Geo-Politics will be the focus of the week

4 December, 2017

This week will be dominated by Geo-Politics as the US Tax Bill needs to be reconciled between the Senate and House, whilst UK Prime Minister May meets Jean-Claude Juncker, the President of the European Commission, Brexit Secretary, David Davis, and his opposite number Michel Barnier, plus, in an all-important oversight role, the President of the European Council, Donald Tusk, who represents the leaders of the 28 EU member states, to move the Brexit process forward.

Early on Saturday saw the US Senate approve the tax overhaul bill. The approval marks a first significant “win” for President Trump and his Republican Party after months of failed proposals. The Bill is a sweeping overhaul of the US tax code that would cut individual rates and slash the corporate tax rate from 35% to 20% starting in 2019. Congress now needs to reconcile both the House and Senate bills this week – a task that should be relatively simple, as the Senate and House Bills are very similar with only minor amendments needed. The news has reinforced risk-on sentiment in the markets. However, the Trump administrations’ celebrations might be short-lived as reports suggest that former US National Security Adviser Michael Flynn pleaded guilty to lying to the FBI and said he would cooperate with the probe into Russian meddling in the U.S. presidential election.

UK Prime Minister Theresa May is hoping her talks with Jean-Claude Juncker today will ensure the EU will open the second phase of Brexit negotiations concerning relations after Britain’s withdrawal on March 30, 2019. The challenge being that the EU will only do that if there is “sufficient progress” in agreeing “divorce” terms, notably on three key issues: a financial settlement, guaranteed rights for EU citizens in Britain and a “soft border” with Ireland. Reports suggest the financial settlement has been agreed and sources close to the process have suggested that there were indications of agreement on citizens’ rights and of an understanding of how at least to move forward on the Irish border issue to avoid holding up the rest of the package. As a result of the talks today, there is hope from May that the EU Commission could then say there is sufficient progress to move to Phase 2. The markets are likely to see GBP volatility on any statements/comments coming out of these discussions.


Source link  
Best currency rally heading for a crash

The analyst who most accurately predicted the ruble's rally in the second quarter is now its most pessimistic forecaster. The Bank of Russia's switch to...

Trade truce 2.0, or new currency wars?

Tensions around trade wars subsided following news reports that both the US and China leaders are set to hold an extended meeting...

Experts predict where crude could go

A top military aide to Iran's supreme leader warned over the weekend that The first bullet fired in the Persian Gulf will push oil prices above...


Morgan Stanley sees global recession

Investors are overlooking the threat posed by the U.S.-China trade war, which could send the global economy into recession in less than a year...

Oil at $100: how will it affect economy?

Brent crude has risen about 33 percent this year and is close to the highest in six months. While higher prices due to strong demand typically reflects...

Oil sector will lose 95% by 2050

Companies in the oil and gas sector, including large groups such as Shell, BP and Exxon, could lose 95% of their value by 2050 if governments...


The US economy recession by 2021

In a recent survey, most business economists believe the U.S. will fall into recession by 2021. Days after the market euphoria over a ceasefire in the...

Fed plans some further hikes

The U.S. Federal Reserve raised interest rates on Wednesday, as expected, but forecast fewer rate hikes next year and signaled its tightening cycle is nearing...

Pound to remain in Limbo

The British pound hit its lowest level in over 20 months yesterday before recovering in today's trading session on the back of a decision by British Prime...

  


Share it on:   or