12 Years of VP vs Noise
Sharing the ideas and experiences that have influenced our work
Our Chief Editor was on Spanish television yesterday to talk about Spain's economy and the viability of a Catalan state. You can see the interview here (in Spanish).
Some cheer was reported when UK industrial production rebounded a stronger than expected 2.9% MoM in July. Manufacturing output also rose a stronger than expected 3.2% MoM. The longer-term picture, however, remains bleak.
Our Head of Research Claus Vistesen was on Bloomberg TV this morning to talk about the significance of last week's ECB meeting and the unveiling of the new bond purchasing programme.
The US economy is currently marked by weak manufacturing, but with a housing market showing signs of a sustainable recovery. However, the Fed is focused on the job market, leaving the option open for more quantitative easing if it doesn’t begin to materially improve (which is highly unlikely in the near term)
Variant Perception recently put out a report to the public about Australia, why the economy and currency are vulnerable and why the RBA is likely to cut rates further. The report has gathered a lot of attention from various official media outlets and blogs.
In principle, a negative current account should not be a problem for Indonesia given the economy’s strong demographic profile, but the slump in external demand will expose the strong credit growth in the domestic economy
The situation in Ukraine is once more coming to a head, as it did so in 2008 and 2009. To avoid a hard default, a critical outflow of foreign funds, and a complete depletion in the central bank’s reserve assets, Ukraine should drop the peg (or widen the trading band) to the USD and devalue its currency.
Core European government bond yields continue to fall and are now outright negative in many countries. Traditionally, this would suggest a stern message from the fixed income market that deflation is around the corner.
But there could be other explanations.
Variant Perception's Editor Simon White was on Bloomberg Television Friday to talk about the funding needs of Spanish banks.