- House prices in Spain are rising healthily again due to economic growth and better credit availability.
- It's a big deal because the 2008 collapse in Spain's housing market triggered the country's economic & financial crisis.
- Good news + seems like Spain will be one of Europe's best performing economies this year.
- Currently at an 11 year low against US$ - bad time for emerging market currencies (weak commodity prices and resurgent US$) but domestic issues in Brazil playing substantial role in sell-off.
- Economy doing badly and fiscal tightening needed, but domestic hostility to austerity.
- Concerns that increasing political uncertainty will undermine president Rousseff's reform program.
- Terribly - currently at an 11-year low.
- US economy strong, european economy weak.
- US interest rates expected to rise mid-year-ish while europe's will remain zero and negative.
- Republicans want greater transparency and allege that Fed's interest rate decisions have become politicised.
- Republicans also want rates to be set by mechanical rules, not opinions.
- Fed Chairman Janet Yellen (Democrat) wants system to stay "as is"
- Monetary policy has been accommodative (i.e. low and even zero interest rates) for a while - but economy now showing consistent signs of strengthening.
- Fed stating now that this consistent growth is likely to start pushing up inflation to their 2% target.
- Translates as Fed preparing markets for possible rate rises soon.
- Greece does not have an actual plan for exiting the euro - this weakens their negotiating position markedly.
- Also, depositors extremely nervous, and Greek banking system will collapse if their negotiating stance is not modified.
- Hence Greek strategy has thusfar failed to challenge German economic orthodoxy.
- Was $115 per barrel in June last year.
- Had fallen to $45 by January.
- Has now rebounded to $60.