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☆ Dollar dips ahead of inflation data due Wednesday
▼ + stars: | 2023-04-11 | by ( Karen Brettell | ) www.reuters.com time to read: +3 min

NEW YORK, April 11 (Reuters) - The dollar fell on Tuesday as investors waited on inflation data for further signs of whether price pressures are ebbing and what it means for further Federal Reserve interest rate hikes. Consumer price data on Wednesday is expected to show headline inflation rose by 0.2% in March, while core inflation rose 0.4%. (USCPI=ECI), (USCPF=ECI)"A lot of traders are focused on this inflation data," said Edward Moya, senior market analyst at OANDA in New York. Strong jobs data for March have added to expectations that the U.S. central bank will complete one more rate hike. European bond yields rose sharply on Tuesday, catching up after the break.

☆ 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.

☆ Morning Bid: Glass half full on disinflation
▼ + stars: | 2023-04-11 | by ( ) www.reuters.com time to read: +4 min

Headline March consumer price inflation is expected to drop as low as 5.2% from 6% - showing the disinflation journey from more than 40-year highs of 9.2% last June to the Fed's 2% target more than half way there. The rider is that headline inflation rates are expected be below stickier annual 'core' rates, which are forecast to have ticked higher to 5.6% last month. The International Monetary Fund's updated World Economic Outlook is also due on Tuesday ahead of the Fund's Spring meeting in Washington. The disinflation picture was encouraged around the world on Tuesday as Chinese consumer price inflation hit an 18-month low last month and the annual decline in factory prices sped up. Hopes that central bank rates are cresting worldwide lifted risk appetite across the spectrum with major cryptocurrency bitcoin broke back above $30,000 level for the first time in 10 months on Tuesday.

☆ Morning Bid: Markets brush off OPEC as factories stall
▼ + stars: | 2023-04-04 | by ( ) www.reuters.com time to read: +5 min

A look at the day ahead in U.S. and global markets from Mike DolanRelatively calm world markets have brushed off OPEC's latest twist and focussed more squarely on stalled global manufacturing and edgy U.S.-China relations. Crude oil prices held much of Monday's pop higher on the surprise weekend production cut by the Organization of Petroleum Exporting Countries. But Brent crude remains below levels seen just before the Silicon Valley Bank bust last month and is still tracking year-on-year declines of 20%. Strikingly, both short and long-term inflation expectations embedded in the Treasury markets , have barely budged since the OPEC news. McCarthy, the third-most-senior U.S. leader after the president and vice president, is due to host a meeting in California on Wednesday with Tsai.

☆ Morning Bid: Dogged inflation shades rebound
▼ + stars: | 2023-03-31 | by ( ) www.reuters.com time to read: +4 min

But for most major stock and bond investments beyond the banking sector itself, the quarter remained a pretty upbeat one overall. "Inflation remains too high and recent indicators reinforce my view that there is more work to do," said Boston Fed chief Susan Collins. Futures markets are still broadly split on the chances of another Fed hike in May, but leaned a bit more on Friday to one more quarter point move. But core inflation, excluding energy and unprocessed food, ticked up as forecast to a new record high for the bloc at 7.5%. Germany said import price inflation fell to its lowest in two years at 2.8% in February.

☆ Safe-haven dollar sluggish as banking fears ebb; yen drops
▼ + stars: | 2023-03-29 | by ( Kevin Buckland | ) www.reuters.com time to read: +3 min

The dollar index , which tracks the currency against six major peers, edged 0.08% higher to 102.57 in Asian trading, following drops of about 0.3% in each of the past two sessions. The weakness comes despite a rise in U.S. Treasury yields, also the result of ebbing demand for the safest assets. The yen remained volatile in the run-up to the end of the Japanese fiscal year on Friday. The dollar jumped 0.59% to 131.68 yen , and touched a one-week high of 131.80. The yen had dropped 0.5% the previous day, when it uncharacteristically moved in the opposite direction with long-term U.S. Treasury yields.

☆ Dollar on the defensive as banking fears ebb; yen drops
▼ + stars: | 2023-03-29 | by ( ) www.cnbc.com time to read: +2 min

In this photo illustration, US 100 dollar bills seen on an American flag. The dollar index , which tracks the currency against six major peers, was flat in early Asian trading, following drops of about 0.3% in each of the past two sessions. The yen remained volatile in the run-up to the end of the Japanese fiscal year on Friday. The dollar jumped 0.51% to 131.59 yen , erasing all of the previous day's 0.5% decline, when it uncharacteristically moved in the opposite direction with long-term U.S. Treasury yields. The token had dipped as low as $26,541 on Monday, after its retreat from a nine-month high of $29,380 last week.

Larger peers Bank of America (BAC.N), Goldman Sachs (GS.N) and JPMorgan Chase & Co (JPM.N) rose between 0.7% and 1.6% in premarket trade. "Markets are calmer as the tension of the banking situation is lessening. A key inflation reading expected at the end of the week will provide more clues on the Fed's monetary tightening plans. ET, Dow e-minis were up 244 points, or 0.75%, S&P 500 e-minis were up 35.25 points, or 0.88%, and Nasdaq 100 e-minis were up 109.25 points, or 0.86%. Reporting by Amruta Khandekar; Editing by Dhanya Ann Thoppil and Vinay DwivediOur Standards: The Thomson Reuters Trust Principles.

☆ Tech Stocks Slide as Investors Shift Attention Back to Rates
▼ + stars: | 2023-03-28 | by ( Matt Grossman | ) www.wsj.com time to read: 1 min

Technology stocks slid Tuesday, dinged by rising bond yields, as an ebbing of the recent turmoil in the banking sector shifted investors’ attention back to the threat of further interest-rate increases by the Federal Reserve. Many investors speculated earlier this month that the high-profile failures of SVB Financial and Signature Bank would test the Fed’s resolve in its efforts to fight inflation. Now, easing anxiety about global banks is leading them to renew bets that interest rates could rise further and stay elevated.

☆ The Fed is about to deliver a momentous policy decision. It'll be a choice between keeping the focus on inflation or stemming the banking chaos.
▼ + stars: | 2023-03-22 | by ( Max Adams | ) www.businessinsider.com time to read: +6 min

Powell and the Fed may acknowledge that monetary policy has caused some pain, and even add that more may be coming. What's your prediction for today's Fed decision and what Powell might say about the recent banking tumult? A market analyst says investors need to have some key questions answered by the Fed today. Market watchers should pay attention over whether the central bank sees the SVB collapse and resulting crisis as deflationary. The governor of Florida has proposed legislation to ban a central bank digital currency and has called on like-minded states to do the same.

☆ U.S. Airlines Expect Strong Demand as Travelers Find Postpandemic Routines
▼ + stars: | 2023-03-15 | by ( Alison Sider | ) www.wsj.com time to read: 1 min

Airline executives said they are optimistic about the outlook for the rest of this year. Executives from major U.S. airlines on Tuesday said they were optimistic about travel demand for the rest of the year, shaking off worries about creeping operating costs and fears of ebbing demand. Travel appetite surged last year and airlines began to make money again after losing billions of dollars during the Covid-19 pandemic. Carriers’ shares have also climbed this year, but airlines have been dogged by worries that demand will falter amid higher fares, and that rising costs of fuel and labor would dent profits.

Despite relief measures, energy prices in February were 19.1% higher on the year, while food prices were 21.8% higher, it said. The first one was driven by energy prices and the second one by material inputs, which are not ebbing. While energy prices were keeping headline inflation high, wage growth will show its impact in core inflation, which will remain stubbornly high, Brzeski said. "Hence, a stepdown to a 25bp pace of hikes could be delayed, which would also push the terminal rate higher." "The interest rate step announced for March will not be the last," Nagel said in a speech.

For many economists, globalization appears to have stalled after three decades of low inflation, easy credit, China's integration into the world economy and a relatively peaceful period. As a share of global GDP, trade likely increased from the previous year's 57% and exports as per World Bank data. It is not really evident in the data," Nicita says, estimating that global trade grew by about 3% last year, at a pace similar to the global economy. "Trade and globalization are not on the wane, but they are changing," she told the Chatham House Global Trade Policy Forum in November, citing growth in service- and digital-based trade. UNIPOLAR V MULTIPOLARThis 'regionalization' will continue assuming Beijing's economic, trade and financial ties to the U.S. gradually loosen.

☆ Zillow can rally nearly 20% as real estate platform navigates tough housing market, JPMorgan says
▼ + stars: | 2023-02-27 | by ( Hakyung Kim | ) www.cnbc.com time to read: +1 min

It's time for investors to jump on the Zillow bandwagon, according to JPMorgan. Analyst Dae Lee initiated coverage of the online real estate platform with an overweight rating with a price target of $48 per share. "Additionally, Zillow has a healthy balance sheet to continue investing through N-T headwinds, which should strengthen its leadership position," he added. "The residential real estate industry is cyclical, and it currently is in a down cycle and faces affordability, mortgage rate volatility, & low inventory challenges," Lee wrote. Shares of Zillow have surged almost 30% this year amidst a 30% tumble in the past 12 months.

☆ Morning Bid: Hang on a minute
▼ + stars: | 2023-02-22 | by ( ) www.reuters.com time to read: +4 min

And so a speech from New York Fed chief John Williams make give a better steer on current thinking. Markets are now priced for a Fed 'terminal rate' in the 5.25-5.50% range by July and no cut from there by year-end. European central bankers are also talking tough as the region's economies dodge recession and inflation stays high. But geopolitical concerns rankle again ahead of Friday's anniversary, with Russia unilaterally withdrawing from a key nuclear arms control treaty. As G20 finance chiefs meet in India, the world is watching closely the extent of the alliance between Beijing and Moscow.

With inflation accelerating, Ueda could finally set Japan on a path to raise rates after the BOJ spent a decade fighting deflation risks with its unorthodox bond buying scheme costing trillions of yen. Ueda himself on Friday said current policy settings were appropriate, which also put a bit of a dampener on expectations of any shift. Implied volatility has also eased in the forex options market, suggesting an ebbing in bets on big shifts in the yen exchange rate. "It's not very apparent that (Ueda) would take on the job and then immediately change the policy." To be sure, 10-year Japanese yields were untraded at the BOJ's ceiling on Monday, indicating plenty of investors are staying short.

☆ Fed's Harker says small rate hikes on table, opens door to cuts next year
▼ + stars: | 2023-02-10 | by ( Michael S. Derby | ) www.reuters.com time to read: +3 min

"What is driving our rate increases right now is inflation, and we are starting to see signs, early signs that inflation is starting to move down," Harker said in a Reuters interview. The Fed's benchmark overnight interest rate is now in the 4.50%-4.75% range. Inflation by the Fed's preferred measure was running at more than double the 2% target in December. DOOR OPENINGIn the interview, Harker said he sees the Fed's policy rate going up to somewhere above 5% and holding there for a while. Harker said he expects the jobless rate to move up to 4.5% from its current level due to the impact of Fed policy before ebbing.

☆ Ahead of State of Union address, Biden's approval is at just 41%: Reuters/Ipsos poll
▼ + stars: | 2023-02-07 | by ( Jason Lange | ) www.reuters.com time to read: +3 min

The Reuters/Ipsos poll has a margin of error of three percentage points either way. Biden will also call on the U.S. Congress to focus on advancing cancer research, expanding mental health services and beating the "opioid and overdose epidemic," the White House said. But the new Reuters/Ipsos poll showed many Americans are uncomfortable with Washington's large debts. Despite Biden's unpopularity, the poll showed that Americans prefer Democrats over Republicans on a range of issues. The Reuters/Ipsos poll, conducted throughout the United States, gathered responses from 1,029 adults, using a nationally representative sample.

☆ Ahead of State of Union address, Biden's approval is at just 41% -Reuters/Ipsos
▼ + stars: | 2023-02-07 | by ( Jason Lange | ) www.reuters.com time to read: +3 min

The rate hikes imposed by the Fed since March have now totaled 4.5 percentage points, with the policy rate now in a range between 4.50% and 4.75%, the highest since 2007. It is in part that resilience that has the central bank poised for "ongoing increases" in its policy interest rate. Stocks, modestly lower ahead of the Fed rate decision, turned sharply higher as Powell spoke. "If you were hoping for clear signs of an upcoming pause in interest rate hikes, you were left wanting. INFLATION TARGET REAFFIRMEDThe Fed statement indicated that any future rate increases would be in quarter-percentage-point increments, dropping a reference to the "pace" of future increases and instead referring to the "extent" of rate changes.

Stocks, modestly lower ahead of the Fed rate decision, turned sharply higher as Powell spoke, with the benchmark S&P 500 (.SPX) index climbing about 1% on the session. At the same time, the yield on the 2-year Treasury note , the maturity most sensitive to Fed policy expectations, dropped abruptly to the day's low, last trading down about 8 basis points at around 4.12%. The Federal Reserve retained the phrase 'ongoing increases' in their statement, leaving their options open depending on what upcoming economic data says," said Greg McBride, chief financial analyst at Bankrate. The statement did indicate that any future rate increases would be in quarter-percentage-point increments, dropping a reference to the "pace" of future increases and instead referring to the "extent" of rate changes. But those, it said, would take into account how the policy moves so far had impacted the economy, language that linked further rate increases to the evolution of upcoming economic data.

In France, the bloc's second-biggest economy, factory activity returned to growth albeit not as strongly as initially forecast. In Asia, factory activity contracted in January as the boost from China's COVID reopening had yet to take full effect. China's factory activity shrank more slowly in January after Beijing lifted tough COVID curbs late last year, a private sector survey showed. China's Caixin/S&P Global manufacturing (PMI) nudged up to 49.2 in January from 49.0 in December, staying below the 50 mark for a sixth straight month. Factory activity expanded in January in Indonesia and the Philippines but shrank in Malaysia and Taiwan, PMI surveys showed.

The Act states the Fed should conduct monetary policy "so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates." On that basis, the average core PCE inflation rate since 2010 is exactly 2.0% - even after the recent scare and with the monthly rate ebbing again fast. At 1.25%, real 10-year yields - measured by market inflation expectations rather than prevailing inflation - are far above sub-zero post-pandemic troughs and are also some of the highest in over a decade. And hence the cat and mouse game between Fedspeak and market pricing - rather than a material change to investors' assumption that the Fed is nearly done. U.S. Fed has missed the mark on inflationThe opinions expressed here are those of the author, a columnist for Reuters.

☆ Dollar cautiously firm ahead of busy central bank week
▼ + stars: | 2023-01-30 | by ( Rae Wee | ) www.reuters.com time to read: +2 min

SINGAPORE, Jan 30 (Reuters) - The dollar firmed on Monday and distanced itself from an eight-month trough ahead of a slew of central bank meetings this week, including the Federal Reserve's, with traders keenly focused on guidance for the path of interest rate rises. The U.S. dollar index , which measures the greenback against a basket of currencies, rose 0.03% to 101.92, edging away from last week's eight-month low of 101.50. Moves were subdued ahead of policy meetings from the Fed, the European Central Bank (ECB) and the Bank of England (BoE) later this week. "We will range trade a little bit as the market tries to assess how the central banks behave .... Elsewhere, the Aussie rose 0.11% to $0.71175, while the Japanese yen slipped marginally to 129.94 per dollar.

☆ Biden to attack House Republican's economic plans in Virginia
▼ + stars: | 2023-01-26 | by ( Steve Holland | ) www.reuters.com time to read: +2 min

WASHINGTON, Jan 26 (Reuters) - President Joe Biden will use a speech at a steamfitters union hall in Virginia on Thursday to launch an attack against Republicans who control the U.S. House of Representatives, saying some of their proposals are dangerous for the U.S. economy. Biden, who is laying the groundwork for a bid for re-election in 2024, will visit the union hall in Springfield, Virginia, a Washington suburb. A White House official said Biden will seek to tie House Republicans to former President Donald Trump, the Republican who Biden ousted in the 2020 election. "The president will outline the biggest threat to our economic progress: House Republicans’ MAGA economic plan," the official said, speaking on condition of anonymity. Biden will say his policies "are laying the foundation for strong and stable growth," the White House official said.

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