Oil prices stabilized on Thursday (February 12th), as the market reassigned a risk premium to US-Iran tensions despite US inventory data showing swelling domestic supplies. This movement confirms one thing: geopolitical headlines are still more "noise" than signals of a short-term surplus. As of 3:50 PM WIB, Brent was at $69.60/barrel (+0.29%) and WTI was at $64.83/barrel (+0.31%). The gains were moderate, but enough to keep prices near the psychological $70 level for Brent. From a geopolitical perspective, market focus is on the potential for escalation in the Middle East. Recent reports...
The Bank of England cut its benchmark interest rate by 25bps to 4.5% in its January 2025 decision, as widely expected, marking the third rate cut since the start of its cutting cycle in August last year. All nine members of the Monetary Policy Committee voted for the rate cut, compared with 8-1 odds, while two members voted for a sharper 50bps cut, including hawkish Catherine Mann. The Bank maintained its stance that monetary easing is expected to be gradual this year, as rising growth concerns weigh on underlying services inflation. However, the Bank revised its growth forecasts for the...
United States President Donald Trump on Monday said he spoke with Canadian Prime Minister Justin Trudeau and plan to speak with him again later today, amid escalating trade tensions between the two countries. Over the weekend, President Trump imposed a 25% tariff on imports from neighboring Mexico and Canada. Both countries swiftly responded with retaliatory measures against U.S. goods, escalating the trade dispute. Amid these developments, President Trump posted on his social media platform, Truth Social, stating that he had spoken with Prime Minister Trudeau and would speak with him...
Brazilian President Luiz Inacio Lula da Silva said on Thursday that his government would reciprocate if U.S. President Donald Trump decides to impose tariffs on Latin America's largest economy, and called for mutual respect. "It is very simple: if he taxes Brazilian products, there will be reciprocity," Lula told a press conference in Brasilia. The United States runs a trade surplus with Brazil, which according to Brazil's government hit $253 million last year. But Trump this week named the country among those he believes meant the U.S. "harm," threatening potential tariffs. "China is a...
Bank of Japan Governor Kazuo Ueda avoided giving a clear signal that he might raise interest rates next month, sticking to his view that the bank needs to continue monitoring risks to the economy in comments that weighed on the yen. "The timing and pace of adjusting the degree of monetary accommodation will depend on developments in economic activity and prices as well as financial conditions going forward," Ueda said in a speech at a business conference in Tokyo on Wednesday. "The bank needs to pay attention to various risk factors at home and abroad, and to examine how these factors will...
The Swiss National Bank cut its interest rate by 50 basis points on Thursday, the biggest reduction in almost 10 years as it sought to stay ahead of expected cuts by other central banks and cap the rise of the Swiss franc. The SNB reduced its policy rate from 1.0% to 0.5%, the lowest since November 2022. While markets had predicted the move, more than 85% of economists polled by Reuters had expected a smaller cut of 25 basis points. It is the steepest drop in borrowing costs since the SNB's emergency rate cut in January 2015 when it suddenly quit its minimum exchange rate with the...
Chief Powell participates in a moderated discussion at the New York Times DealBook Summit, in New York. Key Takeaways Independence lets the Fed make decisions for all Americans, not any political party. There is broad support in both parties for an independent Fed; do not think there is risk of losing it. The U.S. economy is in remarkably good shape. Feel very good about where monetary policy is. Do not think appointment of a "shadow" Fed chair is on the table. Feel the same institutional relationships between the Fed and the Treasury will continue under the new...
U.S. consumer spending increased slightly more than expected in October, suggesting the economy retained much of its solid growth momentum early in the fourth quarter, but progress on lowering inflation appears to have stalled in recent months. The lack of success in bringing inflation back to the Federal Reserve's 2% target, together with the prospect of higher tariffs on imported goods from the incoming Trump administration, could narrow the scope for interest rate cuts from the U.S. central bank next year. The Fed is still widely expected to deliver a third rate cut in December, with...
Federal Reserve officials conveyed optimism that inflation is subsiding and the labor market remains robust, supporting the possibility of further interest rate cuts, though at a measured pace, minutes from November 6-7 meeting showed. Officials noted that monetary policy decisions are contingent on economic trends and cautioned against making premature rate cuts. The volatility in recent data and uncertainty about the neutral interest rate's impact on economic activity made policymaking particularly challenging. Some participants suggested keeping rates at restrictive levels if inflation...
Gold rises in the early Asian trade. There's a broad commodities uptrend, driven by macro uncertainty, a weaker dollar, and persistent demand for "hard" assets, says Fawad Razaqzada, market analyst...
Oil extended declines after OPEC+ agreed to a bigger-than-expected production increase next month, raising concerns about oversupply just as US tariffs fan fears about the demand outlook.
Brent...
The Japanese Yen (JPY) weakened against its US counterpart and reversed part of Friday's recovery from the lowest level since July 23 following Bank of Japan (BOJ) Governor Kazuo Ueda's remarks....