Tensions between Russia and Ukraine escalateMarch 03, 2014 Posted by: Pete Karabatos
Geopolitical risk is at the forefront of market trading today as Russian troops enter Crimea. The Ukraine is calling this an act of war and Washington has warned Russia of economic and political consequences. Equity markets are trading lower on concern that a conflict in Russia could have economic fallout for the U.S. and Europe. There is also risk that Russia may shut down its gas pipeline to continental Europe. The MICEX traded lower by as much as 12.7% and Russia's central bank intervened by selling approximately $10B USD and hiking rates 150 BPs to 7% to slow the Ruble's slide. There is plenty of market uncertainty owing to divergent views on the likelihood for a sustained conflict in Ukraine, with some thinking this situation will blow over soon and others believing that things could get significantly worse.
• U.K. Manufacturing PMI was stronger than expected, coming in at 56.9, a 33 month high.
• BOJ Governor Kuroda appeared before parliament and reiterated that the BOJ’s easing is having the intended impact as inflation expectations have increased and real rates have decreased.
• Australia’s manufacturing PMI rose to 48.6 in February, the fourth consecutive month below 50 implying continued economic contraction.
• U.S. consumer spending increased by more than expected in January, posting the largest increase in services increase for 12 years partly on American enrollment in the Obama administration’s healthcare program.
• U.K. mortgage approvals and home prices increased to the most since 2007 as the housing market continues to post strong gains.
03/05 EUR: GDP (Q4)
03/05 USD: MBA Mortgage Applications (Feb 28)
03/05 EUR: Economic/Consumer/Industrial/Services Confidence Reports (Feb.)
03/05 USD: ISM Non-Manufacturing Composite
03/05 CAD: Bank of Canada Rate Decision.
03/06 EUR: BOE Rate Announcement
03/06 CAD: ECB Announces Interest Rate.
03/07 CAD: Unemployment Rate (Feb)
03/07 USD: Non-Farm Payrolls (Feb)
03/10 CAD: Housing Starts (Feb)
CAD 1.1091Read More