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International financial news

International financial news

[Trump said he would consider providing testimony on impeachment investigations]
US President Trump said on the 18th that he will consider giving testimony to the impeachment investigation of the House of Representatives against him. On the social media, Trump responded to the statement of the US House of Representatives Speaker, Democrat Pelosi, in an interview with the US media. Pelosi said in an interview that if Trump has information that can offend himself, she expects to see that he can go to the House Intelligence Committee to personally state or submit written testimony. Trump said that although he does not want to increase the credibility of this "scam of lack of due process", he will "strongly consider" Pelosi's proposal.

[Fed Chairman Powell said that the Fed will be completely cautious, objective and free from political factors when formulating monetary policy.]
Fed Chairman Powell said that the Fed will be completely cautious, objective and free from political factors when formulating monetary policy. He and Fed officials will set monetary policy in accordance with legal requirements to support maximum employment and stable prices. Powell It is emphasized that the path of policy will depend entirely on the information that may indicate the economic outlook.

[Venezuela's export capacity still exists]

It is reported that Venezuela loaded nearly 11 million barrels of crude oil in the first 11 days of November alone, more than double the load in the same month last month. Most of the oil seems to be shipped to Asia, and half of the ships have closed geolocation devices to avoid being discovered. When sanctions are imposed in the United States, shutting down geolocation devices is also a standard strategy for Iran to export oil. This approach can help countries that are sanctioned to still rely on oil for income. Venezuela is now using the same strategy; according to OPEC's latest monthly oil market report, Venezuela's average daily crude oil production in September was only 644,000 barrels. This is lower than the 727,000 barrels per day in August and the average daily level of 975,000 barrels in the first half of this year. In September 2018, Venezuela's daily output was more than twice that of October, at 1.354 million barrels; this shows that sanctions are curbing oil production but failed to contain Venezuela's exports to zero. The country has signed oil-for-cash agreements with China and Russia, and although it is difficult to repay these debts with limited oil, it is paying off some of its debts, and this does not violate any sanctions.


GMT(time)

Currency

News and Data

04:00

  USD

FOMC Member Mester Speaks 

08:00

  USD

TIC Net Long-Term Transactions (Sep)

08:45

  NZD

PPI Input (QoQ) (Q3)

09:05

  AUD

RBA Assist Gov Kent Speaks 

11:30

  AUD

RBA Meeting Minutes 

22:00

  GBP

CBI Industrial Trends Orders (Nov)


Summary of investment bank views


Morgan Stanley: The prospects for a global economic recovery pressured gold prices




Morgan Stanley economists believe that global economic growth will be boosted in the first quarter of 2020 as the trade situation slows and monetary policy eases. In addition, given that US economic growth is at the end of the cycle, emerging markets will drive the global economic recovery. Economists wrote in the report that there may be a recovery in the first quarter of 2020, and global economic growth has been declining since the seventh quarter, and that the trade situation and monetary policy have eased and relaxed for the first time since the downward trend began, global growth or The recovery began in the first quarter of 2020.

But Morgan Stanley economists believe that the recovery of the small cycle next year may begin. Over the past decade, the global economic cycle has been interrupted again and again, and while suppressing economic overheating, it has also avoided a major recession. Economists point out that with this small cycle of recovery and the third such warming in the past decade, we believe that the economic expansion at the end of the global economic cycle will be extended.


Federal Reserve: US corporate debt problem is worthy of attention




The latest issue of the Financial Stability Report issued by the Federal Reserve pointed out that the risks faced by the stability of the US financial system have remained stable in the past six months, but the corporate debt problem is more prominent. It also mentions that the trade situation may threaten US financial stability. The Fed said in the Financial Stability Report released on the 15th that the risk of stability in the US financial system has barely changed compared with the report released in May. The core sectors of the financial industry have resilience, low leverage, and the largest family and the United States. The banks are all in a more stable state.

The report also pointed out that the corporate debt burden of the United States is at a historically high level, and the growth rate of corporate debt continues to exceed the economic growth rate. It should be alert to the risks associated with the combination of low credit costs and high debt levels of non-financial enterprises. In the medium term, low interest rates and low credit costs make investors more likely to take on greater risks, which may increase the fragility of financial markets. According to the report, about half of the important investment-grade debt levels are only above the junk level, which is close to the all-time high. Once the economy is in recession, large-scale corporate debt downgrades may cause investors to sell corporate bonds, causing more serious liquidity problems in bond markets that already face low cash levels.


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