Pictet sees Europe as most likely candidate for recession, expects big raise
Pictet Wealth Management said the European economy is the “number one” candidate most likely to see a recession. expected jumbo hike by the European Central Bank.
Alexandre Tavazzi, Head of Macro Research, said this was due to rising energy prices, which made companies lose their competitiveness.
He added that “other fundamentals” such as natural gas inventory levels will also be an important factor for the currency. Breaking below par for the first time in 20 years.
—Lee Ying Shan
Malaysia’s central bank raises interest rates for the third time in a row
The Central Bank of Malaysia increased its key interest rate by 25 basis points, according to a statement.
Bank Negara Malaysia cited high inflationary concerns and China’s tight border control measures as reasons for its decision to raise the overnight policy rate to 2.50%, the third consecutive rate hike.
Malaysia’s headline inflation is expected to peak in the third quarter of 2022, the central bank said, and adjustments to forward monetary policy settings will be made “in a measured and gradual manner”.
Australian central bank sues for slower rate hikes
Reserve Bank of Australia Governor Philip Lowe said the central bank “agrees” that “a slower rate of increase in interest rates becomes stronger as the cash rate rises”.
Tapas Stickland, economist at National Australia Bank, said Lowe’s remarks may have “signaled a move to 25bp increases at some point”.
“Given the delays in the functioning of monetary policy and the rapid rise in interest rates over the past four months, this could be soon and a pause is likely at some point,” Lowe said.
Nio says Nvidia chip restrictions won’t hurt them
No said US restrictions Nvidia Chip sales to China will not affect the automaker’s business.
“We believe this will have no impact on our business operations,” said Nio William Li, founder, chairman and CEO of Nio William Li, according to a StreetAccount transcript of the company’s translation. earnings call wednesday.
“Based on our estimations, our computing power is sufficient for us to develop autonomous driving technology in terms of AI training for now,” Li said.
Oil prices rise after Russia threatens to halt energy exports
Oil prices rose, recovery from losses in the previous sessionAfter Russian President Vladimir Putin threatening Stopping oil and gas exports if European countries impose a ceiling price on Russian oil.
Brent crude oil Futures rose 1% to $88.88 a barrel. USA West Texas Central It rose 1.1% to $82.83 per barrel.
“The easing in global oil prices was driven by concerns about slower growth in China after August trade data,” Mizuho noted.
—Lee Ying Shan
S&P says freight rates peak earlier than expected as global trade slows
S&P added that freight rates for containers and dry bulk carriers or ships carrying raw materials and bulk goods have fallen in the last three months, with rates peaking earlier than expected in the second quarter.
S&P’s Freight Rate Forecast models also predict that the Baltic Dry Freight Index, a barometer for the price of shipping key raw materials by sea, will decline by about 20 to 30% for the year before rebounding slightly in 2024.
This underscores the growing risks of a global recession as consumer demand declines. Between rising cost of living and inflation.
To read the whole story is here.
— Su-Lin Tan
Australia saw record decline in trade surplus; iron ore and coal exports fell
Australia saw a record decline in its trade surplus as exports of iron ore and coal fell.
In July, exports fell 10% month-on-month, while imports increased 5%, resulting in a trade surplus of A$8.7 billion in July from A$17.1 billion month-on-month.
Capital Economics said the falling trade surplus was “well below the analyst consensus of A$14.5 billion or even the lower limit of our consensus estimate of A$10.5 billion.”
“The recent drop in iron ore price has not yet fully fueled iron ore exports. Indeed, with the RBA’s commodity price index in August being 20% below its May peak, it is clear that the trade surplus has peaked,” Capital said. said economics senior economist Marcel Thieliant.
— Su-Lin Tan
Apple’s Asian suppliers soar after iPhone 14 announcements
Wells Fargo strategist says US dollar has legs to go higher
this United states dollar According to Wells Fargo Securities FX strategist Brendan McKenna, it has a chance to go higher thanks to the odds behind a hawkish Federal Reserve.
“We don’t think many of these international banks will be able to raise rates as aggressively as the markets are priced in,” he told CNBC’s “Squawk Box Asia.”
“So it’s a combination of a more hawkish Fed and a less hawkish tightening cycle than these international central banks that have been supporting the dollar for the rest of this year,” he said.
– Jihye Lee
Huawei launches first smartphone that connects to China’s rival GPS
Huawei has completed its latest attempt to stay current in the mobile market, the Mate 50 smartphone, despite losing a large amount of ground due to US sanctions.
Huawei claims that this is the first publicly available smartphone that can connect to China’s Beidou satellite network, which rivals the US state-owned Global Positioning System (GPS). ie completed in 2020.
US sanctions on the company in the last three years separate the company from key components and software and crushed the smartphone business.
To read the whole story is here.
Goldman Sachs raises Fed’s hike forecasts for this year
Goldman Sachs has revised its forecasts for the upcoming year of Federal Reserve rate decisions.
Analysts, led by chief economist Jan Hatzius, said in a note that the firm expects a 75 basis point increase in September from the previous 50 basis point forecast, and a 50 basis point increase in November has also been revised. From the previous projection of 25 basis points.
It also expects an increase of 25 basis points in December, citing the latest hawk comments from officials.
Fed officials “appear to imply that the progress towards taming inflation is not as uniform or rapid as they would like,” the memo said.
– Jihye Lee
Japan’s economy grew 3.5% year-on-year, surpassing estimates
Japan’s economy grew 3.5 percent year-on-year In the second quarter, it outperformed the estimates of a Reuters poll that predicted 2.9% growth.
According to official data, the economy grew by 0.9% quarter-on-quarter.
Spending growth will continue to be positive in Japan, according to Darren Tay, economist at Capital Economics Japan.
“Consumers have a huge pandemic imperative savings they can count on,” Tay said on CNBC’s “Squawk Box Asia”, adding that investors are betting on further widening the interest rate spreads between the Federal Reserve and a dovish Bank of Japan. .
– Jihye Lee, Charmaine Jacob
CNBC Pro: Wall Street pro predicts when the S&P 500 will rebound – and reveals how to trade
Market volatility will be permanent, according to market veteran Phil Blancato.
But the chairman and CEO of Ladenburg Thalmann Asset Management sees a “strong rally” on the cards as market conditions improve.
He predicts when the rally will happen and tells his best picks for trading volatility.
For subscribers read more here.
— Zavier Ong
All major averages close higher, Nasdaq catches 7-day losing streak
Stocks rose on Wednesday as Wall Street reviewed concerns about aggressive rate hikes from the Federal Reserve.
The Dow Jones Industrial Average rose 435.98 points, or 1.40%, to end the day at 31,581.28. The S&P 500 was up 1.83% to 3,979.90 and the Nasdaq Composite was up 2.14% to 11,791.90, breaking its seven-day streak.
Brainard says Fed is ‘in this business as needed’
Federal Reserve Deputy Chairman Lael Brainard made that promise Wednesday. Maintaining the central bank’s flight against inflationHe said rising prices hurt low-income households.
“We’re in it, no matter how long it takes to bring down inflation,” Brainard said in statements prepared for a speech he gave in New York. “So far, we’ve rapidly increased the policy rate to the peak of the previous cycle, and the policy rate will need to rise further.”
Brainard said there are some examples of falling prices in the retail industry, but “there may be room for decline” in profit margins, particularly for auto companies.
— Jesse Pound, Jeff Cox
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