Baku. 26 December. REPORT.AZ/ Unlike expectations, 2017 year is about to end in a quiet, stable and rising trend for the financial markets.
Report informs, volatility in financial markets has considerably weakened this year and the growth in the world economy has surpassed the forecasts.
But in 2018, global financial markets may face a liquidity problem as the US Federal Reserve System (Fed) and the European Central Bank (ECB) begin to lower their discount rate. According to the results of the survey conducted by Bank of America Merrill Lynch in December, the main threat to the financial markets will be the "bubble" in the debt market in 2018. Increase in inflation and yield of bonds are among other hazards. The flow of capital has already begun to reflect this tension. Thus, in December, for the first time in the last 14 months, investors started to move away from the corporate bond market.
Elections will be held in many countries in 2018. Here are the developing countries like Russia, Brazil, Mexico. Investors need to pay attention to the changes in monetary policy of these countries.
Euro will most likely increase next year. Notably, the highest increase in euro registered this year compared to the last 14 years in 2017. In the new year, probability of USD/EUR increase to 1.2290 is 67% and the probability of increase to 1,2560 is 50%.
In 2018, investors will also be closely monitoring the Chinese economy and crypto-currency market.