The changing face of inflation: does it undermine the Post-Bretton Woods paradigm

An overview of inflation interpretations In the following article, we are going to examine the current framework of monetary policy – inflation targeting – with a focus on the evolution of the inflation process Post-Bretton Woods and its effects on the current regime of price stability. In the post-war era, Read more…

Inflation Derivatives and the Inflation Risk Premium – Part 2

Following the article from last week, we now investigate the Inflation Risk Premium. We start by introducing the role inflation plays in monetary policy decisions and what are the mechanics of the Inflation Risk Premium, which is one of the most important drivers of market-based inflation rate. Then we analyse Read more…

Inflation Derivatives and the Inflation Risk Premium – Part 1

“Inflation is when you pay fifteen dollars for the ten-dollar haircut you used to get for five dollars when you had hair” Sam Ewing Inflation is an elusive phenomenon which is sometimes dubbed a “hidden tax”, eroding purchasing power and returns. This article is the first in a series of Read more…

A Double Edged Sword of the US Economy

Introduction As we noted in our final publication of 2017, the year 2017 was characterized by very low volatility and stable positive returns on the majority of stock markets. This took place even despite the start of stimulus withdrawal by major central banks which was seen in the gradual increase Read more…

The FED Model: Illusion or Reality?

The aim of this article is to analyse the popular Fed Model, pointing out its strengths as a descriptive tool but warning investors against its alleged predictive qualities. The Fed Model is a stock valuation approach introduced in the late 1990s. It asserts that the acceptable earnings yield (the inverse Read more…

The Economic Aftermath of Erdogan’s Quest for Power

Over the last couple of months Turkey has been greatly divided over President Recep Tayyip Erdoğan’s proposal to augment the executive powers of his position. Ultimately, Erdoğan claimed victory by the slimmest of margins last Sunday as 51% of Turks stood by his side in a vote whose integrity is Read more…

Market Recap 23-04-2017

United States Amidst continued geopolitical uncertainty and mixed corporate earnings results, US equities experienced a week of sideways movement. Later in the week however, the major indices recovered some of their previous week´s losses as confidence in president Trump´s tax reforms strengthened again. US treasury secretary Steven Mnunich announced that Read more…

Czech Koruna Ready to Jump as CNB Removes Floor

The Czech koruna, the currency of an economically relatively small country, recently has gained much attention by an increasing number of speculators. They have been positioning themselves to benefit from a possible appreciation of the Czech currency. For three years, the Czech National Bank (CNB) has kept the koruna above Read more…

Market Recap 02-04-2017

United States The S&P 500 closed at $2,362.72, up 1.44% when compared with the beginning of the week, where opened at$2,329.11 following concerns about President Trump’s ability to secure the passage of the tax reform after failure of his healthcare reform. The other major U.S. equity indices, the Dow Read more…

Market Recap 12-03-2017

United States The S&P 500 closed at $2,372.60, slightly depreciating when compared with the beginning of the week, where it was standing at$2,375.32, but still higher than the weeks’ low of \$2,357.98. Similar was the fate of both the Dow Jones Industrial Average and the NASDAQ, as they closed Read more…

Market Recap 05-03-2017

Market Recap 05-03-2017 United States Despite experiencing a downward correction towards the closing of the week, US equity indices reached new record levels. The Dow Jones Industrial Average reached a new record level by breaching the 21.000 mark. On Wednesday, it peaked at 21.115, to close the week at 21.005, Read more…

Market Recap 26-02-2017

United States Last week was a particular good one for American equities. Indeed, the Dow Jones Index scored four record high closures in a row, up 0.96% from last week’s close. Smaller gains were scored also by the S&P 500 (+0.69%) and the Nasdaq Composite (+0.12%). It is worth noting Read more…

Market Recap 19-02-2017

United States On the week ended February 17, 2017, US stocks closed at record highs as investor sentiment remains positive given the possibility of changes to US corporate tax structure, as well as the likely loosening of regulations. The Dow Jones Industrial Average increased by 1.4% to 20,624, while the Read more…