April 2014: The Month In Charts

In April, the Ukraine continued to make news as the United States imposed sanctions on seven Russian government officials and 17 companies linked to Russian President Vladimir Putin in a fresh attempt to force Moscow to back down from its intervention in Ukraine.

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Late in the month, the euro hit a two-week high against the U.S. dollar, helped by safe-haven flows due to the Ukraine crisis and expectations that inflation in the euro zone may rise, lessening the need for looser monetary policy, as reported in this Reuters story.

“Since the onset of the Ukraine crisis the euro has benefited. We expect that pattern to continue,” said Michael Woolfolk, global markets strategist at BNY Mellon in New York. Woolfolk said even if sanctions impact Russia’s main trading partners, the euro will still find demand due to safe-haven capital flight.

Turning toward Asia, this Reuters story reports that six months into China’s grand economic makeover, Beijing is playing it safe, choosing gradual progress on many fronts over game-changing, riskier reforms such as removing all controls over bank interest rates.

The incremental steps promise to reach enough critical mass to sustain reform momentum and help the world’s second-largest economy shift down fairly smoothly after decades of red-hot investment-fuelled growth.

China’s economy is expected to grow by 7.3 percent this year, the slowest rate in 24 years, close to the level Beijing believes is needed to preserve financial and social stability.

Capitalism seems to be no problem for the Chinese e-commerce juggernaut Alibaba Group Holding Ltd., which was the talk of equity markets as it gave investors a look at the scale and growth of its initial public offering (IPO), expected later this year.

Alibaba, which powers 80 percent of all online commerce in the world’s second-largest economy, is expected to raise more than $15 billion, and could top the $16 billion pulled in by Facebook Inc.’s IPO in 2012.

In Europe, Greece and Portugal successfully tapped the credit markets, for a glimmering sign of hope in the euro zone crisis. In early May, European Central Bank President Mario Draghi said he was concerned about the euro’s strength.

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