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☆ Economists fear major disruption if the Israel-Hamas conflict is not contained
▼ + stars: | 2023-10-25 | by ( Elliot Smith | ) www.cnbc.com time to read: +7 min

ReutersAny possible escalation of the Israel-Hamas war poses a major risk to the global economy, driving up energy prices and disrupting key trade routes, economists have warned. Israel's subsequent bombardment of Gaza in a bid to eliminate Hamas has increased the risk of a spillover to the wider Middle East region. The events in recent days have deepened the greatest fear among economists, that the conflict engulfs the region and begins to pose a long-term threat to global energy and trade infrastructure. Back then oil prices gained 30% in a matter of two weeks before settling at around 15% above pre-war levels," said J. Safra Sarasin Equity Strategist Wolf von Rotberg. "You choke off those points and you create major disruption not just to oil prices, but the whole supply chain of the world for energy and other goods as well."

Persons: Israel's, Isaac Herzog, Pat Thaker, Thaker, Brent, J . Safra Sarasin, J, Wolf von Rotberg, Elijah Oliveros, Rosen, Oliveros, Paul Gruenwald, Gruenwald Organizations: Hamas, Reuters, Palestinian, Lebanese, Hezbollah, Economist Intelligence Unit, CNBC, Fed, ECB, West Texas, J ., Safra Sarasin Equity Locations: Israel, Palestinian, Gaza, Lebanon, East, Africa, Saudi, Ukraine, Europe, Iran, Tehran, Saudi Arabia, Suez, Persian, Hormuz, U.S, Chile, Turkey, Thailand, Philippines, India, Egypt

Enter the Swiss franc, a longstanding safe haven asset that just hit its highest level against the euro since 2015 , standing tall as its traditional rivals lose appeal. Other than U.S. dollar cash, only the Swiss franc and gold remained as options, Ielpo said. The Swiss franc has rallied over 3% against the yen this month. Reuters GraphicsUNCERTAIN WORLDSince the Oct.7 Hamas attacks in Israel, the Swiss franc -- also referred to as the Swissie -- has rallied roughly 2% against the dollar. "The war in the Middle East clearly has lead to a flight to safety that benefited the Swiss franc," said Karsten Junius, an economist at J.Safra Sarasin in Zurich.

Persons: Morgan Stanley, Florian Ielpo, Ielpo, Jeremy Stretch, Karsten Junius, Francesco Pesole, J.Safra Sarassin's Junius, Luca Paolini, Paolini, Treasuries, Toby Gibb, Naomi Rovnick, Alun John, John Revill, Amanda Cooper, Dhara, Dhara Ranasinghe, Tomasz Janowski Organizations: Swiss, Nestle, Wall, Lombard, U.S, Swiss National Bank, Traders, Ministry of Finance, CIBC Capital Markets, Reuters, ING, Management, Artemis, Thomson Locations: ZURICH, Israel, Geneva, Japan, Zurich, Swiss, U.S, London

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 11, 2023. U.S. producer prices increased more than expected in September amid higher costs for energy products, but underlying inflation pressures at the factory gate continued to moderate. Yield on the benchmark 10-year notes fell to a roughly two-week low as prices rose on safe-haven flows due to fighting in the Middle East that has persisted for a fifth straight day. Advancing issues outnumbered decliners for a 1.51-to-1 ratio on the NYSE, while declining issues outnumbered advancers for a 1.10-to-1 ratio on the Nasdaq. The S&P index recorded 11 new 52-week highs and seven new lows, while the Nasdaq recorded 38 new highs and 124 new lows.

Persons: Brendan McDermid, Fed's Bowman, Raphael Olszyna, J Safra, Michelle Bowman, Christopher Waller, Birkenstock, Tim Wentworth, Drugmaker Eli Lilly, LLY.N, Novo, decliners, advancers, Shashwat Chauhan, Ankika Biswas, Arun Koyyur, Shounak Organizations: New York Stock Exchange, REUTERS, Fed's Bowman Exxon, Nasdaq, Treasury, Federal, Apple, Microsoft, Nvidia, Fed, Energy, Exxon Mobil, Natural Resources, Dow Jones, Walgreens Boots Alliance, Novo Nordisk's, Baxter International, NYSE, Thomson Locations: New York City, U.S, Middle East, Israel, Gaza, Bengaluru

☆ Fed will keep rates high as long as necessary, J Safra Sarasin strategist says
▼ + stars: | 2023-10-02 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailFed will keep rates high as long as necessary, J Safra Sarasin strategist saysWolf von Rotberg, equity strategist at J Safra Sarasin, discusses Fed interest rates. He says interest rates will stay high as long as necessary for inflation to come down sustainably to to its 2% target.

Persons: J Safra, Wolf von Rotberg, J Safra Sarasin

☆ Major central banks are on the brink of peak rates — but the inflation battle might not be over
▼ + stars: | 2023-09-18 | by ( Jenni Reid | ) www.cnbc.com time to read: +4 min

Christine Lagarde, president of the European Central Bank (ECB), at a rates decision news conference in Frankfurt, Germany, on Thursday, Sept. 14, 2023. The ECB raised interest rates again, acting for the 10th consecutive time to choke inflation out of the euro zone's increasingly feeble economy. The European Central Bank last week signaled that its Governing Council feels rates may have got there. Federal ReserveFed Chair Jerome Powell made clear last month that further hikes were on the table, and the central bank is deeply concerned about inflation experiencing a fresh acceleration if financial conditions ease. The consumer price index rose at its fastest monthly rate this year in August, mainly driven by energy prices, and was 3.7% year-on-year.

Persons: Christine Lagarde, Berenberg's Holger Schmieding, Raphael Thuin, Thuin, Jerome Powell, J . Safra Sarasin Organizations: European Central Bank, ECB, Bloomberg, Getty, Deutsche Bank, Tikehau, Federal, U.S . Federal, J ., Fed, Markets, Reuters, Bank of England Locations: Frankfurt, Germany, Europe, U.S

☆ Guest view: Bank balance sheets hide climate risks
▼ + stars: | 2023-09-15 | by ( Natasha Landell-Mills | ) www.reuters.com time to read: +7 min

First, banks’ financial statements appear to be ignoring climate risks, which means financial institutions are probably also leaving those dangers out of their capital calculations. Second, a regulatory regime that understates the expected consequences of climate change is allowing the banks’ blind spot to persist. The few banks that refer to climate risks in their accounts tend to conclude that it is not material. Second, banks need to take a prudent view of climate risks in their financial statements. The sooner the banking sector internalises climate risks in its accounting, the better the chance of building a sustainable future.

Persons: Wells Fargo’s, Banks, Natasha Landell, Mills, Peter Thal Larsen, Oliver Taslic Organizations: Reuters, HSBC, HK, “ Management, prudential, The, Greening, Central, Institute, Faculty of Actuaries, University of Exeter, Institutional, Sarasin, Partners, Thomson

Banks typically sold these perpetual bonds - known as AT1 bonds - with five years before an option to repay was triggered. In the past, investors got their money back, and banks replaced the bonds with new ones, but some are changing tack. The banks' actions show how the wipeout of billions of dollars of Credit Suisse AT1 bonds still reverberates around this market, which is estimated at roughly $275 billion. "The AT1 market is splitting," said Alessandro Cameroni, a portfolio manager at asset manager Lemanik. SHOCK ABSORBERThe AT1 bonds were designed to help banks absorb losses, and they count towards their capital buffers.

Persons: Kai Pfaffenbach, Banks, Alessandro Cameroni, Lemanik, Peter Harvey, Federated Hermes, Italy's, Morgan Stanley, Karsten Junius, J . Safra Sarasin, Chiara Elisei, Carlo Giovanni Boffa, Jane Merriman Organizations: REUTERS, Suisse, Raiffeisen Bank, Reuters, Deutsche, Aareal Bank, Credit Suisse, Investors, Federated, Lloyds, Societe Generale, UBS, Santander, J ., Thomson Locations: Frankfurt, Germany, Ukraine, Swiss, Schroders, Russia

The British company, which sells Cornettos cones and Talenti tubs, on Thursday reported a 0.2% dip in overall quarterly sales volumes, but a more than 4% decline in ice cream volumes. Its ice cream prices rose 10.5% in the quarter, driving turnover of 1.7 billion euros ($1.9 billion). About 60% of Unilever's ice cream business is "in-home" - bought from stores - while the rest is eaten in parlours and other venues. "Ice cream is the most discretionary category that we have across all of our categories," finance chief Graeme Pitkethly said. When consumers are under pressure, because ice cream is more discretionary, ice cream gets dropped from the basket."

Cost inflation rose during the COVID-19 pandemic and was exacerbated by Russia's invasion of Ukraine, which sent energy prices to record highs last year. Energy costs have since dropped, however, while global prices for some commodities are rising more slowly. Companies like Nestle (NESN.S), Reckitt Benckiser (RKT.L) and Danone (DANO.PA) continued to raise prices sharply in the first quarter even though input costs are easing. First quarter price/mix, a basket of variables the company uses to help determine what prices to charge, rose 12.4% while sales volumes declined 4.5%. Similarly, Nestle increased its prices by 9.8% during the quarter and sales volumes - which the company calls real internal growth - fell only 0.5%.

☆ Credit Suisse pays back some emergency liquidity, central bank data suggests
▼ + stars: | 2023-04-11 | by ( ) www.reuters.com time to read: +3 min

ZURICH, April 11 (Reuters) - Credit Suisse (CSGN.S) has already paid back some of the emergency liquidity offered by the Swiss National Bank (SNB), data suggested on Tuesday, signaling an ebbing of the liquidity crisis which triggered the lender's fall. Sight deposits - cash held by commercial banks overnight with the SNB - fell by 31 billion Swiss francs ($34.3 billion)last week, data published by the central bank showed. In recent weeks sight deposits have soared as Credit Suisse received emergency liquidity infusions to head off a bank run as nervous customers pulled out their cash. Following a state-sponsored takeover by rival UBS (UBSG.S), another 200 billion francs in liquidity was also made available by the SNB. Credit Suisse, the SNB and UBS declined to comment on the development.

☆ Swiss sight deposits fall, suggesting Credit Suisse, UBS took less emergency help
▼ + stars: | 2023-04-03 | by ( John Revill | ) www.reuters.com time to read: +2 min

ZURICH, April 3 (Reuters) - Sight deposits held by the Swiss National Bank declined last week, data showed on Monday, suggesting that Credit Suisse (CSGN.S) and UBS (UBSG.S) may have cut back on use of emergency funds offered them to facilitate their planned merger. Total sight deposits - meaning commercial bank cash held by the central bank overnight - fell to 563.566 billion Swiss francs ($614.71 billion) from 567.003 billion francs in the previous week, the SNB data showed. Sight deposits had risen 51.8 billion francs the week before, the second biggest increase on record and probably linked to UBS and Credit Suisse tapping the liquidity lines offered by the SNB and Swiss government after the takeover was announced. Both banks have been offered 200 billion francs in emergency liquidity after Credit Suisse suffered massive outflows from worried investors. The SNB and Credit Suisse both declined to comment on the changes in sight deposits on Monday.

☆ Swiss sight deposits jump, suggesting Credit Suisse, UBS took emergency liquidity
▼ + stars: | 2023-03-27 | by ( ) www.reuters.com time to read: +2 min

[1/2] A logo is pictured on the Credit Suisse bank in Geneva, Switzerland, March 15, 2023. Sight deposits - cash held by the SNB for commercial banks overnight - jumped to 567 billion Swiss francs ($619 billion) from 515 billion francs a week earlier. Last week's rise indicates that both UBS and Credit Suisse may have used some of the 200 billion francs in extra liquidity offered by the SNB as part of a state-sponsored rescue of Credit Suisse. UBS agreed to buy Credit Suisse for 3 billion Swiss francs in stock in a merger engineered to avoid more market-shaking turmoil in global banking. Credit Suisse had already said it would take 50 billion francs from the SNB under its emergency liquidity assistance (ELA) facility before the UBS takeover.

☆ More volatility, possible correction ahead for global stock markets: Reuters poll
▼ + stars: | 2023-02-23 | by ( Hari Kishan | ) www.reuters.com time to read: +5 min

SummarySummary Companies poll datahttp://tmsnrt.rs/2nHJiJ9https://tmsnrt.rs/3EwxtMLhttps://tmsnrt.rs/3EwgwloBENGALURU, Feb 23 (Reuters) - Volatility in global stock markets is not yet over, as more investors reckon interest rates will likely stay higher for longer, according to a Reuters poll of equity analysts, a slight majority of whom expected a correction within three months. "Valuations are stretched across equity markets after the rally year-to-date. The Feb. 10-22 Reuters poll of more than 150 strategists, analysts and fund managers covering 17 global stock indices, found 56% were expecting a correction in their local market in the next three months. Latam stock markets will have a relatively better year with Mexican stocks expected to advance 6.7% to 57,500 points and Brazil's Bovespa stock index predicted to gain 14.5% to 125,000 points by year-end. (Other stories from the Reuters Q1 global stock markets poll package:)Reporting by Hari Kishan and Sarupya Ganguly; Additional reporting and polling by correspondents in Bengaluru, Buenos Aires, London, Mexico City, Milan, New York, San Francisco, Sao Paulo, Tokyo and Toronto; Editing by Ross Finley and Sharon SingletonOur Standards: The Thomson Reuters Trust Principles.

☆ POLL Global stocks to correct in short term as inflation weighs
▼ + stars: | 2023-02-23 | by ( Hari Kishan | ) www.reuters.com time to read: +4 min

Summary poll datahttp://tmsnrt.rs/2nHJiJ9BENGALURU, Feb 23 (Reuters) - Global stock markets are expected to correct in the next three months as investors digest the fact that interest rates are likely to stay higher for longer, according to a Reuters poll of equity analysts. The poll showed a majority would fall short, or just about recoup their 2022 losses by the end of the year. Stocks have rallied about 20% in recent months and some strategists say that the market has gone too far. "Valuations are stretched across equity markets after the rally year-to-date. A stronger 70% majority of analysts, 57 of 82, expected value stocks to outperform growth stocks this year.

This would take the rate the ECB pays on bank deposits to the highest level since November 2008, after a steady climb from a record low of -0.5% in July. Reuters GraphicsThe ECB said in December that rates would be increased "at a steady pace" until it is happy inflation is heading back down to its 2% target. BNP Paribas also thought the ECB might take out the reference to a "steady pace" of rate hikes or offset it so that a 50-basis-point increase would be "not predetermined (but) still a possible outcome". And an ECB survey showed banks were tightening access to credit by the most since the 2011 debt crisis - usually the harbinger of lower growth and slowing inflation. To some observers, this meant the ECB would be wise not to commit to any future policy move.

☆ Bank of England to lift rates to 4% on Feb 2, finish at 4.25% in March - Reuters poll
▼ + stars: | 2023-01-24 | by ( Jonathan Cable | ) www.reuters.com time to read: +3 min

REUTERS/Dado Ruvic/IllustrationLONDON, Jan 24 (Reuters) - The Bank of England will lift the Bank Rate by 50 basis points on Feb. 2 to 4.00% and then add another 25 basis points in March before pausing, according to a Reuters poll of economists who said the greater risk was that it would do even more. A firm majority, 29 of 42 respondents to the Jan. 18-24 poll, said the Bank would add 50 basis points next Thursday. Median forecasts in the poll showed the Bank would then add 25 basis points in March, giving a peak rate of 4.25%. Markets are pricing in a peak of 4.50% for Bank Rate. However, the poll showed GDP falling 0.3% this quarter and next and 0.1% in the third quarter.

☆ Swiss National Bank posts record $143 billion loss in 2022
▼ + stars: | 2023-01-09 | by ( John Revill | ) www.reuters.com time to read: +2 min

ZURICH, Jan 9(Reuters) - The Swiss National Bank posted an annual loss of 132 billion Swiss francs ($143 billion) in 2022, it said on Monday, the biggest in its 115-year history as falling stock and fixed-income markets hit the value of its share and bond portfolio. Monday's provisional figure, which marked a reverse from a 26 billion franc profit in 2021, was far bigger than the previous record loss of 23 billion francs chalked up in 2015. It made a loss of 131 billion francs from its foreign currency positions - the more than 800 billion francs in stocks and bonds it bought during a long campaign to weaken the Swiss franc. The strong Swiss franc - it rose above parity versus against the euro in July - led to exchange rate-related losses. The 2022 loss meant the central bank will not make its usual payout to the Swiss central and regional governments, it said.

☆ Swiss National Bank surprises with forex purchases in Q3
▼ + stars: | 2022-12-22 | by ( ) www.reuters.com time to read: +2 min

ZURICH, Dec 22 (Reuters) - The Swiss National Bank bought 12.8 billion Swiss francs ($13.84 billion) of foreign currencies during the third quarter of this year, data showed on Thursday, a surprise after the central bank sold 52 billion francs of forex in the first half. The central bank had been selling foreign currencies to maintain the high nominal value of the franc - an aid in its battle against resurgent inflation. But the SNB bought 12.8 billion francs of forex between July and the end of September. The net acquisition of foreign reserve assets was reduced to 2.4 billion francs after the SNB sold securities valued at 10.4 billion francs during the period. The SNB also published data on Swiss current account, which showed the country's surplus widening to 24.1 billion Swiss francs ($26.08 billion) from 21.7 billion francs a year earlier.

[1/4] Chairman Thomas Jordan of the Swiss National Bank (SNB) looks on as he attends a news conference in Bern, Switzerland December 15, 2022. Although Swiss inflation plateaued at 3% in November, it remains elevated by the country's own standards and outside the SNB's price stability goal of annual increases of 0-2%. The European Central Bank is expected to increase its deposit rate by half a percentage point later on Thursday, according to a Reuters poll, while the Bank of England is also forecast to add 50 basis points to its Bank Rate. In its latest forecast on Thursday, the SNB said it expected inflation rates of 2.9% in 2022, 2.4% in 2023 and 1.8% in 2024. Inflation was then expected to rise again, to 2.1% in the third quarter of 2025, the central bank said - above its price stability goal.

☆ Swiss National Bank cuts overnight deposits by 30 billion francs
▼ + stars: | 2022-10-10 | by ( ) www.reuters.com time to read: +2 min

The building of the Swiss National Bank (SNB) is pictured in Bern, Switzerland June 16, 2022. REUTERS/Arnd WiegmannZURICH, Oct 10 (Reuters) - The amount of commercial bank cash held overnight with the Swiss National Bank fell by 30 billion Swiss francs ($30.07 billion) last week, data on Monday showed, illustrating how the central bank is tightening monetary policy by reducing market liquidity. Total sight deposits, which include other deposits on sight in Swiss francs, declined to 639.332 billion francs from 669.585 billion francs in the previous week. The SNB raised its policy rate to 0.5% last month as it sought to battle inflation in Switzerland. "At 0,445% the SARON today is not that far away from the official policy rate such that further interventions through bills or repos don't seem that urgent," he said.

The building of the Swiss National Bank (SNB) is pictured in Bern, Switzerland June 16, 2022. The increase to 0.5%, from minus 0.25%, followed a 50 basis point hike in June from minus 0.75%, the SNB's first rate hike in 15 years. The SNB originally imposed negative rates in December 2014 and lowered them again in January 2015 to minus 0.75%. Negative rates were unpopular among Swiss banks, who saw them as a charge on their activities and also reduced lending margins. The Swiss Bankers Association said negative rates meant the country's lenders had borne the brunt of the fight against the appreciating franc.

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