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2017 Geopolitics: Lost in Transition

January 3, 2018
For a further year, geopolitical events have continued to occupy the lead stories on the world’s traditional and digital media. We shouldn’t be surprised by this, if we accept that global geopolitics is in a state of transition and that the spaces left by certain actors are being rapidly filled by others.

The financial markets in 2018 - key factors

January 2, 2018
The new year will probably start much as the old one ends, with the markets in positive mood. Risk appetite has been the dominant note for much of the year, except for a few brief bouts of volatility generated by political events and geopolitical tensions.

A good year, with lots of doubts

January 2, 2018
The year 2017 started with plenty of uncertainty for the global economy. President Trump had just been elected, the emerging economies were not doing particularly well and Europe was facing a difficult electoral cycle, with the memory of the Brexit referendum still fresh.

U.S.| Interest Rates Chartbook. December 2017

December 30, 2017
The ​FOMC increased the Fed funds rate to 1.25%-1.50%. Fed funds futures steepen on an optimistic economic growth outlook for 2018. The 10-year Treasury yield has moved sideways in 2017. The baseline is for a gradual increase in long-term yields with the yield curve slope flattening by an additional 15 basis points.

Financial Regulation: Weekly Update. 29 December 2017

December 29, 2017
Highlights: BCBS issued report on supervisory colleges. EBA issued an opinion on DPD exemptions for material exposures. ESMA issued technical advice on short-selling regulation, and updated several documents regarding MiFID II and MiFIR. The EC presented two proposals for directives and seeks feedback on them.

Technology lets consumers take the initiative

December 26, 2017
The changes in spending patterns that have come about in the past twenty years confirm that digital information and communication technology has now become an integral part of consumer behaviour. Irrespective of age, income, sex or any other demographic or socioeconomic characteristic, today’s consumers are highly connected.

U.S. | Weekly podcast: tax effects on home prices

December 23, 2017
Economic update focusing on the effects of tax changes on home prices

Financial Regulation | Basel III End Game

December 23, 2017
The Basel Committee on Banking Supervision (BCBS) announced on December 7th that an agreement was reached on the finalisation of the Basel III post-crisis framework. The calibration of the output capital floor was the most significant pending element and the main focus of negotiations. These announcements will help bring clarity to the banking regulatory framework.

Financial Regulation: Weekly Update. 22 December 2017

December 22, 2017
Highlights: ECB published its 2018 supervisory priorities, and issued a consultation on the assessment of internal models for counterparty risks. EBA issued consultations on internal models benchmarking, published impact assessments for LCR and the full Basel reform, and updated the quantitative analysis for MREL. Finally, SRB published its 2017 MREL policy statement.

Mexico | Bank deposits is supported by the dynamism of its two components

December 22, 2017
In October 2017, the nominal annual growth rate of traditional bank deposits (demand + term) was 13.2%, 2.0 percentage points higher than that observed the previous month and 0.6 percentage points higher than the rate recorded in October 2016.

U.S. | The state of prolonged low interest rates challenges financial stability

December 22, 2017
Financial stability is defined by its ability to facilitate economic growth. Yet in the “new normal” economic environment of prolonged moderate growth, low nominal and real interest rates, an aging population, and rising longevity, the economic environment poses risks to financial stability.

Global | The sustainability of the global growth is more evident

December 22, 2017
Official GDP figures have been revised up in 3Q to 1.02% QoQ, which implies a higher projection for 4Q17 (BBVA-GAIN: 1.04%). Further gains in confidence are not fully reflected in hard data. Global trade recovery continues, but at a slower pace. Global headline inflation accelerated in November driven by volatile components, but core pressures remained subdued.

Eurozone | GDP projected at 0.6%-0.7% in 4Q puts an upward bias to our forecasts

December 22, 2017
Our MICA-BBVA model estimates a GDP growth at 0.6%-0.7% in 4Q, signaling a steady pace or mild acceleration. Confidence increased further in December to record levels. Hard data were somewhat disappointing in October, but these not seem to affect the underlying trend. Inflation increased slightly to 1.5% but the core measure remained stable and subdued at 1.1% in November.