Capital Markets, Financial

BGC Partners eyes new platform to trade US Treasuries

BGC Partners plans to launch a new platform to trade US Treasuries early next year, in a bid to return to a market in the middle of evolution, according to people familiar with the plans.  The company, spun out of Howard Lutnick’s Cantor Fitzgerald in 2004, sold eSpeed, the second-largest interdealer platform for trading Treasuries, […]

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Sales in Rocket Internet’s portfolio companies rise 30%

Revenues at Rocket Internet rose strongly at its portfolio companies in the first nine months of the year as the German tech group said it was making strides on the “path towards profitability”. Sales at its main companies increased 30.6 per cent to €1.58bn while losses narrowed. Rocket said the adjusted margin for earnings before […]

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Renminbi strengthens further despite gains by dollar

The renminbi on track for a fourth day of firming against the dollar on Wednesday after China’s central bank once again pushed the currency’s trading band (marginally) stronger. The onshore exchange rate (CNY) for the reniminbi was 0.28 per cent stronger at Rmb6.8855 in afternoon trade, bringing it 0.53 per cent firmer since it last […]

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Nomura rounds up markets’ biggest misses in 2016

Forecasting markets a year in advance is never easy, but with “year-ahead investment themes” season well underway, Nomura has provided a handy reminder of quite how difficult it is, with an overview of markets’ biggest hits and misses (OK, mostly misses) from the start of 2016. The biggest miss among analysts, according to Nomura’s Sam […]

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Spanish construction rebuilds after market collapse

Property developer Olivier Crambade founded Therus Invest in Madrid in 2004 to build offices and retail space. For five years business went quite well, and Therus developed and sold more than €300m of properties. Then Spain’s economy imploded, taking property with it, and Mr Crambade spent six years tending to Dhamma Energy, a solar energy […]

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Categorized | Currencies

Turkish lira back to record low after EU vote

Posted on November 24, 2016

Well that didn’t last long.

The Turkish lira’s brief boost after the central bank raised interest rates this morning has been wiped out, and then some, with the currency sinking to a fresh record low after the European Parliament voted to call for a suspension of EU membership talks.

The currency is now down 1.5 per cent for the day to 3.4380 per dollar, having briefly been 0.6 per cent up after the central bank defied calls from President Racep Tayyip Erdogan to cut interest rates.

Luis Costa, an analyst at Citi, said the rise in interest rates was too mild and does nothing to deter him from recommending selling the lira:

As it stands now, we are still dealing with a swap curve that is now projecting an overnight rate at around 10% (far above the level of the current weighted average funding of the central bank). The move, in our view, fell shy of market expectations. There is still uncertainty as to the extent to which monetary policy can converge to the levels indicated by the swap markets. All in all, the move does not change our strategy positioning.

Commerzbank’s Tatha Ghose said the move was “definitely in the right direction”, but agreed that it was not enough:

The mix of policy measures adopted today showed explicit signs that CBT is having to compromise with government pressure to ease monetary policy; the CB had to cut RRR [foreign exchange reserve requirement ratios] at the same time that it raised rates – hence, question marks linger about whether CBT could go any further if required. We forecast another 50bps rate hike in early 2017, and see USD-TRY rising to 3.60 by Q2 2017.