Market Flash: Political Developments Remain Centre Stage

Edmond de Rothschild
By September 3, 2019 11:04

Market Flash: Political Developments Remain Centre Stage

Political declarations took centre stage this week, starting with the usual twists and turns on the trade war front. Following a tit-for-tat escalation in customs tariffs, the mood turned more conciliatory and talks will now probably resume. However, Donald Trump’s pressure on the Fed hit a new high with his tweet describing Jerome Powell as an enemy. Meanwhile, Italy witnessed an extraordinary reversal following Matteo Salvini’s attempt to trigger fresh elections. Instead, the populist 5-star movement and the centre left Democratic Party buried the hatchet and teamed up to form a new government with Giuseppe Conte remaining as prime minister. The alliance means no new elections will be held and it also will prevent any automatic rise in VAT. It should also end the confrontation with the European Commission over the budget. Italian bond prices rose sharply with the 10-year government bond yielding less than 1%, down from 1.5% at the beginning of August.

Edmond de Rothschild
By September 3, 2019 11:04


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