Interest rates Financial News

Janus Henderson Investors’ latest Credit Risk Monitor tracks corporate fundamental and macroeconomic indicators on a traffic light system to indicate where we are in the credit cycle.

bitcoin prices has the phones at crypto wallet recovery firms ringing off the hook, as retail investors locked out of their digital vaults make frantic calls to regain access to their accounts. Cryptocurrencies exist on a decentralized digital ledger known as blockchain and investors may opt to access their holdings either through a locally stored software wallet or a hardware wallet, to avoid risks related to owning crypto with an exchange, as in the case of the former FTX.

Japanese Yen has set off alarms in the world of international finance and monetary policy. For the first time since 1990, the yen has weakened past the 160 level against the U.S. dollar, representing a staggering 20% loss in purchasing power over just the last year. This historic slide begs the question — is the yen acting as the proverbial «canary in the mine», providing an early warning sign of deeper systemic risks brewing in the global monetary system? The crisis facing the yen stems from a confluence of factors that have pushed the Bank of Japan into an economic policy corner. With a debt-to-GDP ratio of over 260%, among the highest in the world, Japan has been effectively locked into keeping interest rates at ultra-low levels, near zero, for years. Even as inflationary pressures have built, the BOJ has resisted aggressive rate hikes for fear of making their enormous debt burden even more unmanageable.

Bitcoin touched a record high on Tuesday, fueled by investors pouring money into U.S. spot exchange-traded crypto products and the prospect that global interest rates may fall. The world's largest cryptocurrency hit a high of $69,202, topping November 2021's all-time peak of $68,999.99. Investor interest has increased since the Securities and Exchange Commission approved 11 spot bitcoin ETFs in late January. It then reversed course and was recently down around 7% at $63,400.

The proportion of investors expecting a weaker economy in the next 12 months decreased to a net 25%, from January’s 40%, the survey found.

According to the Bureau for Labor Statistics, the US Consumer Price Index fell to an annual rate of 3.1% in January, down from 3.4% in December. However, this figure came in higher than the 2.9% anticipated by economists.

Economists have advised against heavily relying on LFS data, citing persistent concerns about its quality.

Bean said the QE programme has already cost UK taxpayers £38bn over the last 16 months, and is expected to be as high as £200bn.

Catherine Mann (pictured) said financial conditions had eased 'too much already' since September, in part as markets now 'soon expect' cuts.

Certain ECB officials have spent the month resisting market anticipations of interest rate reductions in the spring, emphasising the importance of waiting for first quarter wage data.

Markets had fully priced in six ECB reductions at the end of last week, with the first move coming as soon as April.

Over two-thirds think the Federal Reserve will be the most important driver of bond yields in 2024.

The estimated number of vacancies in the last quarter of 2023 continued to fall to 934,000 – a 49,000 reduction – marking Q4 2023 as the 18th consecutive quarter of vacancy falls, and the longest consecutive run of quarterly falls ever recorded.

'I do not think the Bank will be able [to lower rates] because I do not think inflation will come down much further or much faster. I think we are stuck with a fairly sticky inflation situation,' she said.

In the minutes from the Federal Open Market Committee last month, the central bank dampened market hope by forecasting only three 25bps cuts throughout the year, while futures markets predict six.

Markets are now expecting up to six 25-basis-point cuts by the end of the year.

The ‘big four’ reduced their one-year deposit rates by 10bps to 1.45% and three-year rates were cut by 25bps to 1.95%, their lowest levels since 1996.

Chancellor of the Exchequer Jeremy Hunt has spurred optimism that the Bank of England could begin interest rate cuts next year, if the government delivers its economic policies.: Simon Dawson / No 10 Downing Street

Sarah Breeden (pictured), the Bank of England's new deputy governor for financial stability.

The Japanese currency fell on the latest announcement from the BoJ and is still down 9.5% this year against the dollar, though it has bounced back from historic lows over the past month on expectations of policy tightening.

He said a lot of economic metrics – such as GDP, employment and wages – may not be 'perfectly measured', which is why often the relevant information comes with a delay leading to revisions to several data sets.