Two things last week that made me go “hmmm”. Firstly: having written a blog on the impact of El Nino on global inflation (here), Anthony was contacted by a company who then came in to see us to discuss their business. Using data from NASA and EU satellites, they produce earnings estimates for retailers, and forecast economic data. By counting cars in Big Box parking lots from space, they gen…Read the article
I just spent two weeks traveling Latin America around the IMF meetings in Lima. The region is navigating through various shocks: lower commodity prices, deteriorating balance sheets, growth and fiscal deterioration, an urgent need for structural reforms and significant political challenges. There is plenty to write about, so in the next couple of days I will post a series of blogs focused on th…Read the article
Recently Claudia and I were in Lima for the annual meetings of the IMF and World Bank. Unsurprisingly (given the host nation and history of the meetings) the majority of sessions were on the developing world, in particular Latin America. Claudia will shortly be posting a series of more detailed blogs on the LATAM countries she visited, so I’ll focus more globally.
In aggregate, the IMF is predi…Read the article
First of all thanks to Business Insider. Every now and then we come into work to find hundreds of new Twitter followers have joined us overnight – this week it was thanks to BI listing us second in its round up of finance Tweeters. It’s a great list and pretty much everyone on it is worth a follow – I’d also recommend following Business Insider’s European markets editor Mike Bird (@Birdyword)…Read the article
It has been a rough ride for metal and mining giant BHP Billiton. Revenues have come under persistent pressure due to weakening commodity prices. Despite one of the strongest balance sheets in the sector, promises made to shareholders have proven tough to keep.
With these commitments in mind the company turned to a nervous bond market earlier this week for some $6.44bn equivalent of hybrid deb…Read the article
Brazil has been facing the perfect storm since the re-election of Dilma Rousseff in October 2014 and asset prices in Latin America’s largest country have collapsed. Credit default swaps on Brazil 5-year sovereign debt in US dollar and hard-currency corporate bond spreads widened to as much as 545 bps and 938 bps respectively, as at the end of September 2015, which is higher than during the 2008…Read the article
Reverse Yankees, i.e., bonds issued by US entities in currencies other than USD, have become an integral part of the global investment grade (IG) corporate bond universe, particularly in the European IG space. For treasurers of US companies the issuance of EUR-denominated Reverse Yankees offers several advantages:
- In case a US firm reporting its results in USD has operations within the Eurozon…
One of the key objectives of modern monetary policy is to anchor inflation expectations, because managing inflation expectations is the first step to managing inflation.
The extent to which inflation expectations are anchored can have direct implications for the performance of inflation and the broader economy.
Where inflation expectations are not very well anchored, falling (or rising) inflati…Read the article
Our new survey, carried out with YouGov across several EU member states (the UK, France, Germany, Italy, Spain and Austria), shows that there is a low level of support for future sovereign bailouts in the event of debt crises and economic difficulties. The following question was asked as part of the M&G YouGov Inflation Expectations Survey – the full survey will be released here in early Octob…Read the article
This morning CPI in the UK has fallen from 0.1% in July to 0% in August, both in year-over-year terms. Continuing deflationary trends observed in transport (largely petrol) and food (supermarket price wars), which have together taken 0.7% off CPI over the last year, were dragged back up to the zero bound by alcohol and tobacco (these always go up!), education and restaurants and hotels, with sm…Read the article