Markets today assess interest rate and inflation risks: what happens?

Markets today assess interest rate and inflation risks: what happens?
Markets today assess interest rate and inflation risks: what happens?

Markets today still focused on China e USA. And, above all, on economic recovery, surge in inflation and future of interest rates.

Exchanges focused on Chinese trade balance data, below estimates, and the words of the US Treasury Secretary Yellen. Pending new US consumer price data, the official’s comment on inflation and rates was not completely reassuring.

As vaccinations continue in Europe and Asia, the spectrum returns coronavirus, even in Taiwan, what’s up in the markets today?

Markets: China slows down, futures go down. The reasons

The Asian equities trade contrasted today, while relief for a positive employment report in the United States was cooled by caution ahead of key inflation data on Thursday.

Meanwhile, a coronavirus outbreak in Taiwan has had a growing impact on chip makers, already struggling.

Data from Beijing showed that the Chinese imports they have grown at the fastest pace of the past 10 years as they have absorbed resources, a boon to everything from copper to iron ore prices.

However, rising costs and supply bottlenecks have been an obstacle to exports (which also grew in May by 27.9%, below forecasts) and Chinese blue chips fell by 0.5%.

At 8.15 am Italian time, the Nikkei is trading at + 0.17% and the Shanghai index is just above par. In the red, however, Shenzhen (-0.25%) and Hong Kong (-0.66%).

South Korea’s Kospi gains 0.25% and Taiwan loses 0.37%.

Yields on benchmark 10-year US Treasuries and the dollar rose. Investors continue to assess whether price pressures will lead central banks to reduce stimulus sooner than expected.

The S&P 500 rose to a record high Friday on an employment report that showed a recovery in hiring but fell short of estimates.

Meanwhile, the G7 nations have secured a landmark deal that could help countries collect more taxes from large companies and allow governments to impose levies on US tech giants like Amazon.com and Facebook.

In this setting at the beginning of the week, i futures swap in red. The big issue remains inflation and the attitude of central banks. The ECB will take the stage on Thursday: will it be tapering?

Rates and inflation: what did Yellen say?

To stimulate even more the debate and fears about the withdrawal of stimuli by the Fed and central banks in general, were the words of the US Secretary of the Treasury.

According to Yellen, Biden must continue to focus on its spending plans, such as that for infrastructure, even if these will cause a increase in inflation and a climate of higher interest rates.

So is the time for tapering approaching? Meanwhile, the ECB and US inflation data will give new indications on Thursday.

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