Why The Popping Of Turkey’s Credit Bubble Is Still Ahead – TURKEY AGENDA LEADS THE WAY!!
Global financial markets were roiled this past week as Turkey’s currency lost approximately one-third of its value after the U.S. placed sanctions on the country in retaliation for holding an American pastor under house arrest. Market participants have been fearful of a contagion spreading throughout emerging markets, which were already struggling this year due to the surging U.S. dollar, rising interest rates, and the tightening of U.S. monetary policy. Though most commentators have focused on the sharp decline of the lira currency, my primary concern is the popping of Turkey’s credit bubble that I warned about in Forbes in early-2014. Read More @ https://www.forbes.com/sites/jessecolombo/2018/08/17/why-the-popping-of-turkeys-credit-bubble-is-still-ahead/#396a4ab2330a
Canada’s inflation rate rises to 3%, highest level since 2011
Canada’s inflation rate rose to its highest level since 2011 last month, as higher prices for airplane tickets, tourism and gasoline pushed the rate to three per cent. Statistics Canada said Friday the consumer price index hit an annual rate of three per cent in July. That’s up from 2.5 per cent in June, which was already the highest level in more than six years. All eight components that the data agency tracks to come up with the rate were higher, and the inflation rate also rose in every single province. Read More @ https://www.cbc.ca/news/business/canada-inflation-rate-1.4788818?cmp=rss
Countries Most at Risk From a Currency Crisis
What do the Turkish lira, the Iranian rial, the Russian ruble, the Indian rupee, the Argentine peso, the Chilean peso, the Chinese yuan and the South African rand all have in common? They’ve all declined steadily this year, and some have depreciated dramatically in the past two weeks alone. The Turkish lira, for example, dropped steeply late last week. At nearly $200 billion, almost 50 percent of Turkey’s gross external debt is denominated in dollars. (Turkey’s General Directorate of Public Finance, which, unlike BIS, accounts for financial borrowers, puts that figure at nearly 60 percent.) But this isn’t the whole story. The whole story is that each of these countries is sitting on a ticking time bomb of U.S. dollar-denominated debt. This story has been long in the making. In the 1990s, many countries began to accumulate large amounts of debt denominated in U.S. dollars. It was an effective way to kick-start economic activity, and so long as their own currencies remained relatively strong against the dollar, it was fairly risk free. From 1990 to 2000, dollar-denominated debt tripled from $642 billion to $2.17 trillion. Read More @ https://geopoliticalfutures.com/countries-risk-currency-crisis/
WHAT IS THE EUR & USD CHARTS SAYING?
Both EUR & USD are taking a breather after an eventful week. Turkey saga is not over yet and the worst is yet to come. FOMC will be clear for September rate hike and FED is all ready for a faster pace rate hike moving forward.
Be cautious as the market will continue to swing and be volatile.
MONDAY NEWS THAT MIGHT AFFECT YOUR TECHNICAL TRADES.
- 2.00pm – German will release their PPI – It’s a leading indicator of consumer inflation – when manufacturers charge more for goods the higher costs are usually passed on to the consumer. Expected to be good.
- 6.00pm – German will release their BYBA Monthly report – volatility expected – It contains relevant articles, speeches, statistical tables, and provides detailed analysis of current and future economic conditions from the bank’s viewpoint.
- 9.15pm – Gov Council Member Wilkins speaks – Volatility expected in favor for CAD.
- 11.00pm – FOMC member Bostic speaks – expect volatility in favor for the USD.
Overall the market remains volatile and fragile. Always keep money management in mind.
High Risk Investment Warning:
Please note that Forex and other leveraged trading involves significant risk of loss, It is not suitable for all traders and you should make sure you understand the risks involved, it is recommended that you seek an independent advice, if necessary.