10 Jul 2013
Flash: Volatility reflect concerns over central banks – NAB
FXstreet.com (New York) - “Recent volatility in equity and currency markets reflects concerns over central bank policy – as does uncertainty over the pace at which the Fed withdraws its QE stimulus,” notes the NAB Research Team.
As such, the impact of the Bank of Japan’s monetary expansion and how the Chinese authorities will manage the transition to lower and better balanced growth without triggering instability in the financial sector.
Global equity markets have come under downward pressure, but the latest data on activity is slightly more positive. Business sentiment about current conditions has picked up in advanced economies and growth in global industrial output is faster. Increasingly concerns focus on the extent to which Chinese growth is slowing. Conversely, there are signs of improved conditions in the previously weak Japanese and UK economies. “While year-average 2013 global growth is predicted to be 3%, just below last year’s pace, we are still expecting an upturn toward the end of the year that takes 2014 growth back to around 3.75% (a touch below trend).“ the team adds.
As such, the impact of the Bank of Japan’s monetary expansion and how the Chinese authorities will manage the transition to lower and better balanced growth without triggering instability in the financial sector.
Global equity markets have come under downward pressure, but the latest data on activity is slightly more positive. Business sentiment about current conditions has picked up in advanced economies and growth in global industrial output is faster. Increasingly concerns focus on the extent to which Chinese growth is slowing. Conversely, there are signs of improved conditions in the previously weak Japanese and UK economies. “While year-average 2013 global growth is predicted to be 3%, just below last year’s pace, we are still expecting an upturn toward the end of the year that takes 2014 growth back to around 3.75% (a touch below trend).“ the team adds.