CitiEuropean OpenSouring risk continued in Asia, as new headlines shook overnight markets. Russia’s President Putin ordered Russian troops to the breakaway region of Ukraine for “peacekeeping,” further escalating tensions. Subsequent headlines of potential sanctions, further talks as well as criticism from the UN Security Council meeting drew little reactions from markets. DXY continued its march upwards, while equities remained low. Oil traded flat in the Asian morning after trading higher overnight. UST cash reopened today with the 5-30y yields down 4-6bps. Meanwhile, in EM, THB saw a 0.8% dip as USD strength, compounded with THB weakness as a result of a Covid surge. INR is down 0.5% following an after-market announcement (details below).Looking ahead, USD will see Conf. Board Consumer Confidence at 15:00 GMT, followed by Fed’s Bostic at 20:30 GMT. GBP sees PSNB ex Banking Groups at 07:00 GMT, as well as BoE’s Ramsden at 10:45 GMT. EUR sees Germany IFO Expectations at 09:00 GMT. Over in EM, HKD sees CPI at 08:30 GMT, while HUF sees a central bank rate decision at 13:00 GMT, where Citi Economics expects a +50bps hike to 3.40%. Taking everything into consideration, however, we remain glued to the newsfeed for any updates amidst the Russia-Ukraine tensions.–DXY continues its march upwards, breaking past the 96 handle. However, JPY and CHF have been relatively flat–UST opened higher following a holiday in the US. 2y yields were down 1bp, while the rest of the tenors were down 4-6bps.–Equities: S&P eminis and Nasdaq100 futures opened lower, but held flat as well through the Asian session–Oil opened higher, although it retreated a little in the Asian session–PLN and ZAR are down a touch, around -0.25% on the dayUSD: Speaking about data:–Conf. Board Consumer Confidence at 15:00 GMT for February. Citi Economics expects the Conference Board’s measure of consumer confidence to rise modestly to 114.1 in February. The increase would further highlight the contrast between the Conference Board’s measures of consumer sentiment and the University of Michigan index, which dropped substantially in the preliminary February release.–Fed’s Bostic Takes Part in Moderated Q&A at 20:30 GMT. Citi Economics is most interested in hearing what Atlanta Fed President Bostic has to say in the wake of stronger inflation data. He has been relatively hawkish on the balance sheet, but as of recently had a base case for just three 25bp rate hikes in 2022.
Source: Tickmill
