- Report that PIMCO lost US$340 mln with Credit Suisse AT1 bonds write-off
- More on US Treasury examining unlimited deposit guarantees if bank crisis worsens
- Goldman Sachs on stocks - "valuations do not look particularly attractive"
- Singaporean-based French commodity trader Trafigura sees oil demand strengthening
- AUD/USD back under 0.6700. The case for an RBA pause at the April 4 meeting has firmed.
- ICYMI: Morgan Stanley strategist says bank stress signals start of end of the bear market
- PBOC sets USD/ CNY reference rate for today at 6.8763 (vs. estimate at 6.8753)
- US equity index futures jumped on Globex on the FDIC 'guarantee all deposits' idea
- RBA minutes: Board agreed to consider again the case for pausing rate hikes
- US is examining ways to guarantee all bank deposits
- South Korean export data has slumped 23% y/y (first 20 days of March)
- Pershing Square's Ackmann says Federal Open Market Committee (FOMC) should pause this week
- RBNZ sees no immediate need to request reinstatement of USD swap line (expired in 2023)
- ECB's Holzmann waters down call for three more rate hikes
- ICYMI: JPMorgan's Kolanovic says a soft landing now looks unlikely, airplane in a tailspin
- Australia weekly consumer confidence stumbling along at deeply pessimistic, ugly levels
- Citi exepcts 25bp Federal Open Market Committee (FOMC) hike Wednesday, presser important
- New Zealand February exports 5.23bn (5.47bn prior) & imports 5.95bn (7.42bn prior)
- Forexlive Americas FX news wrap 20 Mar: GBPUSD trades to the highest level since early Feb
- South Korea February PPI rises at its slowest pace y/y since March 2021
- ICYMI - The G7 is not likely to revise its price cap on Russian oil this week
- WSJ: JPMorgan owned bags supposed to contain nickel but turned out to be full of stones
The minutes of the Reserve Bank of Australia March 2023 meeting were published today. The most notable point was that:
- Members agreed to reconsider the case for a pause at the (April meeting), recognising that pausing would allow additional time to reassess the outlook for the economy. At what point it will be appropriate to pause will be determined by the data and the Board’s assessment of the outlook.
Note that the March meeting was held before the current bout of bank failures. If the RBA Board is looking to pause this turmoil would seem to be enough justification given that:
- while inflation is still well above target it is showing signs of peaking
- economic activity is showing signs of slowing
- yesterday Christopher Kent, Reserve Bank of Australia Assistant Governor (Financial Markets) said that lags in policy transmission meant the full impact of RBA rate hikes so far are yet to be felt
The case for an RBA pause in April is firming.
AUD/USD dirbbled a little lower today, but with NZD/USD and also CAD dipping a little against the USD it doesn’t seem that the RBA minutes really had too much of an impact on the Australian dollar. Perhaps its yet to come.
There was some (equity) market moving news from the US. The US Treasury is examining unlimited deposit guarantees (via the FDIC) if the bank crisis worsens. As I pointed out, there is a huge practical problem with this:
- US bank deposits are around US$18 tln
- The FDIC insurance fund is around US$125 bn
- The FDIC insurance fund is unfunded
Still, US equity index futures jumped higher on the headline. There was a retracement but as I post the emini S&P500 contract, ES, for example, is higher on the session.
Regional equities are higher (Japan is closed for a holiday today).
Asian equity markets:
Japan’s Nikkei 225 CLOSED TODAY
China’s Shanghai Composite +0.18%
Hong Kong’s Hang Seng +0.7%
South Korea’s KOSPI +0.6%
Australia’s S&P/ASX 200 +1.2%
Globex emini S&P500:
(This chart is from our charting app, which is free and can be found at this link)
