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☆ ECB set to raise deposit rate 50 bps as euro zone enters recession -economists
▼ + stars: | 2022-11-22 | by ( Jonathan Cable | Leigh Thomas | ) www.reuters.com time to read: +3 min

It will lift its deposit rate by another 50 bps on Dec. 15, taking it to 2.00%, and do the same to the refinancing rate, putting it at 2.50%, according to the median forecasts in the Nov. 15-21 Reuters poll. That deposit rate view was held by a majority of 45 of 62 respondents, while 14 said it would add another 75 bps as it has done at its previous two meetings. When asked about the risks to their deposit rate forecasts, 18 of 22 economists said it would end higher, either earlier of later than they expect. However, collectively economists gave a 70% probability their deposit rate peak forecasts were accurate. GDP was predicted to fall 0.4% this quarter and in the first quarter of next year, meeting the technical definition of recession.

Nov 21 (Reuters) - Investors are increasingly eyeing U.S. corporate credit offering attractive valuations and yields after steep declines in 2022, fund managers told the Reuters Global Markets Forum (GMF). "We are at the beginning of a rotation as investors come back into credit. iShares iBoxx Investment Grade Corporate Bond ETF (LQD.P) and iShares High Yield Corporate Bond ETF (HYG.P) are on track for quarterly gains of more than 3% in the fourth quarter after falling 20% and 14% respectively this year. "If we're at this turning point then the entry level you get by buying investment-grade credit in the (United) States looks really attractive." The jump in bond yields, which move inversely to prices, has also made corporate credit more attractive to investors looking for income after years of low interest rates, Ramji said.

☆ Fed to lift rates by 50 basis points, but peak policy rate may be higher
▼ + stars: | 2022-11-18 | by ( Prerana Bhat | ) www.reuters.com time to read: +4 min

U.S. consumer price inflation unexpectedly fell below 8% last month, bolstering already well-established market expectations the Fed would go for smaller rate hikes going forward after four consecutive 75-basis-point increases. Peak rate forecasts ranged between 4.25%-4.50% and 5.75%-6.00%. But 16 of 28 respondents to an additional question said the bigger risk was that rates would peak higher and later than they expect now, with another four saying higher and earlier. "While markets are focused on peak inflation, underlying inflation trends are persistent. This could force the Fed to keep raising the federal funds rate well into next year and beyond levels currently anticipated," said Philip Marey, senior U.S. strategist at Rabobank.

☆ TSX futures drop as oil, gold prices weigh
▼ + stars: | 2022-11-17 | by ( ) www.reuters.com time to read: +1 min

(Reuters) - Futures for Canada's main stock index fell on Thursday, tracking losses in commodity prices from fears over weakening demand in top consumer China. December futures on the S&P/TSX index were down 0.5% at 6:52 a.m. The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) ended lower on Wednesday as lower oil prices weighed on energy shares, while data showed that annual inflation held steady. Oil prices also fell as geopolitical tensions eased while rising COVID infections in China added worries that demand would not recover soon. U.S. stock index futures edged lower on Thursday following mixed economic data this week, while chip designer Nvidia rose after reporting better-than-expected quarterly revenue.

☆ Chip stocks hammered in Asia, dollar firms on hawkish Fed
▼ + stars: | 2022-11-17 | by ( Kevin Buckland | Yousef Saba | ) www.reuters.com time to read: +4 min

TOKYO, Nov 17 (Reuters) - Chip stocks took a beating on Thursday, sending most Asian share indexes lower, after grim signals from Micron Technology overnight about excess inventories and sluggish demand. Meanwhile, the U.S. dollar rebounded after stronger-than-expected U.S. retail sales suggested the Federal Reserve was unlikely to ease up in its battle with inflation. Hong Kong's Hang Seng Index (.HSI) tumbled 2.1%, with its tech stocks (.HSTECH) slipping more than 4%. Japan's Nikkei (.N225) lost 0.3% and South Korea's Kospi (.KS11) dropped 1.1%, each led by declines in heavyweight chip players. The U.S. dollar index - which measures the currency against six major counterparts - added 0.13% to 106.41, stabilizing after a slide as low as 105.30 on Tuesday following the release of producer price inflation numbers.

Meanwhile, the U.S. dollar rebounded after stronger-than-expected U.S. retail sales suggested the Federal Reserve was unlikely to ease up in its battle with inflation. That fuelled concerns about the economic outlook, with the U.S. Treasury yield curve remaining deeply inverted in Tokyo trading and suggesting that investors are braced for recession. Hong Kong's Hang Seng Index (.HSI) tumbled 2.7%, with its tech stocks (.HSTECH) slipping more than 5%. Japan's Nikkei (.N225) lost 0.4% and South Korea's Kospi (.KS11) dropped 1.1%, each led by declines in heavyweight chip players. The U.S. dollar index - which measures the currency against six major counterparts - added 0.28% to 106.57, rebounding from a slide as low as 105.30 on Tuesday following the release of producer price inflation numbers.

U.S. consumer spending has remained strong, rising more than expected in September, despite underlying inflation pressures continuing to bubble. "If you look at stocks and asset prices, you would probably expect the Fed to be already easing by now," Gurevich said. read moreHowever, Anita Gupta, head of equity strategy at Emirates NBD, told the forum it was "too early" to draw conclusions for other central banks from this move. "If you're going downhill and pushing your foot on the accelerator, it's going to be very hard to break," Gurevich said. "I feel it's already too late for them to stop deflation and a recessionary cycle."

☆ Lagarde comments at ECB press conference
▼ + stars: | 2022-10-27 | by ( ) www.reuters.com time to read: +4 min

Following are highlights of ECB President Christine Lagarde's comments at a news conference after the policy meeting. And we did not discuss the substantive issues today deliberately because we decided on a lot of issues. FUTURE HIKES"We have acknowledged that more rate (hikes) are in the pipeline, but at what pace and to which level I cannot tell you." ON FUTURE RATE INCREASES"The destination for us is clear, the exact pace will be determined meeting by meeting." HIGHER WAGES"Strong labour markets are likely to support higher wages as is some catch-up in wages to compensate for higher inflation."

☆ Global economy approaching a recession, central banks unchained: Reuters poll
▼ + stars: | 2022-10-26 | by ( Hari Kishan | ) www.reuters.com time to read: +4 min

BENGALURU, Oct 26 (Reuters) - The global economy is approaching a recession as economists polled by Reuters once again cut growth forecasts for key economies while central banks keep raising interest rates to bring down persistently-high inflation. After being late to call the inflation problem, global central banks have spent most of this year frontloading rate hikes to catch up. Most economists and central banks are of the view there will be little work left to do next year. Michael Every, global strategist at Rabobank, said "risk of a global recession" is what everyone's talking about and has become mainstream in forecasts. Reuters Poll - Terminal rate outlookOf the 22 central banks polled this time, only six were expected to hit their inflation targets by the end of next year.

☆ POLL Rising U.S. rates pose biggest risk for Japan but recession unlikely
▼ + stars: | 2022-10-25 | by ( Kantaro Komiya | Devayani Sathyan | ) www.reuters.com time to read: +4 min

REUTERS/Florence Lo/IllustrationTOKYO, Oct 25 (Reuters) - The biggest risk to Japan's economy over the next year is a prolonged period of U.S. monetary tightening, although the world's third-largest economy is unlikely to sink into a recession, the majority of economists polled by Reuters said. Policymakers worldwide, including the International Monetary Fund, have cut global growth projections for 2023, citing elevated prices and higher cost of borrowing. While most economists agreed that such risks would not plunge Japan into a recession, they said that was mainly owing to a low base. "Japan's economy appears robust compared with overseas peers, but that's just because its recovery from the pandemic has been lagging behind," said Fukoku's Takamatsu. Elsewhere in the poll, a median estimate of 34 respondents had the Japanese economy expanding an annualised 2.0% in October-December, slightly better than the 1.9% forecast in the September poll.

☆ Fed to hike by 75 bps again on Nov. 2, should pause when inflation halves -economists: Reuters poll
▼ + stars: | 2022-10-25 | by ( Prerana Bhat | ) www.reuters.com time to read: +4 min

Register now for FREE unlimited access to Reuters.com RegisterResults in the poll are in line with interest rate futures pricing. A majority of economists in the Oct. 17-24 poll forecast another 50 basis point hike in December, taking the funds rate to 4.25%-4.50% by end-2022. The funds rate was expected to peak at 4.50%-4.75% or higher in Q1 2023, according to 49 of 80 economists. The Fed targets the personal consumption expenditures (PCE) index, but the survey suggests roughly half the current rate of inflation ought to be a turning point. CPI inflation was not expected to halve until Q2 2023, according to the poll, averaging 8.1%, 3.9% and 2.5% in 2022, 2023 and 2024, respectively.

☆ Bank of England to hike by 75 bps on Nov. 3 but may go bigger
▼ + stars: | 2022-10-25 | by ( Jonathan Cable | ) www.reuters.com time to read: +4 min

Annual price rises were expected to peak at 10.4% this quarter, the poll showed, before gradually declining, but won't fall to target until at least 2025. The median forecast in the Oct. 18-25 poll showed the BoE would take Bank Rate up by 75 bps to 3.00% next week. But while that was a view held by 18 of 30 respondents, 10 expected 100 bps, one said 125 bps and one said 150. It was then expected to add another 75 bps in December and 50 bps next quarter before pausing, meaning rates would peak at 4.25% in the current cycle. Both the European Central Bank and the U.S. Federal Reserve are expected to deliver 75-bps increases at their next meetings.

☆ Weak oil demand to lower GCC economic growth in 2023
▼ + stars: | 2022-10-20 | by ( Anant Chandak | ) www.reuters.com time to read: +4 min

BENGALURU, Oct 20 (Reuters) - Economic growth in the six-member Gulf Cooperation Council will remain strong but slow significantly next year as high oil prices hurt demand for the commodity, a Reuters poll showed. China, the world's largest crude oil importer, has been fighting COVID-19 flare-ups and stuck to a zero-COVID-19 policy that is weighing heavily on economic activity and global oil demand. "GCC countries have benefitted from sharply higher oil prices, turning budget deficits into surpluses, and increased oil production which has bumped up GDP growth. Among other GCC economies, growth was expected to drop next year in the United Arab Emirates, Qatar and Oman, while in Bahrain growth was forecast to slow to 3.0% compared with 3.4% this year. As other economies reduce their reliance on oil Gulf countries are diversifying their revenue streams.

☆ India's economic growth outlook stagnates, stuck in lower gear
▼ + stars: | 2022-10-20 | by ( Vivek Mishra | ) www.reuters.com time to read: +4 min

It was expected to decelerate further to 4.4% in the fourth quarter, according to an Oct. 13-19 Reuters poll. Register now for FREE unlimited access to Reuters.com RegisterThe median expectation was for 6.9% growth in the 2022-23 fiscal year, slightly above International Monetary Fund (IMF) and World Bank projections of 6.8%. While those figures were only trimmed from the previous poll medians, a deteriorating global economic outlook suggests there may be further downgrades in coming months. "This, we believe, will result in the RBI having to shift its focus toward supporting growth and away from anchoring inflation expectations by engineering a growth slowdown." The poll showed the RBI taking a softer approach with rates.

☆ Egypt's currency seen falling faster than previous projections
▼ + stars: | 2022-10-20 | by ( Nafisa Eltahir | ) www.reuters.com time to read: +3 min

CAIRO, Oct 20 (Reuters) - Egypt's currency will weaken at a steeper pace than expected, although inflation is likely to decrease over the next few years, a Reuters poll showed. In July, respondents had predicted a more conservative devaluation, reaching 19.86 by the end of the 2023/24 fiscal year. The higher outlook is based on pressure on Egypt's currency and the uncertainty in global energy and food prices driven largely by the war, said Mona Bedeir, chief economist at Al Baraka Bank. High inflation and a weakening currency weighed on economists' projections for Egypt's growth, which fell below the 6.6% surge during the fiscal year that ended in June. They predicted growth of 5.4% in the current fiscal year, and 5.0% in the 2023-2024 year.

☆ ECB to go big again on Oct. 27 with 75 bps rate hike
▼ + stars: | 2022-10-19 | by ( Jonathan Cable | ) www.reuters.com time to read: +4 min

Reuters Poll - Euro zone economic outlookIn the run-up to winter, forecasters are expecting the ECB to be more aggressive in tightening policy. The bloc's central bank will take the deposit rate to 1.50% and the refinancing rate to 2.00% next Thursday, a view held by an overwhelming majority of respondents in the Oct. 12-18 Reuters poll of more than 60 economists. Three-quarters of respondents to an additional question, 27 of 36, said the bank ought to choose a 75 basis point lift to the deposit rate while two said it should go harder with a 100 basis point increase. Reuters Poll - ECB monetary policy outlookSHORT AND SHALLOW? The deposit rate was expected to reach a peak of 2.50% next year and the refinancing rate 3.00%, higher than the 1.50% and 2.00% highs given in September.

☆ ECB to go big again on Oct. 27 with 75 bps rate hike: Reuters poll
▼ + stars: | 2022-10-19 | by ( Jonathan Cable | ) www.reuters.com time to read: +4 min

☆ Bank Indonesia playing catch-up, to deliver another 50 bps rate hike on Thursday: Reuters poll
▼ + stars: | 2022-10-18 | by ( Devayani Sathyan | ) www.reuters.com time to read: +3 min

Relatively lower inflation allowed the central bank to hold off with raising rates until August. But in September inflation reached 5.95%, the highest since 2015, and will likely push the central bank to continue tightening. BI, until recently one of the world's last dovish central banks, followed a modest quarter-point rate rise in this cycle with a surprisingly aggressive 50 basis point rise in September. The weaker rupiah , down more than 8% so far this year, has prompted economists to bring forward their rate hike expectations. Reuters Poll: Indonesia inflation and monetary policy outlookThe poll showed inflation was expected to average 4.6% this year and inch down to 4.5% in 2023, a massive upgrade from 3.9% and 3.5% predicted in July.

☆ BoC to dial down size of rate rises again but not done yet: Reuters poll
▼ + stars: | 2022-10-18 | by ( Indradip Ghosh | ) www.reuters.com time to read: +3 min

The expected move at the BoC's next meeting would be the second consecutive reduction in the size of rate rises after a 100 basis point move in July and 75 basis points last month. Given more U.S. Federal Reserve rate rises are due in coming months, the BoC is likely to get the overnight rate, currently at 3.25%, even further above its 2-3% estimate of neutral, where the economy is neither stimulated nor restricted. So far the BoC has matched the 300 basis points of Fed rate rises since March. "We continue to assume the BoC will dial back the pace of rate hikes with a 50 basis point increase later this month," said Josh Nye, senior economist at RBC. Most economists forecast another slowdown in the size of rate rises to 25 basis points in December and January, taking the overnight rate to a peak of 4.25%.

☆ China Q3 growth seen bouncing 3.4%, but 2022 set for worst performance in decades
▼ + stars: | 2022-10-14 | by ( Kevin Yao | ) www.reuters.com time to read: +5 min

Growth is expected to pick up to 3.8% in the fourth quarter, bringing the 2022 pace to 3.2%, far below the official target of around 5.5%. Investors will look for policy signals from a historic congress of the ruling Communist Party due to start on Sunday. The expected 2022 growth would be lower than 4.0% analysts had forecast in a Reuters poll in July and 5.0% in April's forecast. The government is due to release third-quarter GDP data, along with Sept. activity data, on October 18 at 0200 GMT. Economic growth is forecast to quicken to 5.0% in 2023.

☆ Turkish central bank to cut rates to 11% after Erdogan nudge
▼ + stars: | 2022-10-14 | by ( ) www.reuters.com time to read: +3 min

ISTANBUL, Oct 14 (Reuters) - Turkey's central bank is expected to cut its policy rate by 100 basis points to 11% next week, a Reuters poll showed on Friday, after President Tayyip Erdogan called for more easing each month and said rates should be single digits by year-end. The central bank has shocked the markets twice in the past two months by cutting its policy rate (TRINT=ECI) by 100 basis points each time, lowering it to 12%, despite inflation soaring above 83% in September. Register now for FREE unlimited access to Reuters.com RegisterThe president, who has great influence over the central bank, gave even more explicit policy direction earlier this month when he said the bank would continue cuts every month "as long as I am in power". Thirteen out of 20 economists that participated in the Reuters poll predicted the bank would lower its policy rate to 11% at its meeting on Oct. 20. Inflation has surged since November 2021 after the central bank embarked on an easing cycle that saw rates lowered by 500 basis points between September and December last year.

☆ Futures up on higher gold, crude prices; U.S. inflation data awaited
▼ + stars: | 2022-10-13 | by ( ) www.reuters.com time to read: +2 min

Oct 13 (Reuters) - Futures for Canada's resource heavy stock index on Thursday ticked higher, tracking gold and crude prices, with investors avoiding big bets ahead of a crucial U.S. inflation data later in the day. December futures on the S&P/TSX index rose 0.3% after five days of losses on the TSX. Gold prices were steady, while crude oil prices enjoyed extended support from the OPEC+ cuts last week, which the International Energy Agency warned may push the global economy into recession. [GOl/]Register now for FREE unlimited access to Reuters.com RegisterS&P futures rose 0.5% to lead gains among the U.S. stock futures ahead of September consumer prices data due at 08:30 a.m. Canada's stock index (.GSPTSE) closed lower on Wednesday, as U.S. producer price data and minutes from the Federal Reserve's September meeting bolstered expectations for additional rate hikes.

☆ Factbox: Winners of 2022 Nobel prizes
▼ + stars: | 2022-10-10 | by ( ) www.reuters.com time to read: +2 min

Nobel Prize for Peace - Jailed Belarusian activist Ales Byalyatski, Russian rights group Memorial and Ukraine's Center for Civil Liberties won the 2022 Nobel Peace Prize amid a war in their region that is the worst conflict in Europe since World War Two. Register now for FREE unlimited access to Reuters.com RegisterNobel Prize for Literature– French author Annie Ernaux won the 2022 Nobel Prize in Literature for "the courage and clinical acuity" in her largely autobiographical books examining personal memory and social inequality. Nobel Prize in Chemistry - Scientists Carolyn Bertozzi, Morten Meldal and Barry Sharpless won the 2022 Nobel Prize in Chemistry for discovering reactions that let molecules snap together to create new compounds and that offer insight into cell biology. Nobel Prize in Physics - Scientists Alain Aspect, John Clauser and Anton Zeilinger won the 2022 Nobel Prize in Physics for experiments in quantum mechanics that laid the groundwork for rapidly-developing new applications in computing and cryptography. Nobel Prize in Physiology or Medicine - Swedish geneticist Svante Paabo won the 2022 Nobel Prize in Physiology or Medicine for discoveries that underpin our understanding of how modern day people evolved from extinct ancestors at the dawn of human history.

☆ Fed to take rates higher than previously expected; more pain ahead
▼ + stars: | 2022-09-28 | by ( Indradip Ghosh | ) www.reuters.com time to read: +4 min

But that is unlikely to push the Fed to switch its policy path anytime soon as Fed Chair Jerome Powell and other policymakers have remained blunt about the “pain” to come. The survey predicted that would be followed by 50 basis points in December to end the year at 4.25%-4.50%. The real policy mistake is not bringing inflation back down to 2%,” said Michael Gapen, chief U.S. economist at BofA Securities. All but two of 51 economists who replied to an additional question said the risks were skewed towards a higher terminal rate than they currently expected. “The only way the Fed can do that is to hike rates and keep policy restrictive until that is achieved.”(For other stories from the Reuters global economic poll:)

☆ Fed to take rates higher than previously expected; more pain ahead - Reuters poll
▼ + stars: | 2022-09-28 | by ( Indradip Ghosh | ) www.reuters.com time to read: +4 min

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