Technical & Fundamental Oil Reports Specialists

Follow us

The deluge of warnings continues to mount

Published Friday, February 5th, 2016

If you are fed up with warnings of doom and gloom then block your ears and put your hands over your eyes because they are continuing to rain down thick and fast. If there is going to be another global recession and/or financial recession it will be impossible to claim that it came as a surprise. You might even ponder in your despair that if it really is so bad out there after billions of £, $, ¥ and € QE and zero interest rates then “god help us” and wonder why stock markets are not in complete meltdown. Only one month of trading into 2016 and it already feels like a lifetime.

On Tuesday the head of the New York Fed warned that financial conditions are considerably tighter than they were at the time of the Fed’s December meeting and that the recent financial market turmoil could alter the outlook for growth and risks to the US economy. Yesterday, the Bank of England announced no change in interest rates for the 83rd time and cut its UK growth forecast for this year from 2.5 to 2.2%. Mark Carney referred to “unforgiving” global economic conditions making for significant headwinds. Mario Draghi told a Bundesbank conference that acting too late on weak inflation expectations could lead to a long lasting loss of confidence requiring an even heavier dose of monetary accommodation to reverse it.

Moody’s advise that the number of US companies at the highest risk of debt default is close to a peak not seen since the finical crisis in April 2009. The EU Commission cut its eurozone growth forecast for this year to 1.7% and Greece is poised to raise its head as a major problem over deadlocked talks with the IMF and EU over pension cuts which resulted in another national strike yesterday also joined by farmers unhappy at cuts in tax breaks.

to read the rest of the report, please click here

Posted by David Hufton