New Zealand hikes interest rate by 50 basis points in a surprise move; Asia markets mixed

Loretta Mester, President of the Federal Reserve Bank of Cleveland, said: speech New York says the central bank needs to raise interest rates even more to keep inflation down.

“How far the Fed funds rate needs to go from here, and how tight policy needs to stay, will depend on how much lower inflation and inflation expectations are,” Mester said. “How much demand has slowed, supply challenges have been resolved, and price pressures have eased.”

The central bank raised the base rate by 25 basis points at its March meeting, raising the federal funds rate to its target range of 4.75% to 5%.

Mester is not a voting member. 2023 Commission of the Federal Reserve Board But an alternate member.

“In my modal forecast, to keep inflation expectations on a sustained downward trajectory to 2% and to keep inflation expectations anchored, monetary policy this year is likely to push the Fed funds rate above 5% and the real Fed rate at It will move into more restrictive territory, such as rising, and it will remain in positive territory for some time,” she said.

Her comments come even though job openings fell below 10 million in February for the first time in almost two years, and the Fed’s efforts to slow the labor market have had some impact. This indicates that there is a possibility that

– Lee Ji Hye

The Central Bank of New Zealand raised interest rates by 50 basis points, raising its benchmark rate to 5.25%, beating economists’ expectations by 25 basis points.

The move has pushed interest rates to their highest level since October 2008.

This follows on from the previous 50 basis points when interest rates rose from 4.25% to 4.75% in February.

The New Zealand dollar gained 0.59% and traded at 0.6351 against the US dollar.

Japan’s service sector continued to expand in March, according to the report. Undisclosed investigation by au Jibun Bank.

The country’s Services Purchasing Managers Index rose to 55 from 54 in February, marking the seventh straight month of expansion.

The sector expanded the most since 2013 and was the second strongest in the history of the survey.

In addition, the volume of new transactions increased in the same month, marking the sharpest rise since February 2019.

Japan’s “rates of growth in business activity, new business and export orders all accelerated in the month and reached record highs in their respective series history,” the release said, as input inflation settled to a 12-month low. pointed out that

According to au Jibun Bank, companies are becoming “increasingly optimistic” about the outlook for activity over the next year amid expectations of a stable market environment.

— Lim Hijie

The Reserve Bank of New Zealand is expected to raise the cash rate by 25 basis points to 5%, according to a Reuters survey of economists. That takes the benchmark interest rate to its highest level since December 2008.

The New Zealand dollar was slightly higher against the dollar at 0.6311 prior to the decision.

New Zealand stocks traded higher as the S&P/NZX 50 rose 0.26% in the morning session in Asia.

— Lee Ji-hye

Job openings plummeted in February, suggesting the super-tight labor market may be easing.

A Labor Department report on Tuesday said available positions fell to 9.93 million for the month, down more than 600,000 from January and well below FactSet’s estimate of 10.4 million.

The decline marks the first time openings have fallen below 10 million since May 2021.

Turnover and employment also fell, but the number of retirees was just over 4 million.

— Jeff Cox

Crude rose higher on Tuesday, with OPEC+ production cuts keeping prices above $80 a barrel.

West Texas Intermediate crude rose 1% to $81.27 a barrel, while international benchmark Brent rose 0.9% to $85.75. The Energy Select Sector SPDR Fund (XLE) also rose on Tuesday.

The unexpected production cut sent oil prices soaring by 6% a day earlier, fueling fears that the move would further spur inflation and fuel recession fears.

Production cuts have reached 1.16 million barrels per day, bringing OPEC+ production cuts to 3.66 million barrels per day today.

— Brian Evans

US Treasury Secretary Janet Yellen said the banking crisis was “stabilizing” and regulators were ready to act again to protect deposits if needed. According to Bloomberg News.

“The outflows from small and medium-sized banks are down and the situation is stable, but we are watching the situation very closely,” Yellen told reporters.

Yellen also hit back at criticism of the Financial Stability Oversight Council, which some Republicans have accused of failing to identify the banking crisis early. She said the crisis itself only afflicted “a few banks” who were highly threatened with crackdowns.

“I don’t think there is a fundamental problem with the banking system,” Eird added.

— Brian Evans

Gold futures rose Tuesday, up nearly 2% after reaching their highest level since March 2022.

Bullion reached a session high of $2,043 per ounce and is on track for its fifth positive session in the last six. Gold climbed above $2,000 an ounce after bond yields fell on news of weaker-than-expected Labor Department jobs data.

Gold prices are up 11.6% so far this year. Precious metals are often touted as a hedge against inflation.

— Brian Evans, Nick Wells

Credit Suisse chairman Axel Lehmann apologized to shareholders on Tuesday for the bank’s collapse and controversial takeover by UBS.

“We apologize for not being able to stem the loss of trust that has built up over the years and for disappointing you,” Lehmann said at the annual shareholders’ meeting of Credit Suisse. , was the first time a bank leader had spoken to the public.

Swiss authorities brokered an emergency rescue of a troubled bank by the country’s biggest rival bank for just CHF 3 billion over the weekend in late March.

The deal, which was facilitated by Swiss regulators to stem a wider global banking crisis, remains entwined with legal and logistical challenges. Neither UBS nor Credit Suisse shareholders were able to vote on the transaction.

— Kim Ha Kyung