Assets trade off geopolitics today as all eyes remain on Ukraine and Russia, scheduled to speak to one another today in Belarus. The US and allies escalate financial sanctions as key Russian banks are excluded from the SWIFT network. Allies have also frozen assets belonging to Russia’s central bank. Economic sanctions of this scale are unprecedented. The ruble tumbled in early trading, and depreciation of the RUB fans inflation – some estimates peg inflation in Russia at 70%. Russia doubled its key interest rate to 20% and shut down local equity markets today .
Monday: US Wholesale Inventories
Tuesday: President Biden State of the Union Address, ISM Manufacturing PMI
Wednesday: Bank of Canada rate decision, OPEC+ meeting
Thursday: US Jobless Claims, US Durable Goods, ISM Services PMI
Friday: US Jobs Report for February, FR Industrial Production
February 28, 2022
EUR/USD 1.1225 GBP/USD 1.3415 USD/CAD 1.2710 AUD/USD 0.7243 USD/JPY 115.33 USD/CNH 6.3156 USD/ILS 3.2115 USD/MXN 20.3550 USD/CHF 0.9182 USD/INR 75.3330 USD/BRL 5.1520 USD/SGD 1.3577 USD/DKK 6.6300 USD/SEK 9.4575 USD/NOK 8.8450
The dollar spot index rose 0.3% overnight and the dollar is stronger versus all G-10 peers with the exception of the yen and franc. Fed Chairman Powell is expected to speak ahead of the Fed's blackout period in advance of its March meeting. The global situation has put pressure on the Fed, possibly reducing the likelihood they aggressively raise rates.GBP
Sterling gives up ground to the dollar as risk-off sentiment permeates financial markets. The UK and New Zealand finalize post-Brexit trade agreement and remove tariffs and liberalize access for service companies.EUREUR/USD is down slightly amid stop-loss selling following Friday's big rally. Economists expect EUR/USD to remain near recent lows in the short term as the current crisis is a headwind for the eurozone to ease its long-standing accommodative policies.CAD
Despite commodities advancing, the Canadian dollar is down versus the greenback as haven bids remain strong. WTI futures are +3.9% and above $95 a barrel.ASIA/PACIFICUSD/JPY is down as US Treasury yields drop and safe-haven buying of the yen.
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