Federal Reserve’ – Page 3

After Asia selloff, European stocks dive at open

September 20, 2021 by Syed Ahad

Main European stock markets dropped in opening deals on Monday after a spiteful selloff in Asia, as doubts raised over a likely downfall of debt-laden property giant China Evergrande. London’s benchmark FTSE 100 index lost 1.0% to 6,894.33 points, associated with Friday’s closing level. In the eurozone, Frankfurt’s DAX 40 fell 1.9% to 15,202.28 on … Read more

US economy ‘downshifted slightly’ to moderate pace amid Delta variant surge: Fed survey

September 9, 2021 by Web Desk

WASHINGTON: US economic growth “downshifted slightly” to a moderate pace in early July through August amid a Delta variant-fuelled Covid-19 surge, according to a Federal Reserve survey released on Wednesday. “The deceleration in economic activity was largely attributable to a pullback in dining out, travel, and tourism in most districts, reflecting safety concerns due to … Read more

Emerging markets cannot afford repeat of ‘taper tantrum’: IMF official

August 30, 2021 by Web Desk

WASHINGTON: Gita Gopinath, chief economist of the International Monetary Fund (IMF), has warned that the emerging markets cannot afford a repeat of the “taper tantrum’ market disruption that occurred in 2013 as the US central bank prepares to withdraw monetary stimulus. “They (the emerging markets) are getting hit in many different ways, which is why … Read more

Bank of America jumped into the Bitcoin trend

July 17, 2021July 16, 2021 by Syed Ahad

Bitcoin futures trading is now available for a limited set of Bank of America clients, according to sources.

According to the reports, the financial institution is yet to make this service available to all of its customers.

Jerome Powell, the chairman of the Federal Reserve, spoke out about the importance of cryptocurrency and stablecoins in the US economy.

Investment banks intend to allow customers to invest in bitcoin products. After a three-year break, Goldman Sachs has confirmed the return of its crypto trading department.

The investment banking powerhouse had already offered cryptocurrency trading in partnership with the CME Group, and Bank of America is set to do so again for its clients.

Bitcoin trading began in 2017 at the CME Group. Since then, the platform has seen an improvement in investment and involvement.

Other banks and investment banks that sell crypto products to clients across the US are likely to follow Bank of America’s lead.

It’s interesting to note that in 2018, the American multinational investment bank banned its clients from trading in crypto-related goods, however, it has changed its stance since then.

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ECB exceeds incentive of the Fed on digital currency

July 15, 2021July 15, 2021 by Syed Ahad

The European Central Bank (ECB) is dipping its toe into potentially inviting waters.

President Christine Lagarde took the first step toward a digital euro on Wednesday when she announced the start of two-year research into the feasibility of producing an electronic currency. Despite the Federal Reserve’s caution, the ECB has an incentive to exceed it.

The Central Bank does not want to compete with People Bank of China, which has previously tested a digital yuan in key cities like Shenzhen and Shanghai.

However, Covid-19 has accelerated the death of physical cash: According to an ECB survey of eurozone individuals conducted last year, over nine out of ten people stated they would either definitely or probably pay less in cash as a result of the virus.

A significant question for Lagarde and her colleagues will be whether the central bank’s digital cash drains too many deposits from commercial banks, which are critical for channeling credit to families and companies.

According to a UBS survey of central bank reserve managers, the most-cited possible threat is that digital coins could disintermediate banks, possibly undermining financial stability.

In Europe, this would have extremely bad economic implications. According to Morgan Stanley economists, the region’s banks provide three-quarters of a company’s financing needs; in the United States, capital markets provide the same amount of corporate financing.

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