Revoking privilege

Today's news headlines:

‘ECB Surprises With Faster Stimulus Exit on Risk to Inflation’. Officials at the European Central Bank are more concerned about record inflation than the risks to economic growth from Russia’s invasion of Ukraine. The central bank will slow bond-buying from May, with a view to halting the program as soon as the third quarter. During the two weeks since Russia’s incursion, Christine Lagarde and her colleagues have sought to evaluate the effect of sanctions, trade disruptions, and surging energy costs on the 19-nation bloc. Interest rate hikes are likely to come ‘some time after’ bond purchases end, with the governing council carefully choosing its rhetoric to indicate a gradual tightening of policy. (Bloomberg)

‘Biden Set to Call for End of Russia’s Preferred Trade Status’. US President Joe Biden, along with G7 and EU leaders, is set to call for an end to Russia’s preferred trading partner status, clearing the way to increased tariffs on Russian imports. The nation would be relegated to the same status as North Korea or Cuba and would likely be subject to significantly higher tariffs than other World Trade Organization members. The European Union—which accounts for one-third of Russia’s exports—said that it would remove the nation’s most-favoured status last week. (Bloomberg)


Today

Stocks and equity futures swung into the positive this morning following a broad risk-off Asian session. The US Consumer Price Index reached a fresh 40-year high yesterday, which added to stagflation fears. Overnight, The US Dollar Index gained while US ten-year Treasury yields dipped back below 2%.

Events

UK Gross Domestic Product m/m: 0.8% vs -0.2% previously
UK Industrial Production: 0.7% vs 0.3% previously
UK Manufacturing Production: 0.8% vs 0.2% previously
Canadian Employment Change: 1:30PM
Canadian Unemployment Rate: 1:30PM
US preliminary UoM Consumer Sentiment: 3:00PM

Interbank rates:

GBP/USD – 1.3075
GBP/EUR – 1.1910
EUR/USD – 1.0975
USD/CAD – 1.2780

The markets are moving. To speak to our team, please call +44 (0)20 3465 8200.