Financial markets are often characterized by tumultuous swings in prices that catch many traders off guard. The recent burst of volatility in these markets has once again highlighted the inherent risks associated with trading in an environment of low volatility. Trades that are predicated on low volatility can be highly profitable but are also susceptible
Economy
The recent remarks made by Shinichi Uchida, the deputy governor of the Bank of Japan (BOJ), have shed light on the central bank’s stance on interest rate hikes amid market instability. Uchida’s comments, which diverged from the more hawkish tone set by Governor Kazuo Ueda in the previous week, have sparked discussions about the potential
Brazil’s central bank has issued a clear warning that it will not hesitate to raise interest rates if necessary to bring inflation down to its target. The minutes from its July 30-31 policy meeting revealed that the monetary authority is calling for greater vigilance as inflation expectations continue to show de-anchoring. Policymakers have left the
The recent widening of U.S. junk bond spreads in comparison to yields on risk-free Treasuries has sparked concern in financial markets. This trend comes on the heels of a significant daily surge last seen in March 2023. The ICE/BofA U.S. high yield index option adjusted spread skyrocketed by 37 basis points to 372 bp, indicative
The U.S. Commerce Department is set to introduce regulations that would prohibit the use of Chinese software in autonomous and connected vehicles in the near future. This move is motivated by national security concerns, as the administration believes that Chinese-developed software poses a risk to the safety and security of vehicles operating in the United
Richmond Federal Reserve President Thomas Barkin remains steadfast in his monetary policy outlook despite the unexpected weakness in the U.S. jobs data released on Friday. Even though the job growth figures were below expectations, Barkin’s stance on potential rate cuts remains unchanged. The slowdown in July hiring data has not swayed his views, as he
The recent drop in the US dollar to a four-month low is a reflection of the impact of weaker than expected employment data for July. Employers added only 114,000 jobs, falling short of expectations for an increase of 175,000 jobs. The disappointing data has raised expectations that the Federal Reserve will cut interest rates by
The Bank of England recently made the decision to cut interest rates from a 16-year high, with governor Andrew Bailey leading the 5-4 decision to reduce rates by a quarter-point to 5%. This move came after a tight vote by policymakers who were split over whether inflation pressures had eased sufficiently. The central bank’s decision
In a groundbreaking move, a Chinese property developer in Nanjing has decided to refund homebuyers their deposits for apartments in a project that they were unable to complete. This initiative is part of a housing return programme coordinated by local authorities, marking a significant step towards resolving the prevalent issue of unfinished homes in the
The Federal Reserve decided to keep interest rates unchanged, maintaining the benchmark rate in a range between 5.25% and 5.5%. This decision came after a period of assessing incoming data to guide policy decisions. Recent reports have shown progress on inflation, with the core personal consumption expenditure (PCE) index, the Fed’s preferred inflation gauge, remaining