Financial markets fear a slowdown in global growth

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After strong growth of risky assets since the beginning of 2019, concerns about global growth returned. This was evident in the currency markets last week, where he strengthened the U.S. dollar, although there has been easing of monetary policy by the fed. Stock markets in Europe fell after five straight weeks of gains. At the same time, American investors are beginning to worry about the lower profits and, perhaps, of the recession.
The best indicator of the state of the economy and Finance is the analysis of prices in the bond market. The yield desyatiletok Japan again falls below zero, the yield on the German bond fell to a level of 2016 and the yield of the US treasuries 19.3% below the peak level reached in October. Although this does not necessarily mean that the recession is near, the fixed income markets point to a significant slowdown in global economic growth.
The current week will be very important for financial markets. 90-day trading the truce between the Chinese and Americans ends March 1, and if no agreement is reached, it can lead to a doubling of the current U.S. tariffs on Chinese goods. According to the Wall Street Journal, both parties have not even developed a document stating their position. Since the U.S. went to Beijing to start a new round of trade negotiations, the markets expect good news. These expectations are reflected in the Chinese stock indices, which rose after a week-long national holiday.
However, investors should manage their expectations, especially with the conflicting messages of the President of the trump. Approaching important events. Before the release of the United Kingdom from the EU there are only 46 days, but we don’t know what will happen next and which option will be chosen. This week, Prime Minister Theresa may is to make a statement in Parliament about the negotiations. In the US there is important data in the economic calendar this week. Inflation will further understand whether the decision of the fed on the US economy are correct. Retail sales are also another important information.
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Yevgeny Abramovich
Analyst
Forex broker FXOpen