Global bond losses accelerate to the largest on record; UK inflation reaches 6.2% a 30-year high; US and allies expected to announce new sanctions tomorrow.
March 23, 2022
GBP/USD 1.3226 GBP/EUR 1.2005 EUR/USD 1.1017 USD/CAD 1.2589 EUR/CHF 1.0296 EUR/SEK 10.4031 EUR/NOK 9.6804 EUR/DKK 7.4379 USD/ILS 3.2180 AUD/USD 0.7458 NZD/USD 0.6946 USD/SGD 1.3582 USD/JPY 120.95 USD/CNH 6.3879 USD/INR 76.2175 EUR/ILS 3.5451 GBP/ILS 4.2560 USD/ZAR 14.8212
UK inflation surged to a new 30-year high in February. Annual inflation was recorded as 6.2% surpassing expectations of a 6% rise. Rishi Sunak is expected announce help for Britons struggling with rising costs. He may reveal changes to fuel duty or national insurance thresholds; however, the underlying tone is expected to be responsible fiscal policy.
The UK and US have agreed to ease Trump-era tariffs. The UK government is expected to finance a year of spending without the help of the BoE.
GBPUSD trades down -0.16% as we print, after highs near 1.33 throughout the Asian session.EUR
The EU’s crackdown on Big Tech is expected to materialise with the bloc planning to unveil legislation to curb the market power of companies with a market cap greater than €75 billion, that run one ‘core platform service’ like a social network.
EU member states have disagreed on oil sanctions and as such the bloc will not immediately move to curb Russian imports.
EURUSD trades down -0.12%, the London open has seen European stocks edge higher.USD
Short-term treasuries have sunk to their worst quarterly performance in four decades, following Fed officials joining Jerome Powell in increasingly hawkish calls to hike rates. This comes as several Fed members came out seemingly more willing to accept a 50-bps hike, in what appears like a collective Fed move to avoid market tremors when the Fed inevitably does hike rates again.
NATO will meet tomorrow to discuss further sanctions. Ukraine’s Zelensky will take part via video link.
Gains were seen in the S&P500 up 1.13% and 1.95% for the NASDAQ.ASIA/PACIFIC
China aims to produce enough green hydrogen by 2025 to triple the global output, as it seeks to decarbonise.
India’s services and manufacturing activity has remained on course in February, according to key high-frequency indicators. Thailand is heading for back-to-back deficits amid poor tourist markets and rising energy costs.
New Zealand looks set to begin lifting covid restrictions as the omicron peak passes.ILS
USDILS trades around 3.2 as we print, continuing a somewhat linear decline from the 3.3 levels seen in recent weeks.Data & Events
UK – Chancellors Sprint statement
UK – Feb PPI
UK – House Price Index
ECB’s Nagel/Visco speaks
BOE’s Bailey speaks
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