Financial Markets Daily Report 02 March 2023
Inflationary pressures and monetary policy actions remained the focus on Wednesday, following higher-than-expected HICP data in Germany (headline inflation rose to 9.3% y/y in February after 9.2% in January), ahead of the release of the data for the eurozone aggregate this morning. The ECB also releases the accounts of the last meeting.
- Inflationary pressures and monetary policy actions remained the focus on Wednesday, following higher-than-expected HICP data in Germany (headline inflation rose to 9.3% y/y in February after 9.2% in January), ahead of the release of the data for the eurozone aggregate this morning. The ECB also releases the accounts of the last meeting.
- ECB Governing Council member, Francois Villeroy de Galhau, said that February’s inflation prints confirmed the ECB should persevere in the monetary policy tightening, noting that the terminal rate could be reached by September. Separately, FOMC member Neel Kashkari said he could back either a 25 bp or a 50 bp rate hike in the next meeting.
- In this context, sovereign bond yields continued to march higher. Stock indices extended losses across Europe and in the US, negatively affected by the ISM survey, which suggested the industrial sector fell further in February. In Asia, stocks rose, buoyed by the release of positive economic sentiment data in China.