Fed Members Remarks After FOMC Minutes, Inflation in Europe, Crude Fall and More Market Issues Today

Fed Members Remarks After FOMC Minutes, Inflation in Europe, Crude Fall and More Market Issues Today

Asian markets closed in the red, while New York futures operated near stability Thursday morning (18), following the minutes of the latest meeting of the Federal Reserve’s Open Market Committee (FOMC, its English acronym). The next steps for the monetary authority are open.

The US central bank said it remains committed to fighting inflation, but indicated that the severity of monetary tightening will depend on economic indicators.

In this context, investors are expecting the Fed to be able to slow the pace of rate hikes after the CPI reading for July showed that inflation slowed slightly. But not all market participants are convinced.

In the indicators, weekly unemployment insurance claims numbers and used home sales are shown.

On the other hand, European stocks are running without a definite trend, as investors reflect the Eurozone Consumer Price Index for July (CPI), which grew 0.1% on a monthly basis and 8.9% on a yearly basis.

In Brazil, Roberto Campos Neto, President of the Central Bank, and Paulo Guedes, Minister of Economy, talk about the economic prospects at the BTG event, while the calendar of domestic indicators is empty.

Check out more highlights:

1. Global Scholarships

United State

After the Dow Jones spot broke its five high line in the previous session, US futures indexes are in the red with investors positioning themselves to wait for the Fed’s next moves.

The minutes of the meeting said that the monetary authority will monitor upcoming indicators of the economy such as inflation, the labor market and activity indicators. Thus, I have left the door open for adjustments that can be as aggressive as the last, or softer, in the following encounters.

The Federal Reserve raised interest rates in reference for one day in 2.25 resultPercentages numberthis generalAnd the for Range from 2.25% to 2.50%. After releasing the minutes, staff in shrinkage Futures pegged to the Fed’s benchmark interest rate saw an increase of 0.50 Probably a percentage point in September.

“Stay tuned! “Hawks” (hard on inflation)but also opened the door perhaps to increase the 0.50 percentage point in September, instead of 0,75 (result)said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

On the corporate front, Kohl’s, Tapestry, Estee Lauder and Ross Stores reported their results Thursday. Applied Materials will also publish its quarterly update.

Watch the performance of futures markets:

  • Dow Jones Contracts (USA), -0.11%
  • S&P 500 futures contract (US), -0.12%
  • Nasdaq Future (USA), -0.16%

Asia

Asia Pacific markets closed lower, echoing the Federal Reserve’s meeting minutes.

Reserve Bank of New Zealand Governor Adrian Orr said Thursday that he is confident that inflation is declining, a highlight of monetary policy in the region after raising interest rates by 50 basis points on Wednesday.

Meanwhile, the Central Bank of the Philippines is meeting on interest rates and is expected to raise rates by 50 basis points.

In China, local media reported that local governments could sell more than $229 billion in bonds to fund infrastructure investments and boost the country’s economy. In the region, the United States and Taiwan have begun talks to conclude a trade deal that could increase tensions with China.

  • Shanghai SE (China), -0.46%
  • Nikkei (Japan), -0.96%
  • Hang Seng Index (Hong Kong), -0.80%
  • Kospi (South Korea), -0.33%

Europe

European markets are operating without a clear direction as the market remains cautious about inflationary expectations. Eurozone CPI for July rose 0.1% mom and 8.9% yoy, in line with the Refinitiv consensus.

  • FTSE 100 (UK), -0.16%
  • Dax (Germany), +0.29%
  • CAC 40 (France), +0.23%
  • FTSE MIB (Italy), +0.28%

goods

Oil prices rose on Thursday (18) to extend the gains of the previous session. The early morning was a drop in prices, amid rising Russian production and fears of a possible global recession.

The revised Economy Ministry document showed to Reuters that the Russians began gradually increasing oil production after the restrictions related to the sanctions and with Asian buyers stepping up their purchases, prompting Moscow to raise its production and export forecasts until the end of 2025.

Iron ore in Dalian fell to a three-week low on Thursday, losing $100 a ton, as steel component prices were volatile in Singapore, weighed down by concerns about weak steel demand and increased steel demand in China.

A record heat wave hitting several regions in China, the largest steel producer, has caused power shortages, forcing authorities to ration electricity while prioritizing residential use over industrial consumption. Analysts in Huatai told Reuters that iron ore stocks at a port in China at a three-month peak added pressure on prices.

  • West Texas Intermediate crude, +1.16%, at $89.13 a barrel
  • Brent crude rose 1.36% to $94.92 a barrel
  • Iron ore traded on the Dalian Stock Exchange fell 3.96% to 678.50 yuan, equivalent to 99.90 US dollars.

Bitcoin

  • Bitcoin, -1.50% to $23457.30 (from 24 hours ago)

2. Schedule

This Thursday (18), there will be an announcement of weekly unemployment insurance claims numbers and data on US home sales. In addition to these indications, two Federal Reserve members spoke and were able to comment on the FOMC meeting minutes released yesterday (17).

In Brazil, Roberto Campos Neto, President of the Central Bank, and Paulo Guedes, Minister of Economy, speak at a BTG event on macroeconomic perspectives.

Brazil

10:00 am: Paulo Guedes, Minister of Economy, participates in the 23rd Santander Conference – Panel discussion: Proposals for Brazil (closed to the press)

10:30 a.m.: Roberto Campos Neto, President of British Columbia, speaks at the BTG Pactual – Macro Day 2022 event

11:30 am – 11:40 am: BC begins this fifth extension of $15.6 billion in currency swaps

3:00 pm: The meeting of the National Monetary Council by electronic means. (closed to pressure)

4 p.m.: Guedes speaks at a BTG Pactual event

6:30 pm: Datafolha poll

Inside the results – InfoMoney

a Infomoney Until August 19, the series of Por Dentro dos Results interviews with CEOs, CFOs, and other CEOs of publicly traded companies was in Brazil. Check out today’s agenda:

10 a.m.: Interview with Milton Rangel, Chief Financial Officer of Prio (formerly PetroRio) (PRIO3)

3 p.m.: Interview with Daniela Sabbag, Chief Financial Officer, and Gabriel Helu, DRI do Assaí (ASAI3)

5 p.m.: Interview with Jin Tsutsui, CEO of Fleury (FLRY3)

United States of America

9:30 a.m.: Claims for weekly unemployment benefits, Refinitiv consensus shows 265,000 claims

9:30 a.m. Philadelphia time: Philadelphia Fed Manufacturing Activity Index

11 a.m.: Used home sales

2:20 p.m.: Fed Chair Esther George’s speech

2:45 pm: Speech by Fed Director Neil Kashkari

3. Zero tax on fuel in 2023

President Jair Bolsonaro (PL) said he spoke last Wednesday with part of the economic team and included in the budget keeping zero federal taxes on gasoline, diesel, alcohol and cooking gas in 2023. The Royal Tulip Hotel, in Brasilia, a candidate for re-election has stated that it is negotiating with Ministry of Economy about the possibility of reducing the federal tax on aviation kerosene.

In recent months, the government has launched an offensive to reduce the tax burden on fuel. In addition to lowering federal taxes, Palácio do Planalto has sponsored a project in Congress, which is now law, to put a cap on ICMS, a tax that states impose on these products. On the eve of the election, the legislature also approved a constitutional amendment declaring a national emergency to allow new social benefits, such as a truck driver’s allowance and a taxi driver’s allowance, as well as an expansion of the fuel voucher and auxilo of Brazil, from R$400 to $600.

Geddes says tax reform is enough to keep the extra aid in 2023

Economy Minister Paulo Guedes said that in order to preserve the extra R$200 aid next year, “it is enough to approve tax reform one day after the elections.”

Still on the benefit’s continuation, Guedes said one possibility is to correct the cap on income tax exemption, dividend tax and dividends.

The Minister explained, during the Taj Investments forum, that until then, the additional expenses, including those related to emergency aid, were covered by the extraordinary income.

airport auction

The National Civil Aviation Agency (ANAC) and B3 held a virtual session of the concession auction for 15 airports in the seventh round, grouped into three blocks: Block SP-MS-PA-MG, which includes Congonhas Airports (SP); Campo Grande, Corumba and Ponta Pura, in Mato Grosso do Sul (MS); Santarém, Marabá, Parauapebas, and Altamira, in Pará (Pennsylvania); Uberlândia, Uberaba and Montes Claros, in Minas Gerais (MG); The general aviation block, formed by the airports of Campo de Marte (SP) and Jacarepaguá (RJ); North Block 2, incorporated into the airports of Belem (PA) and Macapa (AP). The auction will take place at B3, in São Paulo, on August 18, at 2 pm.

4. Covid

And last Wednesday (17) Brazil recorded 246 deaths and 22,046 cases of Covid-19 virus within 24 hours, according to information from the Media Union, at 8 pm.

The 7-day moving average of deaths from Covid in Brazil is 175, down 16% compared to the level of 14 days before that.

The seven-day moving average of new cases was 17,930, which is a 40% decrease from the level 14 days ago.

The number of people fully vaccinated against Covid in Brazil has reached 169.713,380, equivalent to 79% of the population.

180,427,570 people received at least the first dose of vaccines, representing 83.99% of the population.

The booster dose was administered to 10,139,639 people, or 47.2% of the population.

5. Corporate radar

The Board of Directors of GPA (PCAR3) has approved the implementation of credit assignment agreements with financial institutions to anticipate receivables, amounting to approximately R$2 billion in reference to the installments due on Assaí between 2023 and 2024 as a result of the onerous amounts. Assignment of stores under the “Extra Hiper” banner by the company to Assaí.

The retailer anticipates the amount to be paid by financial institutions to the company in up to three installments during the third quarter of 2022.

Based on the company’s second-quarter quarterly information, this funds forecast will reduce the company’s leverage by about 0.8x, from 1.9x to 1.1x.

Zamp (BKBR3), owner of BK Brasil

Brazilian network operator board Fast food Zamp (BKBR3), formerly BK Brasil, has expressed its opposition to the company’s shareholders’ acceptance of a voluntary public offer to acquire common stock to acquire the company.

On August 1, the fast-food chain received an offer to take control with a car from Emirati investor Mubadala.

Mubadala Capital launched a takeover offer (OPA) aimed at acquiring 45.15% of the shares issued by the company, at a price of R$7.55 per share, so that if OPA is successful, Mubadala Capital will own 50.10% of the shares. capital.

(Jointly with Estadão, Reuters and Agência Brasil)

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