Baltic
Dry Index. 1743 -31 Brent Crude 89.36
Spot
Gold 2336 US 2 Year Yield 4.96 +0.07
The number one problem in today's generation and economy is the lack of financial literacy.
Alan Greenspan.
No need for me to say much today. The comment below sums up yesterday’s
US developments exactly.
"The U.S. Q1 GDP report delivered the worst of both worlds,
softer than expected growth and higher than expected inflation," said
Rodrigo Catril, senior FX strategist at National Australia Bank.
So does the US central bank cut interest rates in June, September,
December or only next year?
Asia stocks rise, yen
falls as BOJ stands pat on rates
By Rae Wee April 26, :57 AM GMT+1
SINGAPORE, April 26
(Reuters) - The yen fell amid volatile trade on Friday after the Bank of Japan
(BOJ) maintained its accommodative monetary policy stance at the conclusion of
its two-day policy meeting, while Asian shares rose elsewhere.
The BOJ kept its short-term rates steady on Friday, as expected,
while removing a reference to the amount of government bonds it has roughly
committed to buying each month.
The Japanese yen fell shortly after the announcement to the
weaker side of 156 per dollar, marking a fresh 34-year trough. It was last
0.25% lower at 156.04 per dollar.
Ten-year Japanese government
bond futures came off lows.
Focus now turns to BOJ Governor Kazuo Ueda's news conference
later on Friday for further details of the BOJ's policy outlook.
Fears of an intervention from Tokyo to
shore up the yen also remained high, given the yen's decline to multi-decade lows
against a resurgent dollar.
Japanese Finance Minister Shunichi Suzuki said on Friday the
country is concerned about negative effects of the weak yen, adding to the slew
of aggressive jawboning from authorities in
recent weeks, though to little effect.
In the broader market,
investors were digesting the implications of Thursday's data, which showed the U.S. economy grew at its
slowest pace in nearly two years in the first quarter, though inflation
accelerated.
That reinforced expectations that the Federal Reserve would not
cut interest rates before September.
"The U.S. Q1 GDP report delivered the worst of both worlds,
softer than expected growth and higher than expected inflation," said
Rodrigo Catril, senior FX strategist at National Australia Bank.
More
Asia
stocks rise, yen falls as BOJ stands pat on rates | Reuters
Japanese
yen weakens to 156 against dollar after Bank of Japan leaves rates unchanged
UPDATED FRI, APR 26 2024 12:11 AM EDT
The Japanese yen slid
to 156 against the U.S. dollar on Friday after the Bank of Japan left its
benchmark interest rate unchanged.
The BOJ kept
its benchmark policy rate at 0%-0.1% as expected. Japan’s
central bank also said it will continue to conduct bond purchases in line with
the March decision.
The yen touched fresh lows
following the decision.
Tokyo’s headline inflation rate
for April came in at 1.8%, slowing from the 2.6% in March. Core inflation in
the capital — which strips out prices of fresh food — sharply fell to 1.6% from
March’s 2.4%, missing expectations of 2.2% from economists polled by Reuters.
Tokyo inflation data is widely
considered as a leading indicator of nationwide trends.
---- Overnight
in the U.S., stocks tumbled after data showed a sharp slowdown in economic
growth and pointed to persistent inflation.
U.S. gross domestic product
expanded 1.6% in the first quarter, the Bureau of Economic Analysis said.
Economists polled by Dow Jones forecast GDP growth would come in at 2.4%.
Along with the downbeat growth
rate, the report showed the personal consumption expenditures price index
increased at a 3.4% pace, well above the previous quarter’s 1.8% advance.
The Dow Jones Industrial Average slid
0.98%, weighed down by steep declines in Caterpillar and IBM.
The S&P 500 dropped
0.46%, and the Nasdaq Composite lost
0.64%.
Asia markets live
updates: Tokyo inflation, BOJ rate decision (cnbc.com)
US Yields Soar as Traders See Fed Delaying First Cut to
December
Thu, Apr 25, 2024, 3:35 PM GMT+1
(Bloomberg) -- Treasuries slumped and traders
further trimmed their outlook for the pace of Federal Reserve interest-rate
cuts, deterred by a US GDP report that highlighted sticky price pressures.
The selloff in US
government bonds on Thursday pushed yields across the curve to the highest
levels of the year. Traders pared back expectations for the timing of a Fed
rate reduction, now fully pricing in the first cut in December.
While data showed
growth for the quarter was softer than most economists predicted, another hot
reading of underlying inflation — and an unexpected drop in weekly jobless
claims — took precedence for bond traders. That sets the stage for a $44
billion auction of seven-year notes later on Thursday.
“Higher inflation
and a strong jobs market are overshadowing weaker consumption,” said Ian
Lyngen, head of US rates strategy at BMO Capital Markets in a note.
“Stagflation chatter will surely pick up in the wake of these figures.”
Thursday’s economic
data is the latest to force Wall Street to temper its expectations for lower
borrowing costs in the world’s top economy. The US bond market is set for a
fifth-straight week of losses.
Gross domestic
product increased at a 1.6% annualized rate last quarter, while a closely
watched measure of underlying inflation advanced at a greater-than-expected
3.7% clip.
The yield on
benchmark two-year Treasuries rose as high as just over 5%. Yields across the
maturity spectrum touched their highest levels since November.
Swaps traders now
see only about 33 basis points of Fed rate reductions for all of 2024, well
below the more than six quarter-point reductions they expected at the start of
the year.
More
US
Yields Soar as Traders See Fed Delaying First Cut to December (yahoo.com)
In other news, someone give US Treasury
Secretary Yellen the latest US GDP and inflation news.
Oil prices on track
to snap two-week losing streak
By Georgina
Mccartney April 26,
2024 5:05 AM GMT+1
April 26 (Reuters) - Oil prices rose on Friday, on
track to end higher this week after two straight weeks of losses, after a top
U.S. official expressed optimism over economic growth and as supply concerns
lingered due to conflicts in the Middle East.
Brent crude futures gained 31 cents, or 0.4%, to
$89.32 a barrel at 0347 GMT, and U.S. West Texas Intermediate crude futures
rose by 23 cents, or 0.3%, to $83.80 a barrel.
For the week, Brent has
gained 2.3% so far, while WTI is up 0.8%.
Treasury Secretary Janet Yellen told Reuters on Thursday U.S.
GDP growth for the first quarter could be revised higher, and inflation will
ease after a clutch of "peculiar" factors held the economy to its
weakest showing in nearly two years.
U.S. economic growth was likely stronger than suggested by
weaker-than-expected quarterly data, she said.
Data showed that economic
growth slowed in the first quarter, and prior to Yellen's comments, tremors
from an acceleration in inflation had weighed on oil prices as investors
calculated that the Federal Reserve would not cut interest rates before September.
Elsewhere, supply concerns as geopolitical tensions continue in
the Middle East also buoyed prices early in the session.
Israel stepped up airstrikes on Rafah
after saying it would evacuate civilians from the southern Gazan city and
launch an all-out assault despite allies' warnings this could cause mass
casualties.
Oil prices on track to snap two-week losing streak | Reuters
Global Inflation/Stagflation/Recession Watch.
Given
our Magic Money Tree central banksters and our spendthrift politicians, inflation
now needs an entire section of its own.
GDP growth slowed
to a 1.6% rate in the first quarter, well below expectations
PUBLISHED THU, APR 25 2024 8:31
AM EDT
U.S. economic growth was much weaker than expected
to start the year and prices rose at a faster pace, the Commerce Department
reported Thursday.
Gross domestic product, a broad measure of goods and services produced in the
January-through-March period, increased at a 1.6% annualized pace when adjusted
for seasonality and inflation, according to the department’s Bureau of Economic
Analysis.
Economists surveyed by Dow Jones had been looking
for an increase of 2.4% following a 3.4% gain in the fourth quarter of 2023 and
4.9% in the previous period.
Consumer spending increased 2.5% in the period,
down from a 3.3% gain in the fourth quarter and below the 3% Wall Street
estimate. Fixed investment and government spending at the state and local level
helped keep GDP positive on the quarter, while a decline in private inventory
investment and an increase in imports subtracted. Net exports subtracted 0.86
percentage point from the growth rate while consumer spending contributed 1.68
percentage points.
There was some bad
news on the inflation front as well.
The personal
consumption expenditures price index, a key inflation variable for the Federal
Reserve, rose at a 3.4% annualized pace for the quarter, its biggest gain in a year
and up from 1.8% in Q4. Excluding food and energy, core PCE prices rose at a
3.7% rate, both well above the Fed’s 2% target. Central bank officials tend to
focus on core inflation as a better indicator of long-term trends.
The price index for
GDP, sometimes called the “chain-weighted” level, increased at a 3.1% rate,
compared to the Dow Jones estimate for a 3% increase.
----“This
was a worst of both worlds report – slower than expected growth, higher than
expected inflation,” said David Donabedian, chief investment officer of CIBC
Private Wealth US. “We are not far from all rate cuts being backed out of
investor expectations. It forces [Fed Chair Jerome] Powell into a hawkish tone
for next week’s [Federal Open Market Committee] meeting.”
More
GDP Q1 2024: Economy increased at a 1.6% rate
(cnbc.com)
The US is dealing with a rare bifurcation of the
economy, and it's raising the odds of recession, Piper Sandler chief economist
says
April 24, 2024
The US is navigating a
"bifurcated" economy that's only been seen twice before, with both
times ending in a recession, according to a top economist.
Nancy
Lazar, Piper Sandler's chief global economist, told Fox
Business Network on Wednesday that
the current economic backdrop is "very difficult" and "very
unusual," and occurred only during the energy crisis in 1978-1979 and the
latest Great Recession in 2008.
"You have those that are
benefiting from higher interest rates. You have those that are suffering from
higher interest rates, those that can pay for these higher prices, and those
that are really getting squeezed," Lazar said.
She said large businesses have been
riding high on interest income, favorable financial conditions from locking in
low-cost debt, surging stock rallies, and hefty government support.
Meanwhile, consumers are feeling the
squeeze, facing mounting debts at elevated interest rates while inflation eats
into wage gains.
"At the end of the day, the
interest rate structure had to go higher for longer, and in turn, eventually,
you did have a recession, and that's how you eventually crushed the excesses
and inflation," she said.
Lazar forecasts a 53% odds of a
recession, but she emphasized that we "need a recession" to tackle
the inflation problem.
"[Otherwise,] you're going to have a big
group of people, a big group of companies continue to spend, continue to bid up
these prices. And so I think it's a fine line, and I worry more about sticky
inflation than I worry about recession."
Covid-19 Corner
This section will continue until it becomes unneeded.
Did people really die in the
UK from Covid 19, or from NHS sedative treatments? NHS Euthanasia?
Approx. 15 minutes.
Midaz
Technology
Update.
With events happening fast in the
development of solar power and graphene, among other things, I’ve added this
section. Updates as they get reported.
Samsung shows off battery tech it says will see you
gone in nine minutes
April 25, 2024
Might
help to set spluttering EV market on fire. Won't catch fire thanks to built-in
vents
Samsung
SDI, the Korean giant’s battery biz, on Tuesday promised EV batteries that can
charge to 80 percent capacity in a mere nine minutes, plus models that can
perform at that level for 20 years.…
The
ultra-fast charging battery will enter production in 2026. The long-lived
product will start rolling off factory floors in 2029.
Samsung SDI
teased the tech in March of this year. At the 37th Electric Vehicle Symposium
& Exposition (EVS37) taking place this week in Seoul, it is also displaying
an anode-free all solid-state battery (ASB) with a 900 watt-hour per liter
density, which it eyes to start mass-producing in 2027.
Solid-state
batteries are considered a significant step up from lithium-ion due to their
higher energy density, faster charging capabilities and perceived safety as
ASBs are less likely to catch fire.
Samsung's
already tried to reduce the likelihood its kit catches fire, a live issue as
Li-Ion-powered appliances and e-bikes spark domestic blazes that have
regulators worried that low-quality products increase risks.
The Korean
champ's approach is to use vents that exhaust heat and gas, so that if its
batteries are involved in an accident or fire the chances of thermal runaway
are reduced.
More
Samsung shows off battery tech it says will see you
gone in nine minutes (msn.com)
Finally,
our latest new section, the world global debt clock. Nations debts to GDP
compared.
World Debt
Clocks (usdebtclock.org)
Another
weekend and a weekend to ponder on what a slowing US GDP might mean for a US
Federal government wracking up another trillion of new debt roughly every one
hundred days.
Early
in the week I produced my assessment of the central bankster’s mass rush
towards introducing Central Bank Digital Currencies. If you would like a copy, please email me at graemeirvine@hotmail.com.
Have
a great weekend everyone.
Nobody spends somebody else's money as carefully as he spends his own.
Milton Friedman.
No comments:
Post a Comment