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Weekly Insight: More talk—more action?

Central banks poised for easing as clouds gather over the global growth and earnings outlook; Policy uncertainty remains a key risk with no-deal Brexit and potential U.S. FX intervention in the spotlight ; China accelerates market opening for foreign investors in a bid to stoke growth and ease trade tensions; Leveraged loan issuance is over 50% below H118 levels; lower global rates reduce the appeal of floating-rate securities; Who holds leveraged loans? Institutional investors may have significant exposure via collateralized loan obligations (CLOs)    

Global Macro Views: How Big is Dollar Long Positioning?

Speculative positioning in the CFTC’s CoT report shows Dollar longs have scaled back sharply and are only modest at this point. Data from option markets suggest positioning may even be modestly short the Dollar versus the Euro. After many years of large Dollar longs in the foreign exchange market, we read these data as saying Dollar positioning is now essentially flat.

Macro Notes: Ukraine’s Debt Dynamics Still Positive

We estimate that Ukraine’s debt should stabilize at around 55%. The exchange rate depreciating roughly in line with inflation is key, as about two-thirds of Ukraine’s debt is issued in foreign currency. A 2014-style FX shock would bring the debt-to-GDP ratio to 100%. We are more concerned about the financing gap in 2020 than debt.

Economic Views: Debt Sustainability in EM

We scan EM for debt risk systematically. Debt is high and increasing in some EMs, … including Brazil and South Africa. Rollover risk due ...

U.S. Regulatory Update -- July 2019

Please find our latest U.S. Regulatory Update, covering the Federal Reserve’s Semiannual Monetary Policy Report, Congressional Libra Hearings, Stress Testing and CCAR results, and Capitol Hill updates, among other topics.

FRT Episode 43: Libra and Beyond

Following his testimony at the US Congressional hearings on Facebook’s proposed Libra digital currency, Professor Chris Brummer joins FRT to discuss the top takeaways and the potential implications for other initiatives in the digital currency landscape (with Brad Carr & Conan French)

 

CEEMEA Regional Report: Monetary Policy to Support Growth

Labor shortages and fragile investor confidence will constrain output growth. Policies will likely become more accommodative, thanks to a dovish ECB and Fed. The external financing and inflation outlook will remain challenging for some. Slow progress in addressing structural problems will intensify vulnerabilities.

Key Takeaways from Libra Congressional Hearings

The IIF has summarized key themes that emerged from the Facebook Libra hearings before both the Senate Banking Committee and the House Financial Services Committee this week in Washington.

June 2019 EM Growth Tracker

Our EM Growth Tracker came in at 3.5% (3m/3m SAAR) in June, 0.3pp lower than the month prior. The deterioration in our tracker was mainly driven by weaker hard data (explaining more than half of the decline) but exacerbated by business surveys and financial variables.

Weekly Insight: In the valley of debt

Low rates may boost short-term growth—but will discourage deleveraging even as debt continues to pile up; Incoming EC President Ursula von der Leyen puts climate change and sustainable finance top of the policy agenda; LIBOR transition update: focus on risks for asset managers; Venezuela: estimated total debt of over 200% of GDP, with external debt accounting for 80% of total debt

 

 

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