GLOBAL NEWS-
Indian inflation reversed course and nudged up slightly in January but remained below the central bank’s target for a sixth straight month, a Reuters poll predicted, supporting this week’s unexpected move by policymakers to cut rates.On Thursday, the Reserve Bank of India caught financial markets off-guard by reducing its key policy rate by 25 basis points to boost growth and as inflation has remained benign.While a change in monetary policy stance to “neutral” was the consensus in a separate poll taken ahead of the Feb 7 meeting, only around a third of respondents expected any easing.
The Reserve Bank of India (RBI) is expected to cut interest rates again next quarter,with a slim majority forecasting policy easing to occur before the general election in May.
Saudi Arabia, the world’s top oil exporter, cut its crude output in January by about 400,000 barrels per day (bpd), two OPEC sources said, as the kingdom follows through on its pledge to reduce production to prevent a supply glut.Riyadh told OPEC that the kingdom pumped 10.24 million bpd in January, the sources said. That’s down from 10.643 million bpd in December, representing a cut that was 70,000 bpd deeper than targeted under the OPEC-led pact to balance the market and support prices.
The Organisation of the Petroleum Exporting Countries, Russia and other non-OPEC producers - an alliance known as OPEC+ - agreed in December to reduce supply by 1.2 million bpd from Jan. 1.The agreement stipulated that Saudi Arabia should cut output to 10.311 million bpd, but energy minister Khalid al-Falih has said it will exceed the required reduction to demonstrate its commitment.Falih last month said that Saudi Arabia would export 7.1 million bpd in February, down from 7.2 million bpd in January.
The U.S. Federal Reserve’s interest rate increase in December likely tipped monetary policy into a restrictive setting that may be pushing the economy farther from one of the Fed’s key goals, James Bullard, president of the St. Louis Federal Reserve Bank, said on Thursday.Bullard, in remarks to reporters after an appearance at St. Cloud State University in Minnesota, said that on an inflation-adjusted basis he now views the current federal funds rate as “a little bit restrictive.”We are putting downward pressure rather than upward pressure on inflation” that may be drifting further below the Fed’s 2 percent target, Bullard said.
The dollar held near a two-week high on Friday, as investors rushed to the safety of the greenback following a setback in U.S.-China trade negotiations and broader worries about slowing global growth.
U.S. President Donald Trump said on Thursday he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline set by the two countries to achieve a trade deal.Asked during an event in the Oval Office whether there would be a meeting before the deadline, Trump said: “No.”When asked whether there would be a meeting in the next month or so, Trump said: “Not yet. Maybe. Probably too soon. Probably too soon.”The remarks confirmed comments from administration officials who said the two men were unlikely to meet before the deadline, dampening hopes of a quick trade pact and sparking a drop in U.S stock markets.
The Bank of England said Britain faces its weakest economic growth in a decade this year as uncertainty over Brexit mounts and the global economy slows, but interest rates will eventually rise if an EU divorce deal is done.While other major central banks have signalled they will hold off from raising borrowing costs, the BoE kept its message that gradual and limited rate rises lie ahead for Britain as long as, in just 50 days’ time, a no-deal Brexit is averted.BoE Governor Mark Carney said “the fog of Brexit” was causing tensions in the economy and that the risk of an abrupt, damaging departure from the European Union was growing.“There are still as almost as a wide of range of possibilities as there were the morning after the referendum,” Carney said after the Bank’s policymakers voted unanimously to keep rates at 0.75 percent.
Japan’s household spending rose slightly in December from a year earlier to mark the first increase in four months, government data showed on Friday, suggesting a pick up in consumption may moderate pressure from slowing global demand.The data offers some relief to Bank of Japan policymakers worried that heightening overseas economic uncertainties may discourage firms from raising wages and hurt consumption.The 0.1 percent year-on-year gain fell short of a median market forecast for a 0.8 percent rise and followed a revised 0.5 percent drop in November.Taken together with separate wages data, also released on Friday, the numbers suggested higher household income may help underpin consumption. The inflation-adjusted real wages rose in December from a year earlier.
Asian stocks lost ground on Friday as investors worried about a broadening global economic slowdown, with sentiment not helped by the absence of any positive signs for a resolution in the U.S.-China trade row.Safe-haven government bonds benefited in the face of growing anxiety over the global outlook, with German long-term debt yields falling to their lowest in over two years.MSCI’s broadest index of Asia-Pacific shares outside Japan shed 0.7 percent, easing back from a four-month peak touched the previous day. The index was down 0.3 percent on the week.Hong Kong’s Hang Seng lost 0.8 percent and South Korea’s KOSPI retreated 1.2 percent. Japan’s Nikkei tumbled 1.6 percent.
Some foreign businesses in Cuba are scrambling to defend their interests while others are rethinking the risk as the Trump administration bears down on Venezuela and Cuba, according to a dozen experts, diplomats and businessmen.The United States has said it is considering activating a long-dormant law that would expose companies and individuals to lawsuits for trafficking in expropriated Cuban property, as well as placing the country on the list of state sponsors of terrorism.That would undermine efforts by the administration of Cuban President Miguel Diaz-Canel to foster foreign investment and promote tourism on the Caribbean island.To make matters worse, the fall of Cuban ally President Nicolas Maduro’s socialist government in Venezuela would be a serious blow to the Communist-run nation’s already fragile economy.
Gold held steady on Friday on worries that a prolonged Sino-U.S. trade war could worsen global economic slowdown, but a strong dollar put bullion on track for its first weekly loss in three.pot gold was steady at $1,309.34 per ounce, after the metal hit its lowest since Jan. 29 at $1,302.11 on Thursday.U.S. gold futures were also unchanged at $1,313.10.
Oil markets dipped on Friday, dragged down by concerns over a global economic slowdown although supply cuts led by producer club OPEC and U.S. sanctions against Venezuela provided crude with some support.U.S. West Texas Intermediate (WTI) crude futures were at $52.47 per barrel, down 17 cents, or 0.3 percent, from their last settlement. WTI dropped by around 2.5 percent the previous session.International Brent crude oil futures were down by 12 cents, or 0.2 percent, at $61.51 per barrel after falling 1.7 percent the previous session.Weighing on financial markets, including crude oil futures, were concerns that trade disputes between the United States and China would remain unresolved, denting global economic growth prospects.