Ukraine fears remain Nato accused Russia overnight of amassing even more troops near Ukraine’s borders in recent days, discounting comments from Vladimir Putin that tanks and troops were returning to bases. UK PM Boris Johnson said overnight Nato had seen satellite images of new field hospitals being erected, “which can only be construed as preparation for an invasion. So mixed signals at the moment”.
Stocks down, but oil up US stocks fell about another 1.3% in US morning trade as the fears about an invasion of Ukraine escalated and attention turned to the US Federal Reserve’s minutes from its last rates decision, which are due after 8am NZT. The S&P 500 was down 0.8% and the Nasdaq was down 1.3% at 7.30 am NZT. Brent crude futures were up 2.4% at US$95.5 for a barrel of oil (bbl) and ever closer to the key US$100/bbl mark. Some analysts have suggested an invasion of Ukraine would so disrupt oil and gas supplies and payments that oil prices could rise to US$120/bbl.
US spendup Data out overnight showing faster-than-expected growth in US retail sales in January also bolstered expectations of faster and bigger US rate hikes. US retail sales rose 3.8% in January from December, which was the fastest growth since March last year and almost double economists’ median expectation. This came after US producer price inflation of 9.7% in January from a year ago was also double Wall St estimates in trade the previous day. Financial markets are currently pricing in a greater than 50% chance of a 50 basis point rise in the Fed Funds rate on March 16, albeit this is down slightly in recent days because of comments from Fed officials preferring 25 basis point hikes, rather than a 50 basis point one.
‘Gas’ tax removal US President Joe Biden is so worried about the effects of rising petrol (‘gas’) prices on US consumers that Democratic lawmakers are considering a suspension of an 18 cent per gallon federal tax through until next year.
Global crypto warning The Financial Stability Board warned overnight that continued growth in the use of cryptocurrency by financial institutions posed an escalating risk to global financial stability. “If the current trajectory of growth in scale and interconnectedness of crypto-assets to these institutions were to continue, this could have implications for global financial stability,” the global financial regulation group said in a report.
Google’s Apple-like cookie move Google announced overnight it planned to change user tracking rules for apps available on its Android app store. The moves are similar to changes adopted by Apple last year that have wreaked havoc for Facebook advertising revenues. Google said it was developing ‘privacy-focused’ replacements for its advertising ID, which currently is a unique string of characters that identifies a user’s device as they bounce around the internet. Apple’s move allowed iPhone users to block tracking on apps such as Facebook, which made its ads less valuable because advertisers were less sure of who they are reaching. (CNBC)
Fresh on BusinessDesk this morning
Brent Melville reports on how relentless increases in building materials costs are squeezing the life out of construction.
Peter Griffin asks in his weekly column where the workers are to power NZ's digital revolution.
