- Peace talks between Russia and Ukraine began yesterday in Turkey, with Ukraine proposing to agree to its neutrality while working towards EU membership, while Russia promised it would scale down its assault on Kiev and Chernihiv, although Ukraine is sceptical Russia will really implement its stated action. News of the talks helped boost risk sentiment, causing stocks to rally (especially in Europe), boosting the Euro, and making several commodities drop. The Ruble has already gained more than 12% against the US Dollar over today’s Tokyo session.
- The Forex market has continued to be dominated by moves by the Japanese Yen, which has gaining strongly despite the third day of intervention from the Bank of Japan designed to see the currency weaken further. The Bank of Japan has pledged to purchase an unlimited amount of JGB bonds at 0.25% after the 10-year Yen yield hit 0.245%, the highest rate seen in 6 years. The USD/JPY currency pair has fallen by more than 120 pips in today’s Tokyo session after briefly trading at a new 6-year high above ¥125 on Monday.
- The US 5-year and 30-year treasury yields have inverted this week for the first time since 2006, which is taken by some analysts to indicate an impending recession. However, the spread between the more closely watched 2-year and 10-year yield spread remains healthy.
- Today will bring a release of the ADP Non-Farm Employment Change forecast, which is expected to be 455k new jobs created.
- US JOLTS Job Openings data released yesterday came in higher than expected, at 11.27 million new jobs compared the forecasted 11 million. This suggests that the US labor market remains tight.
- Daily new coronavirus cases globally fell last week after rising for two weeks in a row.
- The large city of Shanghai remains under lockdown due to rising coronavirus cases.
- It is estimated that 64.4% of the world’s population has received at least one dose of a coronavirus vaccination, while approximately 6.1% of the global population is known to have contracted the virus at some stage.
- Total confirmed new coronavirus cases worldwide stand at over 485.5 million with an average case fatality rate of 1.27%.
- The rate of new coronavirus infections appears to now be increasing only in Australia, Cyprus, France, Italy, Laos, Luxembourg, Malta, Samoa, Taiwan, Tonga, the UK, and Vanuatu.