Central Europe's lower yields may dampen bond outflows

2018 ◽  
Keyword(s):  
Czech Republic ◽  
Emerging Market ◽  
Oil Prices ◽  
High Yield ◽  
Corporate Debt ◽  
Bond Markets ◽  
Quantitative Easing ◽  
The Czech Republic ◽  
Content Type ◽  
Financial Conditions

Subject QE’s influence on Central Europe’s bond markets. Significance Hawkish signals from the ECB are adding to recent strains on global bond markets, causing German ten-year Bund yields to shoot up to their highest levels since July. The sell-off is contributing to sharp outflows from Central Europe’s local debt markets, already under pressure as monetary tightening starts in the region; the Czech Republic, which has raised rates twice since August, is suffering the largest withdrawals. However, the absence of large inflows since the ECB started quantitative easing (QE) in 2015 could help mitigate the fallout from its end. Impacts As OPEC members reaffirm their commitment to production cuts, oil prices are shooting up to their highest level in nearly three years. Sales of speculative-grade US corporate debt have had their strongest New Year since 2014, a sign of enduring demand for high-yield bonds. The three-year low in the dollar index will help keep financial conditions loose and buoy up emerging market currencies.

ECB's QE will buoy EM bond markets

2015 ◽  
Keyword(s):  
Interest Rates ◽  
Developing Economies ◽  
Emerging Market ◽  
Investor Sentiment ◽  
Central Banks ◽  
Capital Inflows ◽  
Bond Markets ◽  
Quantitative Easing ◽  
Content Type ◽  
Large Current

Subject Opposite forces are shaping investor sentiment towards EM assets. Significance Investor sentiment towards emerging market (EM) assets is being shaped by the conflicting forces of a strong dollar and the launch of a sovereign quantitative easing (QE) programme by the ECB. While the latter is likely to encourage investment into higher-yielding assets, such as EM debt, the former will keep the currencies of developing economies under strain, particularly those most sensitive to a rise in US interest rates due to heavier reliance on capital inflows to finance large current account deficits, such as Turkey and South Africa. Impacts EM bonds will benefit from ECB-related inflows, while the strength of the dollar will keep local currencies under strain. Higher-yielding EMs will benefit the most from the ECB's bond-buying scheme since they provide the greatest scope for 'carry trades'. The collapse in oil prices is forcing EM central banks to turn increasingly dovish, putting further strain on local currencies.

EMs will stay fragile despite improving sentiment

2016 ◽  
Keyword(s):  
Emerging Markets ◽  
Institutional Investors ◽  
Asset Prices ◽  
Focal Point ◽  
Investor Sentiment ◽  
Oil Prices ◽  
High Yield ◽  
Corporate Debt ◽  
Content Type ◽  
China’S Economy

Significance The improvement in investor sentiment stems mainly from the stabilisation of oil prices and an easing of concerns about China's economy, lifting asset prices in emerging markets (EMs) and convincing some institutional investors that EM equities have been oversold. However, a plethora of vulnerabilities in EMs, including recurring concerns about China's economy, provides scope for a renewed deterioration in sentiment. Impacts Investors could increase their exposure to US high-yield corporate debt, the focal point of market nervousness late last year. If the ECB disappoints market expectations of new monetary stimulus on March 10, sentiment will deteriorate again. Investors will differentiate between EMs, with Brazil suffering large outflows while Indonesia and Turkey enjoy sizeable inflows.

Fed tightening deepens monetary policy rifts worldwide

2017 ◽  
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Oil Prices ◽  
Inflation Expectations ◽  
Bond Markets ◽  
Quantitative Easing ◽  
Government Bonds ◽  
Content Type ◽  
Political Risks ◽  
Bank Of England

Subject US tightening continued this month despite lower inflation expectations. Significance Monetary policy rifts have deepened since the decision by the Federal Reserve (Fed) on June 14 to raise interest rates for the second time this year despite inflation easing and oil prices falling below 45 dollars per barrel. Growing discord between central banks and bond markets has spread to the Bank of England (BoE), where three of the eight committee members disagreed with the June 15 decision to keep rates on hold despite inflation spiking to its highest since June 2013. The ECB and the Bank of Japan (BoJ) are also under pressure to set out plans to wind down their quantitative easing (QE) programmes. Impacts ‘Reflation trading’ continues to unwind; the world stock of negative-yielding government bonds has surged to nearly 10 trillion dollars. US equity markets are hovering near records despite a plethora of vulnerabilities, including lower oil prices and rising political risks. Emerging markets (EM) inflows continue to surge, but higher US rates may force EMs to raise rates before they are ready, hitting activity. The divergence between rising US rates and ultra-loose ECB and BoJ policy will cushion the dollar, protecting it from rising US risks.

Koruna is likeliest in Central Europe to rise further

2017 ◽  
Keyword(s):  
Growth Rate ◽  
Czech Republic ◽  
Developing Economies ◽  
Equity Markets ◽  
Central Banks ◽  
Bond Markets ◽  
The Czech Republic ◽  
Content Type ◽  
National Bank ◽  
Positive Sentiment

Subject The rally in Central Europe’s currencies despite the dovish stance of most of the region’s central banks. Significance The zloty has shot up against the euro this year; the koruna has strengthened sharply in response to the removal by the Czech National Bank (CNB) of its euro rate cap; even the forint has firmed by 2.2% against the euro since mid-December. Central Europe’s currencies are benefiting from reflationary pressures (particularly in the Czech Republic), inflows into equity and local bond markets, and positive sentiment towards developing economies. Impacts The 40-bp fall in 10-year US Treasury yields since mid-March will buoy world equity markets and encourage more exposure to EM ‘risk assets’. The 6% fall in the dollar index against a basket of currencies since early January is contributing to sharp euro and yen rises. Germany’s economy is performing strongly, in the first quarter enjoying its fastest growth rate in a year. This is underpinning expansion in Central Europe’s economies, particularly in Hungary and the Czech Republic.

Public leadership and strategies of Czech municipalities during the COVID-19 pandemic – municipal activism vs municipal passivism

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Michal Plaček ◽  
David Špaček ◽  
František Ochrana
Keyword(s):  
Czech Republic ◽  
Local Governments ◽  
Strategic Behavior ◽  
Participant Observation ◽  
Capital City ◽  
The Czech Republic ◽  
Content Type ◽  
Public Leadership

PurposeThis paper discusses the role of public leadership and the strategic response of local governments to the external shock caused by the COVID-19 pandemic. The authors examine the typical Czech response with regard to how the leadership of municipalities in the Czech Republic responded to this extremely negative external stimulus.Design/methodology/approachThe authors use qualitative research methods for this investigation. They have chosen the case study method (see Yin, 2009; Stake, 1995; Klonoski, 2013). The general case is the Czech Republic. Mini-cases consist of municipalities from the Znojmo region, municipalities of the Central Bohemian region and the municipal districts in the capital city of Prague. Furthermore, the method of participant observation was used.FindingsThe authors’ analysis of the problem of local government responses to the pandemic crisis shows that municipal leaders responded with a variety of (non-)adaptation strategies. It appears that certain framework factors influenced the various local governments' behavior.Originality/valueThe article examines the strategic behavior of Czech municipal leaders regarding the pandemic crisis based on the observation of the reactions of local governments in the Czech Republic to the pandemic crisis and strives to define their basic strategies.

scholarly journals Draft Genome Sequence of Aeromonas cavernicola sp. nov. DSM 24474T, Isolated from a Cavern Brook in the Moravia Region of the Czech Republic

2018 ◽  
Vol 6 (15) ◽  
pp. e00227-18
Author(s):  
S. M. Colston ◽  
A. Navarro ◽  
A. J. Martinez-Murcia ◽  
J. Graf
Keyword(s):  
Czech Republic ◽  
Genome Sequence ◽  
Novel Species ◽  
Draft Genome ◽  
Water Sources ◽  
Draft Genome Sequence ◽  
The Czech Republic ◽  
Content Type

ABSTRACT Species of the Aeromonas genus can be found in numerous environmental milieus, including various water sources, and some species cause disease in animals. We present here the draft genome sequence for Aeromonas cavernicola DSM 24474T, a novel species isolated from a freshwater brook within a cavern in the Czech Republic.

Does housing market impair employment in The Czech Republic?

2015 ◽  
Vol 8 (3) ◽  
pp. 318-334 ◽  
Author(s):  
Martin Konecný ◽  
Dominik Stroukal
Keyword(s):  
Czech Republic ◽  
Panel Data ◽  
Design Methodology ◽  
Detrimental Effect ◽  
Western World ◽  
The Czech Republic ◽  
Content Type ◽  
Negative Effect ◽  
Building Societies ◽  
Practical Implications

Purpose – The main aim of this paper is to find whether homeownership can have detrimental effect on employment in The Czech Republic. Design/methodology/approach – Oswald’s conjecture is tested on the set of panel data across Czech regions between the years of 2005 and 2012. Findings – By testing a model similar to Oswald’s, this paper receives the similar result that the rate of homeownership leads to higher rate of unemployment in following years. The second model tested in the paper does not support previous findings that regional rate of homeownership has negative effect on individual’s probability of being unemployed. Research limitations/implications – Findings of this paper are valid only for The Czech Republic. Possible refinements to the model are presented as inspiration for further research. Practical implications – Results bring a powerful argument into debate about subsidization of homeowners through building societies. Originality/value – This paper is a first examination of Oswald’s hypothesis in The Czech Republic. It opens a debate about whether Oswald’s conjecture holds outside of the Western world.

Lean home services in Czech Republic

2019 ◽  
Vol 10 (3) ◽  
pp. 784-802
Author(s):  
Felipe Martinez
Keyword(s):  
Czech Republic ◽  
Large Scale ◽  
Assessment Tool ◽  
Future Research ◽  
Lean Management ◽  
The Czech Republic ◽  
Content Type ◽  
Services Sector ◽  
Main Challenge ◽  
Size Limits

Purpose The purpose of this paper is to present the findings of an empirical research on the leanness of the home services sector in the Czech Republic. The automotive sector provides reference to argue the numerical outcomes. Design/methodology/approach The research uses a specifically designed assessment tool (Lean Index – LI) to determine the sector’s leanness level. Referring to the results from both sectors, the paper draws conclusions about the current leanness level of home services providers. Findings The proposed LI indicates a value of 69.50 per cent for home services providers, whereas the LI for the automotive industry suppliers is 82.88 per cent. This suggests that there are large opportunities for the implementation of lean management in the home services sector. However, the main challenge is to introduce a continuous improvement approach to these companies. Research limitations/implications The sample size limits the generalisation of the research results. However, this paper represents the first empirical attempt to implement a large-scale survey. The results are limited to the Czech Republic. However, parties from other countries have indicated interest to replicate the research. Practical implications This research provides first empirical findings on the possibilities of implementing lean in the home services sector. Future research projects in other sectors will have the opportunity to make use of the LI assessment tool. Originality/value The paper presents the first approach of lean management into the home services sector. It provides valuable information to specialised institutions in the sector about the possibilities of lean management in the sector. It also provides an overview of the sector for practitioners and academics willing to pioneer lean in the sector.

scholarly journals Comparative analysis between global sukuk and bond indices: value-at-risk approach

2020 ◽  
Vol 11 (6) ◽  
pp. 1245-1256
Author(s):  
Rubaiyat Ahsan Bhuiyan ◽  
Maya Puspa ◽  
Buerhan Saiti ◽  
Gairuzazmi Mat Ghani
Keyword(s):  
At Risk ◽  
Value At Risk ◽  
Emerging Market ◽  
Management Tool ◽  
Bond Markets ◽  
Investment Portfolio ◽  
Financial Contracts ◽  
Content Type ◽  
Risk Approach ◽  
Bond Indices

Purpose Sukuk is an innovative financial instrument with a flexible structure based on Islamic financial contracts, unlike a bond which is based on the structure of a loan imposed with interest. With the notion that sukuk differs considerably from the conventional bonds in terms of risks related to investment, this study aims to examine whether the sukuk market is different from conventional bond markets based on the value-at-risk (VaR) approach. Design/methodology/approach The VaR of a portfolio consists of sukuk and bond indices and is undertaken to determine whether there is any reduction in the VaR amount through the inclusion of the sukuk index in the portfolio. The analysis is undertaken based on the developed and emerging market bond and sukuk indices from January 2010 to December 2015. Findings This paper examines whether the VaR of sukuk market differs from conventional bond markets by using fundamental techniques. It was observed that the VaR amount of sukuk indices is comparatively much lower than the VaR of bond indices in all the cases. Including the sukuk index with each bond index can reduce the VaR of the portfolio by around 30 to 50 per cent for all the developed and emerging market bond indices. Research limitations/implications This research is limited to covering six years of data. Nonetheless, it is able to provide findings which are believed to be useful for the market players. Practical implications This study unveils attractive opportunities in terms of diversification benefits of sukuk indices for international fixed-income portfolios. Originality/value The VaR method is a useful risk management tool. This study uses this method to emphasise the significant reduction of risks and diversification benefits that sukuk investment could offer by including it in the investment portfolio.

Central European local investors will hold on to bonds

2017 ◽  
Keyword(s):  
Emerging Market ◽  
Bond Markets ◽  
Content Type ◽  
Developed Economies ◽  
Local Currency ◽  
Domestic Debt ◽  
The Us ◽  
Debt Market ◽  
Us Presidential Election ◽  
To Come

Significance The lira’s collapse is fuelling outflows from Turkey’s local currency government debt market, as foreign investors reduce their purchases of emerging market (EM) domestic debt amid a sharp sell-off in bond markets following Donald Trump’s upset victory in the US presidential election. Both Hungary and Poland -- hitherto two of the most resilient EMs -- suffered net outflows last year and are likely to come under further pressure as the ECB starts to scale back, or ‘taper’, its programme of quantitative easing (QE) in April. Impacts The dollar’s rise against a basket of other currencies since the US election will put severe strain on EM assets. The surging price of Brent crude is improving the inflation and growth outlook. Higher international oil prices will also reduce the scope for further easing of monetary policy in developing and developed economies.

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