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China Eases Monetary Policy

The People’s Bank of China lowered interest rates while the economies in the rest of the world are planning on moving the opposite way. The pandemic is still looming over global economies.

China Cuts Interest Rates

The People’s Bank of China cut two key interest rates for the first time in almost two years to strengthen its economy that’s challenged by coronavirus outbreaks and a real-estate slump. The move comes before the release of data showing that the economy grew 4% in the last quarter, slower than the previous three months.

China’s move is contradictory to moves in the U.S. and elsewhere in the world. Other nations are trying to contain price pressures by tightening their monetary policy.

Stock Markets

Asian stocks were mixed today with stocks in China and Japan advancing while stocks in Hong Kong are trading lower. S&P 500 and Nasdaq 100 futures declined, while European contracts gained as traders are following closely a global rise in bond yields and China’s monetary policy easing. U.S stock and bond markets are closed due to a public holiday.
Bond yields in Australia and New Zealand climbed after U.S. Treasuries fell on Friday. The 10-year U.S. yield fell to pre-pandemic levels.

Trading Oil

Oil remains on a rally. Crude oil for delivery in February rose 2.63% and reached $84.28 a barrel while Brent oil for delivery in March rose 2.24%, climbing up to $86.36 a barrel. In the metals market, gold futures for February declined 0.22% to trade at $1817.35 a troy ounce.

What to Watch out for this Week:

Tuesday
U.S. Empire State Manufacturing data
Bank of Japan Monetary Policy Decision

Wednesday
U.S. Housing starts

Thursday
U.S. Jobless Claims
Indonesia, Malaysia, Norway, Turkey, Ukraine Interest Rate Decisions
EIA Crude Oil Inventory Report

Throughout the whole week
U.S. Companies’ earnings reports (including Goldman Sachs, Morgan Stanley, Bank of America, Netflix, United Health Group and more)