Iran tanker seizure shows oil price has become a ‘broken barometer’ for Mideast tension

The U.K. stopped an Iranian tanker several weeks ago that it says was violating European law and allegedly carrying crude to Syria. A Gibraltar court Friday allowed the detention of the Iranian tanker to continue, even though Iran says the ship was not heading to Syria. Last Tuesday, oil prices had moved down dramatically on comments from Secretary of State Mike Pompeo that Iran was willing to talk about its missile program. Minutes later, the Iranians said ‘no we’re not’ and oil prices still di


The U.K. stopped an Iranian tanker several weeks ago that it says was violating European law and allegedly carrying crude to Syria. A Gibraltar court Friday allowed the detention of the Iranian tanker to continue, even though Iran says the ship was not heading to Syria. Last Tuesday, oil prices had moved down dramatically on comments from Secretary of State Mike Pompeo that Iran was willing to talk about its missile program. Minutes later, the Iranians said ‘no we’re not’ and oil prices still di
Iran tanker seizure shows oil price has become a ‘broken barometer’ for Mideast tension Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-21  Authors: patti domm
Keywords: news, cnbc, companies, higher, war, iran, broken, prices, barometer, seizure, iranian, price, saudi, trump, tension, mideast, shows, week, tanker, oil


Iran tanker seizure shows oil price has become a 'broken barometer' for Mideast tension

A picture taken on July 21, 2019, shows Iranian Revolutionary Guards patrolling around the British-flagged tanker Stena Impero as it’s anchored off the Iranian port city of Bandar Abbas.

Last week shows that oil prices are not the indicator for Middle East tensions they once were, and worries about global demand and growing U.S. production has changed that dynamic.

One of the energy industry’s greatest concerns has been that a Mideast conflict could disrupt oil traffic in the key Strait of Hormuz, a narrow waterway through which about a fifth of the world’s oil moves.

Yet, after Iran seized a British oil tanker Stena Impero there on Friday, for alleged marine violations, and temporarily stopped a second one, oil prices moved slightly higher, not with the velocity that might have been seen during other periods of tension.

“What I find amazing is oil has become a broken barometer for Mideast conflict. A few years ago, you could almost gauge how serious a security crisis was because of the oil price,” said Helima Croft, head of global commodities strategy at RBC.

The tanker incident comes as tensions between Iran and the West have been rising. The U.K. stopped an Iranian tanker several weeks ago that it says was violating European law and allegedly carrying crude to Syria. A Gibraltar court Friday allowed the detention of the Iranian tanker to continue, even though Iran says the ship was not heading to Syria.

Last Tuesday, oil prices had moved down dramatically on comments from Secretary of State Mike Pompeo that Iran was willing to talk about its missile program. Iran refuted that statement, and oil did not recover the losses.

“We sold off 4.5% when Pompeo suggested that the Iranians were willing to talk about the ballistic missile program. Minutes later, the Iranians said ‘no we’re not’ and oil prices still didn’t recover. Since Tuesday, it’s been nothing but escalation and oil has kind of shrugged it off,” said Croft.

Also last week, the U.S. destroyed a drone it said belonged to Iran, but Iran denied that claim. Iran did say it had seized another smaller ship it said was engaged in smuggling.

“It doesn’t mean the security situation is not terribly fraught. It does not mean that we could end up with an unintended escalation through miscalculation. It just means oil is not a leading indicator of how this crisis is going,” Croft said, adding traders are more attuned now to the trade war than a potential shooting war.

Croft said a big reason why oil traders are not driving oil prices higher is because of the huge increase in U.S. production. The U.S.has now surpassed Russia and Saudi Arabia to become the biggest oil producer. She said oil trading has also changed and the market is more computer-driven with fewer big commodities players trading it.

“The surge in U.S. production to over 12 million barrels a day has created a U.S. fire wall against these risks, or perceived risks to supply,” said John Kilduff, partner with Again Capital. “They can take all the tankers they want. We still haven’t lost any oil yet. There’s a ton of spare capacity, especially in Saudi Arabia.I think that’s what’s holding prices back.”

Kilduff said, however, he does expect oil to rise if these types of incidents continue to happen.The tanker incident follows numerous attacks by Iranian proxies on oil facilities and key infrastructure, such as an airport in Saudi Arabia.

Earlier this month, Iran admitted to shooting down a U.S. drone and the White House prepared to respond militarily. Trump called off the retaliatory response at the last minute.

“One of these incidents is going to be the straw that breaks the camel’s back,” Kilduff said. He noted that the U.S. is once more using a key Saudi airbase and has positioned patriot missile defense systems there.

Oil prices were volatile last week with international bench mark Brent crude futures down 6.4% in its worst weekly performance since December, 2018. West Texas Intermediate futures were down 7.6%, in the worst weekly performance since May. WTI started the day lower Friday, but settled up 0.6% to $55.63 per barrel, after news of the tanker seizure.

Kilduff said oil could head higher after its steep drop, as central banks gear up to provide stimulus to the global economy. The European Central Bank meets Thursday and it is expected to cut rates at that meeting or the next, in September. The Federal Reserve meets on July 30 and 31, and it is widely expected to cut interest rates.

On Monday, Iranian Foreign Minister Mohammad Javad Zarif told NBC News that Iran does not want a war, and that the door to negotiations would be wide open if Trump lifts his sanctions. The Trump administration put sanctions on Iranian oil and other parts of its economy, after the U.S. pulled out of the Joint Comprehensive Plan of Action, or the nuclear agreement made between Iran, the U.S. and five other countries.

The other parties, which include Britain, have been trying to keep Iran in the nuclear agreement. But Iran has moved to enrich more uranium at higher levels, and has said it would continue to take actions that could violate the agreement.

Kilduff said in past major conflicts, oil spiked quickly but briefly and when oil reached its all time, it was not due to a conflict.

“We got to $147 [in 2008] not because of a war but because supply was tight and the economy was in its last phase of booming,” said Kilduff.


Company: cnbc, Activity: cnbc, Date: 2019-07-21  Authors: patti domm
Keywords: news, cnbc, companies, higher, war, iran, broken, prices, barometer, seizure, iranian, price, saudi, trump, tension, mideast, shows, week, tanker, oil


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What a failed Iran deal would mean for oil prices and military tensions

ATTA KENARE | AFP | Getty ImagesThe Iranian nuclear deal looks all but dead just one year after the President Donald Trump administration walked away from it and reimposed crippling sanctions on the Islamic Republic. The oil price impactThe direction of oil prices will depend on what Iran does with its nuclear program in the event of the deal’s termination, and whether Tehran’s strategy triggers a military response. “An actual military confrontation or even limited military strikes could cause p


ATTA KENARE | AFP | Getty ImagesThe Iranian nuclear deal looks all but dead just one year after the President Donald Trump administration walked away from it and reimposed crippling sanctions on the Islamic Republic. The oil price impactThe direction of oil prices will depend on what Iran does with its nuclear program in the event of the deal’s termination, and whether Tehran’s strategy triggers a military response. “An actual military confrontation or even limited military strikes could cause p
What a failed Iran deal would mean for oil prices and military tensions Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-19  Authors: natasha turak
Keywords: news, cnbc, companies, program, tensions, mean, iran, failed, deal, military, iranian, oil, nuclear, war, sanctions, prices


What a failed Iran deal would mean for oil prices and military tensions

Iranian soldiers take part in the “National Persian Gulf day” in the Strait of Hormuz, on April 30, 2019. ATTA KENARE | AFP | Getty Images

The Iranian nuclear deal looks all but dead just one year after the President Donald Trump administration walked away from it and reimposed crippling sanctions on the Islamic Republic. As Iran’s government starts breaking its agreed uranium enrichment limits, European leaders are floundering to keep it alive. British Foreign Secretary Jeremy Hunt claimed Monday that the Obama-era deal — signed by the U.S., U.K., Iran, Russia, China, France and Germany in 2015 and intended to provide Iran economic relief in exchange for limits on its nuclear program — “isn’t dead yet.” Other European lawmakers frantically stress the dangers of killing the deal, while Tehran says it can always reverse its deal breaches if the EU defies American sanctions and resumes trade with Iran — something it appears largely unable or unwilling to do. For many Iran watchers, the deal has already collapsed. But what will happen if it officially ends, and what are the consequences for the world?

The oil price impact

The direction of oil prices will depend on what Iran does with its nuclear program in the event of the deal’s termination, and whether Tehran’s strategy triggers a military response. “If the deal dies and Iran starts enriching uranium again at 20% levels and spinning the higher speed centrifuges, we will be closer to a military confrontation involving the U.S. and Iran or potentially Israel and Iran,” Helima Croft, global head of commodity strategy at RBC Capital Markets, told CNBC Thursday. “An actual military confrontation or even limited military strikes could cause prices to temporarily spike.”

Iranian leaders have repeatedly claimed they are not after acquiring nuclear weapons, rather civilian nuclear energy. But before the 2015 deal went into action the country was enriching uranium — the fissile material required for a bomb — at 20%, far above the 3.67% level required for an energy program and roughly three months away from reaching 90% enrichment, or weapons-grade uranium. Under the deal, international inspection agencies verified that Iran had brought enrichment down to 3.67%, the level it now says it’s breaching at just over 4%.

For the U.S., I think it all depends on Trump’s domestic political considerations and who is whispering in his ear on a nightly basis. Richard Nephew Program director at the Center on Global Energy Policy, Columbia University, former State Department sanctions expert

“If war were to break out, we estimate that the price of oil would quickly surge to around $150 per barrel following the outbreak of hostilities,” analysts at London-based Capital Economics said in a research note last week. Twenty million barrels of crude per day are produced in the Persian Gulf. Conflict could prompt the closure of the Strait of Hormuz, through which one-third of the world’s seaborne oil passes. Still, oil watchers point out that with the U.S. shale boom and less global reliance on the Persian Gulf than in previous years, there’s probably enough slack in the international market to bring prices back down. “The deal dying and Iran continuing a staged nuclear restart that still keep it fairly far away from reaching nuclear breakout capability could put a floor under oil prices,” Croft said, but with weak demand concerns still high, it “may not move the needle much.”

Military response: Trump’s call

Most analysts maintain war in the Persian Gulf remains unlikely, but fear that with tensions so high and no diplomatic channel of communication, a mere miscalculation could set off a serious conflict. “For the U.S., I think it all depends on Trump’s domestic political considerations and who is whispering in his ear on a nightly basis,” Richard Nephew, sanctions expert and program director at the Center on Global Energy Policy at Columbia University, told CNBC. Trump’s hawkish National Security Advisor John Bolton “had that upper hand for a while,” Nephew said. “Now, it looks like the isolationists do.”

National Security Advisor John Bolton with that notebook as he listens to questions from reporters during a press briefing at the White House January 28, 2019 in Washington, DC. During the briefing, economic sanctions against Venezuela’s state owned oil company were announced in an effort to force Venezuelan President Maduro to step down. Win McNamee | Getty Images News | Getty Images

With his reelection campaign underway and a long-touted pledge to end America’s Middle East wars, recent actions like seemingly absolving Iran of harsh blame for shooting down a U.S. drone in June and calling off a planned retaliatory strike suggest Trump is very reluctant to go to war. However, Trump said Thursday that a U.S. Navy ship had destroyed an Iranian drone in a “defensive action” in the Strait of Hormuz earlier that day. Nephew believes that Iran “will proceed cautiously on the nuclear side and in ways that are non-attributable — where possible — on the regional side.” Some security experts suggest a “surgical strike” on Iranian nuclear facilities by the U.S., if anything, rather than an all-out war. In terms of military capacity, the U.S. has a far greater range than Iran, says Michael Rubin, a former Pentagon official and resident scholar at the American Enterprise Institute in Washington, D.C. “Sure, Iranian speedboats or drones can harass shipping,” Rubin said. “But if the Iranians go too far, the U.S. Navy can strike Iranian small boats and ports from hundreds of miles away in the Indian Ocean, and the Iranian military would have no effective defense.”

Israel’s ‘any means necessary’

Israel, for its part, has said it will use any means necessary to prevent Iran from acquiring a nuclear bomb, though its internal deliberations on the matter are incredibly complex. Between 2010 and 2012 Israel’s intelligence agency, the Mossad, is believed to have been behind the assassinations of four of Iran’s top nuclear scientists, and in 2007 it carried out airstrikes against a suspected nuclear facility in Syria. If Israel were to strike Iran, the big question will be whether the U.S. follows suit and how Iran would respond, which some analysts say would be likely via rocket attacks by its Lebanese proxy Hezbollah. Tamas Varga, a business analyst at PVM Oil Associates in London, still sees a U.S. move toward war as highly unlikely, especially with the 2020 elections looming. “With the U.S. presidential campaign underway, the last thing Donald Trump would need is a jump in domestic retail gasoline prices,” Varga said. “Never say never, but military conflict is currently not plausible.”

What will the nuclear threat look like?


Company: cnbc, Activity: cnbc, Date: 2019-07-19  Authors: natasha turak
Keywords: news, cnbc, companies, program, tensions, mean, iran, failed, deal, military, iranian, oil, nuclear, war, sanctions, prices


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Trump’s business allies and over 400 bundlers give his 2020 war chest a boost

US President Donald Trump speaks at a “Make America Great Again” rally at Minges Coliseum in Greenville, North Carolina, on July 17, 2019. President Donald Trump’s allies in the business world and an army of bundlers have been courting executives across the country in an effort to help raise millions of dollars for the 2020 reelection effort. The Trump bundler program was rolled out in May and is being advised by George W. Bush’s former national finance director, Jack Oliver. “Friends are talkin


US President Donald Trump speaks at a “Make America Great Again” rally at Minges Coliseum in Greenville, North Carolina, on July 17, 2019. President Donald Trump’s allies in the business world and an army of bundlers have been courting executives across the country in an effort to help raise millions of dollars for the 2020 reelection effort. The Trump bundler program was rolled out in May and is being advised by George W. Bush’s former national finance director, Jack Oliver. “Friends are talkin
Trump’s business allies and over 400 bundlers give his 2020 war chest a boost Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-18  Authors: brian schwartz
Keywords: news, cnbc, companies, bundlers, program, campaign, president, told, outreach, 2020, 400, trump, allies, trumps, chest, war, donors, miller, executives, boost, raise, business


Trump's business allies and over 400 bundlers give his 2020 war chest a boost

US President Donald Trump speaks at a “Make America Great Again” rally at Minges Coliseum in Greenville, North Carolina, on July 17, 2019.

President Donald Trump’s allies in the business world and an army of bundlers have been courting executives across the country in an effort to help raise millions of dollars for the 2020 reelection effort.

So far, the campaign has recruited at least 400 experienced fundraisers to work with the Trump leadership, according to people with direct knowledge of the matter.

The Trump bundler program was rolled out in May and is being advised by George W. Bush’s former national finance director, Jack Oliver.

“What you need is people who have networks through their synagogues, churches, mosques, businesses and even sports teams,” Oliver told CNBC. “The bundling program is a way for people to drum up support through people who know there have been results with this president.”

Among the executives and lobbyists reaching out to fellow business leaders are:

Real estate magnate Stanley Chera

Atlas Merchant Capital managing director Patrick Durkin

Travis Brown, founder of political consulting firm Pelopidas

Jeff Miller, an energy lobbyist

The donor outreach campaign has been a resounding success. The strengthening of the president’s formidable campaign war chest has led his organization, along with the Republican National Committee, to raise over $100 million in the second quarter.

Miller, the founder of lobbying firm Miller Strategies, bundled over $110,000 in the second quarter for Trump, a Federal Election Commission filing says. While Miller has been identified in a recent FEC filing as an official bundler for the campaign, it’s unclear whether Chera is making calls to financiers as anything more than a favor to a president to whom they’ve been loyal since he entered the White House. Durkin and Brown, according to people familiar with the outreach, have started actively bundling for the campaign.

A senior Trump campaign spokeswoman told CNBC that the success of the bundling program has spread across the country and it’s leading to donors who stayed away from Trump in 2016 to jump on board this time around.

“Friends are talking to friends and working together to help President Trump win reelection in 2020,” the spokeswoman said. “People who have never given a cent to any campaign before or stayed out of the mix last time are coming off the sidelines in droves to support President Trump.”

The White House declined to comment. Chera, Miller and Brown did not return a request for comment.

Democrats, meanwhile, are fighting among themselves to capture donors who will finance a formidable campaign versus Trump in the general election. With these business leaders and influential lobbyists using their networks to rake in donors for the campaign, it could give Trump an insurmountable fundraising advantage over his eventual opponent.

Donors who have agreed to back Trump cite his business-friendly policies such as tax cuts and reduced regulations, while arguing the Democratic Party is going too far to the left. A person familiar with the Trump donor outreach, who spoke on the condition of anonymity, said many of the people making calls to GOP executives are working to raise over $300,000 each.

In another good sign for the president’s fundraising hopes, several financiers who backed Trump’s opponents in 2016 flipped to his side in the previous quarter.

“Fundraisers were divided in 2016. That’s not the case this time.” Republican donor Dan Eberhart told CNBC. “Everybody is behind the president toward the common goal of another four years. Those grumblers about the president don’t like his style but they darn sure like his policies.”


Company: cnbc, Activity: cnbc, Date: 2019-07-18  Authors: brian schwartz
Keywords: news, cnbc, companies, bundlers, program, campaign, president, told, outreach, 2020, 400, trump, allies, trumps, chest, war, donors, miller, executives, boost, raise, business


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More than 50 companies reportedly pull production out of China due to trade war

The trade war between the U.S. and China has dragged on for more than a year with 25% tariffs placed on $200 billion of Chinese goods. American personal computer makers HP and Dell could move up to 30% of their notebook production in China to Southeast Asia, Nikkei reported. Japan’s Nintendo is also going to pull a portion of its video game console production from China to Vietnam, according to Nikkei. Not only are foreign companies rethinking its production location, a handful of Chinese compan


The trade war between the U.S. and China has dragged on for more than a year with 25% tariffs placed on $200 billion of Chinese goods. American personal computer makers HP and Dell could move up to 30% of their notebook production in China to Southeast Asia, Nikkei reported. Japan’s Nintendo is also going to pull a portion of its video game console production from China to Vietnam, according to Nikkei. Not only are foreign companies rethinking its production location, a handful of Chinese compan
More than 50 companies reportedly pull production out of China due to trade war Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-18  Authors: yun li
Keywords: news, cnbc, companies, tariffs, chinese, pull, production, companies, china, 50, reportedly, war, according, trade, nikkei, moving


More than 50 companies reportedly pull production out of China due to trade war

The pace of companies moving production out of China is accelerating as more than 50 multinationals from Apple to Nintendo to Dell are rushing to escape the punitive tariffs placed by the U.S., according to the Nikkei Asian review.

The trade war between the U.S. and China has dragged on for more than a year with 25% tariffs placed on $200 billion of Chinese goods. President Donald Trump is still threatening to slap duties on another $325 billion of goods. In wake of the intensifying battle, more and more companies announced plans or are considering shifting manufacturing from China.

American personal computer makers HP and Dell could move up to 30% of their notebook production in China to Southeast Asia, Nikkei reported. Apple has asked its major suppliers to assess the cost implications of moving 15% to 30% of their production capacity from China to India, according to an earlier report from the Nikkei.

Japan’s Nintendo is also going to pull a portion of its video game console production from China to Vietnam, according to Nikkei.

Not only are foreign companies rethinking its production location, a handful of Chinese companies are also leaving China. Chinese multinational electronics company TCL is moving its TV production to Vietnam, while Chinese tire maker Sailun Tire is transitioning its manufacturing line to Thailand, Nikkei reported.

The prolonged trade battle seems to be taking a toll on the Chinese economy. Data on Monday showed its economic growth slowed to 6.2% in the second quarter — the weakest rate in at least 27 years.

Trump claimed the slower growth is evidence that China is losing the trade war as the country faces an exodus of companies.

“The United States Tariffs are having a major effect on companies wanting to leave China for non-tariffed countries. Thousands of companies are leaving. This is why China wants to make a deal,” Trump said in a twitter post on Monday.

—Click here to read the original story from the Nikkei Asian Review.


Company: cnbc, Activity: cnbc, Date: 2019-07-18  Authors: yun li
Keywords: news, cnbc, companies, tariffs, chinese, pull, production, companies, china, 50, reportedly, war, according, trade, nikkei, moving


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Microsoft and Nvidia are among RBC’s best ideas for sustainable investing

Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more


Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more
Microsoft and Nvidia are among RBC’s best ideas for sustainable investing Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: maggie fitzgerald
Keywords: news, cnbc, companies, investing, trump, trade, long, microsoft, talks, ideas, sustainable, war, restarted, happens, best, signs, showing, way, nvidia, rbcs


Microsoft and Nvidia are among RBC's best ideas for sustainable investing

Trade war to drag on as Trump says long way to go and China…

The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all.

Markets

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Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: maggie fitzgerald
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EA slides after losing licensing rights to Cristiano Ronaldo’s team Juventus for FIFA 20

Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more


Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more
EA slides after losing licensing rights to Cristiano Ronaldo’s team Juventus for FIFA 20 Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: jesse pound, sarah whitten
Keywords: news, cnbc, companies, trump, trade, way, long, slides, cristiano, losing, rights, talks, war, juventus, team, licensing, ea, restarted, happens, showing, fifa, ronaldos, signs


EA slides after losing licensing rights to Cristiano Ronaldo's team Juventus for FIFA 20

Trade war to drag on as Trump says long way to go and China…

The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all.

Markets

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Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: jesse pound, sarah whitten
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Microsoft and Nvidia are among RBC’s best ideas for sustainable investing

Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more


Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more
Microsoft and Nvidia are among RBC’s best ideas for sustainable investing Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: maggie fitzgerald
Keywords: news, cnbc, companies, investing, trump, trade, long, microsoft, talks, ideas, sustainable, war, restarted, happens, best, signs, showing, way, nvidia, rbcs


Microsoft and Nvidia are among RBC's best ideas for sustainable investing

Trade war to drag on as Trump says long way to go and China…

The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all.

Markets

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Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: maggie fitzgerald
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Watch Facebook’s crypto chief testify before the Senate banking committee on Libra

Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more


Trade war to drag on as Trump says long way to go and China… The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. Marketsread more
Watch Facebook’s crypto chief testify before the Senate banking committee on Libra Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: lauren feiner
Keywords: news, cnbc, companies, crypto, trump, facebooks, senate, trade, testify, long, chief, libra, talks, war, banking, restarted, happens, watch, way, showing, committee, signs


Watch Facebook's crypto chief testify before the Senate banking committee on Libra

Trade war to drag on as Trump says long way to go and China…

The U.S. and China restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all.

Markets

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Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: lauren feiner
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‘We are in a currency war, but nobody has admitted it,’ strategist says

Central banks are currently embroiled in a covert currency war which is causing stagnation in foreign exchange markets, according to Thanos Vamvakidis, the global head of G-10 FX strategy at Bank of America Merrill Lynch. Monetary policy easing has been a key theme for central bankers so far in 2019, with the U.S. Federal Reserve, the Bank of England and the European Central Bank (ECB) all signaling dovish stances and fueling speculation of more monetary policy easing. Wall Street analysts have


Central banks are currently embroiled in a covert currency war which is causing stagnation in foreign exchange markets, according to Thanos Vamvakidis, the global head of G-10 FX strategy at Bank of America Merrill Lynch. Monetary policy easing has been a key theme for central bankers so far in 2019, with the U.S. Federal Reserve, the Bank of England and the European Central Bank (ECB) all signaling dovish stances and fueling speculation of more monetary policy easing. Wall Street analysts have
‘We are in a currency war, but nobody has admitted it,’ strategist says Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: elliot smith
Keywords: news, cnbc, companies, weaken, policy, trying, strategist, bank, war, currency, admitted, currencies, way, central, monetary


'We are in a currency war, but nobody has admitted it,' strategist says

Central banks are currently embroiled in a covert currency war which is causing stagnation in foreign exchange markets, according to Thanos Vamvakidis, the global head of G-10 FX strategy at Bank of America Merrill Lynch.

Monetary policy easing has been a key theme for central bankers so far in 2019, with the U.S. Federal Reserve, the Bank of England and the European Central Bank (ECB) all signaling dovish stances and fueling speculation of more monetary policy easing.

Wall Street analysts have begun to speculate that President Donald Trump may intervene to weaken the nation’s currency, following a series of comments made by the U.S. president.

Trump most recently complained that China and Europe had embarked on policy moves designed to cheapen their currencies in order to be more competitive with the U.S. on trade, and has repeatedly criticized the Fed over a lack of cuts to interest rates.

Vamvakidis suggested that with most major central banks striking similar tones, currencies are likely to enter deadlock.

“They cannot affect the borrowing cost because interest rates are historically low, so the only way they can ease further monetary conditions is to weaken their currency,” he told CNBC’s “Squawk Box Europe” on Tuesday.

“However, it’s about equilibrium because when everybody is doing it, then currencies don’t really move, you don’t benefit anything because you end up wasting very limited monetary policy ammunition without much of a result. So in a way, we are in a currency war, although nobody has admitted it,” he added.

Vamvakidis argued that although in theory, governments can intervene when currencies are overvalued, the way such interventions are unfolding at present is producing more negative side effects.

“Everybody is trying to move their currencies, but everyone is trying at the same time, and in the end, nobody benefits,” he said. “The collateral damage of all this is that international policy coordination suffers.”


Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: elliot smith
Keywords: news, cnbc, companies, weaken, policy, trying, strategist, bank, war, currency, admitted, currencies, way, central, monetary


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Trade war to drag on as Trump says long way to go and China strikes hard-line tone

The U.S. and China have restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. President Donald Trump said Tuesday that there’s still a long way to go to reach a deal with China, threatening to slap tariffs on another $325 billion of Chinese goods. His recent remarks in the Chinese press indicated his tough stance in the trade war. “No face-to-face meetings have even been scheduled,” Donald Straszheim, head of Evercore ISI’s China r


The U.S. and China have restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all. President Donald Trump said Tuesday that there’s still a long way to go to reach a deal with China, threatening to slap tariffs on another $325 billion of Chinese goods. His recent remarks in the Chinese press indicated his tough stance in the trade war. “No face-to-face meetings have even been scheduled,” Donald Straszheim, head of Evercore ISI’s China r
Trade war to drag on as Trump says long way to go and China strikes hard-line tone Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: yun li
Keywords: news, cnbc, companies, tone, peoples, team, way, trade, china, trump, war, zhong, drag, washington, straszheim, long, strikes, chinese, hardline


Trade war to drag on as Trump says long way to go and China strikes hard-line tone

The U.S. and China have restarted their trade talks, but signs are showing a comprehensive deal could be a long way off, if it happens at all.

President Donald Trump said Tuesday that there’s still a long way to go to reach a deal with China, threatening to slap tariffs on another $325 billion of Chinese goods.

Meanwhile, China had suddenly added a new member to its negotiating team — the country’s commerce minister, Zhong Shan, who was present at last month’s G-20 summit and took part in a telephone conversation with U.S. representatives last week. Zhong is seen by many officials in Washington as a hard-liner, a sign Chinese leader Xi Jinping is standing firm, The Washington Post reported.

His recent remarks in the Chinese press indicated his tough stance in the trade war.

“The U.S. side has provoked economic and trade frictions against us and violated the principles of the WTO. It is typical of unilateralism and protectionism,” Zhong told the People’s Daily on Monday, according to a Google translation. “We have to uphold our warrior spirit in firmly defending national and people’s interests in defending the multilateral trading system.” The People’s Daily is the official newspaper of the Communist Party in China.

The new development dampened analysts and investors’ hope for a resolution as some see the progress “in reverse.”

“No face-to-face meetings have even been scheduled,” Donald Straszheim, head of Evercore ISI’s China research team, said in a note. “Trade progress has been in reverse. The two sides are further apart now than in Nov-Dec 2018.”

“A combination of substantial steps, partial actions and empty words which will be a relief but far from a final resolution of what has morphed from trade war to a ‘stop the China rise’ cold war,” Straszheim said.


Company: cnbc, Activity: cnbc, Date: 2019-07-16  Authors: yun li
Keywords: news, cnbc, companies, tone, peoples, team, way, trade, china, trump, war, zhong, drag, washington, straszheim, long, strikes, chinese, hardline


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