1/25/2012: Globicus/qEcon US LEI: Modest US Economic Growth Expected in H1 2012
The Globicus/qEcon Research US overall leading economic index’ growth rate, a measure of future economic growth, edged up to 1.4 in December, a third consecutive monthly gain, from 1.3 in November, signaling the US economy will likely grow at a modest pace in the first half of 2012.
1/11/2012: ECB Finally Doing the Right Thing
The European Central Bank is finally doing the right thing. After being part of the European sovereign debt and banking problems, the central bank is now part of the solution. The ECB made two consecutive 25-basis-point cuts in its benchmark interest rate in November and December to currently 1.00%, reversing its ill-advised rate increases earlier last year. Importantly, the new ECB President Mario Draghi announced new unconventional policy measures to support bank lending and liquidity in the euro area.
11/4/2011: European Government Debt and Banking Debacle
Greece seems to move closer to a default as Greek and European politicians struggle to find a solution to the debt crisis and ring fence the European banking system.The EU summit concluded €1 trillion would be sufficient to backstop. However, the leaders have not come up with a funding plan. Without prompt funding, the risk for a financial collapse and depression remains high.
9/6/2011 Globicus FX Strategy Report: Dollar Index Broke Long-Term Downtrend
US stocks fell on Tuesday while the US dollar rose on fears the eurozone sovereign debt crisis was worsening and global economic growth was slowing. The EUR/USD traded below 1.40 for the first time since July 13, pressured by increasing investor skepticism about European politicians’ ability in solving the debt problem before it blows up the banks’ balance sheets. The Swiss National Bank put a floor under the EUR/CHF by saying the minimum exchange rate is 1.2 EUR/CHF. We believe the SNB will stick to this commitment for the foreseeable future; therefore, we recommend buying the EUR/CHF near 1.2 but before the SNB does so. The US and German bond yields touched new record lows. The S&P 500 fell 8.73 or 0.74% to 1,165.24, but closed well above its session lows. The RJ/CRB commodity index declined 2.84 to 335.22 and gold fell after initially hitting a new record high. See also recent currency reports.
