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Italy's financial sector is set to enhance the national budget by €4 billion ($4.3 billion) over the next two years. This increase will primarily result from the postponement of tax deductions on banks, as outlined in a government budget document.
Extreme tariffs proposed by Donald Trump could disrupt disinflation efforts and lead to higher U.S. interest rates, according to Tim Adams, head of the Institute of International Finance. He warned that while some inflationary impacts might be absorbed in the short term, the overall economic package could exert upward pressure on prices. As Trump positions himself as a change candidate focused on protectionism, analysts express concerns about his potential isolationist policies compared to his opponent, Kamala Harris, who is expected to engage more with the global community.
As a potential Trump return raises concerns, EU's Lagarde emphasizes the importance of fair trade for growth and innovation, warning against protectionism. She acknowledges the risks posed by China's market practices while highlighting the negative impact of proposed tariffs on European exporters. The IMF has identified protectionism as a major threat to the global economy, revising its growth forecast for next year.
As Europe and North America grapple with debt and aging populations, the focus on economic growth has intensified. However, proposed solutions, such as large tariffs advocated by former President Trump, face skepticism from economists who argue that tariffs typically burden consumers and fail to stimulate growth effectively.
Emerging-market bonds and stocks faced declines as investors reacted to expectations of slower US interest-rate cuts, leading to higher US yields. A Bloomberg index for emerging-market dollar sovereign bonds fell for the third consecutive day, with the 10-year Treasury yield surpassing 4.20% for the first time since July. This rise in yields dampened risk appetite, contributing to a 0.6% drop in an MSCI gauge for emerging-market stocks.
Yen selling against the dollar is expected to increase as North American traders begin their sessions, highlighting significant short-selling activity. With US Treasuries under pressure and Federal Reserve officials urging caution on rate cuts, the yen faces further declines, targeting its 200-day moving average at 151.36.
Hungary's central bank is set to maintain its benchmark interest rate at 6.5% amid ongoing turmoil with the forint. All 22 economists surveyed anticipate this decision, which will be announced at 2 p.m. in Budapest, followed by a statement and briefing an hour later.
Short selling in Hong Kong has reached its lowest level since April 2021, accounting for just 9.7% of the market's total turnover, following a series of Chinese stimulus measures that spurred a rally. This figure saw a slight recovery to 10.7% on Monday.
As the US election approaches, Bitcoin's short-term fluctuations are influenced by candidate dynamics, with Trump showing more vocal support for cryptocurrencies compared to Harris, who faces challenges due to the SEC's strict stance. Despite perceptions, historical data indicates that the dollar tends to appreciate during Democratic presidencies, suggesting that investment strategies should focus on economic events rather than political affiliations. For more information, visit [Bloomberg](https://www.bloomberg.com) and [SEC](https://www.sec.gov).
IG
Worries over Cameroonian President Paul Biya's health have led to a decline in the value of the country's international bonds, reflecting investor concerns about potential succession issues. While the government assures that Biya is in good health, analysts warn that the lack of a succession plan could create volatility in the market. Meanwhile, the domestic bond market remains stable, unaffected by the rumors.

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