“The global property boom is over as slowing growth, high prices and rising risks point to the end of the long recovery from the financial crisis, investment bank UBS has warned.
“Rock-bottom interest rates have kept prices rising but the result is that buyers are stretched and are facing record low returns on investment in prime property.
“Prices have run out of room to grow in many parts of the world in commercial and residential property, and the market cycle is thought to have peaked around nine months ago, the bank warned.”
“Americans now pay their banks an average 17% interest on credit cards — the highest level recorded by the Fed.
“The rising monthly cost for U.S. consumers may be one reason they’re spending less, as April’s weak retail sales laid out. The combination doesn’t bode well for GDP growth.”
“The U.S. economy grew at an annual rate of 3.2% in the first quarter of 2019—much faster than many analysts had expected. However, as I noted when the data were first released, the strong headline figure was attributable to massive inventory accumulation by businesses and sharp cuts in spending on imports.
“The economy grew at just an annual rate of 1.5% when the effects of inventories and net trade are excluded.”
“Fallout from the power struggle in Venezuela can be felt far beyond its borders, perhaps nowhere more than in Cuba.
“The U.S. has said Havana’s support for strongman Nicolás Maduro is helping him stay in power in Caracas; as punishment, the Trump Administration has imposed sanctions on Cuba.”
“The US claims to have multiple images of Iranian commercial vessels in the Persian Gulf that it believes are carrying missiles and other munitions, according to a US official with knowledge of the situation.
“CNN has not reviewed the intelligence that has led to the US assessment.
“The US government has provided no proof the ships are carrying hidden missiles and other munitions.”
“China’s state media signaled a lack of interest in resuming trade talks with the U.S. under the current threat to escalate tariffs, while the government said stimulus will be stepped up to buttress the domestic economy.”
“Recent flare up in trade tensions between the US and China led to outflows of more than US$2.5 billion in Chinese equities last week Inflows into global bond funds has been accelerating at their fastest pace since 2002.”
“Since commodity prices are informed by marginal costs subject to intermittent deflationary or inflationary disruptive forces, this expected maturing of the Chinese economy is troubling. In 2017-18, when China’s perceived economic adjustment was clear for all to see, commodities ended up as the worst performing asset class.”
“Singapore’s non-oil domestic exports fell more than expected in April from a year ago, hurt by fewer shipments to most major trading partners and a plunge in pharmaceutical sales, official data showed on Friday.
“Exports fell 10% in April year-on-year, data from the trade agency Enterprise Singapore showed.”
“Japan will be post GDP growth figures for the first quarter on Monday (Sunday, 23:50 GMT).
“But with trade uncertainty still weighing heavily on export-dependent Japanese businesses, the data is unlikely to bring music to policymakers’ ears as the world’s third largest economy is expected to have contracted during the period.”
“Talks between the Government and Labour aimed at agreeing a joint approach to Brexit are set to break up without a deal, PoliticsHome understands.
“The negotiations, which have been going on since the end of March, could break down as early as Friday…
“Numerous meetings have taken place between officials and senior frontbenchers on both sides over the past six weeks, but major differences remain.”
“Euro zone banks are turning away from cross-border activity, putting at risk the bloc’s banking union and raising the risk of dangerous fragmentation, European Central Bank Vice President Luis de Guindos said on Thursday.
“With national rules hindering cross-border consolidation, the euro zone bank sector remains highly fragmented, leaving lenders unable to compete with bigger and more efficient global peers.”
“If a stronger currency is supposed to lead to lower inflation by making imports cheaper and making domestic producers absorb the costs associated with a stronger currency, why is that not happening with the Euro.
“As the EUR advances on the Yuan we see inflation rising and not falling. Why?
“The answer he gave to the conundrum is that there is a bigger influence on the Euro than the currency strength, namely oil.”
“Heavy reliance on debt financing and slow economic growth are leading to the creation of debt bubbles which risk destabilizing the entire financial system should a major shock occur, bond bankers and investors warned at a conference on Thursday.
“Leverage in the system has increased some 50%-60% since the financial crisis a decade ago, with debt now worth some 230% of economic output globally according to IMF estimates, said Frank Czichowski, treasurer at KfW.
“There is no banking system in the world that can cope with the flood coming out of this,” he said.”
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