August, 2019

• 25 August

  The Fed could learn from Bank of Canada

  

  The US Federal Reserve has developed a pretty poor track record for meeting its inflation and employment goals. If it wants to do a better job, it should follow Canada’s example and set some deadlines. More than four decades ago, Congress mandated that the Fed’s monetary policy pursue two objectives: price stability and maximum employment. In January 2012, the central ...

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• 25 August

  Negative interest rates are coming for us all

  

  First they came for central banks, then they came for government bonds, then they came for rich depositors. Then they came for me. Negative interest rates are coming for us all, in one form or another, as central banks redouble their efforts to avert a global economic slowdown that threatens to unleash deflation. So how can we defend ourselves from ...

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• 25 August

  Markets left teetering as trade war derails Fed calming efforts

  

  Bloomberg Any reassurance markets got from the Federal Reserve in Jackson Hole was wiped out within minutes. A volley of acrimonious presidential tweets and a nastier turn in the trade war sent Treasury yields, stocks and the dollar skidding into the weekend. Hopes that the central bank could guide markets to a cool-headed assessment of the US economy now look ...

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• 25 August

  Pound’s biggest Brexit risk is not what it seems to be

  

  Bloomberg As markets bet on a no-deal Brexit, the real shock for pound traders could be Prime Minister Boris Johnson clinching a sudden deal. Sterling has tumbled in recent weeks as Johnson’s “do or die” stance has led traders to increase bets against the currency on the prospects of a no-deal Brexit on October 31. Yet a surge of nearly ...

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• 25 August

  Deutsche Bank SEC case showing ‘classic’ nepotism in Russian hires

  

  Bloomberg Deutsche Bank AG executives were outraged. They had just missed out on a major deal with the Russian government and wanted answers. “We must use whatever tactic and political pressure to avoid this embarrassment,” a senior banker in London wrote in an email to the firm’s top executive in Russia. “DB not participating is a slap in our face.” ...

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• 25 August

  ‘No-deal Brexit may prompt BOE easing’

  

  Bloomberg A collapse of Brexit talks resulting in the UK leaving the European Union without a transition agreement would likely prompt the Bank of England to loosen monetary policy, Governor Mark Carney said. While the Monetary Policy Committee’s reaction would depend on how demand, supply and exchange rate are hit, “the appropriate policy path would be more likely to ease ...

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• 25 August

  Slowdown trims RBC earnings

  

  Bloomberg Royal Bank of Canada (RBC) posted fiscal third-quarter earnings that missed analysts’ estimates, hurt by a slowdown in the company’s capital-markets division. Canada’s largest lender by assets had C$653 million ($491 million) in profit from RBC Capital Markets, a 6.4% decline, the result of lower trading revenue and a drop in investment-banking fees, according to a statement Wednesday. Earnings from ...

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• 25 August

  Pimco rules out Swedish rate hike

  

  Bloomberg Sweden is stuck in negative interest rates. That’s the view of fixed-income giant Pacific Investment Management Co, which predicts that Sweden’s central bank will need to leave its benchmark rate at minus 0.25% through 2020. Sweden’s central bank is struggling to exit more than four years of negative rates. A plan to raise rates to zero again towards end ...

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• 25 August

  HSBC weighs bid for Aviva’s Asian assets

  

  Bloomberg HSBC Holdings Plc, the bank that shook up its senior leadership this month, is considering a bid for Asian operations being sold by Aviva Plc as it seeks ways to diversify its business in the region, people with knowledge of the matter said. London-based HSBC is in the early stages of weighing an offer for at least part of ...

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• 25 August

  SNB finds new way to impose world’s lowest interest rate

  

  Bloomberg The Swiss National Bank (SNB) has a new way of enforcing the world’s lowest interest rate. With the franc near a two-year high against euro, the SNB’s decade-old battle against an overly strong currency is back in focus. There’s evidence it’s been intervening again and analysts are increasingly betting that it will soon follow with a rate cut. That ...

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