http://www.fxstreet.com/fundamental/market-view/weekly-observatory/http://www.fxstreet.com/fundamental/http://mediaserver.fxstreet.com/images/fxstreet-provider-logo1-en.gif7http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-11-21.htmlFinancial strains are spreading to all Eurozone countries excluded Germany European sovereign crisis woe has continued escalating. The poor demand at all European governments’ debt auctions this week suggested that the lack of confidence is spreading to all Eurozone countries, with the exception of Germany. Moreover, Fitch rating agency has warned further contagion from Europe’s debt crisis will pose a risk to American banks. The new Italian governments of “technicians” did not calm riskMon, 21 Nov 2011 05:26:50 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-11-21.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-11-14.htmlNew coalition governments may have limited scope of actions Political turmoil has been in the spotlight in Greece and Italy. Finally, Greece has appointed a new Prime Ministry, Lucas Papademos (a former European Central Bank vice president), the best possible candidate, but the new coalition government has a difficult task ahead to implement reforms as elections will be held very soon, in February 2012. The pressure coming from Europe (and the IMF) remains high, as Greece has to implementMon, 14 Nov 2011 13:36:11 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-11-14.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-11-07.htmlInitial euphoria provided by European Packaged has faded There has been a pullback in risk-on mood in financial markets as the initial euphoria, provided by the European package, has faded. Moreover, the absence of any commitment to invest in the European SPV from either Japanese or Chinese governments brought questions about the ability of this product to attract investors. Furthermore, the IMF’s statement after the G-20 meeting did not include any reference supporting the European SPV.Mon, 07 Nov 2011 06:03:55 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-11-07.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-31.htmlEU plan and US growth lift sentiment Risk premium eased sharply and risk assets rallied on the back of a positive surprise from the EU summit (after expectations have turned rather pessimistic earlier this week). The European Council delivered measures, which will help to underpin sovereign funding markets, achieve a sustainable solution for Greece, strengthen banking sector and move toward a further integration in the European Union. Moreover, better-than-expected data in the US (especiallyMon, 31 Oct 2011 09:50:50 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-31.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-10.htmlRisk aversion continues to ease Risk assets rallied during the end of the week helped by central banks’ decisions and expectations of coordinated actions to recapitalize the European banking sector. Eurozone officials might be about to announce a coordinated recapitalization of the European banking sector In a context of a continued marked vicious circle between banks and sovereign bonds, and with financial risk spreading to other economic areas, comments from European officials suggest thatMon, 10 Oct 2011 06:59:13 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-10.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-10.v02.htmlMarkets volatile, despite reassuring data Asian markets continue to fluctuate in line with global trends. For the week Asian markets ended up, on hopes that European leaders are getting closer to a resolution to their sovereign debt and banking woes, as the European Central Bank and Bank of England announced new liquidity measures on Thursday (see Markets). That said, markets remain on edge, as seen in rising CDS spreads and concerns about the sustainability of China’s growth (Chart 1). TheseMon, 10 Oct 2011 07:15:32 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-10.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-03.html“Risk-on” has increased but uncertainties have not disappeared The risk premium has declined slightly this week after increasing strongly in previous weeks. The US picture was more benign this week, while Europe is close to approving EFSF amendments which would increase its lending capacity from €250bn to €440bn, allowing the fund to purchase government debt in the secondary market and recapitalize banks. Europe’s next step to restore confidence is leveraging the EFSF The pending increase inMon, 03 Oct 2011 08:22:06 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-10-03.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-09-26.htmlRecent economic indicators and reports intensified worries about the global growth outlook. Renewed pessimism was driven by a bleaker US outlook signalled by the Fed (“significant downside risks” cited in FOMC’s statement), and weaker survey results for China and the Eurozone in September. Concerning the latter, flash PMIs were weaker than expected, with readings from core countries (France and Germany) lower than anticipated. Although the Fed did not disappoint and delivered the alreadyMon, 26 Sep 2011 06:38:13 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-09-26.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-09-09.htmlSentiment among investors has slightly improved this week, supported by more benign economic data in the US and in Germany, the positive stance of the German Constitutional Court on the Greek bail-out, the fiscal measures adopted in Italy and the expectations of global policy coordination. In the US, ISM-Services increased to 53.3 in August, above July’s level, suggesting that the service sector is continuing to expand, while industrial production and retail sales came in much better thanFri, 09 Sep 2011 07:10:41 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-09-09.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-08-15.htmlThe recent spike in risk aversion reflects a crisis of confidence triggered by mounting fears of a global economic downturn together with ongoing EZ debt woes. The lack of confidence is driven by: a) doubts concerning the room to fight downside risks to growth and avoid another recession in a context of a recovery that has yet to prove self-sustainable, and b) a deepening distrust in policymakers’ ability to stop spreading contagion in EZ debt markets and avoid a situation that threatens toMon, 15 Aug 2011 09:40:15 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-08-15.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-08-08.htmlThe risky assets sell-off worryingly intensified this week in a context of widespread crisis of confidence, even though the US is no longer in the brink of default – an agreement on the debt ceiling was reached on Monday. Increasing risks of a much weaker growth outlook (see highlight) have added to concerns over US fiscal sustainability and especially over fiscal consolidation in the EZ which would be even much more challenging. In an attempt to halt sovereign debt contagion – Spanish andMon, 08 Aug 2011 05:59:49 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-08-08.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-08-01.htmlDoubts about the implementation of the EFSF flexibility have arisen as the German government rejects a ‘carte blanche’ for widespread purchases on the secondary market. Meanwhile, emerging economies at the IMF are reluctant to pump a large sum of money into another Greek bailout. Furthermore, as investors are mulling over the current PSI, S&P has warned of a second round of restructuring in Greece. All in all, more steps are needed to address the European problem. On the other hand, the USMon, 01 Aug 2011 08:39:24 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-08-01.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-07-25.htmlGlobal risk premiums are currently determined by two threatening crises: 1) the European sovereign debt crisis and 2) a necessary raising of the US debt ceiling (see highlight). This week brought encouraging compromises to address the first issue, while we’re still waiting for a resolution on the second one. The EU council summit on 21 July took steps towards dealing with the debt crisis in the periphery that surprised on the upside. Europe is reducing rates and extending maturities for loansMon, 25 Jul 2011 05:40:56 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-07-25.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-07-18.htmlRush to reach agreements Financial strains in the European periphery have spread to Italy. Neither the approved fiscal austerity package nor the fact that the Italian Treasury managed to sell bonds, and thus meet its allotment’s target (EUR5bn), has reduced tensions. Further contributing to tensions, Moody’s downgraded Ireland’s debt credit rating to Ba1 from Baa3, citing the same reasons as used last week in Portugal’s downgrade (the eventual need of a second aid package with private sectorMon, 18 Jul 2011 06:06:17 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-07-18.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-07-04.htmlThe Greek government finally won enough parliamentary support to pass the Medium-Term Fiscal Strategy Program,me, thus giving the government the green light to implement a EUR78bn package of tax increases and asset sales (see highlight). Financial markets rallied on the positive news coming from Greece. European peripheral sovereign spreads have tightened across all maturities; the Spanish 10 year bond spread against the German bond has tightened 48bp this week. Nevertheless, for uncertaintiesMon, 04 Jul 2011 10:14:30 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-07-04.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-04-04.htmlThe recent data continues to point to strong economic activity in the main economic areas, despite the current uncertainties. Economic growth in Latin American remains resilient while in Asia there are some signs of moderation in growth, pointing to a transition to a soft landing in China. In the eurozone (EZ) figures showed that activity gained momentum in 1Q 2011. However, growth rates may be peaking in the EU. In the US the US ADP private employment report, jobless claims and non-farmMon, 04 Apr 2011 05:30:58 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-04-04.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-28.htmlThe EU Council summit of 24-25 March has confirmed the key decisions taken at previous meetings to create a permanent rescue fund (ESM) with an effective lending capacity of €500 bn, and allows it to buy bonds in the primary market under strict conditionality. Perhaps the door has been opened to more flexibility than expected, although it is not clear how this could be used (see highlight). The framework for prevention of future crises seems robust, but the EU seems to have avoided directlyMon, 28 Mar 2011 05:48:52 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-28.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-21.htmlCoordinated efforts The devastating earthquake and tsunami that has struck Japan has increased financial markets’ uncertainty, reducing appetite for risky assets. The cost in terms of human lives and damage is likely to be greater than the real impact on the Japanese GDP, as long as the there is no nuclear contamination (see highlight). G-7 countries have agreed to coordinate currency intervention to prevent excessive appreciation of the yen. In our view, the negative market impact should fadeMon, 21 Mar 2011 06:05:17 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-21.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-14.htmlSpreads between “periphery” and core interest rates have been widening once again this week on increasing worries that a “comprehensive solution” for the financial stability framework to address the Eurozone debt crisis is not ambitious enough. With the likely lack of progress during this week’s Euro Summit (which is taking place while closing this note), it will be crucial to reach a consensus at the European Summit on March 24-25. Moreover, scepticism about the toughness of the scenarioMon, 14 Mar 2011 06:25:10 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-14.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-07.htmlActivity data released this week continued to show a more upbeat outlook at the beginning of the year than previously anticipated in both the US and the Eurozone. In the US, ISM surveys showed that growth is accelerating in the manufacturing and services sectors. Other data also showed an improvement in the US labour market. In Europe, the manufacturing and services PMI suggests that economic momentum picked up in Q1, while January retail sales showed that household spending strengthened inMon, 07 Mar 2011 05:38:00 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-03-07.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-02-21.htmlThe latest inflation data confirm the short-term inflation pressures. Nonetheless, what matters to central banks is the medium-term outlook and there are no signs of deterioration. In other words, as long as inflation expectations remain well-anchored, central banks in DM can maintain their loose monetary policies for longer, as second-round effects on inflation are small. The UK CPI rose to 4% y/y in January. Moreover the BoE inflation report also showed that inflation remains inMon, 21 Feb 2011 05:38:27 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-02-21.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-02-11.htmlStrong economic indicators and rising inflation have led to more monetary tightening in theregion. China has set the tone with its aggressive tightening campaign, marked this week by another interest rate hike (the third since October) and talk of higher reserverequirements (see Highlights). At the same time, prospects for a faster recovery in the USand rising yield there are leading to a selloff from some of the region’s equity markets, which are weighing on otherwise appreciating AsianFri, 11 Feb 2011 11:03:54 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-02-11.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-02-07.htmlEconomic momentum is improving In the US, domestic demand seems to be gathering momentum as the services index and consumption expenditures showed solid growth again. The payrolls figures released today indicate that the U.S. labor markets remain weak despite strong recovery in 4Q10 and 1Q11, suggesting that the positive trend in domestic demand has not consolidated yet. On the other hand, in the Eurozone there is not clear evidence that foreign demand growth is dragging up domesticMon, 07 Feb 2011 06:20:02 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-02-07.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-31.htmlThe outcome of the greater consensus at a European level is a positive trade-off between core European countries ensuring the euro’s stability and fiscal consolidation in peripheral countries in return for this. European, German and French authorities are closer to reinforcing the EFSF, but with a high conditionality. In this context, next week the Zapatero-Merkel meeting and the European Council meeting will take place at the right moment. Spain has done part of its homework: the Cabinet hasMon, 31 Jan 2011 06:03:06 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-31.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-24.htmlStrong Growth in Emerging Markets Strong domestic growth in Emerging markets (EM) and rising commodity prices are lifting inflation expectations, paving the way for the interest rates normalization process. In some countries this process has already started: China, Hong Kong, Korea, Singapore and Brazil. In our view, policymakers across Asia and LatAm countries will be mainly focused on controlling inflation, and other policies will likely be implemented in order to avoid exchange rateMon, 24 Jan 2011 06:00:30 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-24.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-17.htmlCommodity prices are behind recent inflation spikes, not only in Europe but also in the US and Emerging Economies. In Europe, the ECB echoes this environment and has accommodated its language, more hawkish than expected, and also emphasizes that they see the rise in inflation as transitory. We focus on this scenario, where core inflation remains slightly above 1%. In the US core inflation remains well below Fed’s mandate. Meanwhile, in emerging economies with stronger growth, concerns overMon, 17 Jan 2011 07:34:52 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-17.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-17.v02.htmlRising inflationary pressures, especially from food and commodityprices, has rippled through markets and generated new policy responses. Both Thailand(expected) and Korea (unexpected) hiked interest rates this past weekciting inflationary pressures (Chart 1). Korea and Indonesia also announced administrative and supply-side measures to curb inflation (see Highlights).Meanwhile, Singapore announced further measures to contain rising housing prices, including new stamp duties and higher downMon, 17 Jan 2011 07:53:09 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2011-01-17.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-24.htmlChanges in Germany’s approach to the resolution mechanism, toward greater European integration makes it more likely that a coordinated solution will be achieved in the next European Council Meeting. In our view, this makes the worst case scenario for Europe less likely and prevents a significant additional increase in the European risk premium. The EU intends to launch its first bond issue at the beginning of January, which will be a good reference for the market to track sovereign risk. ShortFri, 24 Dec 2010 06:00:09 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-24.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-21.htmlSentiment improves as financial market tensions ease in Europe The past week was marked by strong gains in regional stock and currency markets. Improving sentiment in the US on fresh strong (though still mixed) indicators, and an easing in worries over Europe’s sovereign debt crisis bolstered risk appetite, leading to inflows to higher-yielding assets across the region. Also bolstering sentiment was the announcement this past weekend by the People’s Bank of China that it will allow greaterTue, 21 Dec 2010 09:35:10 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-21.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-20.htmlAs expected, the European Council took minimal decisions on Friday by approving a treaty amendment whereby the EFSF will be approved by January 2013 by simplified procedure and operative by June 2013. In a further step to calm down the financial markets, the ECB announced that it will increase its subscribed capital by €5 billion in three years to €10.76 billion. In our view this decision gives the central bank more margin to buy bonds and reduce tensions. Additionally, the more open attitudeMon, 20 Dec 2010 06:33:17 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-20.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-06.htmlMon, 06 Dec 2010 07:07:35 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-12-06.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-11-22.htmlThe European Union is forcing the Irish government to accept an aid package to finance its banking system. In doing so the EU is trying to act in advance in order to stop a possible contagion to other countries like Spain that could prompt an increase in the systemic risk premium. Auction results this week have shown that Spanish debt found demand. But in our view, in order for an EU aid package to act as a firewall it should be fast, covering Portugal. Moreover, indebted states shouldMon, 22 Nov 2010 13:41:42 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-11-22.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-11-15.htmlAfter the G-20 summit failed to agree over trade imbalances, exchange rates and financial regulations, investors will likely turn their attention on domestic issues. Meanwhile, in the US, in a relatively less busy week, economic releases were better-than-expected. In Europe 3Q GDP grew 0.4% q/q slowing from the 1% q/q pace in 2Q. This preliminary data suggests a better performance of domestic demand, pointing to a more sustainable recovery. Nonetheless, earlier this week, mainly two events inMon, 15 Nov 2010 08:53:28 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-11-15.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-11-02.htmlGradual approach to QE2 Over the past few weeks US economic data has been validating that a double-dip is not the most probable scenario. Albeit at low levels, the housing sector seems to be stabilizing, and more importantly 3Q GDP grew at a slightly faster pace than in 2Q. Yet, unemployment will likely remain at 9,6% which is too high for the Fed. Thus, the FOMC will most likely announce renewed monetary easing in its policy meeting next week. The key question is what approach to quantitativeTue, 02 Nov 2010 11:52:10 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-11-02.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-09-07.v02.htmlMarkets revive, backed by positive regional indicators Asian markets were on the upside over the last week, encouraged by strong regional indicators and improved global sentiment. China’s PMI and 2Q GDP for Australia underscore Asia’s economic vitality China posted a better-than-expected August PMI (see Highlights). Moreover, 2Q GDP growth in Australia also beat expectations (3.3% y/y, consensus: 2.8%), as domestic and external demand improved. That said, Korean exports fell in August (seeTue, 07 Sep 2010 08:29:59 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-09-07.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-09-07.htmlU.S. remains the focus... After a summer where the concern about the growth of developed countries (especially US growth), has been on the forefront, markets awaited Bernanke´s words at the Jakson Hole meeting. The chairman said that the Fed is ready to do whatever it takes to support the economy if growth prospects deteriorate significantly. Still, while he remarked that the economy has lost track, he considers that growth is likely to pick up next year. Macro data this week was better thanTue, 07 Sep 2010 07:57:15 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-09-07.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-31.v02.htmlThe stream of macro data during the past few weeks, specially the later one, is leading global markets to price that the US growth in 2H10 will turn out to be worse than initially expected. On this point, the probability of an abrupt halt, albeit still low, is also increasing. Some demand components, mainly residential and non-residential investment and employment, are evolving below our expectations thereby suggesting an alarming weakness which preludes even darker clouds on the horizon.Tue, 31 Aug 2010 13:31:32 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-31.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-31.htmlAsian growth momentum has lost some steam in the third quarter, but the extent of the slowdown is modest. Financial markets have been weighted down by rising global risk aversion. Signs of moderation in growth, but pace is still brisk Second quarter GDP figures for the Philippines’s (7.9% y/y) and Thailand (9.1% y/y) were  brisk, beating beat expectations. However, July indicators point to some moderation. Taiwan’s industrial output slowed (from 24.3% y/y in June to 20.7% y/y in July), asTue, 31 Aug 2010 13:21:48 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-31.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-17.v02.htmlAsian markets unnerved by US spillovers Signs of a weakening US growth outlook dragged Asian markets down over the past the week. The deterioration in sentiment was exacerbated by indicators of slowing growth and domestic demand in China, even though the data were in line with expectations. Rising risk aversion has led to a steep strengthening of the Japanese yen, which benefits given its safe haven characteristics, with officials beginning to express concern about the impact on Japan’sTue, 17 Aug 2010 12:37:01 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-17.v02.htmlhttp://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-17.htmlRisk aversion increases Recent releases continue to tell a story of strong growth in emerging economies, with activity surprising positively in Eastern Asia while in China July’s figures are consistent with our soft-landing scenario. In advanced economies, the readings are slightly different, with Germany beating expectations on the back of strong exports, while in the US the labour market confirms the moderation through H2. Next week, the ZEW index will be the first German soft data forTue, 17 Aug 2010 12:23:55 GMThttp://www.fxstreet.com/fundamental/market-view/e.economicos@bbva.bancomer.com (BBVA Bancomer)http://www.fxstreet.com/fundamental/market-view/weekly-observatory/2010-08-17.html