Citibank has hinted there won't be any possible layoff and closure of physical branches in the countries it is exiting.
Meanwhile, Brent oil is testing the psychologically important $70 level.
The direction of the EUR/USD on Tuesday is likely to be determined by trader reaction to 1.2152.
By Geoffrey Smith
(Bloomberg) -- Asian stocks on Wednesday are set to track U.S. declines as concern about faster inflation shadows the economic recovery from the pandemic. A dollar gauge was near the lowest level this year.Futures slipped in Japan and Australia after key U.S. equity benchmarks closed lower and large technology stocks like Amazon.com Inc. and Microsoft Corp. erased gains. U.S. futures dipped as they opened in Asia. A slide in crude on the possibility of more supply from Iran hurt energy stocks. The dollar retreated further and Treasury yields dipped. Markets are closed Wednesday in Hong Kong and South Korea for holidays.Stocks have been volatile after touching a record in early May. Investors have been whipsawed by concerns about accelerating inflation amid elevated commodity prices, as well as a Covid-19 resurgence in countries including India. Traders are awaiting the latest Federal Reserve minutes for clues on how policy makers view price pressures, and any hints of a timeline for tapering stimulus.In Bank of America Corp.’s latest fund manager survey, inflation topped the list of the biggest tail risks, followed by a bond market taper tantrum and asset bubbles. Covid-19 was in fourth place.“The market has been trying to process a very unusual economic environment and a confluence of factors that it has not faced for a long time,” said David Donabedian, chief investment officer of CIBC Private Wealth Management. “I personally would say that the stock market has absorbed it all extremely well because there’s still a high conviction view on earnings being strong.”Bitcoin fell to the lowest since February after the People’s Bank of China reiterated that digital tokens cannot be used as a form of payment. AT&T Inc. plunged the most in the S&P 500 after the company said it plans to spin off its media operations.Here are some key events this week:The Fed publishes minutes from its April meeting Wednesday, which may provide clues to officials’ views on the recovery and how they define “transitory” when it comes to inflationEIA crude oil inventory report WednesdaySt. Louis Fed President James Bullard and Atlanta Fed President Raphael Bostic to speak at separate events WednesdayIMF Managing Director Kristalina Georgieva and ECB President Christine Lagarde speak at the Vienna Economic Dialogue ThursdayEuro-area finance ministers and central bank chiefs hold an informal meeting. A larger group of EU finance ministers and central bank chiefs will meet May 22These are some of the main moves in markets:StocksThe S&P 500 fell 0.9%The Nasdaq 100 fell 0.7%Nikkei 225 futures fell 1.2%Australia’s S&P/ASX 200 Index futures fell 1.1%CurrenciesThe yen was at 108.88 per dollarThe offshore yuan traded at 6.4215 per dollarThe Bloomberg Dollar Spot Index fell 0.3%The euro was at $1.2224BondsThe yield on 10-year Treasuries fell one basis point to 1.64%CommoditiesWest Texas Intermediate crude fell 1.2% to $65.49 a barrelGold future were at $1,869.21 an ounceMore stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Sign up for the New Economy Daily newsletter, follow us @economics and subscribe to our podcast.As Bank of England officials consider how to unwind their emergency pandemic-era stimulus, markets have already made up their minds about what the first step will be. The conclusion could spell trouble for Chancellor of the Exchequer Rishi Sunak.Investors are penciling in the BOE’s first 15-basis-point interest-rate hike for September 2022, reversing its last cut, just nine months after the central bank is scheduled to wrap up its latest round of buying, and too soon to have allowed for any significant balance-sheet reduction.That would have major consequences for Sunak, who has run up the U.K.’s biggest-ever peacetime deficit to fund crisis aid, and relied on BOE stimulus to keep borrowing costs under control.The BOE slashed rates to 0.1% and more than doubled its asset-purchase target to 895 billion pounds ($1.26 trillion) during the crisis. Now, officials led by Governor Andrew Bailey are discussing whether their previous guidance -- that they’d hold onto to those bonds until interest rates hit 1.5% -- is still suitable.“The world has changed hugely” since the BOE last reviewed its stance on tightening, Bailey said following the central bank’s May decision. “It’s appropriate to review that again.”While the review is yet to be completed, Bailey himself last year suggested he was open to a major shift, and was prepared to reduce the institution’s balance sheet before raising interest rates.Aaron Rock, an investment director at Aberdeen Standard Investments, is holding to the view that rate hikes will precede any reduction of the balance sheet. He expects the BOE to halve the policy rate at which balance sheet reduction will be considered to around 0.75%, a level currently anticipated to be reached only in the second half of 2024.Flexible OptionHowever, Rock flagged a risk the review may decide on a more flexible option, allowing the balance sheet to be reduced “starting next year at the same time they are hiking policy rates from 0.1%.”The BOE’s holdings of bonds are financed at its key interest rate, and the massive expansion of quantitative easing since the pandemic began has left the nation twice as sensitive to a one-point move, according to the Office for Budget Responsibility.Even a small increase would immediately filter through to debt-servicing costs, with the buying having shortened the median maturity of public debt to less than two years, from more than seven before the financial crisis, according to the OBR.“I still believe that hikes are a long way off,” said Mike Riddell, portfolio manager at Allianz Global Investors. He doesn’t expect the central bank to ever reduce its balance sheet, despite this being its intention a decade ago.“Now that we have even more debt, which makes the economy even more sensitive to higher rates, then I’d be surprised if the U.K. or global economic backdrop is such that quantitative tightening would be deemed necessary,” Riddell said.That’s not the view of Goldman Sachs Group Inc., which expects balance-sheet reduction to push the first rate hike out as far as 2025.“We expect the Monetary Policy Committee to reverse the previous exit sequencing and adopt a ‘last in, first out’ approach for the process of monetary tightening,” wrote Goldman Sachs economists including Jari Stehn.The Treasury was happy to reap the rewards from QE, so “when the bank begins to tighten policy, it should be prepared to live with the consequences,” Nick Macpherson, former Permanent Secretary at the Treasury, said in a video seminar on Tuesday.(Adds former official’s comment in fina paragraph)More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
I think the main driver of the rally is that gold investors believe the Fed when it says it is going to hold policy accommodative.
U.S. stocks are seen opening higher Tuesday, with the tech-heavy Nasdaq Composite leading the way, helped by renewed confidence in the Federal Reserve retaining its ultra-easy monetary policy, while strong earnings from the retail sector again testify to the strength of consumer demand. Large-cap retailers Walmart (NYSE:WMT) and Home Depot (NYSE:HD) reported blowout first quarters, helped by the last round of stimulus checks that put more money in consumers' pockets, while Macy’s (NYSE:M) raised its forecast for annual sales and earnings, betting on pent-up demand as shoppers return to its stores. At 7:15 AM ET (1115 GMT), the Dow Futures contract was up 90 points, or 0.3%, S&P 500 Futures traded 11 points, or 0.3%, higher, and Nasdaq 100 Futures climbed 90 points, or 0.7%.
The direction of the EUR/USD on Monday is likely to be determined by trader reaction to the pivot at 1.1216.
‘Will she still be able to use our daughter as a tax deduction? My concern is also with the coming child tax credit this summer.’
AT&T's stock is the biggest loser in the S&P 500 on Tuesday. Its valuation depends on how much credit investors give the combined WarnerMedia/Discovery for its future streaming efforts.
A paper that my colleague Anqi Chen and I wrote last year — “How Much Taxes Will Retirees Owe on Their Retirement Income?” — keeps hitting the “top 10” list on a major listserv for social sciences research. As people approach retirement, they tend to add up their financial resources — Social Security benefits, defined benefit pensions, defined contribution balances, and other assets. The question we look at is just how large the tax burden is for the typical retired household and for households at different income levels.
The Biden administration has announced payments will be starting this week.
Learn the basic structure of a 401(k) and why it may not be enough to sustain you during retirement.
Amid the slump sweeping across crypto assets Tuesday, investors were turning their attention to a meme asset, SafeMoon, that has garnered increased attention was recently drawing fresh looks after comments made by Barstool Sports founder Dave Portnoy on Twitter.
Experienced hands look to be buying the dip as a key bitcoin price indicator suggests the pullback may be coming to an end.
Raoul Pal tells bitcoin investors that current volatility is to be expected, but big things are around the corner.
‘Everybody wants to have asset prices forever going up and the cost of financing to be next to nothing,' Kerry Killinger says.
GameStop and AMC overcame rocky starts to the trading day as comments on social media surged and retail traders mused once again about “squeeze"s on both stocks.
The payments will reach more than 65 million children, according to senior administration officials.
SafeMoon debuted its cryptocurrency in March, claiming to solve common problems that plague Bitcoin, Ethereum, and Dogecoin.