Archives of “January 2020” month

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Pres. Trump: Fed should get smart and lower the rate to make US rates competitive

  
  Analysis
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The FOMC decision is set for tomorrow at 2 PM ET

As the FOMC today meeting gets underway today, with the decision due at 2 PM ET/1900 GMT tomorrow, Pres. Trump is adding his two cents into the discussion.

He says:
  • The Fed should get smart and lower the rate to make our interest competitive with other countries
  • If Fed lowers interest rates, we would then focus on paying off and refinancing the US debt
Of course the Fed only controls the shorter-term interest rates. Longer term interest rates have the shorter-term interest rates as a function, but it is not the end all be all for the shape of the yield curve. In fact, rates could increase further out the curve and increase treasury borrowing obligations.

Report (unconfirmed) that head of US intelligence ag. Iran, Iraq has been killed

  
  Analysis
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Be careful. Unconfirmed.

UNCONFIRMED, but this might not be good if true… INTELSky who on their twitter account calls themselves a “MIDDLE EAST AND MEDITERRANEAN AIRSPACE OBSERVER. TRACKING VARIOUS & INTERESTING SPOTS, MIL AIRCRAFT. #OSINT CONFLICT ZONES” is out tweeting:
Be careful. Unconfirmed.
According to INTELSky, D’Andrea headed the hunt for Bin Laden.  There is no adverse reaction to markets.

OPEC said to be discussing extending output cuts until at least June

  
  Analysis
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OPEC is said to be alarmed by the coronavirus outbreak

OPEC

Reuters is reporting on the matter, citing three OPEC sources, in saying that the bloc aims to extend the current oil output cuts through to June at least.

Adding that members are also discussing on deepening the cuts if oil prices or demand should fall significantly on the coronavirus outbreak.
There is little doubt that the virus will weigh on oil demand in Q1 at the very least but if it does have a prolonged impact, OPEC may have to live with lower oil prices until the world adjusts to the situation in the long-term.
I mean, if they can’t even properly comply with current quotas – what more if they choose to deepen cuts further. It’d be all talk but no action.

WHO chief has met with China president Xi on coronavirus outbreak – spokesman

  
  Analysis
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WHO chief, Tedros Adhanom, is in China this week to discuss ways of containing the virus outbreak

The spokesman also said that Tedros has met up with top Chinese officials and discussed measures to protect Chinese and foreigners in areas affected by the coronavirus. They are also said to have discussed possible alternatives to evacuations.

Adding that Tedros did not travel to any place outside of Beijing and that the WHO emergency committee is being ‘kept in the loop’ about the situation.
Tedros is also coming under quite a bit of flak after the WHO previously described the virus risk as being “moderate” over the weekend before admitting to their mistake and correcting the risk to “very high in China and at a regional level, and high at a global level”.
It still doesn’t look like they will declare the virus as a public health emergency it seems.

What is your preferred source of safety from the Coronavirus?

  
  Analysis
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Via Bloomberg, question of the day ?

Via Bloomberg, question of the day ? 
This was a question on Bloomberg Market’s Live blog this week and I thought I would ask our Forexlive readership the same question. What are you looking at for safety in the current concerns over the coronavirus?
  • Treasuries: One of the first ‘go to places’.
  • Gold: Another quick go to place for value. Short term it makes sense for a quick spike, but longer term the improving US outlook means that gains should be capped
  • Bitcoin: Sometimes mirrors gold as a digital ‘gold’, but for some investors the jury is still out whether bitcoin is here to stay or a first flush of a changing digital age that may or may not be here. For me, when investing in a safe haven on the coronavirus fears, I would favour gold over bitcoin every time. Is that just an unfair bias and unnecessary conservatism, or sensible? Anyone take the other view?
  • Tech stocks: Seen as less vulnerable as industrials, finance or energy stocks. Perhaps long health stocks?
Other areas to look at?

(more…)

China said to urge its citizens to delay foreign travel over virus fears

  
  Analysis
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AFP reports

From the headline, it doesn’t appear to be a hard rule but more of a travel advisory – along the lines of asking travelers to reconsider their plans. These travel warnings have always been a bit of a blur line and in my view, I don’t ever see them having much impact.

But if we do see a significant drop in Chinese travelers around the world, expect that to weigh on global economic conditions even more to start the year – especially in economies that rely heavily on tourism and services.

Coronavirus: British nationals returning from Wuhan to be quarantined for two weeks

  
  Analysis
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All 1,500 people who have flown in from Wuhan since mid-January will be asked to remain in isolation for at least a fortnight reports the UK Telegraph (link may be gated)

Wuhexit?
Health officials are now attempting to track cases to make sure they stay in their homes
  • But it is understood that they only have contact details for one in 10 cases who arrived on such flights.
Another 200 British nationals stranded in Wuhan.
All 1,500 people who have flown in from Wuhan since mid-January will be asked to remain in isolation for at least a fortnight reports the UK Telegraph (link may be gated) 
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