16.05 - information from world market
Dollar rose to the highest point in 5 months, oil is still above $70 per barrel level, metals are recovering. The first bank blockchain transaction took place and there might be a new cool destination for international investors.
British banking conglomerate HSBC has stated that the first ever financial deal was finalized using blockchain technology. Transaction was conducted for American agrarian group Cargills which deals with delivering food and various agricultural products. Netherland bank ING took a part of the counteragent in the deal.
According to the source the deal took place last week and the main task was delivering soy beans from Argentina to Malaysia. Of course, blockchain deals have been conducted before but this one was the first ever to use unified digital application.
HSBC have referred to the deal as the “turning point for trading” as the implementation of blockchain technologies in the banking system will allow to cut the time for transaction as well as the amount of various deal stages. It will also eliminate all the paperwork and the possibility for human mistake. According to the calculations, is the whole trade from the Asian region will go from paper format to blockchain format at will allow to shorten export time by 44 percent and decrease spending by 31 percent.
World economy has already had such an experience. A closed-off nation with heavy military ruling that suddenly opened up for the whole of the world. The nation of Myanmar has provided us with this example 7 years ago. And now it is North Korean turn. Of course, all of the talks will come only after the actual meeting of North Korean and American leaders if it actually happens. But if the meeting goes smoothly, there will be an inevitable stream of investors to the country.
According to the opinion of one of the financial managers which was expressed at the Bloomberg Investment Summit earlier this morning “…judging by what we’ve learned from Myanmar, it might be exciting at the start [and it] will be good businesses to be in. Infrastructure will probably come later.”.
Of course the changes that may be brought to the country by the new foreign investors will take some time to come to life. The deal was easier with Myanmar because there was no question of nuclear weapons on the table. With North Korea it is necessary for the sanction to be lifted first and only after that the cash will start pouring in. And that will become possible after the government of North Korea an prove that their country is fully denuclearized. So for all the investors the expert advice goes like that: watch North Korean summit very closely as this country may just be the next thing for profitability.
Central Bank of Thailand has held a meeting yesterday where the vote for the benchmark interest rate was held. For now all of the members of the voting committee have decided to leave benchmark interest rate at 1.5 percent in order to support the ongoing economic growth of the country and somehow moderate domestic demand.
1.5 percent level for the benchmark interest rate is being held by the national bank for three years already so it was of no surprise for the economist and experts to see that it was left in place for now. For several years now Thai economy has been fully dependent on export levels and tourists. Surprisingly there are not many investors who would want to invest into Thai economy even though the situation in the country and in the region as whole looks quite promising for the long term profit.
With US rates rising, so does the pressure on the Thai economy. Still benchmark interest rate may provide a certain wall between recovering and growing national economy and market volatility.
Benchmark interest rates of the countries in the region have been the thing to watch for the economists lately. With Malaysia and Philippines tightening the monetary policy it seems that Indonesia may jusy be the next.
Greenback has had a gain so massive that it brought it to the highest level in month. Together with dollar, Treasuries rose to 4 year maximum level as well. Meanwhile Asian market looks very shaky and uncertain at this time while officials are trying to ease pressure on world goods trading.
S&P 500 lost 0.9 percent.
Stoxx Europe 600 gained about 0.1 percent.
MSCI Emerging Market had its first retreat in a week and together with it the biggest loss in almost seven weeks - -1.7 percent for the index.
MSCI All Country World Index lost 1 percent sharp.
MSCI Asia Pacific declined 1.1 percent.
Dollar reached the highest point in about 20 weeks against the basket of six major currencies - +0.6 percent.
Euro lost 0.7 percent - $11846.
Yen is at the lowest point in four month 0 110.375 yen per dollar.
WTI oil gained just enough to reach $71.31 per barrel point.
Gold fell 2 percent - $1.291.60 per ounce.
- by Anna K.