Euro banks – Last Jeudi http://lastjeudi.org/ Mon, 26 Sep 2022 15:49:36 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://lastjeudi.org/wp-content/uploads/2021/03/cropped-icon-1-32x32.png Euro banks – Last Jeudi http://lastjeudi.org/ 32 32 Europe’s outlook ‘darkens’ as ECB chief hedges recession https://lastjeudi.org/europes-outlook-darkens-as-ecb-chief-hedges-recession/ Mon, 26 Sep 2022 15:15:40 +0000 https://lastjeudi.org/europes-outlook-darkens-as-ecb-chief-hedges-recession/ FRANKFURT, Germany — The head of the European Central Bank said on Monday that the economic outlook is “darkening” and she expects business activity to “slow down significantly” in the coming months as high energy prices and of war-driven food in Ukraine is undermining consumers’ purchasing power. ECB President Christine Lagarde covered her remarks in […]]]>

FRANKFURT, Germany — The head of the European Central Bank said on Monday that the economic outlook is “darkening” and she expects business activity to “slow down significantly” in the coming months as high energy prices and of war-driven food in Ukraine is undermining consumers’ purchasing power.

ECB President Christine Lagarde covered her remarks in the European Parliament on whether the eurozone would slide into recession, saying the bank’s base case scenario was moderate economic growth. But she appeared to qualify this by saying that some assumptions of this outlook – such as the remaining supply of Russian natural gas – have been “undone by events”.

She also mentioned that next year will be “definitely, a tough year” and that the first three months of 2023 “will most likely be negative, as we believe the fourth quarter of 2022 will also be negative.” negative output is one definition of recession, but the European recession dating committee uses a wider range of data, including employment figures.

Russia’s invasion of Ukraine “continues to cast a shadow over Europe”, driving up energy prices that are dampening consumer spending and production for companies hit by higher costs, said The guard.

Meanwhile, the strong summer rebound in tourism-dependent countries was fading, while weaker global demand would mean less support for Europe’s economy, which is heavily trade-driven. Higher interest rates from central banks in major economies would also dampen demand outside Europe.

Lagarde urged governments to target aid programs to those most in need, saying blanket aid would not help fight inflation. As countries clamor to help households and businesses in the face of soaring energy costs, she said most of the aid announced so far was not sufficiently “tailored, temporary and targeted” and that there was “work to do” to adjust the approach.

The ECB raised interest rates by three-quarters of a percentage point at its last meeting on Sept. 8, the biggest rate hike in its history, and said it would hike rates at future meetings.

It joins the US Federal Reserve and other central banks in raising interest rates sharply to fight a global spike in inflation. The 19 countries that use the euro saw annual consumer prices rise to a record 9.1% a year in August, well above the ECB’s 2% target considered the best for the economy.

Many economists predict that the Eurozone will slide into a recession at the end of this year and the beginning of next year. Lagarde, however, said the bank’s baseline scenario is that growth will not turn negative, but that a much bleaker worst-case scenario would include a 2023 recession. This worst-case scenario involves Russia cutting off the last trickle of gas natural gas circulating in its gas pipelines to Europe.

Lagarde said the baseline scenario, set before Russia cut the main Nord Stream 1 gas pipeline to Germany, predicted growth of 0.9% next year. The more gloomy forecast points to a decline of 0.9%. She said her personal outlook was that the outcome would be “somewhere in between” and more will be known when new banking forecasts are released in December.

The state-owned Gazprom has steadily reduced deliveries to a fraction of what they were before the war. European officials say it is energetic blackmail aimed at pressuring their support for Ukraine and sanctions against Russia. Some Russian gas is still flowing in pipelines through Ukraine and Turkey.

Europe is more exposed to the economic fallout of war than other major world economies such as the United States or China. Indeed, Europe for years relied on Russia as a major oil and gas pipeline supplier – ties that have now come undone. Russia has halted most gas shipments, while Europe is set to ban most Russian oil imports later this year.

The Paris-based Organization for Economic Co-operation and Development said on Monday it expects the eurozone economy to grow 1.25% this year in the 19 countries using the euro and 0.3% in 2023. But she said there were risks of a deeper downside in several European countries. economies during the winter months and that the impact of energy shortages could push many countries into recession next year.

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Fnality Bank-backed blockchain payment rail seeks to raise £50m as it eyes digital euro – Ledger Insights https://lastjeudi.org/fnality-bank-backed-blockchain-payment-rail-seeks-to-raise-50m-as-it-eyes-digital-euro-ledger-insights/ Fri, 23 Sep 2022 17:49:53 +0000 https://lastjeudi.org/fnality-bank-backed-blockchain-payment-rail-seeks-to-raise-50m-as-it-eyes-digital-euro-ledger-insights/ Fnality, the institutional payment system backed by 15 banks and the Nasdaq, is seeking to raise an additional £50 million ($55 million), as TheBlock first reported. Previously called Utility Settlement Coin, Fnality tokenizes money in an account held with a central bank to allow institutions to settle transactions such as securities, intraday derivatives or collateral […]]]>

Fnality, the institutional payment system backed by 15 banks and the Nasdaq, is seeking to raise an additional £50 million ($55 million), as TheBlock first reported.

Previously called Utility Settlement Coin, Fnality tokenizes money in an account held with a central bank to allow institutions to settle transactions such as securities, intraday derivatives or collateral exchanges. For the settlement of blockchain transactions, it provides low-risk cash on the ledger, one of the factors that has delayed the institutional adoption of DLT, as it enables atomic settlement or delivery versus payment.

Next month, Fnality is set to launch its first currency, a tokenized British pound. HM Treasury officially recognized it as a payment system at the end of August, and in February the company conducted a pilot transaction with Natwest and one of its Santander investors. This is good news as the UK plans to launch a DLT-based financial market infrastructure (FMI) sandbox next year.

A digital euro next?

Sources told Ledger Insights that Fnality is also actively working on a digital euro, which is bolstered by an investment earlier this year from Euroclear. However, various sources recently informed Ledger Insights that in the past three months, the European Central Bank has started canvassing banks about interest in a wholesale CBDC in addition to its active work on a retail CBDC. .

When the company was incorporated in 2019, it planned for five currencies, the Canadian dollar, the euro, the pound, the Japanese yen and the US dollar. On the dollar side, Fnality was one of several companies involved in the development of DTCC’s blockchain settlement solution, Project Ion.

Fnality is not short of money

When Fnality announced its £50m funding in 2019, the stated intention was always to raise additional funds as each coin was launched. This is because each currency has a separate company that operates a central bank account and a separate licensed Ethereum blockchain network.

Last year, Fnality lost £15 million ($16.6 million) but still had £27 million ($30 million) at the end of the year, partly because it issued £21.7 million ($24 million) in convertible loan notes in 2021.

In addition to the £27 million in cash from holding company Fnality International, Fnality UK also had £4.7 million. It therefore raises funds from a relatively solid financial situation.

How it works

The Bank of England paved the way for the rollout when it gave the green light to omnibus bank accounts, which allow the mixing of funds from different entities for wholesale settlement purposes.

Although Fnality sees itself as a payment system rather than a stablecoin, there are parallels. While stablecoins are backed by Treasury securities and commercial bank account balances, Fnality currency tokens are backed by a central bank account. When a bank wants to tokenize money, it transfers money to the omnibus account and the equivalent amount is tokenized. If he wants to withdraw money, the tokens are burned and the money is transferred from the omnibus account to the central bank account belonging to the bank.

Paving the way for DLT adoption

There have been at least four reasons for the slow institutional adoption of DLT. One of them has been the lack of low-risk cash in the ledger, which Fnality is helping to address. The other reasons also disappear.

What makes a network useful? Exchanges with two or three other institutions are unlikely to produce sufficient efficiency gains. Over the last year or so, many of the major international banks have started building large DLT teams, which means that when a network is launched, there are more participants to trade with.

There has also been a lack of integration with legacy systems, which is not yet resolved, but is starting to be resolved as DLT teams are built.

The final piece of the puzzle is regulation. Some jurisdictions are clearer than others, such as France, Germany, Luxembourg and Switzerland in Europe, and Singapore and Japan in Asia. The UK’s IMF sandbox and the EU’s DLT pilot scheme should help clear the picture.

Arguably, there has been a fifth reason for the slow adoption of DLT, the challenges of building and operating consortia. This leads to Fnality backers: Banco Santander, Bank of New York Mellon, Barclays, CIBC, Commerzbank, Credit Suisse, Euroclear, ING, KBC Group, Lloyds Banking Group, Mizuho, ​​MUFG Group, Nasdaq, SMBC, State Street and UBS.


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Bank of England rate hike averts more aggressive action https://lastjeudi.org/bank-of-england-rate-hike-averts-more-aggressive-action/ Thu, 22 Sep 2022 11:36:42 +0000 https://lastjeudi.org/bank-of-england-rate-hike-averts-more-aggressive-action/ LONDON (AP) — Britain’s central bank raised its key rate another half a percentage point on Thursday, eschewing more aggressive measures to tame inflation that the U.S. Federal Reserve and other banks have taken. The Bank of England raised its benchmark rate to 2.25%, matching its half-point increase last month – the biggest rise in […]]]>

LONDON (AP) — Britain’s central bank raised its key rate another half a percentage point on Thursday, eschewing more aggressive measures to tame inflation that the U.S. Federal Reserve and other banks have taken.

The Bank of England raised its benchmark rate to 2.25%, matching its half-point increase last month – the biggest rise in 27 years. The decision was delayed for a week as the UK mourned Queen Elizabeth II and followed economic relief measures announced by the government of new Prime Minister Liz Truss which are expected to dampen short-term inflation.

It is the bank’s seventh consecutive move to raise borrowing costs as rising food and energy prices fuel a cost-of-living crisis considered the worst in a generation. Despite a plummeting currency, a tight labor market and inflation near its highest level in four decades, officials have decided not to act more boldly as sharp increases threaten to tip the economy in the recession.

The UK’s move comes in a busy week for central bank action. A day earlier, the US Federal Reserve raised rates by three-quarters of a point for the third consecutive time and predicted that more bigger hikes were to come.

Also on Thursday, the Swiss central bank decreed its biggest increase in its key rate.

The meeting “will tell us not only how worried policymakers are about the fall in the pound sterling and other UK markets, but also how the government’s decision to cap energy prices for households and businesses will translate into monetary policy,” said James Smith, Developed Markets Economist with ING Bank.

Soaring inflation worries the bank because it eats away at consumers’ purchasing power. The traditional tool for fighting inflation is to raise interest rates, which reduces demand and therefore prices, making it more expensive to borrow.

Inflation in the UK is 9.9%, close to its highest level since 1982 and five times higher than the Bank of England’s 2% target. The pound sterling is at its weakest level against the dollar in 37 years, contributing to imported inflation.

The central bank warned last month that UK inflation would peak at 13.1% by the end of this year and trigger a prolonged recession.

Since then, the Truss government has unveiled a massive relief package that caps spiraling energy bills for households and businesses. Economists say the measures mean inflation will peak at a lower level and then fall faster next year.

The Bank of England has avoided pressure to expand even as other banks around the world take aggressive action against inflation fueled by the global economy’s recovery from the COVID-19 pandemic and then the Russia’s war in Ukraine.

This month, Sweden’s central bank raised its key rate by one percentage point, while the European Central Bank made its biggest rate hike on record with a three-quarters point hike for all 19 countries. who use the euro.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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Canadian Dollar Crashes on Missed Inflation Brings Bank of Canada Closer to Finish Line https://lastjeudi.org/canadian-dollar-crashes-on-missed-inflation-brings-bank-of-canada-closer-to-finish-line/ Tue, 20 Sep 2022 15:16:33 +0000 https://lastjeudi.org/canadian-dollar-crashes-on-missed-inflation-brings-bank-of-canada-closer-to-finish-line/ Canadian inflation down by all measures Heralds end Bank of Canada rambling cycle But deprives the CAD of support via the tariff channel Photo © Adobe Stock The Canadian dollar fell in the wake of domestic inflation data showing prices rose less than expected in August, underscoring the view that the Bank of Canada will […]]]>
  • Canadian inflation down by all measures
  • Heralds end Bank of Canada rambling cycle
  • But deprives the CAD of support via the tariff channel

Photo © Adobe Stock

The Canadian dollar fell in the wake of domestic inflation data showing prices rose less than expected in August, underscoring the view that the Bank of Canada will be among the first major central banks to complete its cycle of rise.

The Canadian dollar fell against the majority of its major peers on Tuesday after headline CPI inflation came in at -0.3% month-on-month in August, disappointing relative to market expectations. of -0.1% and the positive July result of 0.1%.

In the year to August, CPI inflation rose 7.0%, below the 7.3% market expectation and below the 7.6% expected by the market. July.

Core inflation – which excludes food and energy costs – remained unchanged during the month, after a more pronounced rate of 0.5% in July.


Canadian inflation


All of the Bank of Canada’s preferred inflation measures showed a deceleration: Core CPI fell to 5.7% from 6.0%, the median fell to 4.8% from 4, 9%, and the reduced value dropped to 5.2% from 5.4%.

“We believe it is far too early for the Bank to proclaim ‘Mission Accomplished’. But with interest rate sensitive sectors of the economy rapidly slowing and employment contracting in recent months, a sustained deceleration in price growth could prompt the Bank of Canada to take an extended pause after the October announcement,” said Randall Bartlett, senior director of the Canadian economy at Desjardins Bank.

“While headline inflation remains well above the Bank of Canada’s target, meaning further rate hikes are likely, a clearer gap appears to be opening between inflation trends in the Canada and the United States, which should lead to a lower peak from the Bank of Canada than the Federal Reserve,” says CIBC economist Andrew Grantham.

The divergence in expectations was reflected in a significant 0.75% advance in the exchange rate between the US dollar and the Canadian dollar to 1.3345.

The exchange rate between the pound and the Canadian dollar meanwhile rose 0.40% to 1.5213, bringing money transfer rates to bank accounts to around 1.4787 and payment provider rates specialized at 1.5167.

The inflation data reinforces growing expectations that the Bank of Canada is nearing the end of its rate hike cycle, which in turn implies that Canadian bond yields face limited upside.

This would potentially deprive the Canadian dollar – one of the biggest carriers of 2022 – of support via the rate channel going forward.

“Bond yields fell immediately after the release, but had begun to undo some of that movement later in the morning. The Canadian dollar, however, weakened against its US counterpart, with this trend continuing even when yields have started to level off, as investors reassess their expectations for where the peak in interest rates will be in Canada versus the United States,” Grantham said.


GBP CAD free quote


Looking at the details, food prices in Canada are up 9.8% from a year ago, making it the highest in more than four decades.

But the brake on energy prices was the main driver of the inflation basket thanks to a drop of 6.5% during the month of August.

Looking ahead, RBC Bank economist Claire Fan says flattening demand – according to RBC’s own card spend tracker – looks likely to further limit the pace of growth in physical commodity prices in the US. coming.

“Meanwhile, growth in the prices of services, particularly those related to leisure and travel, are likely to remain higher for longer, supporting the strength of underlying inflation which we expect will not peak until later in the fourth quarter of this year,” she says.

RBC expects an additional 75 basis points of hikes over the rest of 2022, which is well below what is expected from the Fed (190 bps), Bank of England (194 bps) and Bank Central European (130 bp).

In fact, only the Bank of Japan is expected to offer less than the BoC going forward.

“Further increases are coming, but probably at a slower pace,” said James Knightley, chief international economist at ING.

A combination of falling oil prices, troubled global equity markets and the impending completion of the Bank of Canada rate hike cycle could provide potential headwinds for the Canadian dollar in the coming weeks.

GBP CAD free quote

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Peter Schiff finally sees Puerto Rico allow the liquidation of the Euro Pacific bank https://lastjeudi.org/peter-schiff-finally-sees-puerto-rico-allow-the-liquidation-of-the-euro-pacific-bank/ Sun, 18 Sep 2022 15:14:00 +0000 https://lastjeudi.org/peter-schiff-finally-sees-puerto-rico-allow-the-liquidation-of-the-euro-pacific-bank/ Euro Pacific Bank (EPB) Peter Schiff and Puerto Rico’s Office of the Commissioner of Financial Institutions (OCIF) have reached an agreement on the bank’s liquidation plan. The decision comes two months after regulators in the territory issued a cease and desist order against the bank based on inadequate capital levels and compliance checks. This follows […]]]>

Euro Pacific Bank (EPB) Peter Schiff and Puerto Rico’s Office of the Commissioner of Financial Institutions (OCIF) have reached an agreement on the bank’s liquidation plan. The decision comes two months after regulators in the territory issued a cease and desist order against the bank based on inadequate capital levels and compliance checks.

This follows the earlier agreement reached in August 2022 between the two parties to close the bank and devise a plan to return all customer deposits.

“EPB has arranged to transfer all customer deposits, cash and physical precious metals, as well as ownership of the bank’s four wholly-owned subsidiaries, to Qenta, a US-based global financial services and technology company. United States,” the bank said in a statement.

The bank’s customers have the option of withdrawing their deposits by bank transfer to another financial institution of their choice.

But the road has been long for the bank and its owner for two months. Schiff argued that OCIF erred in ordering a halt to banking operations instead of authorizing the sale of the financial institution, “to a highly qualified buyer promising to inject capital well beyond minimums. regulations”. Instead, authorities in Puerto Rico opted to close the bank for capital issues, “despite no evidence of crimes”, according to the bank’s sole shareholder.

The recent decision comes as vindication for the bank owner who wanted to liquidate EPB all along, even via bitcoin, despite being a bitcoin skeptic. Instead, the sale was blocked, with Schiff citing OCIF’s claim that he still held 4% after the trade as the reason.

“They never let me know they objected to it,” Schiff said in a tweet in July. “If they had said the 4% stake was a problem, I would have restructured the deal. I just wanted out.

It seems Schiff was so pleased with the deal that he tweeted about it twice.

But that doesn’t mean Schiff is going ahead without recording the treatment he and his bank have received from Puerto Rico regulators. His camp argues that while the wind-up deal is a nod in the right direction, it is happening despite no formal accusations of wrongdoing having been made to cause the bank to close.

“The IRS agent at the June 30, 2022 press conference in Puerto Rico sometimes inferred criminal conduct from money laundering and tax evasion by EPB. However, he did not announce that EPB, any employee or Mr. Schiff, the sole shareholder, were charged with a crime despite a seemingly thorough investigation lasting more than 2 years,” Schiff’s legal counsel said, Lanny J. Davis.

The lawyer is also not giving up on the sale halted two months ago, noting that he wondered “why Schiff’s proposal to OCIF for Qenta to buy EPB several months before at a fair price was rejected” . This comes as a contradictory point when the recent deal reached included Qenta buying EPB assets and customer deposits “out of receivership at a discount sale price – but to get all operations, jobs and benefits out of the way.” of Puerto Rico”.

In essence, for the Schiff camp, the bank’s closure and liquidation is still much ado about nothing since “despite claims to the contrary and the bank’s receivership, the bank has always had sufficient cash reserves and cash equivalents to cover all deposits”.

“Depositors were always safe with their money in EPB… Also, the bank didn’t make any loans, so EPB had enough capital to operate,” Schiff said.

Nevertheless, it would still take time for bank customers to recover their deposits, and Schiff is working to return everything “as promised”.

On the part of OCIF, regulators believe it is acting to protect the interests of the bank’s customers, saying “Euro Pacific has a long history of non-compliance”.

“We will not allow or tolerate any financial entity with a license issued by the government of Puerto Rico to operate outside the law or ignore the clear mandates of applicable laws and regulations,” Commissioner Natalia Zequeira Díaz said in a statement. a press release in July.

The Puerto Rican decision to halt the bank’s operations would be part of the wider investigation launched by the Joint Chiefs of Global Tax Enforcement in 2018 in response to the leak. Panama Papers. The so-called “J5” is made up of tax regulators from the United States, Australia, Britain, Canada and the Netherlands.

One of the task force’s main investigations focused on the EPB as an alleged vehicle for tax evasion and money laundering.

But now, after the deal was closed, Davis pointed out that when asked if EPB was helping clients launder money or evade taxes, the commissioner responded by saying it was “a conclusion which has not been drawn”.


The information for this briefing was found via the companies mentioned. The author has no security or affiliation related to this organization. Not a buy or sell recommendation. Always do additional research and consult a professional before purchasing a title. The author holds no license.

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ASX up, Apple paces New York tech rally https://lastjeudi.org/asx-up-apple-paces-new-york-tech-rally/ Mon, 12 Sep 2022 18:22:00 +0000 https://lastjeudi.org/asx-up-apple-paces-new-york-tech-rally/ On Wall Street, all three major benchmarks rose. The VIX also rose, up 4.7% to 23.87. Energy and information technology punctuated the 11 S&Industrial groups of P 500 are higher. Apple advanced 3.9%, supported by reports of strong demand for its latest iPhone model. Wedbush Securities Dan Ives: “We are already seeing delivery times push […]]]>

On Wall Street, all three major benchmarks rose. The VIX also rose, up 4.7% to 23.87. Energy and information technology punctuated the 11 S&Industrial groups of P 500 are higher.

Apple advanced 3.9%, supported by reports of strong demand for its latest iPhone model.

Wedbush Securities Dan Ives: “We are already seeing delivery times push to mid-October for many Pro models and most pre-orders are now looking at 3-4 week deliveries and moving quickly. So far, demand and orders for iPhone 14 are slightly ahead of iPhone 13 and exceed our expectations from the start.

Today’s agenda

Local: Westpac-MI, September consumer confidence at 10:30 a.m. AEST, NAB business survey at 11:30 a.m. AEST

Overseas data: August final German CPI; Eurozone ZEW expectations in September; United Kingdom July Unemployment rate as defined by the ILO July; August CPI in the United States at 22:30 AEST

Market Highlights

ASX futures up 45 points or 0.65% at 7002 around 6:45 a.m. AEST

  • AUD +0.7% to 68.87 US cents
  • Bitcoin + 4% to US$22,423 around 6:45 a.m. AEST
  • On Wall St: Dow +0.7% S&P-500 +1.1% Nasdaq +1.3%
  • In New York: BHP +2.3% Rio +1.6% Atlassian +2.3%
  • Tesla +1.6% Apple +3.9% Amazon +2.4%
  • In Europe: Stoxx 50 +2.1% FTSE +1.7% CAC +2% DAX +2.4%
  • Spot gold +0.6% at US$1,727.01 per ounce at 2:10 p.m. PT
  • Brent +1.1% to $93.88 a barrel
  • Iron ore +1.7% to US$101.95 per tonne
  • 10-year yield: United States 3.35% Australia 3.63% Germany 1.65%
  • US prices from 4:43 p.m. in New York

United States

U.S. consumer inflation expectations fell further in August as gasoline prices extended their sharp decline from June’s record high, a development that should be welcomed by Federal Reserve policymakers assessing the magnitude of an interest rate hike next week.

Consumers in August saw inflation at 5.75% over the next 12 months, down from 6.2% in July and the lowest rate since October 2021, the monthly Consumer Expectations Survey showed. the New York Fed. They also predicted price increases of 2.8% on average over the next three years – the lowest pace since the end of 2020 – after setting inflation on that horizon at 3.2% in July.

Additionally, consumers last month saw price increases of 2% over the next five years, matching the level of inflation targeted by the Fed. That was down from 2.35% in July and 3% at the start of the year, when the New York Fed began asking about inflation expectations during this period.

Europe

European stocks hit a two-week high on Monday on hopes of some easing in energy prices and banks rallied to nearly four-week highs on bets on interest rate hikes most important in Europe.

The pan-European STOXX 600 index rose 1.8%, following its first weekly gain in a month on Friday.

Investors focused on attempts to push through multi-billion euro packages to prevent utilities from collapsing under a cash crunch and to protect households from soaring energy bills.

“We are still seeing an extension of the positivity that emerged last week when action was taken in Europe to cap energy prices,” said Stuart Cole, chief macroeconomist at Equiti Capital.

“This has raised a lot of hopes that inflation could peak sooner than previously thought and that central banks, although still expecting to maintain their aggressive stance on interest rate hikes short-term interest, may not have to raise them as high as originally feared.”

But keeping energy prices artificially low risks fueling domestically generated underlying inflation, which could shift expectations for forward interest rates, Cole said.

Banks, gaining in a higher interest rate environment, rose with the Euro Banks Index jumping 3.4%, extending Thursday’s gains when the ECB hiked key rates by 75 basis points. base and promised further increases.

Hawkish signals from the ECB sent the banking index up nearly 10% for the month, supporting much of the STOXX 600’s 3% gain so far in September.

Goods

U.S. emergency crude oil inventories fell 8.4 million barrels last week to 434.1 million barrels, their lowest since October 1984, according to U.S. Department of Energy data ( DOE) published on Monday.

The release of the Strategic Petroleum Reserve (SPR) during the week ended September 9 was the biggest draw since May. It included about 6.3 million barrels of sweet crude and about 2 million barrels of sour crude.

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The dollar stopped, the Swiss franc eclipsed the euro https://lastjeudi.org/the-dollar-stopped-the-swiss-franc-eclipsed-the-euro/ Sun, 11 Sep 2022 05:49:35 +0000 https://lastjeudi.org/the-dollar-stopped-the-swiss-franc-eclipsed-the-euro/ The euro ended the week broadly higher, helped by the historic ECB rate hike. Still, it was eclipsed by the Swiss franc, which was the biggest gainer after the SNB reiterated its favorable host stance on franc appreciation. The Canadian dollar followed in third place, also after another massive rally by the Bank of Canada. […]]]>

The euro ended the week broadly higher, helped by the historic ECB rate hike. Still, it was eclipsed by the Swiss franc, which was the biggest gainer after the SNB reiterated its favorable host stance on franc appreciation. The Canadian dollar followed in third place, also after another massive rally by the Bank of Canada.

On the other hand, Yen was the worst performer. There was some jaw-dropping support from Japanese officials. But there is little chance of a rebound given the policy divergence with other major central banks. The New Zealand dollar and the US dollar were next. The greenback has started to reverse some recent gains and risk sentiment has improved.

Euro’s underlying strength uncertain despite historic ECB hike

The euro ended broadly higher after the ECB announced a historic rate hike of 75 basis points. EUR/USD recovered parity after hitting a short-term low at 0.9863. But there are still doubts about the underlying strength of the euro.

First, the euro clearly underperformed the Swiss franc. EUR/CHF’s drop last week suggests a rejection by the 55-day EMA. The rebound from 0.9550 was held below the 38.2% retracement from 1.0512 to 0.9550 to 0.9917. Both maintain a bearish outlook for EUR/CHF for a further dip through 0.9550 at a later stage to resume a larger downtrend.

Second, while the EUR/GBP rally looked promising, it is still capped below the 0.8720 resistance and struggled to break above the medium-term Fibonacci resistance at the 38.2% retracement of 0.9499 to 0.8201 to 0.8697. A break below the 0.8565 support will signal another rejection by 0.8697 and lead to another drop as the third leg of the pattern from 0.8720.

Third, EUR/CAD also remained range-bound last week, struggling to clear the 55-day EMA and capping below short-term resistance at 1.3271. The development maintains the bearish outlook for another dip through 1.2867 at some point to resume the broader downtrend.

The Swiss franc is strong as the SNB says appreciation helps

Against the euro, the strength of the Swiss franc is much more apparent. Markets expect another 50 basis point rate hike from the SNB on September 22, with the possibility of a 75 basis point move. More importantly, SNB Chairman Thomas Jordan reiterated last week that “at the moment it is rather true that given the inflationary pressure, an appreciation of the franc tends to help rather than hurt.” . The will to increase the franc is a key factor that helps it increase.

The downtrend in GBP/CHF continued last week and broke through the 2020 low at 1.1107. But unlike GBP/USD’s reaction at 1.1409, there is no sign of a rebound yet. Outlook will remain bearish as long as 1.1244 minor resistance holds. The firm break of 1.1107 will open the way for a 200% projection from 1.3070 to 1.2134 to 1.2598 to 1.0726.

CHF/JPY uptrend also resumed last week and jumped up to 148.45. While the yen rallied considerably on Friday, the decline in CHF/JPY so far has been very shallow. Consolidations should be relatively brief as long as 146.90 minor support holds. The breakout of 148.79 will target a 100% projection of 127.48 to 143.73 from 137.13 to 153.38, which matches the peak rise made in 2015 after the SNB suddenly removed the cap on the franc exchange rate.

The dollar reversed its gains as the risk market digested the upcoming Fed hike well

As for the dollar, it reversed some of the recent gains on improving risk sentiment. Investors seemed to have digested another 75 basis point hike from the Fed on September 21 well. Fed funds futures now price a 91% chance of that happening. Still, US stocks rebounded strongly, ending a three-week losing streak.

The S&P 500’s close above the 55-day EMA and the 4000 handle was a positive sign. Stronger rebound is slightly in favor towards 4325.28 resistance. But it should be noted that the price moves from 3636.87 probably form the second leg of the corrective pattern from 4818.62 (the first leg was the three wave move from 4818.62 to 3636.87) . The second stage of a corrective pattern tends to be rather unpredictable, in terms of size, duration, and pattern. It will therefore not be surprising to see flip-flops again.

The Dollar Index should have formed a short-term high at 110.78. Near-term risk is slightly on the downside, for a deeper pullback towards the 55-day EMA (now at 107.12). But there is no clear sign of a reversal as long as it stays well inside the medium-term bullish channel. Another rally through 110.78 is still expected at a later stage.

But given the possibility of a bearish divergence condition in the daily MACD, a sustained break of the channel support (now around 106), could signal the start of a medium-term correction towards the 104.63 support and below. If that happens, it should correspond to a break of the resistance at 1.0368 in EUR/USD.

AUD/USD Weekly Outlook

AUD/USD fell to 0.6698 last week but rallied ahead of the 0.6680 low. The initial bias is slightly to the upside this week for the 55-day EMA (now at 0.6919). A sustained break at this level will then target the resistance at 0.7135. On the downside, a decisive break of 0.6680 will resume a larger downtrend.

Overall, price action from 0.8006 (2021 high) is seen more as a corrective pattern to move lower from 0.5506 (2020 low). Or it could also be a bearish impulse move. Either way, the outlook will remain bearish as long as the resistance at 0.7135 holds. The next target is a 61.8% retracement from 0.5506 to 0.8006 to 0.6461.

On the long term, the rejection by the resistance at 0.8135 suggests that the long term downtrend from 1.1079 (2011 high) is not about to reverse. Yet the structure of the fall from 0.8006 still argues that this is a corrective move. Therefore, a break of the 0.5506 low is not in sight at this time. The long-term outlook remains neutral initially and will be reassessed later after the drop from 0.8006.

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European stocks post their first weekly gain in four https://lastjeudi.org/european-stocks-post-their-first-weekly-gain-in-four/ Fri, 09 Sep 2022 16:40:00 +0000 https://lastjeudi.org/european-stocks-post-their-first-weekly-gain-in-four/ The DAX chart of the German stock price index is pictured on the stock exchange in Frankfurt, Germany, September 7, 2022. REUTERS/Staff Join now for FREE unlimited access to Reuters.com Register Miners Soar on Rising Metal Prices STOXX 600 marks weekly gains of 1.1% Banks expect another 75 basis point ECB rate hike Sep 9 […]]]>

The DAX chart of the German stock price index is pictured on the stock exchange in Frankfurt, Germany, September 7, 2022. REUTERS/Staff

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  • Miners Soar on Rising Metal Prices
  • STOXX 600 marks weekly gains of 1.1%
  • Banks expect another 75 basis point ECB rate hike

Sep 9 (Reuters) – European stocks posted their first in four weekly gains on Friday, boosted by a surge in bank stocks on expectations of further monetary policy tightening from the European Central Bank, while soaring metal prices pushed up mining stocks.

The pan-European STOXX 600 index (.STOXX) rose 1.5% to close at over-week highs.

European stocks briefly lost gains in afternoon trade following reports that ECB policymakers are set to launch a debate next month on cutting the $4 trillion bond pile euros. Read more

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It comes a day after the central bank raised policy rates by an unprecedented 75 basis points (bps) and promised further hikes. Several money houses are forecasting another rate hike of 75 basis points in October. Read more

Eurozone banks (.SX7E), rocked by worries about their profitability in a low interest rate environment, jumped 3.2% to mark their biggest percentage rises in nearly two months. The index is still down 16.3% since the start of the year.

“Traders are in a risk mood even though yesterday saw an ECB rate hike and hawkish comments from (Fed Chairman) Jerome Powell,” said David Madden, market analyst at Equiti. Capital.

“It’s possible that dealers are getting used to the idea of ​​rising interest rates and high bond yields.”

Miners (.SXPP) jumped 3.0% as a weaker dollar and further stimulus for China’s slowing economy pushed up prices for industrial metals and iron ore.

Investors are focused on a meeting of energy ministers from European Union countries later today, where they will find solutions from a long list of possible measures to protect citizens from exorbitant energy prices at the approach of winter. Read more

As the STOXX 600 managed to end the week up 1.1%, investors doubt the rally can be sustained as Russia shuts off its gas taps to Europe indefinitely amid a cost crisis of the life that is being prepared in the region.

“We remain negative on European equities amid heightened geopolitical/energy uncertainty as central banks tighten policy amid an economic downturn,” Morgan Stanley analysts said in a note.

Shares of Telecom Italia (TIM) (TLIT.MI) rose 2.8% as sources familiar with the matter said it was set to launch a process to sell a minority stake in its branch of business services. Read more

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Reporting by Shreyashi Sanyal in Bengaluru; Editing by Sherry Jacob-Phillips, Rashmi Aich and Jonathan Oatis

Our standards: The Thomson Reuters Trust Principles.

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EMEA: New British Chancellor seeks to control inflation https://lastjeudi.org/emea-new-british-chancellor-seeks-to-control-inflation/ Wed, 07 Sep 2022 19:51:57 +0000 https://lastjeudi.org/emea-new-british-chancellor-seeks-to-control-inflation/ In today’s Europe, Middle East and Africa (EMEA) news, the UK’s new Chancellor spent his first full day meeting with leaders from the financial sector and discussing the country’s high inflation. Meanwhile, the European Central Bank (ECB) has identified three potential use cases for a digital euro. Potential BoE reshuffle to be expected as new […]]]>

In today’s Europe, Middle East and Africa (EMEA) news, the UK’s new Chancellor spent his first full day meeting with leaders from the financial sector and discussing the country’s high inflation. Meanwhile, the European Central Bank (ECB) has identified three potential use cases for a digital euro.

Potential BoE reshuffle to be expected as new UK Chancellor seeks to control inflation

The day after his appointment, UK Chancellor of the Exchequer Kwasi Kwarteng (the minister responsible for economic and financial affairs) met a small delegation of senior bankers and stressed that the new government would pursue an “unabashed growth agenda “which involve reducing taxes and regulations while creating the right conditions for investment and innovation. He also used the meeting to reiterate his support for the independence of the Bank of England, but said the central bank’s mission to regulate inflation was key to keeping the cost of living under control.

EU focuses CBDC initiatives on individuals rather than businesses, Web3

In the European Union, the initial phase of a digital euro and potential use cases for a central bank digital currency (CBDC) will target personal use rather than business processes and the advancement of the web3, said an ECB official. Speaking in a panel discussion at the conference, Evelien Witlox, Head of the Digital Euro Program at the ECB, highlighted the three immediate areas of progress: peer-to-peer, consumer-to-business and payments to or by governments. Initially, a retail digital euro would not be allowed to be used to pay bills, issue paychecks or in decentralized finance (DeFi). Instead, the focus will be on people-initiated payments.

OneSpan and BankID extend digital identity service to all Norwegian banks

Digital agreement security company OneSpan and electronic identity company BankID have expanded their partnership to extend digital identity protection covering cross-border transactions to all Norwegian banks. The partnership will bring together a range of digital identity solutions at BankID, which is an electronic identifier for secure online identification and signing issued by 90 banks and 9,000 merchants and used by 4 million Norwegians when banking, purchases and access to public services online.

MTN partners with Dooka for digital supply chain solution

The pan-African telecom giant MTN Group has signed a partnership agreement with Dooka, a B2B market operator based in Johannesburg. The combination will help transform MTN’s supply chain and lead to “digital transparency and greater efficiency for MTN’s suppliers”, the company said.

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Bangladesh Bank launches RTGS for instant forex trading https://lastjeudi.org/bangladesh-bank-launches-rtgs-for-instant-forex-trading/ Sun, 04 Sep 2022 16:51:00 +0000 https://lastjeudi.org/bangladesh-bank-launches-rtgs-for-instant-forex-trading/ Bangladesh Bank has launched instant, bank-to-bank foreign currency transactions through online real-time gross settlement. Banks clear and settle primarily in US dollars, pounds, euros, Canadian dollars and Japanese yen. Bangladesh Bank Governor Abdur Rouf Talukder officially inaugurated the RTGS program at the central bank’s headquarters in Motijheel on Sunday. Deputy Governors Ahmed Jamal and Kazi […]]]>

Bangladesh Bank has launched instant, bank-to-bank foreign currency transactions through online real-time gross settlement.

Banks clear and settle primarily in US dollars, pounds, euros, Canadian dollars and Japanese yen.

Bangladesh Bank Governor Abdur Rouf Talukder officially inaugurated the RTGS program at the central bank’s headquarters in Motijheel on Sunday. Deputy Governors Ahmed Jamal and Kazi Sayedur Rahman, President of the Federation of Bangladesh Chambers of Commerce and Industry Md Jasim Uddin, President of the Metropolitan Chamber of Commerce and Industry Saiful Islam, President of the Bangladesh Bankers Association Bangladesh Selim RF Hossain and senior central bank officials, among others, were present at the event.

Previously, these five currencies – the US dollar, the British pound, the euro, the Canadian dollar and the Japanese yen – were settled in the traditional transaction system. In this method, banks use paper documents and bank officials settle the transaction.

It was time consuming and expensive, said Md Serajul Islam, executive director and spokesperson of Bangladesh Bank.

From Sunday, banks will be able to settle transactions instantly without any hassle through the RTGS system, he said.

The yuan, the Chinese currency, can be exchanged for five foreign currencies.

Bangladesh Bank issued a notification on August 28 to launch instant currency trading via RTGS.

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