Miercoles 19/08/15 Inflacion, Minutas del Fed

[Fenix]

One Trader's FOMC Take - "A Rate Hike Is Coming And It Is Not Priced In"
Submitted by Tyler D.
08/19/2015 - 09:29

A rate hike is coming. It is coming because the economy is not in crisis and zero rates are crisis rates, Bloomberg’s Richard Breslow writes. It is coming because the benefits of starting down the path to monetary policy normality are vitally important to the future health of the economy and restoring the Fed’s reaction function. The world can share the benefits and the costs. But one thing we do know, is that with all the hinting and polling and talk of trajectory, it is not priced in.


US Dollar Flash Crash Sparks Precious Metals Surge
Submitted by Tyler D.
08/19/2015 - 09:58

After yesterday's slamming efforts, precious metals are well bid this morning following the USD flash crash this morning. Silver has regained yesterday's losses and gold is hitting one month highs...

[Fenix]

China Rushes To Inject Hundreds Of Billions In Liquidity To Offset Yuan Intervention
Submitted by Tyler D.
08/19/2015 - 10:20

Now that the PBoC has created a situation where it’s forced to prop up the yuan via open FX ops just about as often as it’s forced to prop up the SHCOMP via China Securities Finance, concerns are growing about liquidity and a severe tightening of money markets, prompting the PBoC to inject hundreds of billions in emergency funding.



One Word Defines This Era: Stagnation
Submitted by Tyler D.
08/19/2015 - 11:27

If we call stagnation progress, what have we accomplished?

[Fenix]

Bitcoin Battered After "Governance Coup"
Submitted by Tyler D.
08/19/2015 - 11:56

Naysyers are warning that the recent plunge in Bitcoin prices - from almost $318 at its peak during the Greek crisis, to $221 yesterday - due to growing power struggle over the future of the cryptocurrency that is dividing its lead developers could spell the end of the cryptocurrency. On Saturday, a rival version of the current software was released by two bitcoin big guns. As Reuters reports, Bitcoin XT would increase the block size to 8 megabytes enabling more transactions to be processed every second. Those who oppose Bitcoin XT say the bigger block size jeopardizes the vision of a decentralized payments system that bitcoin is built and represents a "governance coup.". However, the turmoil in the price also coincides with some rather notable global macro events from Asia (where Bitcoin is extremely popular).


Hilsenrath Confirms Fed Confusion In Leaked FOMC Minutes
Submitted by Tyler D.
08/19/2015 - 13:57

"The Federal Reserve’s next policy meeting is four weeks away and officials show no clear sign of having settled on a decision about whether to raise short-term interest rates at that time."

[Fenix]

Stocks Soar Into The Green As Question Emerges: "Rate Hike Or QE4 First?"
Submitted by Tyler D.
08/19/2015 - 14:21

It appears that the Fed's cunning plan to hike rates so it can cut rates was just foiled once again.



No SDR For You: IMF Tells China To Wait At Least One Year Until Reserve Basket Inclusion
Submitted by Tyler D.
08/19/2015 - 12:28

If there was any confusion as to whether the recently devalued Chinese yuan would be landing in the IMF SDR basket on January 1, the Fund just cleared it up.

[Fenix]

10 Reasons Why The Fed Won't Raise Interest Rates
08/19/2015 14:45 -0400

Submitted by @RampCapitalLLC

1. China Hard Landing - Last week China decided to devalue their currency which brings into question the strength of the global economy.

2. Football - With football season kicking off, there are a lot of Fantasy Football lineups to be filled out. Paying attention to the draft is much more important than a 0.25% rise in short term interest rates.

3. Off The Highs - The market has been range bound almost the entire year. The S&P 500 recently had a couple of brief scares below 2100 but Janet (Yellen) is looking for 2150-2200 before a rate hike can even be put on the table (Update: $SPY just went below 200DMA). The US equity market is currently in the 3rd longest bull market ever. Janet will not settle for anything less than gold (which is now also worthless).

4. The Plague - With a couple of cases of people catching The Plague in California and Colorado, Janet doesn't want to further sicken the market by raising interest rates. See last year's Ebola scare.

5. Commodities and Inflation - Prices of most commodities have been hammered the past few years (still waiting to see this tax cut passed on to the consumer). This weakening of commodity pricing could be bad news if it is a sign that global demand is also weakening. The Fed has also been keeping their eye on inflation (deflation), but we haven't hit the magic 2% inflation target since 2012.
http://www.advisorperspectives.com/dsho ... -Index.php

6. Donald Trump - With Donald Trump leading the polls and dominating the news, this gives Janet the perfect distraction to kick the can until after the 2016 election. An even better distraction would be for Janet to announce her plans to run for President. I'd vote for her, but only if she agrees to nominate me as Treasury Secretary.

7. IMF Warning - Back in June, the International Monetary Fund (IMF) warned about potential risks of a Fed tightening. At this point, the Fed's only job is to fall in line and listen to what the IMF says. If they can "fix" Greece, I'd swallow my pride and listen to them too.

8. Addiction - We are addicted to free money (and fast food). Once an addict, always an addict. From the federalreserve.gov website: "Low interest rates help households and businesses finance new spending and help support the prices of many other assets, such as stocks and houses." Key emphasis on stocks.

9. Labor Market - The Fed won't raise rates because we haven't hit our full unemployment (moving) target.

10. The Ghost of 1937 - I know it sounds super scary. Anyways, about 80 years ago the Fed tried to pull off an unsuccessful rate hike after the Great Depression causing another recession and a 50% market decline. Good enough for me. If it happened 80 years ago it MUST be exactly the same today because nothing has changed since then.

* * *

Bonus: In case I'm wrong and the Fed does raise rates at least we know they can always lower them again when things turn to shit.

[Fenix]

Copper Breaches $5000, Breaks Below 15-Year Trendline
Submitted by Tyler D.
08/19/2015 - 15:10

While the PBOC was literally everything in its power to keep the Shanghai Composite above its 200-day moving average as some sign of 'stability', it forgot about that other proxy of overall Chinese economic health: copper. And just as we warned previously, ever since the CCFD crackdown in 2012, copper has been tumbling and more crucially has just broken a 15-year trendline. The plunge in copper means almost one in five mines globally is losing money.



The Path To Rate Normalization Will Not Come Without Pain
Submitted by Tyler D.
08/19/2015 - 15:40

Market pundits robotically suggest that the Fed should not raise rates because inflation is too low. Well, if zero rates and $4 trillion in asset purchases did not boost inflation, do they really believe that another few months at zero rates will do the trick? Some Fed researchers are actually asking whether policies have become counter-productive to their dual mandates. The path to rate normalization will not come without pain. On the contrary, there will be a difficult period, potentially even a damaging recession. Fed doves will likely feel vindicated. However, while a period of hardship is likely inevitable, purging both bad businesses and market speculation is vital for long-run economic health and will allow more productive businesses to evolve over time.

[Fenix]

Echoes Of 1997: China Devaluation "Rekindles" Asian Crisis Memories, BofA Warns

Submitted by Tyler D.
08/19/2015 18:29 -0400

In "Currency Carnage: Gross Warns On 'Fakers And Breakers'; Morgan Stanley Tells Asia To Watch Its REER," we outlined which Asia ex-Japan economies faced the biggest risk from China’s decision to devalue the yuan.

Broadly speaking, a weaker yuan will likely cause regional economies to suffer a loss of export competitiveness in combination with decreased demand for their products on the mainland.

Even before the latest shot across the bow in the escalating global currency wars, EM FX was beset by falling commodity prices, stumbling Chinese demand, and a looming Fed hike.

Now, the situation is immeasurably worse.

We got a preview of what is perhaps in store when, on Tuesday, Indonesia reported that trade had collapsed in July, while Friday’s meltdown in the ringgit as well as Malaysian stocks and bonds underscored just how fragile the situation has become. And while, as Barclays notes, "estimating the global effects China has via the exchange rate and growth remains a rough exercise," more than a few observers believe the effect may be to spark a Asian Financial Crisis redux.

For their part, BofAML has endeavored to compare last week’s move to the 1994 renminbi devaluation, on the way to drawing comparisons between what happened in 1997 and what may unfold in the months ahead.

"On 1 Jan 1994, China unified its exchange rate by bringing the official in line with swap market rate, devaluing the RMB official rate by nearly 50% (from 5.8 to 8.7 RMB/USD)," BofA reminds us, adding that because only a fifth of transactions occurred at the official rate, the effect was a devaluation on the order of 7%. Because the bank (and they aren’t alone here) ultimately sees the yuan weakening by 10% against the dollar this time around, "the magnitude of devaluation [will] effectively be larger than the 1994 move."

As for the fallout, BofA is "concerned about the competitive impact from China’s devaluation on rest of Asia, as the devaluation comes on top of [1] China’s deflation; [2] China’s growing market share in key third markets; and [3] Asia’s sluggish exports." As the following charts and subsequent commentary make clear, China was already taking share and now, that dynamic could accelerate and demand, already depressed, could be reduced further by the weaker yuan:

China’s market share of US and EU’s imports was already expanding, pre- devaluation (Chart 5 & Chart 6). China was already eating into rest of Asia’s market share, even with an anchored RMB. China’s market share of both US and Europe’s imports generally rose strongly from 2000 – 2010, before moderating during the GFC but has since picked up. China now accounts for about 20% of US imports and 7% of Europe’s imports. In contrast, ASEAN’s share of US imports has declined to 4.4% over 2011-14 from 7% in 2000, before recovering to about 5% in the first half of this year.





In Europe, ASEAN’s share has declined to about 1.8% in 2008 from 2.6% in 2000, before picking up to about 2.4% this year. The IMF Regional Outlook also highlights that China, a major player in Asian supply chains, is capturing an increasingly larger part of the chain as domestically sourced intermediates (from either locally owned producers or subsidiaries of foreign firms) increasingly replaced imported intermediate goods. China’s “on-shoring” is thus one more reason why rest of Asia’s exports is struggling.



Northeast Asia economies will likely face greater competitive pressures from China’s devaluation given stronger trade linkages and overlapping exports. Trade links with China are highest for the Northeast Asian economies: Taiwan (16% of GDP) and Korea (10%). More than a quarter of exports from Korea and Taiwan are destined for China. China’s lower tech exports also compete more closely with Korea and Taiwan. Almost a fifth of Japan’s exports are for China. For Southeast Asia, only 10% of exports go to China, with Malaysia and Singapore having a larger share. But ASEAN commodity exporters (Indo, Mal and Thai) will also be hit if China’s devaluation reduces import demand and intensifies the deflationary pressures on commodity prices.

BofAML's conclusion is that China's devaluation has added "another layer of risk and uncertainty for the rest of Asia, on top of the looming Fed funds rate hike cycle."

"Asia," the bank's FX strategy team continues, "is already not in a good place (compared to past Fed rate hike episodes), as exports are contracting, domestic demand is sluggish and monetary policy is out of sync with the Fed," which means that between the weaker RMB and a Fed that will eventually have to try and prove that contrary to what the St. Louis Fed's Stephen Williamson says, an exit from ZIRP is actually possible, a 1997 replay may indeed be in the cards.

[admin]

http://lta.reuters.com/article/business ... 9820150819

[admin]

Rebaja de bolsa peruana provocaría salida de capitales por hasta 5.000 mlns dlrs: BVL

LIMA (Reuters) - El Gobierno peruano está preparando medidas para evitar que la bolsa local sufra un recorte de calificación por parte del proveedor del índice MSCI, algo que podría ahuyentar capitales de hasta unos 5.000 millones de dólares, dijo el miércoles el presidente de la Bolsa de Valores de Lima, Christian Laub.

La bolsa limeña se derrumbó más de un 5 por ciento el viernes tras la decisión del proveedor del índice MSCI de consultar a los inversores sobre una rebaja en la calificación de la plaza bursátil local a la condición de mercado de frontera desde el actual nota de mercado emergente.

"Si nos dicen que estamos en el mercado frontera nos tomaría entre 7 a 10 años volver al mercado emergente, por eso la gravedad de la situación y el llamado de acción a nivel público y privado", dijo Laub, quien explicó que buscará reunirse con MSCI la próxima semana para plantearle que revierta su consulta.

El jefe de la bolsa local explicó que el Gobierno y el sector privado están trabajando en un conjunto de medidas para generar una mayor liquidez de las acciones locales y así evitar una calificación menor del mercado bursátil local.

Laub dijo que las medidas, que incluyen facilidades para la venta y préstamos de valores, la emisión de nuevos instrumentos, y un mejor tratamiento tributario para los participantes en la bolsa, serán presentadas a los ejecutivos de MSCI.

"Las repercusiones (de un bajo perfil de la bolsa) se harán sentir en el tipo de cambio y tasas de interés, factores que no ayudan a la economía en un contexto internacional cada vez más complejo", afirmó el funcionario.

En medio de las preocupaciones por la salud de la economía global, el índice selectivo de la bolsa limeña registra una baja de 29,4 por ciento en lo que va del año, mientras que el índice general acumula un retroceso del 28,6 por ciento.

Laub dijo que la bolsa coordina las medidas con el Banco Central, el ministerio de Economía, el Congreso, gremios empresariales y el regulador del mercado de Valores de Lima.

(Reporte de Ursula Scollo; editado por Hernán García)

[admin]

El banco central de China inyecta 110.000 millones de yuanes al sistema bancario

Por
Grace Zhu

Miércoles, 19 de Agosto de 2015 17:10 EDT
BEIJING (EFE Dow Jones)--El banco central de China inyectó el miércoles 110.000 millones de yuanes (US$17.180 millones) en el sistema bancario del país a través de su línea de crédito a medio plazo.

El Banco Popular de China dijo en un breve comunicado que inyectó los fondos a través de 14 bancos. La línea de crédito tiene un vencimiento a seis meses y una tasa de interés del 3,35%.

El banco central explicó que esta inyección de liquidez pretende alentar a los bancos a apoyar a los pequeños negocios en China y al sector agrícola.

En julio, el banco central inyectó 250.000 millones de yuanes en el sistema bancario a través de su línea de crédito a medio plazo.

Al mismo tiempo, China inyectó un total de US$93.000 millones en dos bancos estatales de política en el marco de una amplia reforma que busca dar a los bancos más poder para financiar proyectos de infraestructuras y de exportación claves ante la ralentización de la economía nacional, anunció el miércoles Financial News.

El Banco de Desarrollo de China recibió una inyección de US$48.000 millones, mientras que el Banco de Exportaciones y de Importaciones de China obtuvo US$45.000 millones procedentes de las reservas de divisas del país, dijo el periódico, que está respaldado por el Banco Popular de China.

El rotativo explicó, además, que los fondos fueron transferidos por una compañía de inversión creada por el regulador de las divisas chino.

En abril, el Consejo de Estado, el máximo órgano de gobierno del país, reorganizó los bancos estatales de política o desarrollo con el fin de mejorar su capacidad para apoyar nuevas iniciativas de infraestructuras en el extranjero y para respaldar la economía nacional, que se ha estado desacelerando.

El banco central ha estado liderando el plan de reforma de estas entidades, según el periódico.

El diario, citando a fuentes anónimas, dijo que estos fondos mejorará la fortaleza del capital de estos dos bancos, lo que les permitirá promover activamente un crecimiento estable y mejorar la calidad de vida en el país.

[admin]

Los mercados de EE.UU. vuelven a sufrir por la volatilidad en China

ENLARGE
Photo: Zhao Yingquan/Zuma Press

Por
Saumya Vaishampayan
Miércoles, 19 de Agosto de 2015 13:39 EDT
NUEVA YORK (EFE Dow Jones)--La renta variable estadounidense registra caídas el miércoles, ya que las persistentes y violentas oscilaciones de los mercados chinos están lastrando a los mercados de todo el mundo.

El Promedio Industrial Dow Jones pierde un 0,8%, o 143 puntos a 17.365 puntos hacia el mediodía, el S&P 500 restaba un 0,7% o 16 puntos a 2.081 puntos y el Nasdaq Composite cedía 34 puntos, o 0,6% a 5.025 puntos.

El tono bajista comenzó en Asia, donde las acciones chinas han pasado la mayor parte de la sesión en territorio negativo, aunque a última hora de la jornada se recuperaron y el índice Shanghai Composite cerró con un avance del 1,2% tras haber llegado a caer hasta un 5% en algún momento del día. El repunte se produjo después de que un grupo de empresas desvelara que entre sus principales accionistas había firmas estatales, lo que incrementó la confianza de los inversionistas en que el gobierno está actuando para apoyar al mercado.

No obstante, los inversionistas advierten que no hay que dar demasiada importancia a los movimientos de las acciones en Estados Unidos porque los volúmenes de negociación son más bajos de los habituales debido a las vacaciones veraniegas.

La atención en lo que queda de jornada se centra en la publicación de las actas de la última reunión de política monetaria de la Reserva Federal, en las que podrían darse pistas sobre la probabilidad de que se incrementen las tasas de interés en septiembre.

--Tommy Stubbington contribuyó a esta nota

[admin]

Euro (EUR/USD) 1.1133 0.0013
Yen (USD/JPY) 123.97 0.17
Pound (GBP/USD) 1.5682 0.0003
Australia $ (AUD/USD) 0.7347 -0.0001
Swiss Franc (USD/CHF) 0.9664 0.0009
WSJ Dollar Index 88.63 0.01
GOVERNMENT BONDS1:43 AM EDT 8/20/2015
PRICE CHG YIELD
U.S. 10 Year 1/32 2.122
German 10 Year 9/32 0.619
Japan 10 Year 3/32 0.366
FUTURES1:34 AM EDT 8/20/2015
LAST CHANGE % CHG
Crude Oil 40.61 -0.19 -0.47%
Brent Crude 46.88 -0.28 -0.59%
Gold 1138.6 10.7 0.95%
Silver 15.420 0.198 1.30%
E-mini DJIA 17293 8 0.05%
E-mini S&P 500 2074.00 1.30 0.06%