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Jul 11, 2013

Fed stops short of the clarity global markets crave

LONDON (Reuters) – Federal Reserve Chairman Ben Bernanke now knows why uncharted waters on mariners’ charts used to be marked ‘Here be Dragons’.

The U.S. central bank’s disclosure on June 19 of a rough route map for phasing out its unprecedented programme of bond buying by the middle of 2014 drew a fiery reaction from global markets. Investors immediately speculated that an end to the Fed’s near-zero interest rates would follow sooner than thought.

Jul 11, 2013

Analysis: Fed stops short of the clarity global markets crave

LONDON (Reuters) – Federal Reserve Chairman Ben Bernanke now knows why uncharted waters on mariners’ charts used to be marked ‘Here be Dragons’.

The U.S. central bank’s disclosure on June 19 of a rough route map for phasing out its unprecedented program of bond buying by the middle of 2014 drew a fiery reaction from global markets. Investors immediately speculated that an end to the Fed’s near-zero interest rates would follow sooner than thought.

Jul 10, 2013

Euro zone’s queasy feeling as it looks in Japan mirror

LONDON (Reuters) – Monetary policy that cannot get traction; weak banks that cannot or will not lend; an economy trapped in a twilight world of low growth, haunted by the spectre of deflation.

If this combination sounds familiar, that’s because it is.

The euro zone, still drowning in debt bequeathed by the great financial crisis, increasingly resembles Japan in the 1990s as it struggled with its own balance sheet recession brought on by the bursting of an almighty asset bubble.

Jul 10, 2013

Analysis: Euro zone’s queasy feeling as it looks in Japan mirror

LONDON (Reuters) – Monetary policy that cannot get traction; weak banks that cannot or will not lend; an economy trapped in a twilight world of low growth, haunted by the specter of deflation.

If this combination sounds familiar, that’s because it is.

The euro zone, still drowning in debt bequeathed by the great financial crisis, increasingly resembles Japan in the 1990s as it struggled with its own balance sheet recession brought on by the bursting of an almighty asset bubble.

Jul 7, 2013

No escaping the Fed

LONDON, July 7 (Reuters) – As the Federal Reserve moves
closer to scaling back its monetary stimulus, central banks in
the rest of the world may get another reminder this week of just
how tough it is to decouple from U.S. interest rates.

German and British bond yields tracked U.S. yields sharply
higher on Friday following solid U.S. jobs data, a day after the
European Central Bank and the Bank of England, anxious to
protect their economies from rising U.S. borrowing costs, said
they would keep short-term rates firmly anchored near zero.

Jul 7, 2013

Hoping for clarity not confusion from Bernanke

LONDON, June 16 (Reuters) – Like a father who has told his
son the tooth fairy does not exist, Ben Bernanke must find a way
to soothe investors who feel betrayed since he told them it was
also a fantasy to hope he might keep printing free money for
ever more.

Financial markets, of course, knew deep down that the
Federal Reserve would have to start withdrawing its
extraordinary monetary stimulus once the U.S. economy was out of
the emergency ward.

Jul 4, 2013

Portugal’s woes shine light on rest of euro zone periphery

LONDON (Reuters) – Budgetary rigour demanded by international lenders may be the proximate cause of Portugal’s political crisis, but Lisbon is also paying the price for not whipping its economy into shape in better times.

The survival of Prime Minister Pedro Passos Coelho’s centre-right coalition was hanging by a thread on Wednesday as the rightist CDS-PP party debated whether to withdraw its support and leave the government without a majority.

Jul 3, 2013

Analysis: Portugal’s woes shine light on rest of euro zone periphery

LONDON (Reuters) – Budgetary rigor demanded by international lenders may be the proximate cause of Portugal’s political crisis, but Lisbon is also paying the price for not whipping its economy into shape in better times.

The survival of Prime Minister Pedro Passos Coelho’s center-right coalition was hanging by a thread on Wednesday as the rightist CDS-PP party debated whether to withdraw its support and leave the government without a majority.

Jun 30, 2013

The Fed and China churn already choppy waters

LONDON, June 30 (Reuters) – Data this week will add spice to
speculation as to when the U.S. Federal Reserve will start
scaling back its stimulus while reinforcing the realisation that
China is serious about shifting to a less frantic growth rate.

Fed policy makers have sent mixed messages since Chairman
Ben Bernanke’s June 19 announcement that the central bank was on
course to end its bond buying, now running at $85 billion a
month, by mid-2014.

Jun 23, 2013

Taper tantrum conceals brightening growth picture

LONDON (Reuters) – Markets dismayed by the Federal Reserve’s stimulus withdrawal timetable might be in no mood for good news, but evidence is mounting that other rich economies are joining the United States on the road to recovery.

Improving growth prospects, of course, are the main reason why the Fed expects to phase out its bond purchases, now running at $85 billion a month, by the middle of 2014. The U.S. central bank reckons output will expand by 3.25 percent next year.

    • About Alan

      "I'm the Global Economics Correspondent for Reuters News based in London. I've reported from more than 40 countries over 30 years and have had postings in Frankfurt, New York, Washington, Paris, London, Tokyo, Singapore and Beijing. From the Plaza Accord to the creation of the euro and the rise of China, I'm lucky to have covered many of the big economic stories of recent years."
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