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FILE PHOTO: A security guard walks past in front of the Bank of Japan headquarters in Tokyo, Japan January 23, 2019. REUTERS/Issei Kato/File Photo
April 25, 2019
TOKYO (Reuters) – The Bank of Japan kept monetary policy steady on Thursday and clarified its intention to keep interest rates very low for a prolonged period, committing to do so at least through around the spring of next year.
In a widely expected move, the BOJ maintained its short-term interest rate target at minus 0.1 percent and a pledge to guide 10-year government bond yields around zero percent.
“The BOJ intends to maintain the current extremely low levels of short-term and long-term interest rates for an extended period of time, at least through around spring 2020,” the BOJ said in a statement announcing its policy decision.
Until now, the BOJ did not have a specific time frame on how long it would maintain very low rates.
BOJ Governor Haruhiko Kuroda will hold a news conference at 3:30 p.m. (0630 GMT) to explain the policy decision.
(Reporting by Leika Kihara, Tetsushi Kajimoto, Stanley White and Kaori Kaneko; Editing by Chris Gallagher)
Source: OANN
FILE PHOTO: Chinese Finance Minister Liu Kun attends a news conference during the ongoing National People’s Congress (NPC), China’s parliamentary body, in Beijing, China March 7, 2019. REUTERS/Jason Lee
April 25, 2019
BEIJING (Reuters) – China aims to make the Belt and Road Initiative sustainable and prevent debt risks, finance minister Liu Kun said at a forum on Thursday, adding that Beijing will support financing via multiple channels.
Yi Gang, the central bank governor, said at the Belt and Road Forum that local currencies will be used for investments related to China’s Belt and Road Initiative to curb exchange rate risks.
China will follow market principles and rely on commercial funds for Belt and Road financing, Yi said.
(Reporting by Kevin Yao; Editing by Jacqueline Wong)
Source: OANN
FILE PHOTO: U.S. Dollar and Euro notes are seen in this June 22, 2017 illustration photo. REUTERS/Thomas White/Illustration
April 25, 2019
By Daniel Leussink
TOKYO (Reuters) – The euro nursed losses against the dollar on Thursday after dipping to a 22-month low on a surprise drop in a leading indicator for economic activity in Germany, amplifying worries of a growth slowdown in Europe’s largest economy.
German business morale deteriorated in April, bucking expectations for a small improvement, a business index by the Munich-based Ifo economic institute showed on Wednesday, as trade tensions weighed on the German economy, leaving domestic demand to support slowing growth.
The greenback rallied to a 23-month high of 98.189 against a basket of key rivals overnight after gaining more than half a percent, largely propelled by the euro’s weakness. The index last traded slightly lower at 98.096.
“Yesterday’s strength of the dollar was exaggerated by the weakness in countries other than the U.S.,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.
“A big question is if the weakness in Australia and the euro area are temporary or not,” he said. “The main scenario is (for) a recovery in the second half of this year in the euro area and other regions.”
The euro sat at $1.1153, having suffered its biggest one-day loss against the dollar since early March when the European Central Bank pushed back plans for its first post-crisis interest rate hike.
The single currency also shed nearly 0.4 percent against the yen overnight and was last trading at 125.125 yen.
The Japanese currency slipped to a 2019 low of 112.40 yen per dollar on its own during the previous session, with traders eyeing a Bank of Japan policy decision later on Thursday for trading cues.
The BOJ is expected to keep monetary policy steady on Thursday and predict that inflation will fall short of its 2 percent target for three more years, signaling that its massive stimulus will stay in place for the foreseeable future.
The dollar was last a shade lower on the yen, changing hands at 112.12 yen.
The Australian dollar was largely unchanged at $0.7017.
The Aussie had given up nearly 1.3 percent during the previous session after weaker-than-expected Australian inflation numbers heightened the prospect of an interest rate cut.
The Canadian dollar was flat at $1.3495 after hitting a four-month low overnight, as investors raised bets on a Bank of Canada interest rate cut this year after the central bank slashed its economic growth outlook.
Market participants awaited policy decisions by the Swedish and Turkish central banks later on Thursday.
Sweden’s Riksbank is likely to keep its benchmark rate unchanged and may be forced to delay plans to tighten policy later in 2019, a Reuters poll of analysts published on Tuesday showed.
“The Riksbank may push further out the timing of the next rate hike, and also the market may speculate it’s too early for a rate cut by the Turkish central bank,” said Mizuho’s Yamamoto.
“That could be a negative for these currencies and positive for the dollar.”
(Editing by Jacqueline Wong)
Source: OANN
FILE PHOTO: A man looks at an electronic board showing the Nikkei stock index outside a brokerage in Tokyo, Japan, January 7, 2019. REUTERS/Kim Kyung-Hoon
April 25, 2019
By Tomo Uetake
TOKYO (Reuters) – Asian shares slipped on Thursday as a surprise deterioration in German business morale rekindled fears of slowing global growth, while oil prices pulled back slightly after a sharp run-up earlier in the week.
The euro slumped to a 22-month low against the U.S. dollar overnight after the drop in German business confidence highlighted the divergence between data in the euro zone and the United States.
MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.2 percent, while Japan’s Nikkei average edged up 0.3 percent to 22,264.81 points.
Overnight, Wall Street shrugged off some earnings misses but drifted lower at the end of the session, after the S&P 500 and the Nasdaq Composite registered record closing highs on Tuesday.
Chotaro Morita, chief rates strategist at SMBC Nikko, noted
hopes that the Chinese economy is bottoming out have contributed to recent rallies in global equities.
“Corporate earnings that have been released so far suggests the worst period for the Chinese economy was over. While that is supportive of share prices, that alone is not enough to keep the rally going for more than a month,” he said.
In the currency market, the dollar index, which measures the greenback versus a basket of six major rivals, rose to as high as 98.189 overnight, its highest level since May 2017. The index was last quoted at 98.133.
The euro sat at $1.1150, having suffered its biggest one-day loss against the dollar since early March.
The deteriorating reading on German business morale, in a survey by the IFO economic institute, bucked expectations for a small improvement.
The pound held at a two-month low, weighed down by a broad-based rally in the dollar and fading hopes of a breakthrough in Brexit talks between the British government and the opposition.
U.S. Treasury yields fell across maturities on Wednesday as investors piled into the safe-haven asset after a slew of weak international economic data.
A sharp slowdown in Australian inflation also lifted bond prices, while Premier Li Keqiang in China said authorities should not underestimate the difficulties in the Chinese economy, adding to concerns about global demand.
However, the U.S. yield curve steepened to its widest level since November at one time on Wednesday, in an expression of bullish sentiment.
Oil prices hovered below six-month highs after data showed U.S. crude stockpiles surged to their highest levels since October 2017, countering fears of tight supply resulting from OPEC output cuts and U.S. sanctions on Venezuela and Iran.
Brent crude futures fell 0.4 percent to $74.29 a barrel, while U.S. West Texas Intermediate crude futures dropped 0.5 percent to $65.57 a barrel. Both benchmarks hit 5-1/2-month highs on Tuesday.
The Bank of Japan is expected to keep monetary policy steady later on Thursday and predict that inflation will fall short of its 2 percent target for three more years, signaling that its massive stimulus will stay in place for the foreseeable future.
Investors are also awaiting the release of U.S. gross domestic product (GDP) data for the first quarter, due on Friday.
(Graphic: Asian stock markets: https://tmsnrt.rs/2zpUAr4).
(Reporting by Tomo Uetake; Additional reporting by Hideyuki Sano; Editing by Kim Coghill)
Source: OANN
FILE PHOTO: A woman walks past a building of Bancorp (Banco Corporativo S.A) in Managua, Nicaragua March 7, 2019. REUTERS/Oswaldo Rivas
April 25, 2019
MANAGUA (Reuters) – Nicaraguan bank Bancorp has requested permission from the country’s banking regulator to cease operations after the United States imposed sanctions on the firm, according to a letter seen by Reuters on Wednesday.
Bancorp submitted a request to Nicaragua’s banking and financial regulator for “early voluntary dissolution.”
“Our bank is unable to continue doing business due to the sanction,” said the letter dated April 22 and signed by Luis Barcenas, Bancorp’s legal representative.
U.S. national security adviser John Bolton last week called Bancorp a “slush fund” for Nicaraguan President Daniel Ortega and announced sanctions on the bank as well as and the president’s son Laureano Ortega, for what he described as “vast corruption.”
Washington has previously sanctioned President Ortega’s wife and Nicaraguan Vice President Rosario Murillo.
Bancorp was created in 2015 as a subsidiary of Alba de Nicaragua, known as Albanisa. The company is a joint venture of Venezuela state oil firm PDVSA and Nicaragua’s own state-run Petroleos de Nicaragua.
Nicaraguan lawmakers in March voted to approve a government purchase of Bancorp for $23 million.
The banking regulator confirmed it received Bancorp’s request to dissolve, but did not clarify whether the government acquisition had been finalized.
(Reporting by Ismael Lopez, Writing by Daina Beth Solomon, editing by G Crosse)
Source: OANN
FILE PHOTO: A man walks in a park at a business district in Seoul, South Korea, March 23, 2016. Picture taken on March 23, 2016. REUTERS/Kim Hong-Ji
April 24, 2019
SEOUL (Reuters) – South Korea’s economy unexpectedly shrank in the first quarter, marking its worst performance since the global financial crisis, as government spending failed to keep up the previous quarter’s strong pace and as companies slashed investment.
Gross domestic product (GDP) in the first quarter declined a seasonally adjusted 0.3 percent from the previous quarter, the worst contraction since a 3.3 percent drop in the fourth quarter of 2008 and sliding from 1 percent growth in Oct-Dec, the Bank of Korea said on Thursday.
None of the economists surveyed in a Reuters poll had expected growth to contract. The median forecast was for a rise of 0.3 percent.
From a year earlier, Asia’s fourth-largest economy grew 1.8 percent in the January-March quarter, compared with 2.5 percent growth in the poll and 3.1 percent in the final quarter of 2018.
Exports fell 2.6 percent quarter-on-quarter, a sharper drop than the 1.5 percent decline in the previous three months.
Capital investment tumbled 10.8 percent to a 21-year low, while construction investment inched down 0.1 percent, according to the central bank.
(Reporting by Joori Roh, Cynthia Kim; Editing by Kim Coghill)
Source: OANN
FILE PHOTO: A man walks past the Bank of England in the City of London, Britain, February 7, 2019. REUTERS/Hannah McKay
April 24, 2019
LONDON (Reuters) – The Bank of England is likely to keep interest rates on hold until August 2020 because of a slower global economy and prolonged uncertainty about Brexit, a leading think tank said on Thursday.
The National Institute of Economic and Social Research pushed back by a year its previous forecast of a BoE rate hike which it made as recently as February.
NIESR economist Garry Young said a weaker global economy, and its knock-in impact on oil prices and other imports, was impacting monetary policy around the world, while in Britain uncertainty about Brexit has also kept the BoE on the sidelines.
“Now we expect the first increase in Bank Rate to be next August rather than this August,” he said.
The weakness in prices of imports would help offset inflation pressure from rising wages at home, Young said.
Britain is facing more uncertainty about its future relationship with the European Union after a deadline for Brexit was delayed from April 12 until the end of October this month.
Last week, a Reuters poll showed most economists now expect the BoE to raise borrowing costs early next year.
The British central bank has raised rates twice to 0.75 percent from an all-time low of 0.25 percent but Governor Mark Carney said the outlook for the economy is now shrouded in the “fog of Brexit.”
NIESR trimmed its expectation for British economic growth this year to 1.4 percent from its February forecast of 1.5 percent. It expected growth to pick up to 1.6 percent in 2020.
The forecast was based on the assumption of a “soft” Brexit which avoids disruption at the Irish border and maintains a high degree of access to EU markets.
The growth outlook would be slower if Britain ends up in a customs union with the EU, as favored by the opposition Labour Party, or if the country leaves the EU without a transition deal, NIESR said.
(Writing by William Schomberg)
Source: OANN
FILE PHOTO: A security guard walks past in front of the Bank of Japan headquarters in Tokyo, Japan January 23, 2019. REUTERS/Issei Kato
April 24, 2019
By Leika Kihara
TOKYO (Reuters) – The Bank of Japan is expected to keep monetary policy steady on Thursday and predict that inflation will fall short of its 2 percent target for three more years, signaling that its massive stimulus will stay in place for the foreseeable future.
Given their dwindling policy tool-kit, BOJ officials have made clear that subdued inflation alone won’t trigger additional easing, and that the central bank will act only if risks threaten to derail Japan’s economic recovery.
But slowing global demand and simmering trade tensions have hurt Japan’s exports and business sentiment, putting the test to the BOJ’s projection the economy will keep expanding moderately.
With uncertainty over a scheduled sales tax hike in October also clouding the outlook, some analysts expect the BOJ to change its forward guidance in coming months to give markets more clarity on how long interest rates will remain very low.
“If the BOJ were to downgrade its inflation forecast, changing the forward guidance could be among options,” said Izuru Kato, chief economist at Totan Research.
“But the BOJ likely won’t do it this time,” because markets already expect any rate hike to be some time away, he added.
At a two-day meeting ending on Thursday, the BOJ is expected to maintain its short-term rate target at minus 0.1 percent and a pledge to guide long-term yields around zero percent. It is also expected to reiterate it will keep buying assets such as government bonds and exchange-traded equity funds.
In quarterly projections also due on Thursday, the BOJ may slightly cut its growth and price forecasts for the current fiscal year ending in March 2020, sources have told Reuters. It will also project inflation to move above 1.5 percent but fall short of 2 percent in fiscal 2021, they said.
Such projections will underscore a dominant market view that heightening risks and soft inflation will keep major central banks from whittling down crisis-mode policies any time soon.
Under forward guidance adopted last year, the BOJ pledged to keep rates very low for an “extended period” given uncertainties such as the impact of this year’s sales tax hike on the economy.
Some analysts say the BOJ could tweak the language to reassure markets that rates will stay ultra-low long after the tax increase takes place.
“The BOJ could extend its forward guidance and commit to maintaining current monetary easing at least through 2020,” said Hiroshi Ugai, chief Japan economist at JPMorgan Securities.
Ugai said the BOJ could make the tweak on Thursday, though most analysts expect any such change to happen later this year.
Despite some government steps to soften the tax blow, analysts polled by Reuters expect it will briefly knock the economy into contraction in the fourth quarter.
Years of heavy money printing have failed to fire up inflation to the BOJ’s 2 percent target and left it with little ammunition to fight the next recession.
Prolonged easing has also added to stresses on regional banks, already facing slumping profits due to an ageing population and an exodus of borrowers to big cities.
Under current projections, the BOJ expects core consumer inflation to hit 1.1 percent in the year ending in March 2020 and accelerate to 1.5 percent next year. That is much higher than projections in a Reuters poll of 0.7 percent inflation this fiscal year and 0.8 percent the following year.
(Reporting by Leika Kihara; Editing by Kim Coghill)
Source: OANN
This has become a monthly feature here a SchiffGold News – Russia buys more gold.
The Central Bank of Russia added another 18.7 tons of gold to its stash in March according to a press release last week. This boosts the country’s gold reserves to 2, 167.9 tons or 69,700,000 ounces. Gold now makes up about 18% of the Russian central bank’s reserves.
Through the first quarter of this year, Russia has increased its gold hoard by 56 tons. This continued a trend we saw throughout 2018. As a Bloomberg article earlier this month put it, “Vladimir Putin’s quest to break Russia’s reliance on the US dollar has set off a literal gold rush.”
Russia has been endeavoring to reduce its exposure to the dollar over the last several years by buying gold and selling off US Treasurys. Russian gold reserves increased 274.3 tons in 2018, marking the fourth consecutive year of plus-200 ton growth. In February 2018, Russia passed China to become the world’s fifth-largest gold-holding country. Over the last decade, Russia has quadrupled its bullion reserves, according to Bloomberg.
Special report on gold’s activity around the world.
Russia has also been divesting itself of US debt. In the spring of 2018, the Russians sold off nearly all of its US Treasury holdings. According to Bank of America analysts, the amount of US dollars in Russian reserves fell from 46% to 22% in 2018.
The pace of Russian gold accumulation has begun to outstrip the country’s domestic production. Russia ranks third in the world in gold production, and the central bank is the biggest buyer. Renaissance Capital chief economist Oleg Kouzmin told Bloomberg that given the geopolitical risks, the central bank will likely keep increasing gold’s share of reserves.
“Should it reach the limit for domestic purchases, I think the central bank will start to import gold.”
Russia is not the only country on a gold-buying spree.
China bought gold for the fourth straight month in March, adding another 11.2 tons of the yellow metal to its reserves, and other central banks have also been adding to their gold holdings. In total, the world’s central banks accumulated 651.5 tons of gold last year. The World Gold Council noted that 2018 marked the highest level of annual net central bank gold purchases since the suspension of dollar convertibility into gold in 1971, and the second highest annual total on record. Russia was the leading purchaser of the yellow metal in 2018. Central banks in Turkey and Kazakhstan were also big buyers. We even saw increases in gold reserves from two EU banks – Hungary and Poland.
There is a growing concern in many countries about over-dependence on the greenback. In a CNN interview last fall, French President Emmanuel Macron said European corporations and entities are too dependent on the dollar, calling it “an issue of sovereignty.” The EU even took steps to minimize the ability of the US to use the dollar as a foreign policy weapon. In September 2018, the EU announced plans to develop a special payment channel to circumvent US economic sanctions and facilitate trade with Iran.
Leo Zagami joins Owen via Skype to expose those that seek to control the world from the shadows.
Source: InfoWars
During the New Orleans Investment Conference, Peter Schiff participated in a panel discussion with Ben Hunt and Mike Larson. They talked about bubbles, booms and busts.
Hunt called it the “bubble of everything.” But he said the “gravitational force” created by all of the assets central banks have purchased over the last year have changed the “bubble-popping process.” That makes it hard to predict when things will actually start to deflate. He said it will take something the undermines the market confidence that central banks can bail us out. Hunt said inflation was possibly the pin that could prick the bubble.
Larson called it the “uber-bubble,” and he said he already sees some of the background concerns that have been simmering for a long time are starting to “bubble over.” (Pun intended.) He said the last two bubbles were high in amplitude, but limited to certain parts of the economy (dot-coms and housing). The current bubble isn’t as high in amplitude, but it’s broader-based. We see bubbles in stocks, high-yield bonds, housing (again), and commercial real estate, along with a lot of other assets you don’t hear as much about – such as art and comic books.
“I think the process of unwinding this is already beginning.”
Peter focused in on the cause of the bubbles.
“When you see rampant, wide-scale bad decisions, generally a central banker is behind it, and they have made a bad decision to create too much money and to artificially manipulate interest rates down.”
This creates distortions in the economy because interest rates are really nothing more than price signals.
“And like all prices, they need to be determined by the free market.”
Whenever the government – and central banks are really an extension of governments – price fixes something, it creates big distortions and malinvestments.
“We have had artificially low-interest rates for an unprecedented number of years at an unprecedented low rate. So, the mistakes that have been made during this time period dwarf the mistakes that have ever been made in any bubble in the past because the bubble is so much bigger.”
When a bubble finally bursts, it’s really just the free market trying to clean up the mess created by the intervention. The bigger the boom, the bigger the bust.
“The problem now is that the boom is so big that the bust will be catastrophic. And what’s going to make this bust different is that there is no bailout. There is no stimulus. It is impossible to reflate this bubble, because, as has been said, this is a bubble of everything. They can’t make a bubble go someplace else. It already is everyplace.”
Peter said the only place there isn’t a bubble is in gold. That means there is also a bubble in complacency and optimism.
“People are so drunk on all this cheap money, they think nothing can go wrong.”
As far as what pin will prick the bubble, Peter said there are all kinds of pins out there. The problem is that when you’re in a bubble, you can’t see the pins.
The panel goes on to discuss some of the specific manifestations of the bubbles and where they see trouble spots.
And Peter makes a pitch for gold, saying his 24 karat gold cufflinks will outperform the S&P 500 over the next five years. He pointed out that when they started popping the dot-com bubble, gold was under $300. It got as high as $1,900 in 2011.
“This game is not over. The fat lady hasn’t sung yet. When this final bubble pops, gold is going through the roof –I do think that by the time this bubble has run its course, you’ll be able to buy the Dow Jones for an ounce of gold.”
Owen Shroyer delivers an epic rant on how U.S. soldiers were disrespected at the southern border by the Mexican Army.
Source: InfoWars
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