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☆ Top economist Joe Lavorgna: Fed is making a classic policy mistake by constantly raising rates
▼ + stars: | 2023-02-28 | 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 EmailTop economist Joe Lavorgna: Fed is making a classic policy mistake by constantly raising ratesSMBC Nikko Securities America's Joe Lavorgna joins 'Squawk Box' to discuss what's ahead for the economy, why the 10-year treasury yield hasn't moved, and more.

☆ India's Adani to hold fixed-income roadshow next week in Asia
▼ + stars: | 2023-02-24 | by ( ) www.reuters.com time to read: +1 min

NEW YORK, Feb 24 (Reuters) - India's Adani Group will hold a fixed-income roadshow next week in Asia, according to a bank document seen by Reuters, as the beleaguered conglomerate tries to shore up investor confidence in the aftermath of a U.S. short-seller report. Adani group executives, including group Chief Financial Officer Jugeshinder Singh, will attend the roadshows in Singapore on Feb. 27, and Hong Kong on Feb. 28 and March 1, the document showed. Dollar bonds of Adani Group were largely trading lower on Friday. Bonds of Adani Ports (APSE.NS) maturing in February 2031 led the losses, while some notes of Adani Green Energy (ADNA.NS) were marginally higher. Barclays, BNP Paribas, DBS Bank, Deutsche Bank, Emirates NBD Capital, ING, IMI-Intesa Sanpaolo, MUFG, Mizuho, SMBC Nikko and Standard Chartered Bank are the banks organising next week's roadshow, according to the document.

January's rise was the fastest since September 1981, when fuel costs spiked due to a Middle East oil crisis and hit Japan's import-reliant economy. Core consumer inflation has now exceeded the Bank of Japan's 2% target for nine straight months, mostly reflecting persistent rises in fuel and raw material costs, the data showed. "But there are questions as to whether the rise in inflation will be sustainable, as it is still driven largely by food and fuel costs," he said. At Ueda's debut policy meeting on April 28, the BOJ will release for the first time its inflation forecasts extending to fiscal 2025. Japan's economy averted recession in the fourth quarter of last year but rebounded much less than expected as business investment slumped.

☆ Japan's Nikkei seen hitting 30,000 by end of 2023 on economic recovery: Reuters poll
▼ + stars: | 2023-02-22 | by ( Junko Fujita | ) www.reuters.com time to read: +3 min

"Japanese companies will issue their outlook for 2023 by May, which will be based on the current macro environment. So the forecast will be conservative," said Hikaru Yasuda, chief equity strategist at SMBC Nikko Securities. "But as the environment is not as bad as companies (now) expect, they will slowly raise their forecast towards the end of the year." "Companies whose businesses are linked with China are expected to perform well," said Hiroshi Namioka, chief strategist and fund manager, T&D Asset Management. "Japanese equities are undervalued due to caution for the currency movement," said Hirokazu Kabeya, chief global strategist at Daiwa Securities.

☆ Adani Group hires banks to hold bond investor calls after market rout
▼ + stars: | 2023-02-15 | by ( Davide Barbuscia | ) www.reuters.com time to read: +3 min

NEW YORK, Feb 15 (Reuters) - India's Adani Group and two of its main subsidiaries caught up in a short-selling storm in recent weeks are to hold calls with bond investors on Feb. 16 and Feb. 21, according to a document seen by Reuters. The planned calls follow a long-awaited credit report issued by the Indian conglomerate earlier this week that said its companies faced no material refinancing risk, or near-term liquidity issues. According to the document sent to investors the call on Thursday for Adani Group will be attended by its Chief Financial Officer (CFO) Jugeshinder Singh and head of Group Corporate Finance Anupam Misra. An Adani Green Energy call also on Thursday will involve its CFO Phuntsok Wangyal, and an Adani Transmission call next week will be attended by its CFO Rohit Soni and CFO of Adani Electricity Kunjal Mehta. Rating agencies S&P Global and Moody's this month revised their outlooks to negative from stable for some of the group's companies, while index provider MSCI said it would cut the weightings of some Adani companies in its stock indexes.

Globally, IPOs across all sectors nosedived last year after a blockbuster 2021, as aggressive interest rate hikes by central banks to curb inflation put an end to the era of cheap money. In the biotech sector, there were only 47 IPOs last year that raised a total of about $4 billion, compared with 152 offerings in 2021 that had raised over $25 billion. While the XBI is still trading 50% below its February 2021 closing high, analysts believe the downturn in biotech has bottomed out. All we need is one or two biotech IPOs to get good interest and the floodgates will open." Reuters GraphicsThe second half of 2023 is more likely to see a significant step-up in biotech IPOs instead of the first half, as markets await further clarity on potential rate cuts, analysts said.

U.S. credit card borrowing rates have never been higher and bank lending standards are at recession levels. Many of his colleagues have doubled down on their view that interest rates may need to stay higher for longer. The average U.S. credit card rate is now higher than it has been in at least half a century. This is easily the highest since the comparable data series was started in 2007.chart"It's triple trouble: credit card rates are at record highs, balances are up 15% over the past year, and more people are carrying credit card debt," said Ted Rossman, senior industry analyst at CreditCards.com. "Credit card debt is one of those things that's easy to get into and hard to get out of," he said.

☆ Japan current account surplus shrinks sharply as weak yen, trade deficits bite
▼ + stars: | 2023-02-08 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +3 min

Summary Dec current account surplus shrinks to 33.4 bln yen -MOFPrimary income surplus helps offset trade shortfallsFor 2022, current account surplus falls most on recordAnalyst sees current account bottoming out in 2023TOKYO, Feb 8 (Reuters) - Japan's current account surplus fell sharply in December after a record rise the prior month, finance ministry data showed on Wednesday, highlighting the impact of persistent trade deficits and a weak yen on the country's once-solid balance of payments. The current account surplus stood at 33.4 billion yen ($255.51 million) in December, down steeply from a surplus of 1.8 trillion yen the previous month that was driven by income gains from securities investments and hefty Japanese investments overseas. The latest figure marked a decline of 334 billion yen from a year earlier and undershot economists' median estimates for 98.4 billion yen surplus in a Reuters poll. There is some worry in financial markets that Japan's hefty public debt and a dwindling current account surplus could entrench weakness in the yen over the long run. For the whole of 2022, the current account surplus fell the most on record -- by 10.1 trillion yen from the previous year -- to reach 11.4 trillion yen.

☆ Markets may be taking the wrong read from January's shocking jobs report
▼ + stars: | 2023-02-06 | by ( Jeff Cox | ) www.cnbc.com time to read: +5 min

"The resounding strength of January employment report does not change our view of the labor market. Significant imbalances remain in the labor market due to too much excess demand and limited labor market slack," added Michael Gapen, chief U.S. economist at Bank of America. That's because they see the jobs report gain of 517,000 as a potential impetus to push the Fed into more aggressive interest rate hikes. He thinks future months will show a slowing labor market that will force the Fed into halting its hikes. "From a data-dependency perspective, the strength of the labor market suggests there might be need to continue to raise interest rates."

☆ SoftBank Q3 seen under pressure from tech weakness, Arm IPO eyed
▼ + stars: | 2023-02-03 | by ( Kiyoshi Takenaka | ) www.reuters.com time to read: +3 min

SoftBank has said the initial public offering (IPO) is unlikely to take place during the current business year that ends in March due to market conditions. SoftBank is expected to post a net profit of 103.7 billion yen ($806.13 million) for the latest quarter, according to analysts' average estimate compiled by Refinitiv. That compares with a 29 billion yen profit a year earlier. SoftBank bought Arm, whose technology underpins the global smartphone industry and is used in supercomputers, for $32 billion in 2016. read moreOne notable change to SoftBank's quarterly announcement this time around is the lack of founder and chief executive Masayoshi Son's colourful presentation, which has been a regular feature of SoftBank's earnings disclosure.

☆ Some economists see a 'rolling recession' ahead. Here's what that means
▼ + stars: | 2023-01-25 | by ( Jeff Cox | ) www.cnbc.com time to read: +5 min

Termed "rolling recessions," the idea is that rather than contract broadly and all at once, the economy could see different sectors decline in succession, one after the other. I think we will see rolling recession in the future." Sonders is a proponent of the "rolling recession" theory and noted that stocks can perform well even in downturns. A traditional recession looms To be sure, there are detractors to the "rolling recession" theory. "Have we ever had a period where both housing and manufacturing were in recession at the same time and we didn't have a recession?"

The TGA is a liability on the Fed's balance sheet. This means that when the TGA goes down, reserves go up, effectively administering an injection of liquidity into the system. chartThis runs counter to the Fed's current stance of pursuing a tighter monetary policy, of which draining liquidity from the system via QT is a part. Mark Cabana, head of U.S. rates strategy at Bank of America, calculates that since the Fed's QT program got underway last May, the Fed's balance sheet has shrunk by $406 billion and the TGA has dropped $422 billion. "Fed QT to date has been largely absorbed by lower TGA," he and his team wrote in a recent note.

☆ Debt ceiling clash could push Fed to cut rates, restart QE, says SMBC Nikko Securities America's LaVorgna
▼ + stars: | 2023-01-19 | by ( Melissa Lee | ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailDebt ceiling clash could push Fed to cut rates, restart QE, says SMBC Nikko Securities America's LaVorgnaSMBC Nikko Securities America's Joe LaVorgna on whether hitting the debt limit will counter everything the Fed's trying to do. With CNBC's Melissa Lee and the Fast Money traders, Tim Seymour, Bonawyn Eison, Steve Grasso and Guy Adami.

☆ Japan's yield control faces biggest test to date as BOJ debates policy
▼ + stars: | 2023-01-17 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

But with inflation exceeding its 2% target, the BOJ is facing its biggest test so far for its stimulatory policy, which is called yield curve control (YCC). The cap for the 10-year bond therefore became 0.5%. Market expectations of an early rate hike have boosted yields broadly, with the eight-year moving higher than the 10-year yield. In considering the BOJ's options, some analysts bet it will further widen the band and allow the 10-year yield to rise as far as 0.75%. Others expect the central bank to raise the 10-year yield target above 0%, change it to one targeting a shorter-dated maturity, or abandon it altogether.

☆ Japan current account surplus jumps, marks record for November
▼ + stars: | 2023-01-12 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +2 min

Summary Nov current account surplus at 1.8 trillion yenPrimary income surplus at 3.7 trillion yenTOKYO, Jan 12 (Reuters) - Japan's current account surplus logged a surprising surge to mark a record for November, as weakness in the yen drove income gains from portfolio investment and direct investment overseas to their highest level for the month. November's data marked the first year-on-year growth in the current account surplus since March 2022. The primary income surplus, which includes interest payments and dividends from investments overseas, hit 3.7 trillion yen. It was the largest amount for the month since comparable data became available in 1985, with the previous record being 2.4 trillion yen in November 2021. The trade deficit was 1.5 trillion yen, narrowing from the previous month's 1.9 trillion yen.

☆ Top economist Joe Lavorgna on the biggest risk to the labor market
▼ + stars: | 2023-01-05 | by ( Melissa Lee | ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailTop economist Joe Lavorgna on the biggest risk to the labor marketSMBC Nikko Securities America's Joe Lavorgna on what tomorrow's report means for the market and the Fed. With CNBC's Sara Eison and the Fast Money traders, Tim Seymour, Karen Finerman, Dan Nathan and Guy Adami.

☆ The worst of inflation is likely over, but the worst for the economy probably isn't
▼ + stars: | 2022-12-13 | by ( Jeff Cox | ) www.cnbc.com time to read: +5 min

While the inflation rate is still extraordinarily high, there's widespread agreement that the peak has passed. In fact, the only sector where interest rate increases have seemed to hit so far has been housing. So with lots of policy tightening still in the pipeline, softer inflation's accompanying economic slowdown is yet to come. The Fed's critics worry that the rate increases may have gone too far and could be a severe weight on the economy once inflation wears off. However, following the CPI report traders priced in a lower "terminal rate," or end point for the Fed rate hikes.

☆ Investors revive wagers on Bank of Japan policy change
▼ + stars: | 2022-12-08 | by ( Junko Fujita | ) www.reuters.com time to read: +4 min

TOKYO, Dec 8 (Reuters) - Global investors are short-selling Japanese bonds and driving its other market yields higher, reviving bets that the Bank of Japan will need to tweak its ultra-easy monetary policy sooner rather than later. BOJ Governor Haruhiko Kuroda has repeatedly stressed the need to persist with the bank's unique yield-curve-control policy, which makes Japan an outlier among major central banks aggressively tightening policy to combat inflation. Japan swaps vs yieldsKuroda has said policy will not change until the recent cost-push inflation is accompanied by higher growth in wages. "The central bank may tweak its YCC before March. There should be an event weight it doesn’t have at the moment," says Malcolm, while making clear UBS does not expect any policy change for at least another year.

☆ The Fed's path to a 'Goldilocks' economy just got a little more complicated
▼ + stars: | 2022-12-02 | by ( Jeff Cox | ) www.cnbc.com time to read: +2 min

Spencer Platt | Getty ImagesLittle effect from policy movesThe numbers would indicate that 3.75 percentage points worth of rate increases have so far had little impact on labor market conditions. Much of the Street analysis after the report was viewed through the prism of comments Fed Chairman Jerome Powell made Wednesday. Among them were supply chain issues, housing growth, and labor cost, particularly wages. "Wages are rising more than productivity, as labor supply continues to shrink. To restore labor demand and supply, monetary policy must become more restrictive and remain there for an extended period."

☆ Is the consumer really as strong as Black Friday sales suggest?
▼ + stars: | 2022-11-28 | by ( Melissa Lee | ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailIs the consumer really as strong as Black Friday sales suggest? Joe Lavorgna, SMBC Nikko, on just how strong the consumer really is. With CNBC's Melissa Lee and the Fast Money traders, Dan Nathan, Karen Finerman, Guy Adami and Jeff Mills.

☆ Dollar slides, CPI data suggests Fed could slow pace of rate hikes
▼ + stars: | 2022-11-10 | by ( Herbert Lash | ) www.reuters.com time to read: +5 min

"Inflation is clearly moving in the right direction, and that keeps a more hawkish Fed at bay," he said. The spike higher in the yen versus the dollar stirred speculation the Bank of Japan intervened, which analysts doubted. Fed funds futures priced in a drop in expectations for the U.S. central bank's peak target rate, which fell below 5%. The likelihood of a 50-basis-point rate hike by the Fed instead of a 75-basis-point increase in December rose to 71.5%. CPI rose 7.7% in October on a year-over-year basis, down from 8.2% in the prior month, as headline inflation fell below 8% for the first time since February.

☆ Four experts break down strong third-quarter U.S. GDP data
▼ + stars: | 2022-10-27 | 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 EmailFour experts break down strong third-quarter U.S. GDP dataAustan Goolsbee, former CEA chairman and Booth School of Business professor, Joe LaVorgna, former Trump White House economist and chief economist at SMBC Nikko Securities America, Lindsey Piegza, chief economist at Stifel, Nancy Davis, chief investment officer at Quadratic Capital Management, and CNBC's Rick Santelli join 'Squawk Box' to react to the latest third-quarter GDP data.

☆ Premarket stocks: Don't be fooled by a strong GDP report
▼ + stars: | 2022-10-26 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +7 min

That’s why it’s so surprising that the US economy is expected to show robust growth in Thursday’s third-quarter GDP report. Economists warn that the report could be a one-hit-wonder that overstates momentum in an economy that is actually slowing. “There is more braking power being inflicted on the US economy than will be at all apparent in the third-quarter GDP report,” wrote Kelly. Central bank officials are going to be looking at underlying metrics in the report, and will likely ignore headline numbers, said Patterson. The bottom line: The rejiggering of trade balances often falsely inflates economic growth calculations ahead of a recession.

☆ BOJ, battling rising yields, will conduct emergency bond buying for 2nd day
▼ + stars: | 2022-10-21 | by ( Junko Fujita | ) www.reuters.com time to read: +2 min

In its latest move to curb elevated yields, the BOJ said it would conduct an emergency operations, offering to buy 100 billion yen ($665.56 million) of bonds with maturities between 10 and 25 years. The BOJ conducted a similar operation on Thursday only to see yields on some notes rising to multi-year highs. "But upward pressure on the 10-year bond yields is getting stronger, because not just super-long yields, but yields on shorter ended notes are rising." Yields on the benchmark 10-year yields are at 0.25% at the top of the ceiling of BOJ's policy band, having breached that level for two straight sessions this week. Additionally, the bank would offer to buy 650 billion yen of 5- to 10-year bonds, up from planned 550 billion yen.

☆ Japan manufacturers' mood sours, higher costs dim outlook - Reuters Tankan
▼ + stars: | 2022-10-11 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +3 min

REUTERS/Issei Kato/File PhotoThe monthly poll, which tracks the Bank of Japan’s (BOJ) closely watched tankan quarterly survey, found manufacturers’ mood is expected to deteriorate again over the coming three months while service-sector mood was seen rebounding further. Industries such as autos, steel and textiles weighed on overall manufacturers’ sentiment, while communications, transport and utilities led non-manufacturers. “The prices of products are not keeping pace with surging raw materials costs” as many subcontractors in the supply chain could not pass on input costs to their clients, one manager at a chemicals maker said. “There are concerns about worsening profits due to import costs boosted by a weak yen on top of rising raw materials and energy costs,” said a manager of a food-processing firm. The BOJ’s last survey on Oct. 3 showed big manufacturers’ mood had worsened in July-September for a third straight quarter as high material costs dimmed recovery prospects for the fragile economy.

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