natural gas

Bond markets reach “The End of the Beginning” as traders finally realise rates will be higher for longer

300+ years of Bank of England data shows that interest rates are typically inflation plus 2.5%. At today’s level, this would imply – US rates would be 3.7% + 2.5% = 6.2%: Japan would be 3.2% + 2.5% = 5.7%: Eurozone rates would be 5.3% + 2.5% = 7.8%; UK rates would be 6.7% + 2.5% = 9.2%

Bond markets reach “The End of the Beginning” as traders finally realise rates will be higher for longer Read More

Clean energy set to squeeze fossil fuel demand as ‘the electrification of everything’ continues

Portugal is showing the way. Despite 6 months of drought last year, 57% of its electricity came from renewables. And its clean energy focus means it is becoming “one of the cheapest markets in Europe”. CO2 emissions will also have reduced by 75% in 2030 versus 2021.

Clean energy set to squeeze fossil fuel demand as ‘the electrification of everything’ continues Read More

Interest rates break out of their 40-year downtrend – and start creating chaos in global markets

US inflation was last at 8.3% in January 1982. And then, the 10-year yield was 14.6%. History may not be a perfect guide, but it is the best we have. So it might be worth planning for rates to go much higher than most “experts” expect, now that they have broken out of their downtrend.

Interest rates break out of their 40-year downtrend – and start creating chaos in global markets Read More

Food costs and interest rates rise as energy and fertilizer supplies are hit by the invasion

It’s going to be a very difficult winter. Most of the world will be impacted as Europe bids up energy/food prices to keep its people warm and fed. And it would never have happened if policymakers had recognised the importance of geopolitics, energy markets and demographics.

Food costs and interest rates rise as energy and fertilizer supplies are hit by the invasion Read More

FT Letters - Jackson Hole comment by Paul Hodges

Jackson Hole is a chance to prepare for a financial shock

The problems began with the supply chain crisis caused by the pandemic. Russia’s war in Ukraine then created a further challenge. And now we face the risk of famine as fertiliser costs become unaffordable. Central bankers at their annual Jackson Hole get-together should therefore focus on preparing for the arrival of a potential Fourth Horseman of the Apocalypse, in the shape of a major financial crisis.

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