Category Archives: Adolfo Laurenti

Five Themes for the Week

Economic Struggles in China and Greece Chinese authorities sprang into action just a few days after announcing a disappointing first quarter GDP growth rate. The People’s Bank of China (PBOC) last night reduced the banks’ reserve requirement by 1% to 18.5% with the intended goal of free, loanable funds in the banking system in order [...]

China Barely Meets Diminished Expectations

The latest report on Chinese GDP raises new concerns about the economic health of the country. The economy grew 7% in the first quarter; conveniently, that is the growth target set by the Chinese authorities for 2015. Unfortunately, it is also the slowest pace since 2009

Energy Cuts Weigh on Industrial Production

Recent weeks have not been kind to economic readings, with a mix of negative reports or failures to meet expectations. Today’s report on industrial production in March is in line with the overall soft trend for the first quarter.

Divide in Eurozone Economies

After I wrote this on Twitter (@AdolfoLaurenti): “Among Eurozone economies, the real divide is between the reformed (Spain) and the unreformed (Italy and France).” I received a question from  @ml8_ml8: “When you say that Spain is “reformed”, Italy and France not, what do you mean by that?” My answer is too involved to reply on [...]

Greece Capitulates to Reality

The temporary “compromise” found between the European Union (EU) and Greece is nothing short of a full capitulation by Athens to economic realities, at least for the time being. On the surface, the can has been kicked down the road for four more months. But it is notable that none of the requests advanced by [...]

A Tale of Two Countries

Developments in the separate crises in Ukraine and Greece are likely to offer some upside lift to financial markets, at least in the short term. My thoughts: • The ceasefire in Eastern Ukraine is a clear positive for financial markets and reduces concerns about geostrategic and military risks

Mr. Draghi Delivers

In the end, Mario Draghi delivered. The much expected move into quantitative easing is now a reality, as announced by the president of the European Central Bank (ECB) today. The ECB will purchase government bonds, debt securities issued by European institutions and private sector bonds at the pace of 60 billion euros per month until September [...]

Europe: QE and Greece in the Balance

This is a crucial week. On Thursday, we expect the European Central Bank (ECB) to announce the much anticipated plan for asset purchases, aka quantitative easing. On Sunday, Greece will vote for a new parliament, where anti-European forces may win

Swiss Central Bank Rocks Currency Markets

Earlier today, the Swiss National Bank (SNB) discontinued efforts to hold the Swiss franc’s exchange rate with the euro at 1.20 francs. Since September 2011, Switzerland had capped the value of the franc, to contain intense pressure to appreciate against the European single currency and other major currencies. Switzerland is considered a financial safe haven

There Is More to a Flat CPI than Flat Prices

The index for consumer prices (CPI) was flat in October but 1.7% higher compared to one year ago. On the surface, today’s data suggest that inflationary pressures remain contained. Prices seem to have found a bottom, which may ease some of the worries about deflationary trends that have circulated in recent months; at the very [...]