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Source:© Sema8841 | Megapixl.com
What’s happening at the RBA front?
The Reserve Bank of Australia or the RBA has reconfirmed that it will continue to maintain record low interest rates and will continue to maintain its targets on certain benchmark three-year bonds. The minutes from the March board meeting of the RBA showed that members preferred not to suddenly stop buying three-year bonds with a maturity of April 2024. The board agreed that it would not consider removing the target completely or changing the target yield of 10 basis points. This is good news for owners of the current three-year bonds.
As per the RBA board judgements, the wages growth would be unlikely to be consistent with the inflation target earlier than 2024. The bank said that its decision on maintaining target interest rates would depend heavily on economic data. Meanwhile, the board considered risks of high asset prices particularly in property because of low rates. Members noted that the lending standards remain sound and would continue to remain so in an environment of rising house prices and low interest rates.\
Source:©Lucidwaters | Megapixl.com
Vaccine Update
The news of suspension of AstraZeneca’s Covid19 vaccine has raised concerns worldwide. The World Health organization or the WHO urged people not to panic on the suspension as investigation of possible side effects is underway. France, Italy, Germany, and Spain are the countries who have all suspended the AstraZeneca’s Covid19 jab. However, the British drug developer and regulators, including the WHO and EMA said that there is no evidence of the side effects.
Source: © Steveheap | Megapixl.com
Financial deals
US President Joe Biden chose Gene Sperling to oversee and manage the 1.9 trillion-dollar stimulus programme.
On the other hand, Brussels has launched legal actions against the UK over alleged breaches of the Brexit deal on Northern Ireland. The British plans were a violation of the international law and a major problem as per EU officials.
Are China factories at target?
Marking the deadliest day in Myanmar, over 39 people were killed on Sunday when Chinese-financed factories were set ablaze in Yangon. The Chinese Embassy in the industrial zone of Yangon confirmed that the factories have been targeted. Authorities have imposed martial law in the affected and nearby areas.
Global Economic events to watch out today
The officials from the United States and Japan will hold their first in-person talks. Representative from the United States include US defence secretary Lloyd Austin and US secretary of state Antony Blinken.
U.S. Secretary of State Antony Blinken and Defence Secretary Lloyd Austin will be meeting counterparts in Tokyo on Tuesday, highlighting a focus by the new Washington administration on alliances in Indo-Pacific in the face of assertive China. The visit, from March 15 to March 18, to Tokyo and Seoul is the first overseas trip by top cabinet members of President Joe Biden's team and follows last week's Quad alliance summit of the leaders of the United States, Japan, Australia, and India. Issues on the agenda will range from freedom of navigation in the South and East China Seas and semiconductor supply-chain security to the North Korean nuclear issue and a military coup in Myanmar.
On the UK foreign and defence policy front, the Boris Johnson government is expected to set out an integrated review of its policies highlighting economic opportunities of Asia and potential strategic threat of China.
Amongst the most important event this week is the US Federal Reserve’s two-day meeting.
The Bank of Japan will also unveil the results of its biggest policy review this week since 2016 as the Central Bank faces a tough time with the never-ending stimulus. The review is expected to pay way for more variation in buying by the bank, purchasing less bonds and equities as per market conditions. The cap on 10-year bond yields at around zero, prospective of a deeper negative interest rate below the current -0.1% and the buying of equity exchange traded funds by the bank will be the main policy points to watch out for.
The data to watch out will be the weekly payrolls to February 27 and ABS house prices. Euro zone ZEW expectations for March; Japan industrial production for January; US total net TIC flows in January; US NAHB housing market index for March and the FOMC policy meeting are key economic data to keep an eye on.
