Private banks profit from the crisis in Russia

Several emerging private banks in Russia have big winners from the economic crisis in the country, writes Reuters. Amid the difficulties of large state-owned banks that were hit by Western sanctions, until recently smaller players “Finansovaya corporation Otkr—čtie”, “Promsvyazybank”, “Moscow Credit Bank” (ICD) and “Binbank” have become large creditors need of local currency companies.

So they replace state banks such as Sberbank, VTB and Gazprombank, whose access to financing from the international capital markets was suspended due to sanctions. Four private banks have the advantage of using the tools of central bank refinancing in foreign currency, as state institutions can not take advantage of them for a period of over 30 days.

Shift in sector
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Norwegian Investment Fund first loss of three years

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gpfgWith oil prices below $ 50 a barrel and the collapse of the bond market and stock the largest in the world sovereign wealth fund – that Norway is facing difficulties. In the second quarter the fund, which manages assets of 875 billion. Dollars a net loss of 73 billion. Kronor (8.8 billion. Dollars). This is the first negative quarter financial results for three years, reported Reuters.

The fund, in which Norway holds the majority of its oil wealth, has reached its peak against the backdrop of the collapse of oil prices, according to the central bank.

Less revenue

The fund has received significantly less funds from the government – 12 billion. Kronor (1.4 billion. Dollars) in the second quarter and 5 billion. In the first at an average of 60 billion. Kroons per quarter over the past 10 years, notes Bloomberg.
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Fed not likely to raise interest rates in September

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fedTranscript of the meeting held on 28 and 29 July, did not mention any plans to increase happens at the next meeting of the leadership of the September 16 to 17, notes Financial times. Until recently prevailed among analysts forecast that the first interest rate increase in 2006 will be announced next month.

The discussions show that the leadership of the Fed still have different opinions regarding key economic indicators such as inflation, and the timetable for interest rate hikes. However, talks are now aimed not so much whether to raise interest rates and how change can be best communicated to the markets, notes FT.

“Most members of the management believe that the conditions for monetary policy tightening has not yet been achieved, but note that approaching such a point,” said in the documents of the meeting. From conversations evident that the Fed wants the markets to be aware that after raising interest rates still start, it will be gradual and moderate.
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The outflow of capital from emerging markets approaching $ 1 trillion. dollar

The outflow of capital from emerging markets have reached a volume of nearly 1 trillion. dollars for the past 13 months. This is nearly double compared to the same process during the global financial crisis, which shows a significant drop in confidence in these economies, reports the Financial Times.

Sustainable divert investors reinforces fears that these economies suffer from slow growth and depreciation of local currencies have begun to lose its long-standing role as engines of global growth. These trends may even become emerging markets obstacle to the development of consumption.

Analysts told the newspaper that can be expected acceleration of capital flight after the surprise devaluation of the yuan undertaken by the Chinese central bank last week. Another major reason for the deterioration of the trend can be nervousness of investors expecting the US Federal Reserve to start raising interest rates.

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