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☆ China cuts lending benchmarks to revive slowing demand
▼ + stars: | 2023-06-20 | by ( ) www.reuters.com time to read: +4 min

REUTERS/Thomas Peter/FILE PHOTOSHANGHAI/SINGAPORE, June 20 (Reuters) - China cut its key lending benchmarks on Tuesday, the first such reductions in 10 months as authorities seek to shore up a slowing economic recovery, although concerns about the property market meant the easing was not as large as expected. The one-year loan prime rate (LPR) was lowered by 10 basis points to 3.55%, while the five-year LPR was cut by the same margin to 4.20%. The People's Bank of China (PBOC) lowered short- and medium-term policy rates last week. "There is no need to roll out all policy measures all at once." Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages.

Persons: Thomas Peter, Julian Evans, Pritchard, Xing Zhaopeng, Xing, China's, Bruce Pang, Jones Lang LaSalle, Winni Zhou, Tom Westbrook, Kripa Jayaram, Sam Holmes Organizations: Central Business, REUTERS, Capital Economics, Reuters, Mainland Properties, People's Bank of China, ANZ, Jones, Graphics, Thomson Locations: Beijing, China, SHANGHAI, SINGAPORE, outpacing

That could necessitate a second round of debt restructuring eventually at some of the developers, they said. Private developers have been in turmoil since mid-2021 following a crackdown on debt levels by Beijing that ensnared China Evergrande Group (3333.HK), then the No.2 developer, and eventually spread in the sector. Evergrande and Sunac China (1918.HK) are the most prominent among the handful of companies that have announced their offshore debt restructuring terms so far. More are expected to do so in the coming months, which will also include terms such as longer maturity extensions, lower coupons, and converting some debt into equity, developers and advisers said. Moreover, the private developers are staring at lower potential future revenues as they are unable to build on their land banks due to their precarious financial positions.

☆ Take Five: Sell in May?
▼ + stars: | 2023-05-05 | by ( ) www.reuters.com time to read: +5 min

The services component of the price data can gauge demand, but consumer and producer price data broadly paint a picture of deflation. April inflation data is out Thursday. At 10.1%, UK inflation is the highest in Western Europe. Reuters Graphics Reuters Graphics4/ SELL IN MAYConventional wisdom has it that May is the ideal point to take profit on equities and lay low until later in the year. "Sell in May and go away" is based on the premise that the best six-month period of the year for stock market returns is November to April, while the leanest is May to October.

LONDON, May 1 (Reuters) - Inflation in the euro area is too high for comfort, meaning markets expect the European Central Bank to deliver its seventh straight interest rate hike on Thursday. 1/ How much will the ECB hike rates by on Thursday? Most analysts expect at least one more rate move after Thursday, even as the Federal Reserve looks set to pause its rate hike campaign. Market pricing suggests ECB rates will peak around 3.6% this year, and Belgium's central bank governor Pierre Wunsch says he wouldn't be surprised to see rates rise to 4%. Tuesday's bank lending should offer some clues but it might be too early to gauge the full impact of the March banking crisis on financing conditions.

In February, over 150,000 Chinese tourists travelled to Thailand, the latest data from the Thai Ministry of Tourism show - a three year high but still 85% below February 2019 levels. Chinese tourists used to make up 10% of European arrivals from outside the continent. Flights to Europe are up to 80% more expensive than before the pandemic, according to ForwardKeys, a travel data firm. Chinese tourists making a comeback is crucial for regional economies. Reuters GraphicsPre-pandemic, China was Australia's top source of tourists, but numbers following Beijing's reopening of borders have only trickled back.

☆ Take Five: How bad is it?
▼ + stars: | 2023-04-14 | by ( ) www.reuters.com time to read: +5 min

China and Britain release key economic data and officials from the Group of Seven nations talk climate goals. 1/ EARNINGS RECESSIONU.S. earnings season goes up a gear and the outlook is gloomy due to the regional banking crisis and the most aggressive monetary policy tightening in decades. Analysts expect Q1 S&P 500 earnings to fall 5.2% from the year-ago period, Refinitiv I/B/E/S data as of April 7 showed. In a sign of which way the authorities want lending rates to head, smaller regional banks have already cut deposit rates. China GDP vs 1-year MLF rate4/ NO ALARMS, NO SURPRISESIt's a big week for UK data, with February jobs figures on Tuesday and March inflation numbers Wednesday.

☆ Take Five: An uneasy calm
▼ + stars: | 2023-04-06 | by ( ) www.reuters.com time to read: +5 min

Kazuo Ueda takes over the helm at the Bank of Japan while U.S. bank earnings kick off and Switzerland's parliament debates the UBS-Credit Suisse tie up. 1/ BANKS' BOTTOM LINESThe uneasy calm that has settled over the U.S. banking sector after the collapse of Silicon Valley Bank will be tested as U.S. financials kick off their earnings season. S&P 500 earnings are predicted to fall 5.0%, I/B/E/S data from Refinitiv showed. Reuters Graphics5/ SPRING MEETINGSPolicymakers and investors head to Washington for the World Bank and International Monetary Fund Spring meetings starting on Monday. It will be the first meeting for Ajay Banga, U.S. nominee to run the World Bank and sole contender for the job.

☆ Signs of pain as easy cash era ends are growing
▼ + stars: | 2023-03-30 | by ( ) www.reuters.com time to read: +5 min

LONDON, March 30 (Reuters) - The easy-cash era is over and markets are feeling the pinch from the sharpest jump in interest rate in decades. Since late 2021, big developed economies including the United States, euro area and Australia have raised rates by almost 3,300 basis points collectively. Japanese, European and U.S. banks stocks, while off recent lows, are still well below levels seen just before SVB's collapse. Reuters Graphics2/ DARLINGS NO MOREAs the SVB collapse showed, stress in the tech sector can quickly ripple out across the economy. Reuters Graphics4/ CRYPTO WINTERHaving benefited from an influx of cash during the easy-money era, cryptocurrencies have felt pain as rates rose last year, then gained on recent signs that tightening could end soon.

☆ Take Five: Everything Everywhere All at Once
▼ + stars: | 2023-03-17 | by ( ) www.reuters.com time to read: +5 min

Lender Credit Suisse will likely dominate a Swiss National Bank meeting and the Bank of England might place its inflation fight on hold. Some predict Credit Suisse could merge with peer UBS to rebuild Switzerland's reputation as a finance safe haven. Credit Suisse will also take centre stage when the SNB meets on Thursday. The Bank of England could be on the verge of wrapping up a 17-month campaign of raising rates to combat inflation. Labour market pressures - including wage inflation - are starting to soften.

Markets have ramped up bets on further rate increases after the ECB has already tightened monetary policy by 3 percentage points since July. ECB President Christine Lagarde reckons a 50 basis points (bps) rate hike "is very, very likely". "The ECB is prioritising getting policy rates as high as needed and nothing else is as important," Pictet Wealth Management's head of macroeconomic research Frederik Ducrozet, said. Signs of economic resilience suggest ECB growth forecasts, also out on Thursday, could be revised upwards for 2023. Falling energy prices and a stronger euro, up around 6% in trade-weighted terms from August lows, suggest headline inflation forecasts could be revised lower.

☆ Take Five: A macro-packed punch for markets
▼ + stars: | 2023-03-10 | by ( ) www.reuters.com time to read: +5 min

1/ THE PRICE IS RIGHTU.S. inflation data have been pivot points for markets and Tuesday's report will likely be consequential as investors gauge whether the Federal Reserve will return to the jumbo-sized rate hikes that shook markets last year. The European Central Bank has raised rates by 3 percentage points since July to 2.5% and looks set for another half-point increase on Thursday. Austria's central bank chief Robert Holzmann wants half-point rises at each of the next four meetings. Riskier, more fragile emerging markets, especially those with twin deficits, could feel the heaviest punch if the Fed goes all the way to 6%. Emerging markets countries hiking (+) or cutting (-) their policy ratesCompiled by Amanda Cooper; Graphics by Pasit Kongkunakornkul, Kripa Jayaram and Vincent Flasseur; Edited by Shounak DasguptaOur Standards: The Thomson Reuters Trust Principles.

☆ SVB collapse a sign of pain coming from end of easy-cash era
▼ + stars: | 2023-03-10 | by ( ) www.reuters.com time to read: +6 min

LONDON, March 10 (Reuters) - The easy-cash era is over and its impact is only just starting to felt by world markets yet to see the end of the sharpest interest rate hiking cycle in decades. European banks slid on Friday after JPMorgan (JPM.N) and BofA (BAC.N) shares fell over 5% on Thursday. BofA noted European banks' bond holdings have not grown since 2015. And with defaults rising, the focus is on the less visible private debt markets, which have ballooned to $1.4 trillion from $250 billion in 2010. Reuters Graphics5/FOR SALEReal estate markets started cracking last year and house prices will fall further this year.

☆ Take Five: A manic March
▼ + stars: | 2023-03-03 | by ( ) www.reuters.com time to read: +5 min

Another dose of hot job growth after January's payrolls increase of 517,000 trounced estimates could stoke fears of more hawkish Fed action. Powell has said the January jobs report showed why the battle against inflation will "take quite a bit of time". Powell's comments and the jobs data could help settle what the Fed does later this month. The RBA hinted at further tightening at its meeting last month, but data since then has pointed the other way. After a red-hot January rally, bonds and equities retreated in February as strong data sparked concerns about more rate hikes.

☆ Take Five: Strap in for no landing
▼ + stars: | 2023-02-24 | by ( ) www.reuters.com time to read: +5 min

1/ FED VS STOCKSReports on U.S. durable goods orders, home prices as well as manufacturing and consumer confidence threaten to cement expectations of more Fed rate hikes and to deal a knockout punch to the early-year stocks rally. Evidence of a stronger-than-expected economy has forced investors to recalibrate projections for Fed hawkishness, lifting bond yields and weighing on stock gains. Tuesday's consumer confidence data may be of particular interest, offering a glimpse into households' views on economic prospects and inflation expectations. The idea of "no landing," which upends a host of popular trades based on a the scenario of the global economy entering recession is gaining traction thanks to surprisingly upbeat data. A soft landing could still happen.

☆ Take Five: A year of war in Ukraine
▼ + stars: | 2023-02-17 | by ( ) www.reuters.com time to read: +5 min

LONDON, Feb 17 (Reuters) - The coming week will mark a year since Russia invaded Ukraine. The war goes on, but the world, and the markets, are in a very different place from last February. 1/A YEAR OF WARSenior politicians and military leaders from around the globe meet in Germany this weekend, days before the anniversary on Feb. 24 of Russia's invasion of Ukraine - Europe's biggest conflict since World War Two. Moscow is ramping up its spring offensive, while Ukraine - armed with heavier and longer-range firepower from the West - gathers strength for a counter push. On the same day as the Ukraine anniversary - Feb. 24 - Ueda should offer clues on timing when he testifies with his two would-be deputies to the lower house.

[1/3] A view of the destroyed village of Moshchun amid Russia's invasion, Kyiv region, Ukraine May 19, 2022. But before they can even begin to be answered, Kyiv is seeking billions just to ride out this year. After a 30% contraction in its economy in 2022, Ukraine will need $38 billion by the end of year to cover its budget deficit alone. "But to me, one of the surprises has been how the private sector has been so resilient." "Supporting Ukraine now is critical to avoid a devastating humanitarian crisis and to strengthen Ukraine for what it's doing for the rest of the world."

☆ Take Five: The truth about inflation
▼ + stars: | 2023-02-10 | by ( ) www.reuters.com time to read: +5 min

That puts Tuesday's U.S. inflation data on the must-watch list. 1/ INFLATION BETSurprisingly strong January U.S. jobs data forced markets to rethink the view that interest rates will peak soon. Now, Tuesday's latest inflation figure is the next big test for where the Federal Reserve takes rates in coming months. Stock markets are confident that the Fed can bring down inflation without triggering a sharp growth slowdown. January's inflation report on Wednesday could show double-digit price rises, meaning no respite yet on the interest-rate front.

☆ Take Five: The Bottom Line
▼ + stars: | 2023-02-03 | by ( ) www.reuters.com time to read: +5 min

Australia and India's central banks are navigating the shifting sands of data and markets are digesting what the world's top central banks have to offer. The question is what impact this will have on bonds and stocks markets after a stellar January? Reuters Graphics4/ RUN RALLY, RUNIt was a stellar start to 2023 for markets - stocks and government bonds enjoyed one of the best Januaries on record, fuelled by optimism that the worst is over. That's not good for a central bank, nor is the idea that their communication is ineffective. Policy rate hikes and cuts by central banks overseeing the 10 most traded currencies.

☆ End of easy-cash era is going to hurt
▼ + stars: | 2023-02-01 | by ( ) www.reuters.com time to read: +5 min

LONDON, Feb 1 (Reuters) - The end of the easy-cash era is over and its impact yet to be felt on world markets, hopeful that the pain of aggressive rate hikes and high inflation has passed. Reuters Graphics3/ GOING PRIVATEPrivate debt markets have ballooned since the financial crisis to $1.4 trillion from $250 billion in 2010. Reuters Graphics Reuters Graphics4/CRYPTO WINTERRising borrowing costs roiled crypto markets in 2022. Reuters Graphics5/FOR SALEReal estate markets, first responders to rate hikes, started cracking last year and 2023 will be tough with U.S. house prices expected to drop 12%. How the sector services its debt is in focus and officials warn European banks risk significant profit hits from sliding house prices.

ECB President Christine Lagarde, speaking in Davos recently, stressed the need for monetary policy to "stay the course." "There were questions recently about why markets don't understand what the ECB will do next," said ING's Brzeski. With updated ECB projections not out until March, Lagarde is likely to be pressed on how the ECB views core inflation, which strips out volatile food and energy prices. The ECB targets headline inflation at 2%, but officials are focused on a core measure. Reuters Graphics5/ Is the ECB more upbeat on the growth outlook?

☆ Take Five: Much to say in Tokyo (and Davos)
▼ + stars: | 2023-01-13 | by ( ) www.reuters.com time to read: +5 min

U.S. earnings and retail sales numbers, a slew of China data and inflation readings elsewhere mean there's plenty to mull over. Recent data showed Tokyo inflation at double the central bank's target. Reuters Graphics Reuters Graphics3/ HOPE AND FEARU.S. retail sales data and more earnings reports are on tap. Before then comes December's data deluge, with industrial output (CNIO=ECI), retail sales (CNRSL=ECI) and Q4 economic growth data (CNGDP=ECI) lining up to be ugly. Economists expect retail sales to have dropped 7.8% for a fourth straight monthly decline and for annual growth to finish up at a meagre 1.8%.

Reuters GraphicsReuters GraphicsIn addition, Loo said a speedy recovery is also hampered by shifts in household liquidity positions over the course of the pandemic. "Unlike the outright cash payoff schemes seen in Hong Kong and Singapore that go some way in supporting household spending, China's COVID-relief programmes have instead focused predominantly on supporting businesses affected by lockdowns," she said. An official factory activity survey showed a sub-index of new export orders has remained in contraction territory for 20 consecutive months. But a recovery in the country's embattled property market could take much longer. Graphics by Kripa Jayaram, Riddhima Talwani and Sumanta Sen; Reporting by Ellen Zhang and Kevin Yao; Editing by Kim CoghillOur Standards: The Thomson Reuters Trust Principles.

☆ Take Five: Welcome to 2023
▼ + stars: | 2023-01-06 | by ( ) www.reuters.com time to read: +5 min

LONDON, Jan 6 (Reuters) - A potential shift by the world's most dovish major central bank, inflation pressures abating, a turn in the economic outlook and oil markets suffering their biggest tumble in decades: Welcome to 2023! 1/ EARNINGS AND INFLATIONThe week ahead brings a critical read into two key themes for Wall Street in 2023: the health of corporate profits and inflation. With crude oil volatility soaring, 2023 might be anything but plain sailing for producers and consumers alike. Barclays expects the UK economy to keep contracting until the end of the third quarter of 2023. It takes time for declines in market prices to filter through into household bills, but signs are positive for cash-strapped consumers and businesses.

☆ China holds benchmark lending rates for 4th consecutive month
▼ + stars: | 2022-12-20 | by ( ) www.reuters.com time to read: +2 min

SHANGHAI, Dec 20 (Reuters) - China kept benchmark lending interest rates unchanged for the fourth consecutive month on Tuesday, matching the forecasts of most market watchers who nevertheless expect further monetary easing to prop up a slowing economy. The one-year loan prime rate (LPR) was left at 3.65%, while the five-year LPR was held at 4.30%. Market watchers regard MLF announcements as guides to any LPR changes. Xing Zhaopeng, senior China strategist at ANZ, said with rates unchanged, household spending would continue without any increase in disposable income. Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages.

☆ Take Five: The grand 2022 central bank finale
▼ + stars: | 2022-12-09 | by ( ) www.reuters.com time to read: +5 min

1/TWICE THE FUNInvestors will be fed a huge helping of year-end U.S. news when Tuesday's release of November consumer inflation data is followed by the Federal Reserve's last rate decision of 2022 on Wednesday. Reuters Graphics2/ SUPER THURSDAYIt's super Thursday in Europe, where central banks in the euro area, Britain, Switzerland and Norway all meet. The pace of aggressive rate hikes from big central banks is slowing but the fight against inflation is not over yet. Surging energy and food costs propelled consumer price inflation to a 41-year high of 11.1% in the year to October. Wednesday's UK inflation data may hint at price rises having peaked, following trends in the eurozone and the U.S.

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