Demand for short-term bonds has been increasing rapidly as investors remain cautious regarding Eurozone debt turmoil. Traders have submitted $748.5 bn in offers for the $54.4 bn of short term assets maturing 2012 - 2014. 13.8 to 1 ratio beats the typical 3-to-1 offer. The bids indicate that the Federal Reserve borrowing rate may remain at record low.
Gail Kelly, CEO of Westpac Banking Corp, claimed the additional money gained coming from central bank's interest rate cut most likely will be used either to increase savings or to repay loans. She indicated that Australian consumers currently are very cautions towards extra spending. Kelly suggested the Reserve Bank of Australia should apply further repo reduction. According to her, Australia economy will experience growth when
Italian PM Berlusconi's majority is collapsing ahead of government vote tomorrow as allies pressure him to step down. During past few days nine premier's affiliates have quitted. According to Giuliano Ferrara, newspaper Il Foglio editor, Berlusconi may resign within hours. Roberto Maroni, Interior Minister claims PM's majority most likely to be unravelled. Maroni supports early elections.
Chinese equities experienced sharp decline reaching biggest low in two weeks. Shanghai Composite Index decreased 18.5 points, or 0.7%, closing at 2,509.8 which is the biggest drop since October 21. Fall in markets is associated with investors' fears that Chinese government will not apply expansionary monetary policy despite economy slowdown. Concerns were fuelled by Chinese PM's announcement that country will stick to curbing property industry
European finance leaders today meet in Brussels to work on aspects of plan how to increase the leverage of European Financial Stability Facility (EFSF). According to EU officials' estimations, EFSF power should reach EUR 1 trillion. One of the key goals of meeting is to persuade world leaders that Spain and Italy can be protected from of debt crisis by extending their bailout package.
According to European Central Bank (ECB), overnight deposits parked by banks reached 2011 high last week. On Friday banks lent ECB EUR 288.429 bn compared to EUR 275.226 bn on Thursday. Amount of deposits indicates that banks favour lending money to ECB instead of giving it to their counterparties. Such reluctance might be caused by uncertainty regarding other banks' exposure to Eurozone debt.
Latest reports show that US economy is gradually moving forward. Economists say the hiring and consumption have increased faster than expected. Nevertheless, they indicate that customers are unable to spend enough money to boost rapid economic growth. Although during July-September period there have been added about 117,000 jobs, wages are increasing very slowly advancing only by 1.8% in the past 12 months. Therefore, economists are sceptic
Currently Japanese home debt is rising at a faster pace than was previously predicted and according to Ministry of Finance might surpass 1 quadrillion yen ($12.8 trillion) at the end of March 2012. Japan had planned to stick to deficit of ВҐ995.92 bln earlier this year; however, after updating forecasts, additional borrowing will be undertaken. Representatives of Finance Ministry say the surge in national debt was mainly
Greek Prime Minister George Papandreou has confirmed his resignation. Papandreou and Antonis Samaras, leader of opposition, have agreed to create a national unity government to provide the execution of European Council bailout programme. According to Papandreou and Samaras, new elections will be held straight away after the completion of EU bailout plan. Both officials will meet on Monday to select the next prime minister.
Asian stocks experienced a drop on Monday. Both Australia's S&P/ASX 200 index and Japan's Nikkei Stock Average fell by 0.5%, while South Korea's Kospi declined 0.4%. China's Shanghai Composite lost 0.3%, whereas Hong Kong's Hang and Seng traded down 0.2%. According to Tom Kaan, Louis Capital Markets manager of equity trading, Asian investors are concerned with ongoing events in Europe as Greek PM agreed to resign.
Chief executive of Industrial & Commercial Bank of China Ltd., Jiang Jianqing, said that worries over the nation's real estate market are overstated and that the Fed is likely to introduce next round of quantitative easing to stimulate U.S. economic growth.
US stocks experienced a sharp growth on Thursday following Greece's abandonment of bailout referendum and surprising ECB interest rate cut. Dow Jones Industrial Average gained 1.8% or 208.43 points, S&P 500 Index rose 1.9% or 23.24 points, while Nasdaq Composite Index climbed 2.2% or 57.99 points. According to Paul Nolte, Dearborn Partners managing director, the cut of ECB repo rate to 1.25% contributed significantly to growth in US
Asian equities advanced sharply after an unexpected interest rate reduction by the European Central Bank. Stock rally also was fueled by Greece's refusal of to make country's bailout referendum. Hong Kong's Hang Seng Index gained 3.3%, whereas Shanghai Composite jumped 0.8%. Japan's Nikkei Stock Average increased by 1.4%, while South Korea's Kospi climbed 2.9% and Australia's S&P/ASX 200 index add 2.6%.
US stocks returned back to an upward trend after investors gained clarity regarding ECB interest rate cut and Greece's referendum. Dow Jones Industrial Average gained 106.56 points, S&P 500 Index climbed 8.69 points while Nasdaq Composite jumped 19.86 points. Major retrieval came from announcement that Greek prime minister abandoned the plans for referendum on EU bailout plan.
European Central Bank (ECB) has unpredictably lowered the interest rate from 1.5% to 1.25%. According to ECB president Mario Draghi, several predictions regarding economic growth in 2012 have been revised downwards and therefore initiated interest rate cut. Draghi characterized eurozone as a highly uncertain economic environment facing many challenges that can hinder economic growth.
Greece Prime Minister and the referendum initiator George Papandreou said on Thursday that nations' opinion is required as alternative in case the strong opposition in Greek parliament will not back the bailout package agreed earlier. He stated that if the opposition will support tough bailout requirements, the referendum is not a necessity.
Greek PM George Papandreou faced a severe opposition when trying to propose referendum on EU debt crisis plan. Four ministers including Finance Minister Evangelos Venizelos voted against referendum. According to EU officials, Greece will not have access to bailout funding until it approves the agreement. George Papandreou has received requests from his own party members to resign.
Viewpoints of the policymakers have split over the right course of further monetary policy: one top policymaker suggested extra stimulus provision is necessary, while another pointed at a necessity of monetary policy tightening. Jeffrey Lacker, the head of the Richmond Fed, admitted that although the US inflation is more likely to diminish in the next months due to declines of
Stephane Deo, head of European economic research at UBS, believes that Greece would be required to introduce a 100% haircut in order to make its debt manageable. The expert added that the only possible solution to tackle debt woes is to involve a larger share of the private sector.
Viewpoints of the policymakers have split over the right course of further monetary policy: one top policymaker suggested extra stimulus provision is necessary, while another pointed at a necessity of monetary policy tightening. Jeffrey Lacker, the head of the Richmond Fed, admitted that although the US inflation is more likely to diminish in the next months due to declines of
According to ZIFX.com analysts the main support levels may be found at 1.3581, 1.3464 and 1.3340. These are expected to hold intraday dips. Alternatively, if the European currency gains in value comparatively to the greenback, resistances might be in focus. The immediate line is located at 1.3814, followed by 1.3930. The highest indicated resistance is situated at 1.4050. Currently the
Investors are putting increased pressure on European officials pushing them to design a rescue plan for region's struggling banks before November G20 summit. Simon Maughan, head of sales and distribution at MF Global Ltd. in London, claims that a decision on general capitalization, and occasionally - over-capitalization of banks is likely the only chance left for European leaders. According to IMF, banks
Investors are putting increased pressure on European officials pushing them to design a rescue plan for region's struggling banks before November G20 summit. Simon Maughan, head of sales and distribution at MF Global Ltd. in London, claims that a decision on general capitalization, and occasionally - over-capitalization of banks is likely the only chance left for European leaders. According to IMF,
Investors are putting increased pressure on European officials pushing them to design a rescue plan for region's struggling banks before November G20 summit. Simon Maughan, head of sales and distribution at MF Global Ltd. in London, claims that a decision on general capitalization, and occasionally - over-capitalization of banks is likely the only chance left for European leaders. According to IMF, banks