TFE_WeeklyObservations (201116-1)

tfe_weeklyobservations-201116-1

Summary – November 8 to 20

  • US Presidential Election November 8, 2016
  • Stocks have stormed to record levels
  • The rise in rates is very dangerous in equities as whole, not just in some sectors
  • Traders interpreted President Elect Trump’s spending promises as economic growth and inflation booster, thus bond prices decreased with higher yields
  • Janet Yellen’s latest speech make certain a rate hike in December, but Trump’s fiscal policy created an uncertainty regarding the Fed’s monetary policy in 2017
  • The BoJ intention to keep interest rates near 0% by rising the gap between long-term and short-term interest rates.
  • US core inflation decreased by 0.1% to 2.1%, Fed still waiting for the PCE index at the end of the month. Demand for the housing market increased.

Summary – November 21

  • Oil jumps to 3 week high as Putin freeze comments
  • Dollar rally shows signs of fatigue
  • Global Stocks mostly higher
  • Fed rate hike odds approach 100%
  • ECB President Draghi speech: Bank solvency improved, the profitability is still challenging for banks. Todays’ low interest rate environment is necessary for a return to higher rates in the future. Structural reforms and more growth friendly fiscal policies should be implemented to boost the growth.
  • Commodity – A brief story of gold (price) digging – An Elephant with a golden Trump

 

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