Editor, Investment Strategy. Europe, Middle East and Africa, London
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May 3, 2013

Inflation angst evaporates in race for returns

LONDON, May 3 (Reuters) – For all the trillions of
dollars-worth in new money that central banks are printing,
financial markets seem to be signalling that fears of rampant
global inflation are unfounded.

Over the past month, investors have devoured virtually any
fixed income securities on offer, from the U.S. Treasury to tech
giant Apple, debt-laden euro sovereigns Italy or Slovenia and
even debut bonds from exotic African countries like Rwanda.

May 2, 2013
via Global Investing

Weekly Radar: May days or Pay days?

So, it’s May and time for the annual if temporary equity market selloff, right? Well, maybe – but only maybe.  A fresh weakening of the global economic pulse would certainly suggest so, but central banks have shown again they are not going to throw in the towel in the battle to reflate. The ECB’s interest rate cut today and last night’s insistence from the Fed that it’s as likely to step up money printing this year as wind it down are two cases in point. And we’re still awaiting the private investment flows from Japan following the BOJ’s latest aggressive easing there.

So where does that all leave us? A third of the way through 2013 and it’s been a good year so far for nearly all bulls – both western equity bulls and increasingly bond bulls too! Not only have developed world equities clocked up some 13 percent year-to-date (the S&P500 set yet another record high this week while Europe’s bluechips recorded a staggering 12th consecutive monthly gain in April) , but virtually all bond markets from junk bonds to Treasuries, euro peripherals to emerging markets are now back in the black for the year as a whole. For the most eyebrow-raising evidence, look no further than last week’s debut sovereign bond from Rwanda at less than 7 percent for 10 years or even newly-junked Slovenia’s ability this week to plough ahead with a syndicated bond sale reported to already be in the region of four times oversubscribed. For many people, that parallel rise in equity and bonds smells of a bubble somewhere. But before you cry “QEEEEE!” , take a look at commodities — the bulls there have been taken a bath all year as data on final global demand hits yet another ‘soft patch’ over the past couple of months.

May 2, 2013
May 1, 2013
May 1, 2013
May 1, 2013

Boosting European lending without banks

LONDON (Reuters) – With a lack of bank lending to European businesses stifling the region’s economy, sidestepping the middlemen – if not quite cutting them out altogether – is becoming more attractive.

Stricter regulation, higher capital buffers and basic risk aversion among banks has meant floods of cheap liquidity from central banks is still not getting to the real economy. As the economy weakens, ebbing loan demand compounds the problem.

May 1, 2013

Analysis: Boosting European lending without banks

LONDON (Reuters) – With a lack of bank lending to European businesses stifling the region’s economy, sidestepping the middlemen – if not quite cutting them out altogether – is becoming more attractive.

Stricter regulation, higher capital buffers and basic risk aversion among banks has meant floods of cheap liquidity from central banks is still not getting to the real economy. As the economy weakens, ebbing loan demand compounds the problem.

Apr 29, 2013
Apr 29, 2013
Apr 26, 2013

Green light for some tweaking of euro austerity

LONDON (Reuters) – Hints the euro zone may shift away from front-loaded fiscal austerity have been treated kindly by financial markets this week as bond investors seem comfortable with at least a measured tilt in the policy mix.

With business sentiment in many euro zone countries, notably Germany, deteriorating again this month and jobless numbers continuing to rise, policymakers have signaled a need to ease back on draconian deadlines for deep budget cuts.

    • About Mike

      "Mike Dolan is Reuters' Investment Strategy Editor in Europe. He has been a correspondent and editor for the past 20 years, working for Reuters from London and Washington DC in a variety of roles covering global policymaking, economics and investment trends."
      Joined Reuters:
      1995
      Awards:
      Reuters Editor of the Year, 2009. Reuters multimedia journalist of the year award, 2011
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