Global economy unsettled by trade policy turbulence - NAB


In view of the analysts at National Australia Bank, the global outlook has deteriorated.

Key Quotes

“Financial markets hit a pothole in May following an escalation of the US-China trade dispute and the short-lived US threat to raise tariffs on imports from Mexico, although more dovish expectations around central bank policy have helped support share markets.”

“NAB has revised down its forecast for the US Fed funds rate; we now expect it will be 50bps lower by the end of 2019 (previously we had expected no change) although the risk is that there will be more cuts rather than fewer.”

“The latest data confirm that major AE growth strengthened in Q1. However, this is unlikely to be sustained and we expect growth to ease over the rest of the year. This is mainly due to a fading impact from last year’s US fiscal stimulus, the impact of trade tensions, ongoing Brexit uncertainty and the planned increase in Japan’s Value Added Tax later in the year.”

“Emerging market (EM) economies are more trade exposed than the AEs and therefore the increase in trade tensions between the United States and China are a negative.”

“We have again lowered our global growth forecasts – to 3.2% in 2019 (from 3.3%) and to 3.3% in 2020 (from 3.4%) – due to an expectation that last month’s trade policy events will negatively affect business sentiment and investment for an extended period of time.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD consolidates losses as Fed moderates message

EUR/USD is trading above 1.1350, consolidating its losses. The Fed's Bullard and Chair Powell have conveyed a balanced message and chancing for a sharp rate cut of 50bp in July have dropped.

EUR/USD News

GBP/USD offers fewer moves ahead of Carney’s speech

Having reversed from the 50-day SMA, mainly because of renewed Brexit fears and sluggish data from the UK’s CB retail sales survey, the GBP/USD pair trades modestly flat near 1.2685 ahead of the London open.

GBP/USD News

USD/JPY: Bulls back in charge, re-takes 107.50

The less dovish rhetoric from a selection of Fed speakers overnight continues to aid the post-FOMC US dollar recovery, prompting the USD/JPY pair to retest the midpoint of the 107 handle despite negative Asian equities. 

USD/JPY News

Gold: 100-HMA triggers the U-turn towards $1421?

Gold is on a run towards near-term horizontal-resistance following its U-turn from the 100-hour moving average (HMA) ticks it up to $1407.80 ahead of the European open on Wednesday.

Gold News

Conference Board Consumer Confidence: The China syndrome

The index declined to 121.5 in June from April’s revised 131.3. A much more modest drop to 131.2 had been predicted.  “The escalation in trade and tariff tensions earlier this month appears to have shaken consumers’ confidence,” wrote Lynn Franco.

Read more

Majors

Cryptocurrencies

Signatures