In This Week’s Issue…

by Alexander Kalis | Managing Partner & Head of Investments at Milltrust International 

Threats to world trade, Korean breakthrough, China to overtake euro-area, Indian equity fund flows power through, and Mexico’s election.

The Threat to World Trade

Not since its inception at the end of the second world war has the global trading system faced such danger.Thankfully, world steel markets have thus far remained unfazed by Trump’s tariff threat.

“Won”-derful Breakthrough

Stocks in South Korea rallied and the Korean won firmed on Friday after South Korea revealed that US president Donald Trump had agreed to meet North Korean leader Kim Jong Un.

Seeing Red

In another sign that the “Asian century” has arrived, China is on course to overtake the euro area in the size of its economy this year. China’s gross domestic product is forecast to reach about $13.2 trillion in 2018, beating the $12.8 trillion combined total of the 19 countries that use the euro. In 2017, the euro cohort edged China by less than $200 billion.

Keeping Faith

Investors in Indian equity funds are keeping faith, unfazed by a planned tax on stock holdings, a bank fraud scandal and turmoil in global markets. Equity funds took in 163 billion rupees ($2.5 billion) in February, after pulling 154 billion rupees in January, data from the Association of Mutual Funds in India show.

The Threats, Real and Imagined, of Mexico’s Election

In less than five months, Mexico will have a presidential election that is mostly being described by US and international media commentators as a perilous undertaking. For some, it is part of a “perfect storm” that could wreak havoc on the Mexican economy (together with Trump’s tax reform and threats to NAFTA); for the business press, there is a threat to foreign investment, especially in the state-owned oil industry, which has had an unprecedented opening to such investment since 2013; and for other observers, it is a threat to the “security”—that is, foreign policy—of the United States.

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