Know What's Happening in Global Economy
Know What's Happening in Global Economy
Japan’s ultra‑loose policy fuels $435 billion yen carry‑trade, raising global risk
The Bank of Japan’s ultra‑loose stance has turned the yen into the world’s cheapest funding currency, enabling a massive carry‑trade that amassed roughly $435 billion between 2022 and 2024. A modest rate hike in March 2024 barely dented the trade, but markets remain wary that aggressive tightening could shrink spreads and force borrowers to repay yen‑denominated debt.
Oil prices surged to $100 a barrel as the Iran‑Hormuz crisis intensified, prompting a wave of individual buying in the United States Oil Fund (USO). USO attracted nearly $1 billion of inflows and has risen about 46% since the conflict began, while the S&P 500 ETF (SPY) saw $12.6 billion of outflows and a 3.5% decline. Market strategists argue the flare‑up may be short‑lived, suggesting investors shift from energy to equities, utilities, financials and industrials. In Europe, the “bank and tank” theme remains attractive despite higher Treasury yields and potential ECB rate hikes.
He puts his name on everything, so let’s make sure his name is on this, too: —> “Overall, it has not toppled Iran’s dictatorship and might have strengthened it. We helped install a younger supreme leader, Mojtaba Khamenei, who may be...
Oil prices have spiked above $100 a barrel as the war in Iran forces the Strait of Hormuz to close, prompting the International Energy Agency to label the disruption the worst in history. Australian economists and the RBA’s futures market...
DataTrek co‑founder Jessica Rabe warned that the financial sector’s weakness reflects dual concerns: exposure to private‑credit assets and the prospect of higher oil prices slowing the U.S. economy. She noted that historically, a rapid doubling of oil prices within a...
It’s hard to see how international countries will cooperate with Trump on keeping the Strait of Hormuz open after 14 months of erratic demands. It’s one thing for Trump to complain about paying for European protection (somewhat understandable) but asking...
Kenya’s foreign minister is traveling to Moscow to demand an end to Russian recruitment of Kenyan citizens, amid reports that over 1,000 Kenyans and more than 1,700 Africans overall have been enlisted to fight in Ukraine. African governments, including Ghana...
Gold up. Oil up. Bonds down. Stocks wobbling. Dollar flat. When this many asset classes move at once, the market is repricing the entire macro regime. This pattern has a name: stagflation. The last time all five conditions aligned simultaneously was 1979-1980. What...
The S&P 500’s aggregate valuation masks a stark split between the high‑flying Magnificent 7 and the rest of the market. Forward price‑to‑earnings ratios for the Magnificent 7 are significantly higher than those for large‑, mid‑, and small‑cap indices. While the Magnificent 7 index has...
Colombia’s natural‑gas output fell to a multi‑decade low of 683 mmcf/d in January 2026, a 17 % drop year‑over‑year, forcing the government to lean heavily on costly LPG imports that now cover about 30 % of domestic gas demand. The shortfall threatens electricity...
Shares of the world’s oil super‑majors have surged to record levels following the US‑Israeli strike on Iran, driving oil prices above $117 a barrel. In the two weeks since the conflict began, the combined market capitalisation of the six listed...
The Philippines’ current‑account deficit shrank by 12.3% in 2025, falling to $16.3 billion or 3.3% of GDP, down from $18.6 billion in 2024. Strong export growth of 15.2%, led by electronics, machinery and minerals, offset a 5% rise in imports. Record remittances...
FWIW while many are suggesting Fed Rate Hikes and markets are beginning to price that as well. We much prefer 1. Ending RMO 2. Addressing the uneven distribution of reserves by establishing a minimum reserve requirement to protect the high...
The Federal Reserve is confronting a new supply‑side shock that threatens to revive inflationary pressures as geopolitical tensions persist. Central banks are diverging, with Australia likely to raise rates again while Europe and the UK pause policy tightening. This split...
Mark Carney’s Post-American Economic Strategy Phew. This essay took a lot of work. The argument is simple: PM MarkJCarney has an economic strategy for Canada, it's just not obvious. I try to connect the dots for readers. https://markhamhislop.substack.com/p/mark-carneys-post-american-economic
The supply shock move in Energy prices, fertilizer prices, and food prices IS a Rate hike which slows the economy and is disinflationary to goods and services that are not energy and food. A dual mandate central bank doesn't hike...
Gold investors face a pivotal Fed meeting on March 17‑18, with spot gold slipping below $5,050 and losing more than 1% for the week as a strong dollar and mixed economic data weigh on the metal. The Fed’s rate decision...
Please find below the links to my weekly look at what has become a much more complicated and uncertain situation for the global economy and markets. linkedin.com/pulse/weekly-look-global-economy-markets-mohamed-el-erian-shp3e/?trackingId=vXKBwDM3QxqdFHY2kfbOrQ%3D%3D&lipi=urn%3Ali%3Apage%3Ad_flagship3_detail_base%3BXcJdDTIXTiGfbxaVzWx6xA%3D%3D https://open.substack.com/pub/mohamedelerian/p/the-weekly-look-at-the-global-economy-372?utm_campaign=post-expanded-share&utm_medium=web #economy
"This month’s attacks on Iran point to a sixth global energy supply shock, but the rise in crude oil prices to date does not represent a shock of the magnitude seen in earlier episodes. At $100bbl, Brent crude is less...
India has introduced a new Quality Control Order (QCO) that obliges both domestic and foreign manufacturers of aluminium and alloy products to adhere to Bureau of Indian Standards (BIS) specifications. The move comes as imports from China surged from $1.47 billion...
I don’t know how much clearer I could have been in the latest roundup. 1) the price of oil doubled in a week and the Hormuz closure is 100x works for European and Asian markets. Therefore as long as it...
The Bank of England’s Monetary Policy Committee is expected to keep the base rate unchanged at 3.75% as the Middle‑East war fuels higher energy prices and fresh inflation risks. Economists had pencilled in a rate cut after January’s inflation dip...
In "The Age of AI and Our Human Future," Henry Kissinger, Eric Schmidt and Daniel Huttenlocher argue that artificial intelligence is reshaping geopolitics, ethics and human identity, demanding a partnership rather than replacement. The review by futurist Ian Khan highlights...
Despite the Iran‑Iran war threatening oil flows through the Strait of Hormuz and pushing crude prices above $103 a barrel, the United States economy continues to show resilience. Recent data show unemployment at 4.4% and Q1 2025 GDP growth projected...
The @wsj on one of the most sensitive prices across the economic, political and social landscape: “Average regular gasoline prices nationally were around $3.68 a gallon on Saturday, according to AAA, a 23% increase from before the war started at the...
More supply chain extension of Iran war. China halts fertilizer exports. How does Trump’s trade war with Canada and Canadian potash fit here for US farmers? Which can affect the E2E food supply chain. That supply-inflation loop.
France and Italy have opened diplomatic talks with Iran to secure safe passage for commercial vessels through the Strait of Hormuz, a vital oil transit chokepoint. The initiative follows recent French casualties and heightened military presence that underscored the risks...
Crude Oil Futures started trading in 1983. The 48% spike over the past 2 weeks was the 2nd biggest 2-week % increase in history. From $67/barrel to $99/barrel... Video: https://t.co/P29a0c5vMR
The most absurd number in CPI? According to the US Government, the cost of health insurance has declined 20% over the last 5 years... https://t.co/Iw2M0izZim
Governments are scrambling to curb soaring oil prices after Iran’s closure of the Strait of Hormuz cut roughly 20% of global supply. The International Energy Agency authorized a historic release of 400 million barrels from strategic reserves, equivalent to about 20...
The Iran war has forced the cancellation of TENS OF THOUSANDS of flights across the Middle East. Rerouted flights are burning more fuel and pushing ticket prices higher. TRUMP-NETANYAHU = A WAR TAX. https://t.co/xDKppRjcdi
Distinguished military historian Phillips O’Brien on the war in Iran: "[Trump] was boasting about American military power... He thought this would be relatively straightforward, [like] the Venezuela model... Kill the leadership, and get a leadership that is much more compliant." https://t.co/gV29tXCQYl
Gold up. Oil up. Bonds down. Stocks wobbling. Dollar flat. When everything moves at once, the market is repricing the entire macro regime. That's not a correction. That's a reset. https://t.co/tyjpVcTUuH
UAE's Fujairah resumes oil loadings after attack, sources say. Oil is still expected to open higher when trading resumes tonight https://t.co/PPrPe2zMLy
Goldman just raised US recession probability to 25%. Oxford Economics says $140 oil triggers recession in the eurozone, UK, and Japan. Brent is at $100 and the Strait of Hormuz is still closed. https://t.co/7yjIA43hkG
Take a look at what Israel's Reign of Terror in the occupied West Bank & Gaza has done to their economies. And we don't even have 2025 data, yet. https://t.co/AruQRDwOZD
Australia is lobbying for more overseas investment in its gas resources as the Middle East conflict riles energy markets 🇦🇺💰 https://t.co/GpZPpkrjwB https://t.co/pVWyatVjys
Military historian Phillips O’Brien on the problems the US is facing in executing its war in Iran: "It reveals a lot of the shoddy nature of the strategic planning." https://t.co/qS1gZLapCT
As recession fears mount, remember that stocks bottom ~5 months before GDP inflects. JPMAM https://t.co/R8swcw5iFp
Chatted w/ @TheKEReport this weekend about the outlook for financial markets amid the ongoing war -- and what our quant models are signaling...
3rd month out of the last 4 that the US' biggest export has been gold. Only time that's happened in at least 20 years (& probably ever.) US is de facto net settling a portion of trade its trade deficit...
Trump-Netanyahu orchestrated dollar dedollarization, debasement & devaluation in full view as collateral damage to their war on Iran, Lebanon, et al. #ByDesignOrDefault
IEA countries have now confirmed their contributions to our largest ever oil stock release This brings unprecedented additional volumes of oil to the market from 16 March onward. However, opening the Strait of Hormuz is vital for a return to stable...
The US-Israeli war on Iran, is heavily disrupting fertilizer, aluminum, semiconductor inputs, and other key industrial supplies. Supply chain expert Nick Vyas: “We have created equal if not greater uncertainty than during the pandemic.” TRUMP’S WAR = AFFORDABILITY PROBLEMS. https://t.co/zziB6qAr5L
The UK economy showed NO GROWTH in January. No surprise. RUSSOPHOBE Starmer is too busy picking fights with Russia than fixing Britain's TANKING economy. https://t.co/Wz4vL8LULC
The WSJ reports: "The U.S. economy is less exposed to oil shocks today than in prior decades." But, today’s economy shows strain in airlines, farms, autos. Airlines face soaring fuel costs. Farmers face higher fertilizer prices. Rising gas prices threaten US autos. https://t.co/bOpYCs0pCD
Iran war chills the IPO market: No companies expected to price in the U.S. this week
The world’s top central banks are about to confront a fresh inflation threat as the war in Iran jolts oil https://t.co/dTDfbxKZsB via @jrandow https://t.co/tBFHewSb2m
I’m really concerned that when people take this one step further and learn that the US is actually selling oil to other countries that the public’s demand for an export ban will become overwhelming.
More than 100 cargo ships are stuck in the Persian Gulf. Nearby ports are packed with redirected cargo. Costs are being driven up globally. NOBODY IS SPARED FROM THE TRUMP- NETANYAHU WAR TAX. https://t.co/EF8fmqKgiV
US Treasury Secretary Scott Bessent, US Trade Representative Jamieson Greer and China’s Vice Premier He Lifeng began talks in Paris on Sunday to map out plans for a leaders’ summit later this month https://t.co/ALjOia2Bim
