💼 Macro-News round-up
MarketNews
🏦 Fed: The Minneapolis Fed’s Neel Kashkari stated that he doesn’t rule out rate hikes if necessary, but the markets largely ignored him. The reason may be that Kashkari has no vote on monetary policy decisions this year, and will not be a voting member of the Fed committee until 2026. There are a lot of Fed speakers scheduled over the next few days, which could cause some additional market volatility.
💵 The dollar index takes flight again. Nevertheless, the dollar index has been strengthening since yesterday and now stands at 105.60 points, seeming to be heading back towards the target of 107 points. Meanwhile, the EURUSD manages to hold above 1.07, currently trading near 1.0750. Perhaps, encouraged by the positive PMI data from Europe, yesterday.
🇩🇪 Despite the fact that no very relevant data has been published in the last 48 hours, this morning we have had the German industrial production data. It contracted by 0.4%, a contraction of 0.6% was expected, so it could be considered relatively good.
🇸🇪 Particularly interesting is the situation of the Swedish krona. Sweden has accumulated four consecutive quarters of GDP contraction. It is possible that Sweden’s central bank, Riksbank, had been under pressure to cut rates and expand monetary liquidity. In such a scenario, the Swedish krona would be dragged to new all-time highs against the euro, potentially pushing the EURSEK pair into a range of 12 to 12.50, never seen before.
📈 Equity: from the corporate world, the news would be in yesterday’s presentation of Apple’s new iPad. As we warned in previous reports, yesterday’s presentation could encourage further rises in the stock, closely linked to its retail sales level. As a novelty presented, its orientation towards AI. The new iPad Pro models are equipped with Apple’s latest M4 chip, which according to the company is 50% faster than the previous M2 chip and has a faster neural engine for AI tasks.
📱 TikTok battle: The US is urging ByteDance to sell TikTok, but the Chinese company refuses. ByteDance has filed a legal challenge against a US law mandating the app’s divestment by January 19. This lawsuit could lead to a lengthy court battle, potentially reaching the Supreme Court, weighing free speech and national security concerns.
🌍 Geopolitics: remember when I told you last week that Xi Jinping was starting his European tour this week? Well, yesterday he visited Serbia. Just on the 25th anniversary of the NATO bombing of the European country, where the Chinese embassy was attacked on May 7, 1999, causing the death of three Chinese journalists and injuring as many Chinese citizens, which ended with a public apology from U.S. President Bill Clinton.
🇺🇸 “The friendship between China and Serbia, which is steeped in the blood the two peoples shed together, has become a joint memory of the two peoples and will encourage both sides to take huge steps forward together,” Xi said. Next stop, France. But Xi’s decision to avoid Germany shows the political difficulties between the EU and China.
🇺🇸 US: The judge overseeing the case against Donald Trump for mishandling classified documents has indefinitely postponed the start of the trial, which was scheduled for May 20. The trial is not likely to begin before August, as the judge did not give a new date or a reason for the postponement in her ruling. There are likely to be ongoing negotiations between the prosecution and the defense on the case.
🇮🇱 Israeli tanks entered the Palestinian city of Rafah in the southern Gaza Strip, amid warnings the move could spark a humanitarian crisis. Rafah is located on Gaza’s border with Egypt and is home to around 150,000 Palestinians. Videos released by the IDF showed at least four Israeli tanks on the Gazan side of the Rafah border crossing with Egypt. The incursion came hours after Hamas said it had agreed to a ceasefire proposal from Egypt and Qatar. Israel rejected the deal. UN agencies and aid groups have warned of severe impacts if Israel conducts a major operation in Rafah, including on displaced civilians.
