- Fiat Money vs. Cryptocurrencies / Private vs. Public digital currencies…
Fiat Money vs. Cryptocurrencies / Private vs. Public digital currencies…
Tuesday 28 January 2020
Research / Market
The first part of this study analysed the competition between USD, RMB and EURO and presented the challenges for China and Europe to develop a genuine international currencies, having the capacity to compete with the USD (see Part 1: “FX wars vs. currency wars: SD vs. EUR vs. RMB vs …”; DP # 43, January 2020)). However, currency competition goes well beyond the “simple” competition between sovereign currencies (USD, EUR, RMB, JPY, CHF...). The advent of private digital currencies and very soon the first central bank digital currencies represent an important and new phenomenon: it shows that the world has entered a “total digital (disruptive) era”, and currencies are no exception. In less than 10 years, additional forms of monies have surfaced: central banks digital currencies (a few), digital currencies (plenty), local currencies (some) and investment money (major projects ongoing), while electronic monies are gaining ground (vs. cash). Digital currencies are more financial assets than currencies, but electronic and digital currencies are gaining ground for different reasons...
ECB QE Monitor- January 2020
As of October 30, 2019, the Fed lowered its key rate for the third time in 2019. The ECB cut its deposit rate in September to a record low -0.5% from -0.4% while introducing a two-tier system to preserve bank’s profitability.
Global Investment Views - February 2020
At the start of the 2020s, markets continued to be dominated by geopolitical issues, with short-lived Iran tensions at the forefront initially, followed by the news regarding a phase one trade deal between the US and China. Now, growth expectations are becoming the main driver of the market. That’s why the recent volatility due to the news about the spreading of the corona virus in China is higher than in the case of US-Iran tensions, as the epidemic could harm China (and global growth) if not contained soon (not our base case at the moment). Other than this issue, recent data point to a ‘so far, so good’ assessment as Germany has avoided a recession and the Euro area is bottoming out. Inflation uptrends are materialising to some extent, but risks appear to be limited and the overall inflation outlook remains benign. Central banks are likely to continue to pause on policy changes, which should help to maintain dovish financial conditions across regions. Therefore, in the search for further growth, attention is globally moving towards fiscal measures: Japanese stimulus package; approval of 2020 Budget Laws for Indonesia, the Philippines and India; and hopes for support in Germany, the UK and broader Europe (€1tn European Green Deal).
ESG Investing in Corporate Bonds: Mind the Gap
As investors gradually integrate ESG into their stock and bond portfolios, it becomes crucial for Amundi, as a leading responsible investor, to gain a deep understanding of the various facets of ESG and its impacts on different asset classes. Therefore, ESG has been a top priority for Amundi research teams.