Ilari Puranen
@ilethegamester.bsky.social
Portfolio Manager, Emerging Market Debt
Should you be borrowing money to increase your reserves? No! For one, you are paying higher rates to your liability, than you receive from your reserves, therefore eroding your reserves with negative carry.
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May 15, 2025 at 2:50 PM
Should you be borrowing money to increase your reserves? No! For one, you are paying higher rates to your liability, than you receive from your reserves, therefore eroding your reserves with negative carry.
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An interesting outcome of trade negotiations might be, that countries accused of currency manipulation might do less of manipulation.
Wether that was the case in friday's TWD appreciation (+3%), is just a rumour. But maybe worth keeping eye on with some of the EM currencies.
Wether that was the case in friday's TWD appreciation (+3%), is just a rumour. But maybe worth keeping eye on with some of the EM currencies.
May 3, 2025 at 4:46 PM
An interesting outcome of trade negotiations might be, that countries accused of currency manipulation might do less of manipulation.
Wether that was the case in friday's TWD appreciation (+3%), is just a rumour. But maybe worth keeping eye on with some of the EM currencies.
Wether that was the case in friday's TWD appreciation (+3%), is just a rumour. But maybe worth keeping eye on with some of the EM currencies.
Governance matters when you invest in government bonds. And several governance indicators for USA have been declining for years now (2024 data hasn't been published yet).
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April 22, 2025 at 1:21 PM
Governance matters when you invest in government bonds. And several governance indicators for USA have been declining for years now (2024 data hasn't been published yet).
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I agree here, the short term moves in USD are cyclical. The de-dollarisation happens gradually and is a long-term factor.
There's two ways the de-dollarisation will happen:
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There's two ways the de-dollarisation will happen:
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The Dollar is falling. Every time it falls, some see an end to its reserve currency status. If that were the case now, the Dollar would be falling on a broad basis, but it isn't. It's falling against the G10 (black), but not against EM (blue). This Dollar fall is just a cyclical G10 re-rating...
April 17, 2025 at 1:11 PM
I agree here, the short term moves in USD are cyclical. The de-dollarisation happens gradually and is a long-term factor.
There's two ways the de-dollarisation will happen:
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There's two ways the de-dollarisation will happen:
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As of yesterday, Argentina has changed their FX regime from crawling peg to float freely between 1,000-1,400 per dollar.
The band will be gradually expanded.
This is an important step towards making ARS investable currency. Make Argentina Great Again!
The band will be gradually expanded.
This is an important step towards making ARS investable currency. Make Argentina Great Again!
April 15, 2025 at 2:11 PM
As of yesterday, Argentina has changed their FX regime from crawling peg to float freely between 1,000-1,400 per dollar.
The band will be gradually expanded.
This is an important step towards making ARS investable currency. Make Argentina Great Again!
The band will be gradually expanded.
This is an important step towards making ARS investable currency. Make Argentina Great Again!
When an emerging market country is heading into a debt or currency crisis, the symptoms are often the following:
- Equity markets sell off
- Currency depreciates
- Yields on sovereign debt rise
- Yield curve steepens
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- Equity markets sell off
- Currency depreciates
- Yields on sovereign debt rise
- Yield curve steepens
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April 11, 2025 at 12:09 PM
When an emerging market country is heading into a debt or currency crisis, the symptoms are often the following:
- Equity markets sell off
- Currency depreciates
- Yields on sovereign debt rise
- Yield curve steepens
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- Equity markets sell off
- Currency depreciates
- Yields on sovereign debt rise
- Yield curve steepens
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Tariffs can be negotiated and Argentina is leading the way. Others will soon follow, but the big question mark is China.
buenosairesherald.com/economics/ar...
buenosairesherald.com/economics/ar...
Argentina is negotiating a tariff cut, U.S. official confirms - Buenos Aires Herald
U.S. Trade Representative Jamieson Greer welcomed the move, where Argentina aims to reduce tariffs and non-tariff barriers
buenosairesherald.com
April 9, 2025 at 6:00 PM
Tariffs can be negotiated and Argentina is leading the way. Others will soon follow, but the big question mark is China.
buenosairesherald.com/economics/ar...
buenosairesherald.com/economics/ar...
Will we see a surprise rate hike from the National Bank of Hungary (NBH) tomorrow?
Inflation has been surprising to the upside and latest print, 5.6, was well above NBHs target range of 2-4. This trend, driven by food and fuel, has been going on for a few months now. (1/2)
Inflation has been surprising to the upside and latest print, 5.6, was well above NBHs target range of 2-4. This trend, driven by food and fuel, has been going on for a few months now. (1/2)
March 24, 2025 at 2:46 PM
Will we see a surprise rate hike from the National Bank of Hungary (NBH) tomorrow?
Inflation has been surprising to the upside and latest print, 5.6, was well above NBHs target range of 2-4. This trend, driven by food and fuel, has been going on for a few months now. (1/2)
Inflation has been surprising to the upside and latest print, 5.6, was well above NBHs target range of 2-4. This trend, driven by food and fuel, has been going on for a few months now. (1/2)
Unfortunate for Bitcoin enthusiasts, but BTC just doesn't make a good FX reserve for central banks.
For one, it doesn't meet the IMF criteria for FX reserves (liquidity, stability, credit risk). Furthermore:
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For one, it doesn't meet the IMF criteria for FX reserves (liquidity, stability, credit risk). Furthermore:
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South Korea Central Bank Rules Out Bitcoin as Reserve Asset - Decrypt
The Bank of Korea said that Bitcoin does not meet the International Monetary Fund’s criteria for foreign exchange reserves.
decrypt.co
March 17, 2025 at 6:17 PM
Unfortunate for Bitcoin enthusiasts, but BTC just doesn't make a good FX reserve for central banks.
For one, it doesn't meet the IMF criteria for FX reserves (liquidity, stability, credit risk). Furthermore:
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For one, it doesn't meet the IMF criteria for FX reserves (liquidity, stability, credit risk). Furthermore:
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Some say that Bitcoin is digital gold. Is it, though?
In the recent market turmoil (from 24-Feb, when VIX started climbing up) Bitcoin has lost 10% of its value. (1/2)
In the recent market turmoil (from 24-Feb, when VIX started climbing up) Bitcoin has lost 10% of its value. (1/2)
March 12, 2025 at 3:30 PM
Some say that Bitcoin is digital gold. Is it, though?
In the recent market turmoil (from 24-Feb, when VIX started climbing up) Bitcoin has lost 10% of its value. (1/2)
In the recent market turmoil (from 24-Feb, when VIX started climbing up) Bitcoin has lost 10% of its value. (1/2)
China is building a strategic reserve of fuels, food and other commodities.
USA is building a strategic reserve of cryptocurrencies and meme coins.
Which one is the winning strategy?
www.reuters.com/markets/comm...
USA is building a strategic reserve of cryptocurrencies and meme coins.
Which one is the winning strategy?
www.reuters.com/markets/comm...
China plans to accelerate annual stockpiling of strategic commodities
China said on Wednesday it would accelerate the annual stockpiling of strategic fuels, food and other commodities.
www.reuters.com
March 6, 2025 at 11:26 AM
China is building a strategic reserve of fuels, food and other commodities.
USA is building a strategic reserve of cryptocurrencies and meme coins.
Which one is the winning strategy?
www.reuters.com/markets/comm...
USA is building a strategic reserve of cryptocurrencies and meme coins.
Which one is the winning strategy?
www.reuters.com/markets/comm...
Reposted by Ilari Puranen
From the Financial Times article, “China’s holdings of US Treasuries fall to lowest level since 2009:”
“Analysts say the change partly reflects China’s desire to diversify its foreign reserves by buying assets such as gold. But they add that Beijing is seeking to disguise the true extent of…
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“Analysts say the change partly reflects China’s desire to diversify its foreign reserves by buying assets such as gold. But they add that Beijing is seeking to disguise the true extent of…
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February 19, 2025 at 9:33 AM
From the Financial Times article, “China’s holdings of US Treasuries fall to lowest level since 2009:”
“Analysts say the change partly reflects China’s desire to diversify its foreign reserves by buying assets such as gold. But they add that Beijing is seeking to disguise the true extent of…
1 of 2
“Analysts say the change partly reflects China’s desire to diversify its foreign reserves by buying assets such as gold. But they add that Beijing is seeking to disguise the true extent of…
1 of 2
There’s been a lot of critique on Trump administration after yesterday’s news about Ukraine. Is the media negativity really justified?
The bond market seems to be taking these events more positively: Ukrainian bonds were up roughly 2 figures from yesterdays open. (1/2)
The bond market seems to be taking these events more positively: Ukrainian bonds were up roughly 2 figures from yesterdays open. (1/2)
February 13, 2025 at 4:06 PM
There’s been a lot of critique on Trump administration after yesterday’s news about Ukraine. Is the media negativity really justified?
The bond market seems to be taking these events more positively: Ukrainian bonds were up roughly 2 figures from yesterdays open. (1/2)
The bond market seems to be taking these events more positively: Ukrainian bonds were up roughly 2 figures from yesterdays open. (1/2)
Who’s been buying gold? Top 5 central banks, who added gold to their reserves in 2024*:
(*Turkey is based on data up to Q3, since Q4 figure hasn’t been published yet)
Source: World Gold Council
(*Turkey is based on data up to Q3, since Q4 figure hasn’t been published yet)
Source: World Gold Council
February 12, 2025 at 3:19 PM
Who’s been buying gold? Top 5 central banks, who added gold to their reserves in 2024*:
(*Turkey is based on data up to Q3, since Q4 figure hasn’t been published yet)
Source: World Gold Council
(*Turkey is based on data up to Q3, since Q4 figure hasn’t been published yet)
Source: World Gold Council
China’s central bank keeps buying gold (see link in comments). It's a smart move.
In fact, any central bank that is facing threat of financial sanctions or asset seizures should be doing the same. Diversifying their reserve assets.
In short, trade wars are bullish for gold.
In fact, any central bank that is facing threat of financial sanctions or asset seizures should be doing the same. Diversifying their reserve assets.
In short, trade wars are bullish for gold.
February 8, 2025 at 2:52 PM
China’s central bank keeps buying gold (see link in comments). It's a smart move.
In fact, any central bank that is facing threat of financial sanctions or asset seizures should be doing the same. Diversifying their reserve assets.
In short, trade wars are bullish for gold.
In fact, any central bank that is facing threat of financial sanctions or asset seizures should be doing the same. Diversifying their reserve assets.
In short, trade wars are bullish for gold.
(The expectation of) tariffs is bullish for gold. And not only that, you want to have your gold in the right jurisdiction.
www.bullionvault.com/gold-news/go...
www.bullionvault.com/gold-news/go...
Record Gold Outflows Hit London | Gold News
www.bullionvault.com
February 7, 2025 at 5:27 PM
(The expectation of) tariffs is bullish for gold. And not only that, you want to have your gold in the right jurisdiction.
www.bullionvault.com/gold-news/go...
www.bullionvault.com/gold-news/go...
If you think markets have been complacent about tariffs, take a look at JP Morgan EM FX volatility index.
It has bearly nudged since Friday and is well below it's long term average.
It has bearly nudged since Friday and is well below it's long term average.
February 3, 2025 at 2:09 PM
If you think markets have been complacent about tariffs, take a look at JP Morgan EM FX volatility index.
It has bearly nudged since Friday and is well below it's long term average.
It has bearly nudged since Friday and is well below it's long term average.
Reposted by Ilari Puranen
February 1, 2025 at 8:56 AM
Will Donald Trump be able to stop the de-dollarization?
In the short run tariffs are a deterrent for BRICS countries not to de-dollarize.
But in the long run the threat of tariffs (or other financial sanctions) is an incentive to de-dollarize.
In the short run tariffs are a deterrent for BRICS countries not to de-dollarize.
But in the long run the threat of tariffs (or other financial sanctions) is an incentive to de-dollarize.
January 31, 2025 at 12:45 PM
Will Donald Trump be able to stop the de-dollarization?
In the short run tariffs are a deterrent for BRICS countries not to de-dollarize.
But in the long run the threat of tariffs (or other financial sanctions) is an incentive to de-dollarize.
In the short run tariffs are a deterrent for BRICS countries not to de-dollarize.
But in the long run the threat of tariffs (or other financial sanctions) is an incentive to de-dollarize.
Case in point: The Hong Kong Monetary Authority left its base rate at 4.75%. Fed didn't cut, so neither did HKMA.
Unpopular opinion: Hong Kong should give up the currency peg to USD.
In the previous cycle Fed's accomodative monetary policy resulted in negative real rates in Hong Kong, leading to a real estate bubble. Rates were too low.
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In the previous cycle Fed's accomodative monetary policy resulted in negative real rates in Hong Kong, leading to a real estate bubble. Rates were too low.
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January 30, 2025 at 1:58 PM
Case in point: The Hong Kong Monetary Authority left its base rate at 4.75%. Fed didn't cut, so neither did HKMA.
Nobody's writing about this. When Trump threatened Colombia with tariffs, asset seizures were also on the table.
So his trade policy is not just about tariffs. I think this is pretty huge deal. Any central bank on Trump's crosshair should have a strong incentive to de-dollarize.
So his trade policy is not just about tariffs. I think this is pretty huge deal. Any central bank on Trump's crosshair should have a strong incentive to de-dollarize.
January 28, 2025 at 9:32 AM
Nobody's writing about this. When Trump threatened Colombia with tariffs, asset seizures were also on the table.
So his trade policy is not just about tariffs. I think this is pretty huge deal. Any central bank on Trump's crosshair should have a strong incentive to de-dollarize.
So his trade policy is not just about tariffs. I think this is pretty huge deal. Any central bank on Trump's crosshair should have a strong incentive to de-dollarize.
Unpopular opinion: Hong Kong should give up the currency peg to USD.
In the previous cycle Fed's accomodative monetary policy resulted in negative real rates in Hong Kong, leading to a real estate bubble. Rates were too low.
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In the previous cycle Fed's accomodative monetary policy resulted in negative real rates in Hong Kong, leading to a real estate bubble. Rates were too low.
(1/2)
January 24, 2025 at 3:34 PM
Unpopular opinion: Hong Kong should give up the currency peg to USD.
In the previous cycle Fed's accomodative monetary policy resulted in negative real rates in Hong Kong, leading to a real estate bubble. Rates were too low.
(1/2)
In the previous cycle Fed's accomodative monetary policy resulted in negative real rates in Hong Kong, leading to a real estate bubble. Rates were too low.
(1/2)
Turkey's central bank cutting rates 250bp seems odd to me.
With inflation running at 44.38%, their monetary policy doesn't seem very restrictive 🤔 (real rates at zero)
Is this another "erdoganomics" moment?
With inflation running at 44.38%, their monetary policy doesn't seem very restrictive 🤔 (real rates at zero)
Is this another "erdoganomics" moment?
January 23, 2025 at 3:23 PM
Turkey's central bank cutting rates 250bp seems odd to me.
With inflation running at 44.38%, their monetary policy doesn't seem very restrictive 🤔 (real rates at zero)
Is this another "erdoganomics" moment?
With inflation running at 44.38%, their monetary policy doesn't seem very restrictive 🤔 (real rates at zero)
Is this another "erdoganomics" moment?
What happens when an EM central bank intervenes in FX markets? It has to sell reserves. That means US Treasuries / T-bills.
Reuters reports, that reserves of EM central banks have been declining (see link in comments).
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Reuters reports, that reserves of EM central banks have been declining (see link in comments).
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January 17, 2025 at 10:46 AM
What happens when an EM central bank intervenes in FX markets? It has to sell reserves. That means US Treasuries / T-bills.
Reuters reports, that reserves of EM central banks have been declining (see link in comments).
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Reuters reports, that reserves of EM central banks have been declining (see link in comments).
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