Today, Baidu was added to the list of companies assisting the Chinese military by the Pentagon. China announced some import tax cuts. USA and Chinese Although things are going well for now, we continue to see such small steps. for Iran yesterday trump Although his explanations are comforting, he is full of surprises. So how do the markets interpret the current situation?
US Markets and Cryptocurrencies
Following today’s CPI data, the expectation that there will be 3 interest rate cuts this year has increased. As the contraction in employment slows down, in the next 2 meetings Powell’s He is not expected to raise his hand to the discount. However, Warsh may postpone QE and start cutting interest rates as of June. Moreover, concerns about QE are decreasing. Leaks last week suggested that Warsh might soften his former anti-QE stance once he becomes Fed Chairman.
As the highly anticipated US inflation data, which could shed light on whether the Federal Reserve will cut interest rates this year despite the healthy labor market, is moderate, we have the potential to start the weekend on a calmer note.
S&P 500 and Nasdaq 100 futures fell 0.4%, with the largest technology companies trading mixed. The Stoxx 600 index fell 0.4%. Gold and silver recovered somewhat. Shares fell slightly as investors reduced risks ahead of the Chinese New Year holiday in the mainland and Hong Kong.
Latest Developments
At the time of writing in the USA There is talk of banning some of the semiconductors coming from China. Alibaba said it would pursue all available legal remedies “because it has been added to the list of companies aiding the Chinese military.” The most important developments of the last minutes: USA-Chinese was the increase in mobility between them.
If the situation faced by Chinese companies is kept on the agenda by the Chinese state, this may lead to increased tensions with the USA. For now, China and the US have mended fences, and if China wants to escalate tensions for further negotiations, it can do so. Trump and Xi will make mutual visits in the coming months. But this is not certain. Since last year’s visits were postponed, it is likely that the upcoming program will not be changed, and if so, tensions will not increase.
We will be watching closely for statements from the Chinese front and will likely see cryptocurrencies drop sharply when a new US-China tension flares up.
