Financial Analysis – Week 11, 2021

Mar 24, 2021

Market Overview

 

financial-analysis-week-11-2021

 

USA

Unrealistic optimism of the Minister of Finance and Chair of the Fed about a quick economic recovery in 2022.

The finance minister has launched a plan to inject $ 3,000 billion to support infrastructure projects. Biden promised in the election campaign that he would allocate 7,000 billion dollars for infrastructure.

The current deficit in 2020 hit a record high – 647.2 billion dollars, which is an increase of 34.8%.

House sales fell in February – 18.2%.

The richest 1% of Americans do not pay and hide 20% of their taxes.

Lack of raw materials and rising prices of copper, timber, beef, and corn.

 

IMF

A decision was made to intervene in June with 650 billion Special Drawing Rights to help the recovery of the world economy.

This is the first IMF intervention since the financial crisis in 2009.

 

Japan

The business activity index increased from 45.9 to 46.5 points.

Drop of sales in February by – 2.1%

 

Russia

Indebtedness in February 2021 on credit cards is 150 billion rubles, which is an 18% increase compared to last year.

 

United Kingdom

The unemployment rate rose to 5.1% in February.

 

Germany

The Bundesbank expects an economic decline in Q1 from 1.4% to 2.7%.

Inflation growth, due to oil price, will be 3%.

 

Turkey

The Turkish lira fell 10% over the weekend.

President Erdogan replaced the governor when he was appointed in November because he raised the reference interest rate from 17% to 19%.

Inflation over 15%.

Interest growth. Insolvency in the market.

The huge dissatisfaction of businessmen and citizens with economic policy.

 

Actions

Stably high and rising.

DJ – 32,533

DAX – 14,594

S&P 500 – 3,928

 

Gold

Gold rose in the week behind us to $ 1,730 and is patiently waiting for its moment.

Debts are rising and interest rates shouldn’t be raised, because that would lead to an immediate financial collapse.

Inflation is rising and interest rates are becoming negative.

Hence forecasts that the rise in gold prices will follow.

 

The-relation-between-gold-and-inflation

The relation between gold and inflation

 

Falling-interest-rates-on-government-bonds

Falling interest rates on government bonds

 

Gold-price-growth-forecast

Gold price growth forecast

 

 

Silver

Unchanged and undervalued – $ 25.22 / ounce.

 

Oil

Oil is falling. Price – $ 62.06 / barrel.

The reason for the decline is the closures in Europe and reduced purchases.

 

USD

The dollar remained unchanged against the euro – 1.1824.

There has been a high demand for dollars throughout last week.

 

Russian ruble

The ruble is falling against the strengthened dollar – 76.1810.

In decline against the euro – 90.0759.

 

Bitcoin

Slight further growth to $ 56,446.

Daily transfer number over 306,000.

 

 

Branko Dragaš

Investment banker

Categories

Market Overview