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Wednesday, 28 March 2018

High volatility in the markets will continue in the foreseeable future

The European economy against the backdrop of strong post-crisis economic growth continues to demonstrate a slowdown in inflationary pressures, as well as a noticeable decline in business activity, consumer and business confidence.
Published Tuesday data on the import price index in Germany indicate that after a fairly significant surge last year, and then the same decline in the current rate continued to fall and, according to the information provided, for the first time since November 2016 moved to negative territory.
It was assumed that the price index for imports in Germany in annual terms will fall in February by 0.3% against the increase of the previous year by 0.7%, but it fell by 0.6%. The monthly value of the indicator also showed negative dynamics in February, having decreased by 0.6% with a 0.3% decline forecast and a 0.6% increase in January.
As for the British pound, it is also possible to speak about its probable local decline, if the arrangements for the UK's exit from the European Union slow down. While the expectation of an early resolution of Brexit supports an undervalued pound, and still high inflation stimulates hopes that the Bank of England will raise interest rates already at the May meeting.
In general, observing the world markets and for the currency one in particular, we can state the fact that uncertainty remains, which does not allow investors to concentrate and trade both for raising and lowering. We continue to believe that high volatility in the markets will continue.



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