Raghuram Rajan inspired an outbreak of optimism when he took the reins as the Governor of the Reserve Bank of India. Economists now suggest that this is not merely irrational exuberance, and is grounded in realistic expectations of economic improvement.
High yield bonds, and companies struggling to borrow, are both unexpected ‘safe places to hide’ in an era of cheap money, according to Ben Bennett, credit strategist for Legal & General.
It looks increasingly likely that tapering will be off the table in the US following the weaker than expected payrolls numbers.
China’s growth accelerated to 7.8% year-on-year, reversing the slowdown seen during the first half of 2013.
The US budget deadlock was broken overnight but after being closed for 16 days, the fingerprints of the shutdown are clear to see.
Ratings agency Fitch last night said it could cut America’s prized AAA credit rating, but investors have shrugged off the warning.
Mike Riddell, manager of the M&G Global Macro Bond fund, believes the US dollar looks cheap on almost all measures, while emerging market currencies still face significant risks.
The European funds industry amassed net inflows of 3.5bn for August, with Italy, Spain and the United Kingdom taking the lion's share of assets, according to the latest research from Lipper.
Kentaro Sasaki, head of Japan equity research and lead manager of JPM Japan Select Equity fund, says that while Japanese markets have priced in the impact of a depreciating yen, the impact of higher inflation as a result of the economic reforms enacted by Prime Minister Shinzo Abe is not yet reflected in share prices.
Economists believe that falling manufacturing output and industrial production makes an imminent rise in interest rates increasingly unlikely.
Japanese Prime Minister Shinzo Abe’s planned tax increase for April 2014 could cause a minor bump in the country’s road to recovery, but the decision has removed any uncertainty overshadowing markets, according to regional experts.
Economists and strategists see little impact from the US government shutdown in the short-term, but believe it could have a significant impact on the economy and stock market if a resolution is not found swiftly.
