GLOBAL NEWS

Stocks Drop for Second Day; Treasuries Advance

US stocks notched a second straight small decline after reaching a record, as investors assessed what the latest inflation reading means for aid prospects. The S&P 500 fell by 0.04% to 3,909.88 while Dow Jones was up 61.97 points (0.02%) to 31,437.80.

Powell Urges ‘society-wide’ Push to Deliver Full Employment

Federal Reserve Chair Jerome Powell said the US job market remains a long way from a full recovery and called on both lawmakers and the private sector to support workers. “We are still very far from a strong labor market whose benefits are broadly shared,” Powell said, noting that employment last month was nearly 10 million below February 2020 levels .

US Core Consumer Prices Show Scant Inflation in Snub to Market

A key measure of prices paid by US consumers was unchanged in January for a second straight month, underscoring the pandemic’s lingering restraint on inflation that financial markets see heating up. The core consumer price index, which excludes volatile food and energy costs, increased 1.4% from the prior year, a Labor Department report showed. The broader CPI once again got a boost from higher gasoline prices, advancing 0.3% from the prior month and 1.4% from a year earlier.

BOE’s Bailey Says UK Won’t Slash Regulation After Brexit

Bank of England Governor Andrew Bailey said it’s not in the UK’s interest to dramatically ease banking rules following Brexit. While rules may change, Britain intends to keep up with international standards, he said. “Let me be clear, none of this means that the UK should or will create a low regulation, high risk, anything goes financial center and system,” Bailey said.

Riksbank Sticks With 0% Rate as Inflation Goal Won’t be Hit for Years

Sweden’s central bank Governor Stefan Ingves made clear he’s more worried about withdrawing monetary support too soon rather than too late, given the severity of the current crisis. Ingves said he’s in “no hurry” to adjust the Riksbank’s guidance, which shows a key interest rate of zero into 2024, as inflation remains stubbornly below the 2% target for years to come.

China’s Inflation Divergence Shows Unbalanced Economic Recovery

China’s producer prices gained for the first time in a year in January while core consumer prices posted the first decline in a more than a decade, highlighting the economy’s unbalanced recovery. Rising commodity costs drove up producer price inflation to 0.3% last month, matching forecasts, the first gain in the index since January 2020, data from the National Bureau of Statistics showed. The consumer price index fell 0.3% last month from a year earlier.

RBA’s Harper Says Australia ‘way Off’ An Asset-price Bubble

Reserve Bank board member Ian Harper said Australia’s unemployment is too high and the economy has too much lost activity for monetary stimulus to be fueling excessive stock and property valuations. “The tendency of this to produce an assetprice bubble is way off where we’re presently headed,” said Harper.

Oil Extends Longest Rally in 2 Years With US Supplies Dropping

Oil futures rose for an eighth straight day in New York as a decline in US crude inventories further highlighted depleting global supplies. Brent crude for April settlement rose US$0.38 to US$61.47 per barrel.

Source: Affin Hwang Research - 11 Feb 2021