the market push this up further to test the Bank of Japan's mettle.

BOJ’s Ueda Ramps Up Yen Warnings While Traders Keep Selling [Bloomberg]

Yellen counsels caution on currency intervention after surge in yen [AFR]?

Japan warns of action over rapid currency moves [MSN] Japan Is Now Caught In A Doom Loop [Zerohedge]


Canada

Bank of Canada warned the public of a possible sharp correction in asset prices &? systemic risk to the banking system.

Click here to watch

Bank of Canada
Bank of Canada

United Kingdom

Old Lady of Threadneedle Street holds rates steady

Click here to watch

Bank of England
Bank of England

US Economy

‘Phantom debt’ from ‘buy now, pay later’ schemes is a $700 billion black hole that economists aren’t accounting for [Yahoo Finance]

Bezos, Zuckerberg lead magnificent seven insider stock sales [AFR]

US Weekly Jobless Claims
US Weekly Jobless Claims

Fannie and Freddie into the fray

The proposed equity mortgage reforms could potentially unleash liquidity into a frozen property market.

Fannie Mae & Freddie Mac are US Govt lending departments which may be allowed into secondary market mortgage lending? to prop up a market where Basle 3 stops banks lending.?

This could be a massive stimulus which may not be a good thing. Who wants public lending for housing ?

Expert analysis from Melody Wright and Adam Taggart on the ThoughtfulMoney show [YouTube}

The mortgage reform that could unleash the next big US stimulus [FT]

Real Estate

Contagion spreads to apartments in the US.

A Third of Office Mortgages Packed Into Bonds Are at Risk of Default [Bloomberg]


Gold

Gold bars are selling like hot cakes in Korea’s convenience stores and vending machines [CNBC]


In The Background

>>China

Xi Jinping’s vast gold war chest could let him take Taiwan without a fight [Telegraph]

Deflation seems to have been averted for now, but PPI is looking ominous and the trade numbers suggest that the rest of the world economy is not going to come and save China's economy.

China CPI, PPI April 2024
China CPI, PPI April 2024
China Trade Balance April 2024
China Trade Balance April 2024?

>>Cryptocurrencies

US House Advances Bill To Allow Financial Firms To Hold Bitcoin [Watcher.Guru]


>>Europe

Sweden cuts interest rates as Europe diverges from Fed [FT]

Germany Industrial Production March 2024
Germany Industrial Production March 2024
EU PPI March 2024
EU PPI March 2024

>>Australia

Ratings warning over Victoria’s $188b debt [AFR]

The budget next week is getting a lot of coverage. The economy is slipping but prices paid are not. The new tax cuts and HECS debt cancellations will be stimulatory and Chalmers will be looking for voter buy-in.?

RBA Holds: https://www.youtube.com/live/jNYAdTseh8c?si=wvYoHVJ4t_UCtR9i

A rate rise was closer than you think [AFR]

Australia Retail Sales April 2024
Australia Retail Sales April 2024

What's Next

It's CPI week !

BRICS meetings in Moscow Putin visits China

Saudi Arabia's Crown Prince Mohammed bin Salman goes to Japan the week after.


This Week's Important Economic Indicators [London time]

This Week's Important Economic Indicators [London time]
This Week's Important Economic Indicators [London time]



Dan O'Brien

Financial Planning & Analysis Manager

10 个月

Thanks Ian, be interesting to see the impacts of further crypto legislation in the US.

回复

要查看或添加评论,请登录

Ian Reynolds的更多文章

  • Limit Up! 20th March 2025

    Limit Up! 20th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight BoJ holds rates steady "Under…

  • Limit Up! 19 March 2025

    Limit Up! 19 March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight Economic Indicators Released…

  • Limit Up! 18th March 2025

    Limit Up! 18th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight Economic Indicators Released…

  • Limit Up! 17th March 2025

    Limit Up! 17th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight Scott Bessent hits the wires…

    1 条评论
  • Risk Off

    Risk Off

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website University of Michigan Consumer…

  • Limit Up! 14th March 2025

    Limit Up! 14th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight US PPI February 2025 Even lower…

  • Limit Up! 13th March 2025

    Limit Up! 13th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight Economic Indicators Released…

  • Limit Up! 12th March 2025

    Limit Up! 12th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight Economic Indicators Released…

  • Limit Up! 11th March 2025

    Limit Up! 11th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight Economic Indicators Released…

  • Limit Up! 10th March 2025

    Limit Up! 10th March 2025

    Links Daily LinkedIn | Weekly LinkedIn | Next event | Check out the website Overnight China CPI, PPI February 2025 And…

社区洞察

其他会员也浏览了