Markets expect a pause in rate hikes, while regulators deal with the aftermath of bank failures
The US dollar index, which measures the greenback against six other major currencies, plunged to near one-month lows on Monday, following a Goldman Sachs forecast that Washington will likely halt rate hikes. According to trading data, the index slid 0.6% to 103.9 by 09:00 GMT.
Goldman’s previous forecast predicted a 25-basis-point hike at the next Fed meeting in March. The change in expectations came after US regulators on Sunday announced a new emergency program aimed at protecting bank clients, following the failures of Silicon Valley Bank and Signature Bank last week.
According to a joint statement from US Treasury, Federal Reserve and the Federal Deposit Insurance Corporation (FDIC), they will make a “systemic risk exception” to allow both insured and uninsured depositors of the failed banks to regain full access to their money. The Fed also separately announced it would make additional funding available for banks in cases of emergency, through a new Bank Term Funding Program.
The measures led investors to predict the Fed may be too busy sorting through the fallout of the banks’ failures to raise interest rates in the near term.
There is a historic correlation between higher interest rates and failures of overleveraged financial institutions. Overleveraging occurs when a business has borrowed too much money and is unable to pay interest payments, principal repayments, or maintain payments for operating expenses due to its debt burden. However, analysts say US inflation data release on Tuesday may also affect the Fed’s rate hike plans.
The Fed hiked the key rate on more than one occasion in recent months in a bid to reign in soaring inflation. The latest 25-basis-point increase was announced on February 1, bringing the rate to a target range of 4.5%-4.75%. Prior to last week, analysts expected at least three more rate hikes this year to bring the indicator to a peak of 5.25%-5.5%.
https://www.rt.com/business/572886-us-dollar-slides-banking-turmoil/
US President Donald Trump confirmed on Wednesday the upcoming start of ground strikes against drug cartel targets in Latin America.
He made the remarks during Christmas greetings to the military.
Trump said the United States was "now going after the land" in its fight against drug cartel targets, noting that drug trafficking by sea was down 96 percent.
The U.S. president also extended special congratulations to the crew of the aircraft carrier USS Gerald R. Ford, currently deployed in the Caribbean.
BEIJING (Sputnik) - China has begun operating the world's first intelligent ultra-large oil tanker powered by methanol, the China Central Television (CCTV) reported on Monday.
The tanker, designed to transport crude oil, was successfully put into operation in the city of Dalian in China's northeastern coastal province of Liaoning, the report said. State-owned company Dalian Shipbuilding Industry Co Ltd independently designed and built the vessel, it added.
The tanker is approximately 333 meters (1,092 feet) long and can carry around 2.1 million barrels of crude oil, the CCTV reported. Designed to produce low emissions and having intelligent control capabilities, the tanker will serve the route to the Middle East, among others, according to the report.
The vessel is powered by a dual-fuel methanol engine, which reduces carbon dioxide emissions by 92% compared to conventional fuel, the CCTV reported. It is equipped with an intelligent ship platform, an intelligent liquid cargo ...
A car bomb has killed a senior General Staff member, officials have confirmed
Source: The Investigative Committee
A Russian general has been killed in a car bomb blast in Moscow, the Investigative Committee has reported.
Officials identified the victim as Lt. Gen. Fanil Sarvarov, head of operational training at the General Staff. According to the statement, an explosive device had been planted beneath the vehicle he was traveling in, and detonated on Monday morning in the southern part of the Russian capital.
The blast also damaged several other vehicles and seriously injured Sarvarov’s driver, media reports stated.
Russian officials said one line of investigation is an assassination carried out by Ukrainian intelligence services, noting that Kiev has previously used explosive devices in targeted killings of officials and public figures.
Last December, a bomb hidden in an e-scooter killed Lt. Gen. Igor Kirillov, commander of Russia’s Nuclear, Chemical, and Biological Defense ...
