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The Panama papers leak shines light on wealth hidden, Saudi Arabia looks to a $100 billion budget overhaul, and eurozone unemployment falls to the lowest since 2011. Here are some of things people in markets are talking about today.
Leaked files from a Panamanian law firm show that politicians, celebrities and criminals worldwide have used banks and shadow companies to hide their wealth, according to a series of reports by the International Consortium of Investigative Journalists. The reports have piled pressure on Iceland's prime minister, who faces a no-confidence motion in parliament today, and have led to denials from Argentina's president while Andrey Kostin, chief executive officer of VTB Group, Russia’s second-largest lender said allegations against Russian President Vladimir Putin are "bulls**t" in a Bloomberg Television interview.
Saudi Arabia is planning the country's biggest ever economic shake-up which would see the burden of low crude prices spread to the population, Deputy Crown Prince Mohammed bin Salman said in an exclusive Bloomberg interview. He said the package of measures is expected to raise $100 billion by 2020. For investors, the first sign of the new Saudi Arabia will be the country's debut international bond program, which could launch as soon as September. In the immediate term, the fallout in the oil market from the prince's statement that his country would only freeze production if Iran did too continues to put pressure on the oil price, with a barrel of WTI crude trading at $36.79 at 10:41 a.m. London time.
Unemployment in the euro area fell to 10.3 percent in February, its lowest level since 2011, according to data from Eurostat, the European statistics agency. The jobless rate in Germany held at 4.3 percent while in Spain, which still has no government following last December's inconclusive election, unemployment fell more than expected in March.
Commodity slump continues
It's not just oil falling as commodities prices across the board remain under pressure. Copper is having its worst run in two years amid concerns that the global glut is set to continue while zinc and lead are also falling. In precious metals, gold is down 0.6 percent as it continues to falter after opening the year with its best quarter since 1986.
Time to worry about inflation?
Morgan Stanley is following BlackRock Inc., and Pacific Investment Management Co. in recommending Treasury Inflation Protected Securities as it sees Federal Reserve policy remaining “decidedly dovish.” In Japan and the euro area, the opposite problem exists, with Japanese companies cutting their inflation forecasts for the next five years and European Central Bank Executive Board Member Peter Praet saying the central bank will continue to act forcefully to counter the risk of low inflation in the single currency area becoming entrenched. The great divergence, it seems, is set to continue for some time.
What we've been reading
This is what's caught our eye over the weekend.
- Alaska Air to buy Virgin America is a deal valued at $4 billion.
- Cash is still king in Switzerland.
- After a disastrous year, these bond traders become world-beaters.
- Orange-Bouygues deal collapse ends months of tense diplomacy.
- Lagarde says Greek deal far off as talks roiled by leaks.
- Kuroda's monetary program turns three.
- Trump, Cruz declare victory in first state delegate test.