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February 27 (Reuters) – From Mike Dolan USA and an outlook on the day ahead in global markets
Another intense month of March inflation and at a time when it faces interest rate worries, so do markets in China Russia is in jeopardy about how his relations with will develop next week.
The United States warned China on Sunday that if it provided arms to Russia to support its invasion of Ukraine, it would raise tensions between the two leading economies.
The White House national national security adviser Jake Sullivan told CNN that “if it goes this way, it’s going to cost China real money.”
China on Monday USAdespite the warning of Ukraine said that he was looking for dialogue and peace. Russia President Vladimir Putin praised relations with Beijing last week and his Chinese counterpart Xi Jinping to Moscow in March trip said he would USA officials said it could be as early as next week.
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China and the United States flying through the Taiwan Strait on Monday military clearly from their planes complaint did.
of Ukraine The tense geopolitical background related to the anniversary of the occupation coincides with events that appear to be re-accelerating the world economy and inflation.
The last surprisingly hot US in the stock market on Friday inflation After the reading and renewed US interest rate concerns, Shanghai markets underperformed on Monday as the yuan rallied dollars reached the lowest level of the year before.
85 available amid heightened geopolitical tensions and declining appetite for Chinese property bonds, JPMorgan said billion dollar Asia credit the new Asia, with China weighting down in parallel to the index credit index offer does.
Monday Europe stocks and US futures edged higher, but DXY dollars The index briefly reached its highest level since January 6.
However, the new US interest rate horizon remains bleak. The implied target federal funds rate now stands at 5.42% through July — about 75 basis points higher than today — and futures markets pencil in rates as high as 5.30% by the end of the year.
At 4.85%, two-year Treasury yields hit their highest intraday level since early November.
Britain bank NatWest said it now expects the Fed to raise rates by 50 bps at its March meeting and join others in expecting 25 bp hikes at its May and June meetings, raising its “terminal rate” to 5.75% – up half a point. he thought before.
Dollar also reached the highest level of the year against the Japanese yen.
Incoming Bank of Japan Governor Kazuo Ueda said the central bank has thoughts on how to exit massive stimulus, but made clear that such a shift to tighter policy is not imminent.
“It’s not that I have no idea how to change the BOJ’s current policy. But the desired arrangement will change depending on the economic changes at the time,” Ueda said.
British Prime Minister Rishi Sunak and Europe Sterling took some patience as Commission President Ursula von der Leyen prepared to announce a new Brexit deal for Northern Ireland on Monday if they could agree the final details during lunchtime talks.
According to JPMorgan, the Bank of England is likely to raise interest rates by another 25 bps in June as more tightening may be needed to tame sticky inflation. A 25 bps hike would take the BoE terminal rate to 4.75%, following similar-sized moves in March and May.
Meanwhile, Warren Buffett’s Berkshire Hathaway ( BRKa.N ) reported its highest annual operating profit on Saturday, even as foreign exchange losses and rising interest rates helped lower earnings in the fourth quarter.
“I have yet to see a time when it makes sense to make a long-term bet against America,” Buffett said in his bullish letter.
Key developments that could guide US markets on Monday:
* US durable goods orders in January, January pending home sales, February Dallas Fed manufacturing survey.
* Federal Reserve Board Governor Philip Jefferson. Europe Philip Lane, member of the Board of Directors of the Central Bank
* US corporation earnings: Target, Occidental Petroleum
Reuters Graphics Global markets in 2023Fund flows: U.S. bond fundsDefense stocks drive Russian aggression into Ukraine every yearBy Mike Dolan, Editing by Ed Osmond [email protected]. Twitter: @reutersMikeD
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2023-02-27 15:19:30
Source – reuters
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