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Citigroup says cuts in Fed rates, global recession risks could propel gold above US$2,000  

Gold prices may rally to a record above US$2,000 an ounce in the next two years, according to Citigroup, which gave a laundry list of positive drivers including rising risks of a global recession and the likelihood that the Federal Reserve will reduce interest rates to zero.“We expect spot gold prices to trade stronger for longer, possibly breaching US$2,000 an ounce and posting new cyclical highs at some point in the next year or two,” analysts including Aakash Doshi said in a note received on… Source link

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China 

‘Shallow recession’ likely in the US as economy slows, trade war weighs on global growth, CLSA says

The United States is likely headed towards a “shallow recession” and world trade could turn negative next year as a slowing economy and an escalating dispute with China weighs on global growth, according to Eric Fishwick, chief economist at Hong Kong-based investment bank CLSA.If world trade growth contracts in 2020, it would be the first protracted period of negative growth since 2008 and 2009, the height of global financial crisis, he said.“We are already at the weakest point in terms of… Source link

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China 

US-China trade war escalation seen moving global recession risk closer to tipping point

The latest tit-for-tat trade tariff increases by China and the US on Friday are a further sign that a near-term resolution of the trade war is unlikely, pushing the global economy closer to tipping into a severe slowdown, with a recession in America and a sharper-than-expected slowdown in the mainland.Many analysts believe the global economy can avoid a recession next year, helped by more aggressive policy responses from the US and China that would include greater monetary easing from the US… Source link

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The bond market is flashing a recession warning, but that’s no cause for alarm yet

Out driving the other day, an orange warning light appeared on the dashboard. My first thought was not that the engine was about to burst into flames, nor did I abruptly pull over. I continued driving towards where I was going and then I drove home again. My calmness was due to the realisation that warning lights themselves are not a sign that something bad has happened – smoke from the engine would be in this case – but that something bad may happen.The bond market is the same. The global……

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Easy money is losing its magic as global recession fears spread

The “bad news is good news” mantra has pervaded financial markets ever since the world’s leading central banks embarked on quantitative easing to help shore up recession-ravaged economies during the global financial crisis.It is a testament to the potency of ultra-loose monetary policy that mere hints of additional stimulus have been enough to spark some of the fiercest rallies in markets over the past several years. As recently as the beginning of last January, signals from the Federal Reserve… Source link

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Stocks blog: Will Hong Kong, mainland China join the recession party?

Well, that did not last long. A cheer brought on by a delay in tariffs on about US$300 billion worth of Chinese goods has proved to be short-lived. US equities tanked as much as 3 per cent overnight, spooking investors. And as chances of a recession build up, will Asia join the party? China and Germany released weak economic data on Wednesday, while the world’s largest gaming company, Tencent Holdings, posted disappointing results. Meanwhile, protests continue in Hong Kong for a 11th… Source link

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Global 

US stocks tumble on fears of looming recession

Wall Street stumbled on Wednesday as investors fled equities for safe-haven assets, seeking shelter amid gathering signs that a recession could be on the horizon.All three major US indices were sharply lower as short- and long-dated Treasury yields inverted for the first time in 12 years, a potential signal of imminent recession.Elsewhere, ominous indicators suggested a faltering global economy, hobbled by the intensifying US-China trade war, Brexit jitters and geopolitical concerns. Germany… Source link

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More than a third of investors expect a recession in 12 months, Bank of America Merrill Lynch survey finds

Recessions fears have reached their highest levels in eight years as investors shift away from equities to bonds, according to the latest Bank of America Merrill Lynch survey of fund managers.More than a third of investors surveyed believe a global recession is likely in the next 12 months, the highest recession probability since October 2011, the August Fund Manager Survey found.“Investors are the most bullish on rates since 2008 as trade war concerns send recession risk to an eight-year high,… Source link

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China 

Singapore economy tipped for recession as US-China trade war slams imports, exports, manufacturing

Singapore’s economy has been tipped to enter recession in the third quarter of 2019 as the fallout from the US-China trade war continues to rock the Southeast Asian nation after second quarter growth was confirmed at minus 3.3 per cent.The gross domestic product (GDP) figure released on Tuesday was a huge decline on the 3.8 per cent growth in the first three months of 2019, and the worst reported quarterly growth for seven years.On a year-on-year basis, the economy grew at just 0.1 per cent,… Source link

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Global 

Is China’s ‘currency manipulator’ tag the start of a global recession, currency war?

The United States’ decision to label China a “currency manipulator” after the yuan’s exchange rate weakened beyond a closely watched barrier is raising the question of whether the world’s two largest countries have started a currency war as part of a broadening economic conflict.China, which had prevented the exchange rate of the yuan, also known as the renminbi (RMB), from breaching the psychologically important level of 7 to the US dollar from the last 11 years, let the currency slip below… Source link

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