Whether one is a nation, an individual, or a corporation, it does not do to enter a tougher environment without the financial wherewithal and without a plan, writes Kyran Fitzgerald 

Whether one is a nation, an individual, or a corporation, it does not do to enter a tougher environment without the financial wherewithal and without a plan, writes Kyran Fitzgerald

President Donald Trump said he won’t fire US Federal Reserve chairman Jerome Powell but blamed an “out of control” US central bank for the worst stock market sell-off since February.

The US Federal Reserve has raised interest rates as expected, and left its monetary policy outlook for the coming years largely unchanged amid steady economic growth and a strong job market.

Some 10 years ago, Lehman Brothers filed for bankruptcy. On September 29, 2008 the Irish Government announced a blanket guarantee of all the liabilities in the Irish banking system.

The euro dropped yesterday to a three-week low of $1.1662 after minutes from the ECB’s July policy meeting showed policymakers were worried about a possible overshoot in the euro.

US GDP growth slowed to just 0.2% in the first quarter of the year from 0.5% in the final three months of 2016, its weakest performance since the opening quarter of 2014.

Before UK prime minister Theresa May surprised markets with a snap general election, 2017 was already the year of political risk for Europe.

The US Federal Reserve raised its benchmark lending rate a quarter point and continued to project two more increases this year, signalling more vigilance as inflation approaches its target.

Data released late last week showed that the US economy expanded at a very weak annualised rate of 0.5% in quarter one this year, following the sluggish growth of 1.4% recorded in the final quarter of 2015. 

Despite a considerable amount of volatility on financial markets and diverging trends in US and eurozone monetary policies, the key euro/dollar exchange rate has been very range bound over the past year, largely trading in a $1.06-$1.15 corridor.

Risk-off sentiment has dominated financial markets year-to-date, largely driven by concerns over the health of the global economy and doubts about central banks’ policies, especially negative interest rates.

Inflation numbers from the United States tomorrow could be the final ingredient required to convince the Federal Reserve to raise interest rates next month.

The four major reserve currencies (dollar, euro, yen, and sterling) have been confined to relatively narrow trading ranges against each other over the past six months. This follows a period of big exchange rate moves in the second half of last year and early part of 2015.

Most eurozone bond yields fell yesterday, including the cost of borrowing for the Irish Government, after ECB policy makers hinted at their readiness to modify or expand their unprecedented stimulus programme should market turbulence warrant further action.

 

Last week saw a series of encouraging GDP reports published in a number of economies. 

The recent progress in terms of a solution to the Greek debt crisis has allowed the focus on markets to shift back to underlying fundamentals. 

Market hopes for a Greek deal went on something of a roller coaster ride as initial pessimism turned to hopes after confirmation that Greece would likely table its formal bailout plan to the European authorities later today.

ECB president Mario Draghi’s advice last week for markets to “get used to periods of higher volatility” is aptly timed. The past week saw bouts of exceptional volatility in financial markets, with equities, bonds, and currencies experiencing some very sharp swings, writes Oliver Mangan.

The marked strengthening of the dollar, evident over the second half of 2014, continued in the early part of 2015, writes Oliver Mangan.

The marked strengthening of the dollar, evident over the second half of 2014, continued in the early part of 2015. The US currency gained around 11% against the euro and 6% versus sterling in the opening three months of the year, writes Oliver Mangan.

A noticeable feature of foreign exchange markets this year has been much greater uncertainty and volatility, writes Oliver Mangan.

Central bank bond-buying programmes aren’t working, BlackRock’s Peter Fisher has claimed.

The ‘Great Recession’ of 2008-2009 and the subsequent sluggish and uneven pace of recovery from it, has seen many central banks cut interest rates to record low levels of between 0% and 0.5%.

In recent months, the dollar has had a stronger tone, making gains against a basket of currencies.

Janet Yellen has been sworn in to succeed Ben Bernanke, becoming the first woman to lead the US Federal Reserve in its 100-year history.

The US Senate confirmed Janet Yellen as the first woman to lead the Federal Reserve, elevating an advocate of fighting unemployment and a backer of the central bank’s efforts to spur the economy with low interest rates and massive bond purchases.

The incoming president of the US Federal Reserve, Janet Yellen, gave a strong defence of the central bank’s very loose monetary policy before a Senate Banking Committee hearing last week.

The latest eurozone unemployment figures, showing an increase of 1m more people out of work, has caused global alarm.

Former US treasury secretary Lawrence Summers has withdrawn from consideration to be chairman of the Federal Reserve, saying it would hurt the nation for him to go forward with what would be a contentious confirmation before the US Senate.

The man who many thought was favourite to succeed Ben Bernanke as the US Federal Reserve chairman has quit the race.

The ISEQ continued its downward spiral yesterday as prices fell a further 99.82 points or 2.35%.

Last year was very much characterised by range trading and low volatility in currency markets.

A Bangladeshi man has appeared in federal court in the US to face charges of attempting to use a weapon of mass destruction and attempting to provide material support to al-Qaida.

The US Federal Reserve has announced it will pump in US$40bn a month (€31bn) to bolster the world's biggest economy.

Can Mario Draghi, the new broom at the head of the European Central Bank, deliver on his pledge to do whatever it takes to defend the European currency from attack, asks Kyran Fitzgerald

Banking’s reputation was already on the floor when along came rate-fixing and money laundering for drug cartels and rogue states to completely destroy the public’s trust, writes Kyran Fitzgerald

The Iseq Index dropped 37.33 points to close at 3,156.

Oil fell for a third day after government data showed US inventories rose to the highest level in more than five months and on expectations that the Federal Reserve will not take new action to bolster the economy.

As the eurozone crisis edges closer to another 2008-style meltdown, the situation calls for the intervention of the banking big-boys with the money to assure markets and hopefully get credit flowing once more, reports Kyran FitzGerald

The US Federal Reserve today painted a bleaker outlook for the nation's economy, which it thinks will grow much more slowly and face higher unemployment than it had estimated in June.