Weekly Markets Review, July 28, 2018
In this issue
- Boiling Hot at 4.1 %
- Technology Chills
- Foreign markets to outperform US equities
- Risks Ahead : Bonds, Wars and Donald Trump
- The Week in Review
- The Markets in Charts
Boiling hot at 4.1 %
That is the rate of economic growth achieved by the US economy in the second quarter of 2018, the best since 2014, as strong labor markets and lower tax bills enticed consumers to spend more and more. Donald Trump is right to rejoice, but the base effect of lower taxes will ultimately fade away in the coming quarters and economic growth will therefore slow down marginally in the coming quarters.
Weekly Currency Markets Review July 22, 2018
Last week, the trade war between the US and China have evolved into a currency war with Donald Trump tweeting that China and Europe were keeping their currencies artificially low.
In our various posts relating to the Trade War, we highlighted the fact that the ultimate goal of the Trade War was actually a structural revaluation of theChinese RenMinBi, a natural and needed evolution at this stage of China’s development, and the rapport de force will not end until China accepts to change its currency policies.
TRADE WARS, THE TRUMP METHOD AND LIQUIDITY
Equity Markets rose sharply last week as economic indicators and the heightened trade war led investors to conclude that the world economy would slow down marginally in the next six months while the ongoing trade wars would only have a limited systemic impact.