Page 6 - TURKRptSep22

2.0 Politics 2.1 Watchlist
● Global liquidity: The Fed’s balance sheet has stopped breaking records.
A record $8.97 trillion was registered as of April 12. As of August 23, it stood at $8.85 trillion.
The month of August usually brings about shaky markets as liquidity dries up during the vacation period. However, for the financial industry, August this year has proceeded in an extremely positive fashion (as positive as possible amid the global tightening) while the positive atmosphere on global markets faded away through the end of the month.
November, prior to the beginning of the new year rally in December, could also be bloody this year.
The yield on 10-year US Treasury papers magically surpassed the 3%-level once again while the USD index (DXY) was sailing through the 110-level.
The US yield curve remains inverted.The Fed and US government deny it but the US entered a technical recession as of Q2. A recession is here with high inflation, we have stagflation.
European Central Bank
On June 9, the European Central Bank (ECB) said that it would end its bond-buying programme as of July 1.
On July 21, the ECB delivered a 50bp rate hike versus expectations for 25bp.
On September 8, at its next rate-setting meeting, the ECB will certainly deliver another rate hike and it may be 50bp.
The EUR/USD remains below the 1.00-level.
6 TURKEY Country Report September 2022 www.intellinews.com