Mr. Bank

作者： bankr

  • Iran’s parliament has passed a bill allowing the government to slash four zeros from the rial, Iranian state media reported on Monday, after a sharp fall in the value of the currency as a result of crippling U.S. sanctions

    Iran’s parliament has passed a bill allowing the government to slash four zeros from the rial, Iranian state media reported on Monday, after a sharp fall in the value of the currency as a result of crippling U.S. sanctions.

    Iran’s national currency will be changed from the rial to the Toman, which is equal to 10,000 rials, under the bill.

    “The bill to remove four zeros from the national currency was approved by lawmakers,” Iran’s Students News Agency ISNA reported. The bill needs to be approved by the clerical body that vets legislation before it takes effect.

    Iran’s state TV said the Central Bank of Iran will have two years to “pave the ground to change the currency to Toman”.

    The idea of removing four zeros has been floated since 2008, but gained strength after 2018, when U.S. President Donald Trump exited Iran’s 2015 nuclear deal and reimposed sanctions, as the rial lost more than 60% of its value.

    The Iranian currency was trading at about 156,000 rials per dollar on the unofficial market on Monday, according to foreign exchange websites.

    Iran’s weak currency and high inflation have led to sporadic street protests since late 2017. (Writing by Parisa Hafezi; Editing by Alexander Smith)

  • OPEC and Allied Nations Extend Production Cut of Nearly 10 Million Barrels to Boost Oil Prices

    OPEC and allied nations agreed Saturday to extend a production cut of nearly 10 million barrels of oil a day through the end of July, hoping to boost energy prices hard-hit by the coronavirus pandemic.

    Ministers of the cartel and outside nations like Russia met via video conference to adopt the measure, aimed at cutting out the excess production depressing prices as global aviation remains largely grounded due to the pandemic. It represents some 10% of the world’s overall supply.

    However, danger still lurks for the market. Algerian Oil Minister Mohamed Arkab, the current OPEC president, warned attendees that the global oil inventory would soar to 1.5 billion barrels by the mid-point of this year.

    “Despite the progress to date, we cannot afford to rest on our laurels,” Arkab said. “The challenges we face remain daunting.”

    That was a message echoed by Saudi Oil Minister Abdulaziz bin Salman, who acknowledged “we all have made sacrifices to make it where we are today.” He said he remained shocked by the day in April when U.S. oil futures plunged below zero.

    “There are encouraging signs we are over the worst,” he said.

    Russian Energy Minister Alexander Novak similarly called April “the worst month in history” for the global oil market.

    The decision came in a unanimous vote, Energy Minister Suhail al-Mazrouei of the United Arab Emirates wrote on Twitter. He called it “a courageous decision and a collective effort deserving praise from all participating producing countries.”

    OPEC has 13 member states and is largely dominated by oil-rich Saudi Arabia. The additional countries part of the plus-accord have been led by Russia, with Mexico under President Andrés Manuel López Obrador playing a considerable role at the last minute in the initial agreement.

  • ECB加码刺激，FED会出什么招数？

    本周全球金融市场一片歌舞昇平，股市持续上涨，其中美国那斯达克指数周四收盘时距离2月所及的纪录高点仅差2%，其他风险资产也高歌猛进，在冒险意愿一片火热的情形下，避险货币成为市场抛售重心，美元指数跌至三个月低点附近，日圆兑美元则是一度跌至两个月低点。

    欧元本周一路走高，延续上周突破1.11重要关卡及200日均线后的涨势，欧洲央行决定扩大刺激政策增强市场对经济复苏的期望，更为欧元走势火上加油，欧元兑美元周线迄今涨幅超过2%，且一度写下近三个月来最高。

    经济数据虽仍是一片惨淡，但投资人都已将之抛诸脑后，认为新冠疫情引发的经济衰退低谷已过，期望景气将在央行宽松政策引导下走向光明未来，显然央行政策才是左右汇市及全球金融市场的重心。欧洲央行本周加码刺激政策之后，市场焦点将转向下周美国联邦储备委员会(FED/美联储)会议，各界将密切关注美联储在现有印钞计画下，是否还会祭出更多法宝来提振经济。

    欧洲央行加码刺激高于预期

    本周全球各地股市涨成一片、公债收益率普遍走高、避险货币则是遭遇抛盘，主因市场认为新冠病毒疫情所造成的衰退终将会被刺激经济政策所化解，而各地央行降息及印钞行动所释出的资金则是在风险资产中逐利，在冒险情绪高涨下，美元及日圆等传统避险货币节节败退。

    经济数据已经不再是金融市场的主要题材，所有资产类别都在反映刺激政策营造出的美好未来憧憬，央行的宽松政策因而成为金融市场的主宰，本周欧洲央行会议即是最佳范例。以往央行实施宽松政策时，当地货币往往会反应利差题材而下跌，但本周欧洲央行宣布延长紧急购债的时间及扩大规模、引发当地经济加速复苏的预期之后，欧元不跌反涨，兑美元创下近三个月高点，周线料将连续第三周上扬。

    摩根大通全球市场策略师Jai Malhi表示，“这凸显了欧洲央行支持复苏的承诺…欧元区很可能比美国和英国更快摆脱新冠疫情引发的衰退。”高盛纽约全球外汇联席主管Zach Pandl则指出，“欧盟执委会以及欧洲央行最近的行动，降低了围绕欧元区经济前景的尾部风险。”

    然而欧洲央行对经济前景的看法并未因扩大刺激而转向乐观，该行内部将今年欧元区产出的基线预测大幅下调至萎缩8.7%，而3月的预测还是小幅增长0.8%，明年虽预期将增长5.2%，但欧洲央行总裁拉加德表示，风险偏向出现更糟糕的结果，今年GDP可能萎缩高达12.6%，这或许暗示着刺激行动还未结束。

    百达财富管理策略师Frederik Ducrozet表示:“我们预计，9月份将决定将PEPP的规模再增加5,000亿欧元，至1.85万亿欧元…我们认为，脆弱的复苏将需要一段时间的稳定干预。”

    美联储还能做些什么？

    美联储今年以来除了大幅度降息至近零水准以外，资产负债表规模也急速膨胀，从2月底3月初的约4.2万亿美元一路膨胀至6月3日止的7.21万亿美元，短短三个月之内就强力释出了3万亿美元的资金。

    美联储的强力措施不单解决了市场上的美元荒，同时也巩固了市场信心，避险资产受追捧的热度逐渐转淡，美元和美国公债遭到抛售，美元跌至近三个月低点，美债收益率则出现3月以来最陡峭的型态。

    在收益率曲线趋升的情形下，各界预期美联储下周会议可能推出额外购债计画，或者以短期利率为目标采取收益率曲线控制措施，但一些基金经理人预期，只有当收益率较目前水平大幅上升时，才需要对收益率曲线的大部分进行干预。相反，他们正在寻找线索，暗示美联储相信新冠疫情危机的最严重时期已经过去。

    Eaton Vance全球收益和投资组合联合主管Eric Stein正寻找美联储相信经济反弹能支撑收益率上升的迹象。他称，“美联储可以接受缓慢攀升，尤其是在经济复苏的背景下，但如果升得太多并导致复苏不稳，那么就有理由担忧了。”

    Osterweis Capital Management投资组合经理Eddy Vataru指出，美联储面临的更大风险是利率仍太低，所以不太可能大举推动收益率曲线控制措施。Columbia Threadneedle资深利率分析师Ed Al-Hussainy表示，预计美联储将把重点放在新推出的主街贷款计划，而不是采取新的重大刺激举措。

    除了美联储会议的重头大戏之外，另外需要关注的是美国各地抗议活动还会持续多久，因为这些抗议活动已经造成某种程度的商业活动停摆，可能最终会推迟经济复苏，另外也要留意在各地解除防疫封锁措施后，是否会出现第二波的疫情。

  • Rupiah to strengthen further as foreign investors make comeback: Bank Indonesia

    Bank Indonesia (BI) expects the rupiah to strengthen even after the currency returned to levels seen before the COVID-19 crisis, as foreign investors make a comeback on the back of a global economic recovery.

    The rupiah has rebounded by almost 15 percent since the end of March to reach 13,877 per US dollar on Friday, Bloomberg data shows, erasing most of the losses it recorded in the first three months of the year amid fears of the outbreak.

    “Foreign investors’ confidence in Indonesia’s economy is getting better as reflected by rising capital inflow into government bonds,” BI Governor Perry Warjiyo told reporters in a live-streamed news conference on Friday. “The rupiah remains undervalued and will strengthen further.”

    The rupiah is still undervalued as the country’s credit default swap had yet to fall into pre-pandemic levels, while its current account deficit narrowed and inflation remained low, Perry explained.

    The currency crashed to its worst level of 16,575 against the greenback during the 1998 financial crisis on March 23, when fears over political unrest prompted investors to dump Indonesian assets. They dumped US$10.34 billion worth of assets in the first quarter, according to Finance Ministry data.

    The government and the central bank have pledged to strengthen its cooperation and measures to ensure macroeconomic and financial system stability. BI decided to hold its benchmark interest rate at 4.5 percent last week, despite room for further easing to maintain financial market stability.

    The financial market is currently being buoyed by hopes of an economic recovery as Jakarta, Indonesia’s financial hub and an engine of growth for the economy, will begin to reopen the economy with offices, restaurants and retail outlets permitted to open from June 8 under strict health protocols.

    The central bank reported Rp 18.67 trillion ($1.33 billion) in net inflows, mainly in sovereign debt papers, from the second week of May to the first week of June. From April 1 to May 14, BI recorded $4.1 billion in net inflows.

    “Our foreign exchange reserves will increase this month, driven by a strengthened rupiah and capital inflows,” Perry said, adding that relatively better market conditions from three months ago reduced the need for the central bank to conduct a market intervention.

    The central bank has bought up to Rp 166 trillion in government bonds in the secondary market during the first quarter of 2020 to stabilize the rupiah and another Rp 26.1 trillion to support budget financing needs, boosting the central bank’s ownership of government bonds to Rp 445.4 trillion.

    “We believe that BI’s policy measures will continue to cushion the rupiah in the short-term,” researchers at Fitch Solutions wrote in a research note. “Moreover, a forecast narrowing in CAD in 2020 due to slightly cheaper imports will also add to investors’ confidence in Indonesia’s fundamentals.”

    However, they warned that risks remained for the currency as Indonesia continued to record new COVID-19 cases while facing a limited healthcare capacity.

    “The government’s initial mismanagement of the COVID-19 outbreak led to a collapse in investors’ confidence in the country’s assets, including the rupiah.

    “Downside risks will continue to emerge from the COVID-19 outbreak in Indonesia. As we have noted, cases across Indonesia continue to rise at a rapid pace and the country has limited healthcare and financial resources to deal with a widespread outbreak.”

  • Will banking stocks continue bullish run?

    Market participants are paying keen attention to the future course of bank stocks as they have been showing a solid rebound from the COVID-19 crisis in line with the stock market recovery.

    Bank stocks, although they saw a setback Thursday, have been experiencing a bullish run, as the financial market appears to be on track for a stable recovery with uncertainties surrounding the coronavirus pandemic diminishing here and abroad.

    Shares of Shinhan Financial Group, the nation’s largest financial holding firm by market capitalization, rose to 35,750 won ($29.38) Wednesday, up 11 percent from the previous trading day, on signs of economic recovery and the subsiding pandemic spread.

    The stock price KB Financial Group inched up to 38,600 won, a gain of 6.5 percent from a day ago. Shares of Woori Financial Group and Hana Financial Group were also on the rise.

    Of note is that shares of not just the commercial lenders but state-run banks also enjoyed growth. The stock of Industrial Bank of Korea closed at 9,730 won, up 8.11 percent from the previous day.

    Local economists predicted most banking stocks would continue on a stable track for recovery in the latter half of 2020.

    “Banking stocks will maintain favorable fundamentals in the second half of the year, rather than expanding concerns,” Yuanta Securities economist Park Jin-hyoeng said.

    The analyst argued that major bank stocks are expected to gain momentum for growth for more quarters to come, as their valuation has steeply declined for the past few months due to the virus shock.

    “We believe bank stocks have enough room for growth in consideration of their profit-making capability and attractive dividend distribution,” he said. “In particular, bank stocks will be able to achieve bigger-than-expected growth than other industries in the case of a mass buying spree of foreign investors.”

    The Bank of Korea (BOK)’s recent key interest rate cut also boded well for stock growth in the banking industry, according to Korea Investment & Securities.

    Last week, the central bank cut the benchmark rate by 25 basis points to 0.5 percent. The brokerage house analyzed banks cleared away a series of risk factors surrounding the rate cut after the BOK’s decision.

  • Australians are hurting from the coronavirus-led recession, but we fare better than most countries

    Australia might be in its first recession in almost three decades, but our economy is faring better than many advanced economies driven into decline as they attempted to fight a surge in coronavirus infections.

    On Wednesday, Treasurer Josh Frydenberg conceded Australia will enter into a technical recession when the June quarter GDP data is released, breaking its record of 28 years without one.

    But economists say Australia’s ability to limit the spread of COVID-19, and the Federal Government’s massive economic stimulus, will mean the nation will likely emerge from the crisis in better shape than most.

    That doesn’t mean Australians aren’t feeling immense financial pain, and economists point to two big risks for Australia’s economy.

    Firstly, what happens post September when JobKeeper — the $1500 fortnightly wage subsidy scheme supporting 3.5 million Australians — is removed, and mortgage repayment holidays offered by banks end?

    And second, what if there’s another wave of COVID-19 infections?

    Australia’s growth slowed 0.3 per cent in the March quarter, and annual growth was just 1.4 per cent — its weakest since the last downturn in 2009.

    Economists expect gross domestic product (GDP) will go deep into negative in the June quarter as the full impact of the coronavirus-driven shutdowns is revealed.

    But as the Treasurer pointed out in a slide when the national accounts data was released on Wednesday, Australia’s economic contraction is not so bad compared to that experienced overseas.

  • Hedge Funds Brace For Second Stock Market Plunge

    Summary

    Hedge funds seem to be expecting that the US stock market is going to begin to decline once again and have already begun to position themselves for such a fall.

    Attitudes have changed over the past ten days as investors appear to now believe that the Federal Reserve will not continue to dominate the future.

    The concerns of hedge fund managers have already had an impact on foreign-exchange markets as the value of the US dollar has been decreasing for the past ten days.

    Laurence Fletcher writes in “Hedge Funds Brace for Second Stock Market Plunge,”

    Hedge funds are getting ready for another slump in stock markets after growing uneasy that surging prices do not reflect the economic problems ahead.”

    Investors have been riding on their confidence that the Federal Reserve can “do it all”, and this trust has been built up over ten or eleven years of Federal Reserve support for the stock market as the generator of a “wealth effect” sufficient to drive consumer spending to higher and higher heights.

    That era may be coming to an end.

    It seems, according to Mr. Fletcher, that hedge funds are preparing for the stock market to reverse its recent rise and have begun to move as other investment sources continue to push the stock markets back toward historic highs.

  • Cash is king: Indonesians withhold spending, augment emergency funds

    People are becoming increasingly cautious about spending as they prepare for the possibility that the pandemic will have a long-term impact on their finances. Many have opted to allocate more money for emergency funds.

    English teacher Norma Solikhah, 28, and her husband are one example. They decided to cancel their planned purchase of new furniture and have delayed plans for vacations to have more cash for emergency needs. They have cooked meals at home every day since the work-from-home policy began in March, and they have bought essential items online at lower prices.

    “We try to be as budget-wise as possible to continue paying our mortgage, and we’re also delaying applying for a loan restructuring policy from the bank,” said Norma, whose family is based in Jakarta. 

    “The last time I topped up GoPay and OVO before Eid was in March, which means I almost never took a ride or ordered food from online applications during quarantine.” Norma added that she would continue to spend smart, at least until there was a significant decline in cases or a vaccine became available.

    Consumer spending, which accounts for nearly 60 percent of Indonesia’s GDP, is expected to contract this year to the lowest level in decades, economists predict. Consumer confidence nosedived to at least a 12 year low, according to Bank Indonesia’s (BI) consumer confidence index (IKK) survey in April.

    Center of Reform on Economics (CORE) director Mohammad Faisal predicted that consumer spending would contract in the second quarter. Consumer spending growth slowed down markedly in the first quarter to 2.84 percent year-on-year (yoy), a far cry from the 5.01 percent growth over the same period last year.

    Consumer spending in the lower-middle-income segment of society is greatly depressed at present because millions of people have lost their jobs, Faisal said. Meanwhile, the middle to upper income segments have tended to delay nonessential purchases and investment because of the uncertain and volatile economic conditions, he added.

    Approximately 115 million Indonesians, or 45 percent of the country’s population, have yet to achieve economic security and the lifestyle of the middle class, according to a World Bank report titled Aspiring Indonesia – Expanding the Middle Class.

    “There is high uncertainty at this moment, and it makes people think they need to be careful in spending money. Instead of [spending] on investment and holidays, many people are saving more money for survival,” said Faisal.

    The latest consumer confidence survey by Nielsen Research also indicated that in the first quarter of 2020 Indonesian consumers had significantly reduced their spending on holidays from 42 percent in the previous quarter to 36 percent. Consumers also reduced investment in stocks and mutual funds to 34 percent, down from 46 percent in the fourth quarter of 2019.

    Ester Christine Natalia, 26, who lives in Tangerang with her husband, has decided to reallocate the funds the family usually used for investment in mutual funds for a cash emergency fund.

    “Because it is more liquid and safe,” said Ester. “In a crisis like this, cash will always be king.”

    Private sector employee Rizki Amalia, 26, has also opted to hold more cash in an emergency fund for her parents instead of spending it.  

  • Germany unveils 130-billion stimulus to kickstart virus-hit economy

    Germany will plough 130 billion euros ($146 billion) into a stimulus package to kick-start an economy severely hit by the coronavirus pandemic, Chancellor Angela Merkel said Wednesday.

    Under the wide-ranging measures outlined in a 15-page document, value-added tax will be temporarily slashed, families will receive 300 euros for each child, while those who purchase electric cars will see a government rebate doubled to 6,000 euros.

    “The size of the package will reach 130 billion euros for 2020 to 2021, 120 billion of which will be borne by the federal government,” said Merkel.

    “We have an economic stimulus package, a package for the future and in addition, we’re now dealing with our responsibility for Europe and the international dimension.”

    Noting that millions of employees in Germany have been put on shorter working hours, Merkel said that “shows how fragile the whole thing is, and why we must succeed in giving the economy a push so that jobs can be secured.”

    “We need to get out of this crisis with an oomph,” said Finance Minister Olaf Scholz.

    The fresh stimulus comes on top of a massive 1.1 trillion euro rescue package already agreed in March, comprising loan guarantees, subsidies and a beefed-up shorter-hours program to avoid job cuts.

    To fund the unprecedented package, parliament had approved new borrowing, marking a sea change in German economic policy, upending a financial-crisis-era constitutional rule drastically limiting budget deficits.

    ‘Find its feet’

    With borders slamming shut, employees kept home, and shops and restaurants forced to close to halt transmission of the coronavirus, Germany is headed for the worst recession in its post-war history. 

    Disruptions to trade and travel have also weighed on the export powerhouse.

    Latest data released earlier Wednesday showed that the unemployment rate rose to 6.3 percent in May, the equivalent of some 2.8 million people, from 5.8 percent in April.

    With new infections sharply dropping, Europe’s biggest economy began easing social restrictions in early May, allowing shops to reopen while restaurants and tourist businesses are taking the first tentative steps. 

    Factories too are restarting their production lines.

    Merkel has said the support program will help “the economy to find its feet and grow again”.

    To boost consumer spending, VAT will be cut from 19 to 16 percent from July 1 to December 31 this year.

    But a controversial plan for a cash-for-clunkers scheme that also covers petrol and diesel cars did not materialize after noisy environmental protests.

    The youth environmental movement “Fridays for Future” had organized some 60 protests nationwide on Tuesday, with demonstrators asked to wear masks and keep their distance in line with coronavirus-fighting measures.

    Bavaria state premier Markus Soeder, who had pushed for help to the automobile sector, defended the package, saying the VAT cut will benefit sales of all classes and types of vehicles.

    The increased rebate for electric cars is aimed meanwhile at giving consumers the incentive to switch to cleaner vehicles, said Soeder, whose state hosts BMW and Audi.

    Meanwhile, companies in sectors hardest hit by the crisis — including hospitality, tourism and entertainment — will receive “bridging help” worth 25 billion euros in total from June to August.

    Under the measure, restaurants, hotels or event management companies could get up to 80 percent of their fixed operating costs reimbursed if revenues had plunged by more than 70 percent compared to a year ago.

  • Indonesia unveils bigger stimulus worth $47.6 billion to fight coronavirus impacts

    The government unveiled on Wednesday a bigger stimulus package worth Rp 677.2 trillion (US$47.6 billion) to anchor the virus-battered economy, the growth of which is expected to fall to a level similar to that of the 1998 Asian financial crisis.

    The latest budget, which is higher than the Rp 641.17 trillion initially allocated, aims to strengthen the healthcare system, direct more spending toward social protection to boost consumption and provide incentives to rescue Indonesian businesses from bankruptcy and workers from layoffs.

    Finance Minister Sri Mulyani Indrawati said the government had put in place support measures to counter an economic fallout from the coronavirus pandemic, adding that the government would again revise the macroeconomic assumption underpinning the state budget to cover for the larger stimulus package.

    “This is a thorough stimulus package to support people’s purchasing power and businesses,” Sri Mulyani told reporters in a livestreamed news conference. “We are hoping that this stimulus can maintain our economic growth at above zero percent.”

    The Indonesian economy grew 2.97 percent year-on-year (yoy) in the first quarter, the weakest in 19 years, as household spending and investment growth plunged as the outbreak hit economies around the world.

    Sri Mulyani said gross domestic product (GDP) growth could be lower than the government’s projection of 2.3 percent this year. In the worst-case scenario, the government expects the economy to contract 0.4 percent.

    Under the new stimulus budget, the government will provide Rp 87.55 trillion for the healthcare sector, Rp 203.9 trillion to strengthen social safety net programs and Rp 123.46 trillion in incentives for micro, small and medium businesses.

    As much as Rp 120.6 trillion will be allocated for bigger tax incentives and Rp 97.11 trillion to support ministries and regional administrations, while Rp 44.57 trillion comprises the stimulus for state-owned enterprises (SOEs) and labor-intensive businesses.

    The government now projects the state budget deficit to reach 6.34 percent of GDP, up from the previous estimation of 6.27 percent. It expects state revenue to reach Rp 1.4 quadrillion this year, while state spending is projected to increase by Rp 124.5 trillion to Rp 2.74 quadrillion.

    “We will treat the widening budget deficit carefully in terms of sustainability and financing,” Sri Mulyani pledged. “We will look for financing sources with the lowest risk and costs.”

    Bank Indonesia Governor Perry Warjiyo pledged during the same briefing to continue buying government bonds in the primary market as the last resort and non-competitive bidder to help finance the government’s budget. The central bank has bought around Rp 26 trillion worth of bonds directly through auctions.

    “Close coordination between the Finance Ministry and the central bank in budget financing has fueled confidence among market players,” Perry told reporters. “With growing market optimism, we expect that the needs of our bond buying program will be small.

    “Bank Indonesia is also ready to minimize the government’s interest rate burden to support economic recovery if needed.”

    BI has injected a total of Rp 583.5 trillion since the beginning of the year to carry out monetary operations to stabilize the financial market and boost bank liquidity, among other purposes.

    World Bank senior economist for Indonesia Ralph van Doorn called on the Indonesian government to take steps to maintain market confidence as debt mounts amid the outbreak.

    “The government must [provide assurances over its] fiscal strategy to raise revenues back to at least the 2018 level to flatten the debt curve,” Van Doorn said recently.

    It should unwind “exceptional measures” taken to battle the pandemic after the virus threat subsides, including by reinstating the deficit ceiling of 3 percent and ending Bank Indonesia’s partial financing of the deficit, he said.

    Indonesia’s debt-to-GDP ratio would rise to 37 percent this year, from 29.8 percent at the end of last year, van Doorn projected.

    Center of Reform on Economics (CORE) Indonesia economist Piter Abdullah, meanwhile, lauded the government’s move.

    “Although it may not be enough, the move signals that the government is flexible about adjusting the stimulus,” Piter told The Jakarta Post on Wednesday. “This would boost market confidence and help strengthen the rupiah exchange rate.”