- Tax reform took centre stage in the US as the administration announced proposals for a new corporate tax rate of 20%. There are also plans for a simplification of personal tax brackets, down to three from the current seven. Whilst it remains to be seen whether the plans come to fruition, the markets were positive on the announcements.
- Fed Chair Janet Yellen also spoke in Cleveland last week, were she warned of moving too gradually on interest rates. This led the dollar higher as expectations of one more interest rate rise in the US continue to move higher.
- The euro moved lower over the course of the week in the wake of the Germany’s election results. Whilst Angela Merkel secured her fourth term as Chancellor, she did so with a smaller majority than expected in an election which also saw the far-right AfD party exceed expectations with over 12% of the vote.
Source : Zurich Investment Managers Monday 2nd October 2017