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Summary US-China trade tensions are rising. Pakistan devalued the rupee for a third time since December. Bulgaria will seek to join the eurozone banking union and ERM-2 simultaneously. The National Bank of Hungary appears to have tilted more hawkish. Newly elected Egyptian President El-Sisi shuffled his cabinet. Argentina has a new central bank chief after Federico Sturzenegger resigned. Chile central bank signaled...

Bad Hair Day Produces Positive Divergences On Friday the ongoing trade dispute between the US and China was apparently escalated by a notch to the next level, at least verbally. The Trump administration announced a list of tariffs that are supposed to come into force in three week’s time and China clicked back by announcing retaliatory action. In effect, the US government said: take that China, we will now really hurt...

The number of registered unemployed in Switzerland dropped by 9% in May 2018 to a rate of 2.4%, down from 2.7% in April, according to a report by the State Secretariat for Economic Affairs (SECO). The rate in May 2018 was 22% lower than in May 2017. ©-Sculpies-_-Dreamstime.com_ - Click to enlarge Switzerland’s unemployment hasn’t been this low since 2008. In March 2018, SECO changed the way it calculates unemployment...

© Lovelyday12 | Dreamstime.com Yesterday, Switzerland’s National Council, or parliament, voted 95 to 94, with 3 abstentions, to introduce quotas for the management and boards of quoted companies. Boards will be required to have 30% women and management teams 20%. The rules could affect 250 companies. At the same time the quotas will not come with sanctions. Companies would have to explain why the quotas had not been met...

US consumers continue to recover from their debt splurge at the end of last year. Combined with still weaker income growth, the Federal Reserve estimates that aggregate revolving credit balances grew only marginally for the fourth straight month in April 2018. To put it in perspective, the total for revolving credit (seasonally adjusted) is up a mere $2.2 billion for all four months of this year combined, compared to...

Neuchâtel, 11 June 2018 (FSO) -The Swiss nominal wage index rose by +0.4% on average in 2017 compared with 2016. It settled at 101.1 points (base 2015 = 100). Given an average annual inflation rate of +0.5%, real wages registered a decrease of -0.1% (101.0 points, base 2015 = 100) according to calculations by the Federal Statistical Office (FSO). Development of nominal wages to the consumer prices and real wages...

The former chief executive of Raiffeisen bank in Switzerland, Pierin Vincenz, spent 15 weeks behind bars. Vincenz was released on Wednesday (Keystone) The Swiss Financial Market Supervisory Authority (FINMA) has concluded its investigation into Swiss bank Raiffeisen, saying it identified “serious shortcomings” in governance. “FINMA has found that the bank’s handling of conflicts of interest was inadequate,” the...

Swiss Franc The Euro has risen by 0.40% to 1.1576 CHF. EUR/CHF and USD/CHF, June 15(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge The Dollar Index edged higher to its best level this year before turning down as market attention shifts from central banks to trade tensions. Reports confirm that the US will go ahead with the 25% tariff on $50 bln of Chinese goods and provide some...

The People’s Bank of China won’t update its balance sheet numbers for May until later this month. Last month, as expected, the Chinese central bank allowed bank reserves to contract for the first time in nearly two years. It is, I believe, all part of the reprioritization of monetary policy goals toward CNY. How well it works in practice remains to be seen. Authorities are not simply contracting one important form of...

Junk Bond Spread Breakout The famous dead parrot is coming back to life… in an unexpected place. With its QE operations, which included inter alia corporate bonds, the ECB has managed to suppress credit spreads in Europe to truly ludicrous levels. From there, the effect propagated through arbitrage to other developed markets. And yes, this does “support the economy” – mainly by triggering an avalanche of capital...