Market Information Monday 26 September 2022

Market Information Monday 26 September 2022

Last week was dominated by central banks that adjusted interest rates. The central banks of the United States, the United Kingdom, Sweden and Switzerland raised interest rates. The Bank of Japan chose to keep interest rates unchanged. In Turkey, on the other hand, interest rates were lowered despite an inflation rate of over 80 percent. This week, no central bank meetings have been planned.

The pound reached an all-time low against the dollar after the UK’s finance minister Kwasi Kwarteng announced new budget plans. He aims to cut taxes significantly. Some describe the all-time low as a flash-crash, the markets are bracing for more declines.

In a letter, Milieudefensie (Friends of the Earth Netherlands) informs that accountancy firms should check more closely for climate risks at large companies in The Netherlands. Climate risk should become a key focus of controls. This mainly concerns the large polluting companies that, according to the organization, are doing too little to achieve the climate goals set in Paris.

The 6M Euribor decreased with 1 basis point to 1.76% compared to previous business day. The 10Y Swap increased with 8 basis points to 2.85% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

Market Information Friday 23 September 2022

Market Information Friday 23 September 2022

The Bank of England raised interest rates for the sixth time in a row on Thursday. This was revealed in the UK central bank’s delayed interest rate decision on Thursday. The central bank raised interest rates by 50 basis points from 1.75% to 2.25%. This is in line with market expectations. The Bank of England has been raising interest rates since December, high inflation is forcing the central bank to continue with it.

Global steel production also fell in August, but at a slower pace as production rose slightly in China. This was revealed on Thursday by figures from industry body World Steel Association. In total, the 64 steel-producing countries produced 150.6 million tonnes of steel in August. That is 3.0% less than August 2021. In July, production was still down 6.5% year-on-year.

Yesterday, Japan intervened to strengthen the Yen for the first time since the late 1990s, after the currency tumbled to a 24-year low on pledges by the central bank to stick with its ultra-loose policy. Masato Kanda, the country’s top currency official, said the government had “taken decisive action” to address what it warned was a “rapid and one-sided” move in the foreign exchange market. It was the first time Japan had sold dollars since 1998, according to Japanese government data.

The 6M Euribor increased with 3 basis points to 1.77% compared to previous business day. The 10Y Swap increased with 8 basis points to 2.77% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

Market Information Thursday 22 September 2022

Market Information Thursday 22 September 2022

US stock markets closed lower on Wednesday after the Fed again aggressively raised interest rates. Everything on Wednesday was dominated by the Federal Reserve’s interest rate decision. In line with expectations, the US central bank raised its key interest rate, the federal funds rate, by 75 basis points to a range of 3.00% to 3.25%. The leading S&P 500 index fell 1.7% to 3,789.89 points, the Dow Jones index lost 1.7% at 30,183.71 points and the Nasdaq was 1.8% lower at 11,220.19 points.

Governments in Europe have earmarked nearly 500 billion euros in the last year to cushion citizens and companies from soaring gas and power prices, according to research published by think-tank Bruegel on Wednesday. Months of surging prices have seen governments roll out measures to curb retail power prices, slash energy taxes and give subsidies to bill-payers. The EU’s 27 countries have collectively allocated EUR 314 billion for measures to ease the pain, while Britain has set aside EUR 178 billion, according to Brussels-based Bruegel.

U.S. natural gas futures jumped about 4% to a near one-week high on Wednesday, on forecasts for stronger U.S. gas demand this week than previously expected and renewed worries about a possible U.S. rail strike. A rail strike could boost demand for gas by threatening coal supplies to power plants.

The 6M Euribor is unchanged at 1.74% compared to previous business day. The 10Y Swap is unchanged at 2.69% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

Market Information Wednesday 21 September 2022

Market Information Wednesday 21 September 2022

The euro was still trading around parity on Tuesday ahead of the Federal Reserve’s (Fed) interest rate decision, to be announced Wednesday evening. With a possible 100 basis point rate hike on the horizon, it remains to be seen whether that level can be maintained. “It looks like that for now,” currency trader Stéphane van der Meer of currency broker Ebury told ABM Financial News on Tuesday. “To start with, only 20% of the market believes the Fed will raise interest rates by 100 basis points. We keep it at 75 basis points. In addition, the market is initially still looking forward to European Central Bank President Christine Lagarde’s lecture, which could hardly ignore the pressure to adopt a ‘hawkier’ tone. If the president heeds that, it could mean support for the euro,” according to Van der Meer.

Dutch consumer confidence decreased further in September. This was revealed on Wednesday by figures from the Central Bureau of Statistics (CBS). Consumer confidence was at -59 in August, down from -54 in July. At -59, consumer confidence in September was well below the 20-year average of -9. “Consumers have never been so negative about the economy and their financial situation,” CBS stated. The sub-indicator economic climate decreased from -74 to -79. Not since measurement began in 1986 have consumers been so gloomy about the economy. Consumers were both more negative about the economy in the past 12 months and about the economy in the next 12 months. Willingness to buy decreased to -46 in September, from -41 in August. Consumers have never been so negative about making major purchases.

Market interest rates are rising rapidly. In the Netherlands, the effective yield on 10-year government bonds increased to over 2.24% on Tuesday. This passed the peak in June. The yield is now at a level not seen the since summer of 2013. The ECB is expected to raise the deposit rate to at least 2.5% by the end of the first quarter of 2023. Currently, Frankfurt is still applying a rate of 0.75%. The money market has now priced in eight steps of 25 basis points between now and mid-March. On Tuesday, the Swedish central bank already set an example by implementing a one-full percentage point rate hike in one go.

The 6M Euribor increased with 7 basis points to 1.74% compared to previous business day. The 10Y Swap increased with 11 basis points to 2.69% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

Market Information Tuesday 20 September 2022

Market Information Tuesday 20 September 2022

New figures published today by the German statistical office, Destatis, show that producer prices rose further in August. Prices rose 45.8% in August compared to a year earlier. The increase in July was still at 37.2% and 32.7% in June.

Bread prices in the European Union rose by almost 20% in August compared to a year earlier, according to the European statistics office Eurostat. In The Netherlands, the increase was still relatively low at 10% but the price in Hungary saw an increase of 66%. The increase is mainly due to the ongoing conflict between Russia and Ukraine who are the largest exporters for the grain and corn they use in Europe.

Inflation in Japan rose further in August to 3.0% year-on-year, new government figures show. This puts inflation above the Bank of Japan’s desired 2% for the fifth month in a row. However, the monetary policy body recently announced that it sees no reason to adjust interest rate policy. Coming Friday, the Bank of Japan will announce the new interest rate decision.

The 6M Euribor increased with 6 basis points to 1.67% compared to previous business day. The 10Y Swap increased with 5 basis points to 2.58% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.