• Avatar of Marianne Lovejoy
    30 Mar by Marianne Lovejoy
    Last week’s warning from the International Energy Agency (IEA) that the surging cost of oil now represented a bigger risk for global growth than the European sovereign debt and banking crisis did not generate the publicity it deserved. Brent crude has jumped by 17% this year to USD 126 a barrel, essentially matching the high achieved a year ago; in...
  • Avatar of Marianne Lovejoy
    22 Mar by Marianne Lovejoy
    There can be little question that the cycle has turned for the Aussie. In 2009 and 2010, it seemed as though the Australian currency could do no wrong. Last year, the AUD still attracted a great deal of buying interest from multiple sources, especially those who were concerned by the deliberate debasement of the major currencies by their respective central banks....
  • Avatar of Marianne Lovejoy
    22 Mar by Marianne Lovejoy
    There are always winners in every crisis. In this instance, one of the big beneficiaries of Europe’s sovereign debt and banking debacle has been German house prices, which have been moving steadily higher over the past couple of years. Flush with deposits sent from Europe’s troubled south, financial institutions in the north have been desperate to lend to German households whose...
  • Avatar of Yan Yanich
    15 Mar by Yan Yanich
    Notwithstanding the general mood of optimism apparent in risk assets these days, there is a growing school of considered opinion which believes that China is heading directly for a hard landing. Complicating the compilation of evidence to support this view is the fact that the Lunar New Year holidays were earlier than usual this year, distorting most series. Even so, there...
  • Avatar of Yan Yanich
    14 Mar by Yan Yanich
    Gold bulls are starting to shiver and shake, with the price down another 2% today to USD 1,643 an ounce. At the end of last month, it was close to USD 1,800; six months ago, it was touching USD 1,900. So, what is going wrong? Is this the end of the bull cycle, or simply a healthy correction after what...
  • Avatar of Yan Yanich
    12 Mar by Yan Yanich
    The deal is done, credit default swaps are likely to be activated and in one fell swoop Greece’s debt mountain has been cut by EUR 100bln. But what’s the outlook for Greece now and does this mean the worst is over in terms of the debt situation? The good news is that, in activating the CACs (Collective Action Clauses), the deal...
  • Avatar of Yan Yanich
    07 Mar by Yan Yanich
    Excessive currency strength has become a tremendous policy vexation for some central banks over the past couple of years. In Japan, the BoJ’s FX-intervention war-chest is now monumental, such is the concern in Tokyo regarding the negative impact which an overvalued yen poses to the economy. Recently, the BoJ significantly expanded its asset-purchases program and implemented an inflation target designed...
  • Avatar of Yan Yanich
    06 Mar by Yan Yanich
    On the face of it, China’s revision of its growth target was an expected and relatively small change, but this is China we are talking about, so any shift in stance cannot be ignored. The move to target growth of 7.5%, rather than 8.0%, really reflects the official sanctioning of what has been desired for some months now, if not...
  • Avatar of Yan Yanich
    24 Feb by Yan Yanich
    The ECB’s auction of 3Y funds back in December has been credited with any number of things, from staving off a full-scale credit crunch in the eurozone to helping the rally in peripheral bond markets and also supporting the best start to the year for world stock markets for 15 years. Next week the ECB will undertake the second 3Y...
  • Avatar of Yan Yanich
    22 Feb by Yan Yanich
    Last night’s resignation by Foreign Minister (and ex-Prime Minister) Kevin Rudd has further inflamed political tensions within his Labour Party over who should lead it into the next election. After weeks of intense speculation surrounding her leadership, current Prime Minister Julia Gillard expressed her disappointment at Rudd’s decision, which the latter claimed had resulted from her failure to express her...