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💰 Is the U.S. Dollar’s Dominance at Risk?💰 📌 Global Influence of the Dollar Since World War II, the U.S. dollar has been the dominant global currency, used in most international transactions and held as the primary reserve by many countries. Its strength is rooted in U.S. economic stability and the liquidity of dollar-denominated assets. However, U.S. monetary policy, such as Federal Reserve interest rate hikes, can create economic problems in other countries, especially those that rely heavily on the dollar. 📌 The Dollar as a Political Tool The U.S. uses the dollar as a foreign policy weapon, leveraging its control over the global financial system to impose sanctions on countries like Russia, Iran, and North Korea. These sanctions can cut nations off from international finance, as seen in the 2022 actions against Russia. However, this has prompted some nations to seek alternatives to reduce their reliance on the dollar. 📌 Challenges and Alternatives Though the dollar remains dominant, there are potential challengers like the euro and China’s yuan. However, the euro lacks the political unity of a complete economic system, and the yuan is limited by government control and low global trust. Other options, like gold and Bitcoin, are considered stores of value but lack the stability or liquidity to replace the dollar. U.S. internal risks, such as political instability and debt ceiling battles, could also weaken the dollar’s global role over time. Though no immediate rival threatens the dollar’s dominance, internal U.S. challenges and efforts from countries to diversify away from the dollar suggest that its global supremacy could gradually erode.

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 ✂️ ECB cuts rates amid faster inflation drop and slowing economy  ✂️📉 📌 The European Central Bank (ECB) has reduced interest rates for the third time this year, lowering the deposit rate to 3.25%, as inflation slows quicklier than expected. The ECB anticipates inflation control will be achieved next year, adjusting its forecast from the second half of 2025. While the exact timeline for future rate cuts remains unclear, the central bank stressed that rates will stay restrictive as long as needed to manage inflation. 📌 Despite the earlier optimism for economic growth, the region’s economy has slowed, with inflation dropping below 2% for the first time since 2021. ECB President Lagarde acknowledged downside risks to growth but maintained that a recession is unlikely, projecting a "soft landing" for the economy. Challenges include geopolitical risks and uncertainties around global trade, particularly regarding the Middle East and potential U.S. tariffs under Donald Trump’s presidency. 📌 Economic performance remains mixed across the eurozone, with strong demand in southern countries like Spain and Greece, while Germany’s economy lags due to weaker demand from key markets such as China. Some analysts predict the ECB may continue cutting rates into 2025, bringing the deposit rate to 2% by year-end, in line with estimates for a neutral monetary policy stance. However, inflation risks persist, particularly in the services sector, keeping the ECB cautious in its approach to monetary easing. Source: Bloomberg

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China at a Crossroads: Can It Avoid Prolonged Stagnation? 📌 After decades of unstoppable growth, China is now facing one of its deepest economic crises, with a 2024 growth target of 5% that seems increasingly out of reach. Consumer spending is down, the real estate market is unstable, and tensions with the United States, limiting China’s access to advanced technologies like semiconductors, are hindering innovation and high-value-added production. 📌 The real estate sector, traditionally a key driver of China's growth, is at the center of this crisis. After attempting to curb developers' debt, the government triggered a market contraction, leading to the default of many companies and a decline in housing prices. This has eroded trust in the real estate market, once considered a safe investment and a source of wealth. The crisis has wiped out approximately $18 trillion in household wealth, driving consumers to save rather than spend. Youth unemployment hit record levels in August, further worsening the situation. 📌Despite government efforts to revive the real estate sector and restore consumer confidence, progress remains slow, and a recovery in household spending seems distant. Among the measures taken, in September the government cut interest rates, increased liquidity to incentivize lending, and promised funds to support the stock market. Bloomberg forecasts that these measures could boost growth by up to 1.1% over the next four quarters, but many analysts remain skeptical about their long-term effectiveness. The risk is that China may enter a prolonged period of weak growth, like Japan’s “Lost Decade” in the 1990s, with global impacts due to the strong economic ties. According to the International Monetary Fund, China will remain the main contributor to global growth until 2028, accounting for 22.6%, more than double that of the United States. However, Beijing is at a crossroads, and its next decisions will be crucial not only for the country’s economic future but also for global economic stability.

🔔 Good Morning, Here it is our market update:

🔔 Good Morning, Here it is our market update:

🔔 Good Morning, Here it is our market update:

𝐑𝐞𝐯𝐢𝐯𝐢𝐧𝐠 𝐄𝐮𝐫𝐨𝐩𝐞'𝐬 𝐜𝐨𝐦𝐩𝐞𝐭𝐢𝐭𝐢𝐯𝐞𝐧𝐞𝐬𝐬: 𝐌𝐚𝐫𝐢𝐨 𝐃𝐫𝐚𝐠𝐡𝐢'𝐬 𝐬𝐭𝐫𝐚𝐭𝐞𝐠𝐲 🚩 𝐂𝐮𝐫𝐫𝐞𝐧𝐭 𝐬𝐢𝐭𝐮𝐚𝐭𝐢𝐨𝐧: Europe faces economic stagnation with a widening gap compared to the United States, primarily due to weak productivity growth linked to slow adoption of advanced technologies like AI, cloud computing, and robotics. 📌 𝐓𝐞𝐜𝐡𝐧𝐨𝐥𝐨𝐠𝐢𝐜𝐚𝐥 𝐥𝐚𝐠: Europe lags the U.S. and China in innovation, particularly in advanced tech sectors, resulting in fewer global tech leaders. 📌 𝐇𝐢𝐠𝐡 𝐞𝐧𝐞𝐫𝐠𝐲 𝐜𝐨𝐬𝐭𝐬: Europe's industries struggle with energy costs, especially natural gas, which is significantly higher than in the U.S., exacerbated by supply disruptions from Russia. 📌 𝐆𝐞𝐨𝐩𝐨𝐥𝐢𝐭𝐢𝐜𝐚𝐥 𝐝𝐞𝐩𝐞𝐧𝐝𝐞𝐧𝐜𝐢𝐞𝐬: Europe's reliance on external sources for raw materials and essential technologies has made it vulnerable to geopolitical risks, notably from Russia and China. 📌 𝐍𝐞𝐞𝐝 𝐟𝐨𝐫 𝐫𝐚𝐝𝐢𝐜𝐚𝐥 𝐜𝐡𝐚𝐧𝐠𝐞: Draghi calls for a substantial shift, proposing annual investments of €750-800 billion (4.4-4.7% of the EU's GDP) to boost competitiveness, akin to the Marshall Plan. 📌 𝐂𝐨𝐦𝐦𝐨𝐧 𝐝𝐞𝐛𝐭 𝐢𝐬𝐬𝐮𝐚𝐧𝐜𝐞: to fund large-scale projects, Draghi suggests issuing joint debt instruments among EU member states to strengthen capital markets integration. 📌 𝐅𝐢𝐬𝐜𝐚𝐥 𝐫𝐞𝐟𝐨𝐫𝐦 𝐧𝐞𝐜𝐞𝐬𝐬𝐢𝐭𝐲: despite having a unified currency for over 25 years, the EU lacks a cohesive fiscal system, hampering its ability to respond to crises and finance strategic initiatives. 📌 𝐔𝐫𝐠𝐞𝐧𝐭 𝐚𝐜𝐭𝐢𝐨𝐧 𝐫𝐞𝐪𝐮𝐢𝐫𝐞𝐝: Draghi emphasizes that Europe must act now or face irreversible decline, urging for immediate and decisive measures to transform existing strengths into global competitiveness.

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