Posted on Saturday, 19th June 2010 by Jesse Walker
LONDON (Reuters) – Tensions in global financial markets stemming from the euro zone’s sovereign debt crisis appear to be easing, setting the stage for investors to dip back into risky assets in the second half of this year.
China’s announcement on Saturday that it will end the yuan’s 23-month peg against the dollar, clearing the way for appreciation of the Chinese currency to resume, is likely to reinforce the recovery of an appetite for risk.
Last week’s relatively successful bond sales in peripheral euro zone countries, and expectations that the Federal Reserve and other central banks will keep borrowing costs low, are calming investor nerves after a risk storm in May prompted a rush to safe-haven assets.
Against this backdrop, world stocks, measured by the MSCI index .MIWD00000PUS, scored their biggest weekly gain since early March last week and hit a one-month high on Friday.
Tags: Easing, Easing Ahead
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