Closing summary
Global stocks have staged a recovery today, with the FTSE 100 index in London 0.4% ahead while France’s stock market has gained 1%. Wall Street has also opened higher.
The Russian miner Evraz is the top faller in London, down 10.5%, while Barclays is the top riser after bumper results. The UK lender paid out more bonuses to its investment bankers and traders, but froze £22m of bonuses for former boss Jes Staley until there are further developments in a regulatory investigation into his links to Jeffrey Epstein.
The Russian rouble has fallen back towards 80 to the dollar today, trading down 1.2% at 79.74.
Here is a handy explainer on western sanctions:
And the Ukraine-Russia crisis explained: a complete visual guide:
Final data from Eurostat showed eurozone inflation rose to an all-time high of 5.1% in January, while a separate survey from GfK showed an unexpected drop in consumer confidence, because of rising Covid-19 infections and high inflation.
Our other main stories today:
The governor of the Bank of England has called on businesses to show restraint when raising their prices, after he came under heavy criticism for saying workers should not demand big pay rises to help manage inflation.
Andrew Bailey said that he recognised his call for workers to show restraint in the annual wage-bargaining process was unpopular, but warned that there were risks of an upward spiral for inflation taking hold.
Thank you for reading. We’ll be back tomorrow. Take care. -JK
Analysts at ING have looked at the market reaction to the western sanction so far, which is limited as today is a public holiday (Defender of the Fatherland Day) in Russia.
Russia’s recognition of the Donetsk and Lugansk People’s Republics (DLPR) has sparked global outrage and triggered the first tranche of sanctions. Although Russian markets are closed for a public holiday, offshore trading shows a continued sell-off in Russian USD debt.
There has been no trading of local currency OFZ Russian sovereign bonds today, but the more liquid 2047 dollar Eurobond has sold off further, with yields another 50bp higher near 6.00%. In light of new prohibitions to trade Russian sovereign bonds in the secondary market, for new debt issued from 1 March onwards, investors will watch carefully for the performance of OFZs when they re-open tomorrow.
Prior to the sovereign debt sanction announcement, non-residents held RUB2.8 tr ($35.3 bn), or around 18% of the overall OFZ market. Russia is now experiencing the fifth consecutive month of foreign portfolio outflows from OFZ.
The rouble initially took the new sanctions in its stride but remains vulnerable.
Commodities have been pricing in a fairly large risk premium as tensions between Russia and Ukraine escalate. This is not a surprise, given the powerhouse that Russia is when it comes to commodities. This is particularly the case for crude oil, natural gas, palladium, platinum, nickel, aluminium and wheat. The concern has been that any sanctions from the West could potentially disrupt export flows of these commodities, at a time when a number of these markets are already tight and trading near multi-year highs.
However, sanctions announced so far should have little to no impact on most of these key commodities. Therefore, it is not surprising that we have seen oil and some metal markets (aluminium and nickel) trading lower from their recent highs. But, given that there is still plenty of uncertainty over how the situation will evolve, we would expect markets to continue to price in a fairly large risk premium, particularly given that the current tightness in a number of these markets leaves them more vulnerable to supply shocks.
Here’s a longer take on the Andrew Bailey testimony to the Treasury select committee:
The governor of the Bank of England has called on businesses to show restraint when raising their prices, after he came under heavy criticism for saying workers should not demand big pay rises to help manage inflation, writes our economics correspondent Richard Partington.
Andrew Bailey said that he recognised his call for workers to show restraint in the annual wage-bargaining process was unpopular, but warned that there were risks of an upward spiral for inflation taking hold.
However, in a conciliatory response to questions from MPs on the Commons Treasury committee, he said the same point also held true for firms planning price hikes to protect their profit margins.
“I’m not saying people should not take pay rises. I did make the point it was in the context of large pay rises. And my concern is the second-round effects. If everybody tries to get ahead of the shock we’ve had from outside, then we’ll get the second-round effects and it will get worse. That’s the problem,” he said.
Asked by the Labour MP Angela Eagle whether big companies and City bankers should exercise similar restraint, Bailey said: “The same point holds on restraint. [It] holds for everybody.”
The Bank’s governor said he was worried that current high rates of inflation, caused by soaring energy prices, could persist for longer if workers and firms tried to offset the shock by significantly raising their incomes. This could create so-called “second round effects” to the initial shock from higher energy costs.
UK asks regulator to look at Russian news channel RT
Britain’s culture minister Nadine Dorries has asked the media regulator, Ofcom, to look at the Russian news channel RT and take action if it is found to have breached broadcasting rules, according to a spokesman for Boris Johnson.
Several MPs have called on the prime minister to censure state-sponsored RT (Russia Today), after Vladimir Putin’s formal recognition of two separatist regions in eastern Ukraine and the ordering of Russian troops into the area.
While Johnson had suggested that Dorries had asked the regulator to review RT’s broadcast licence, his spokesman said she had written “to express her concerns about Russia’s ability to spread their propaganda in the UK”.
All the culture secretary is asking Ofcom is to take any appropriate action should there be any attempt to use Russia Today to spread disinformation.
Never mind the sanctions. Bloomberg’s energy and commodities columnist Javier Blas has looked at what’s not covered by them. He writes:
In the 24 hours after Vladimir Putin signed a decree recognizing two breakaway Ukrainian territories, the European Union, the U.K., and the U.S. bought a combined 3.5 million barrels of Russian oil and refined products, worth more than $350 million at current prices. On top of that, the West probably bought another $250 million worth of Russian natural gas, plus tens of millions dollars of aluminum, coal, nickel, titanium, gold and other commodities. In total, the bill likely topped $700 million.
And that’s the way it’s going to be — at least for now. The U.S. and its European allies will continue buying Russian natural resources and Moscow will continue shipping them, despite the biggest political crisis between the former Cold War warriors since the collapse of the Soviet Union in 1991.
Both sides are aware of the contradictions. The West knows that commodities are a cash cow for Putin, fueling his imperial ambitions thanks, in great part, to ultra-high oil and gas prices, but the allies are also aware of the economic self-harm of cutting imports to zero. For its part, the Kremlin may be tempted to weaponize its natural resources — which could trigger blackouts in Europe. But it also knows commodity exports are its own economic lifeline.
It’s the commodities market version of the Cold War doctrine of mutual assurance destruction, or MAD.
With other adversaries — say Iran or Venezuela — the White House has been quicker to use oil as a geopolitical tool. As a result, both Tehran and Caracas cannot sell oil legally in world markets, not just into the U.S. However, Russia remains free to ship its oil into America; and the U.K. continues to buy Russian diesel, too.
COLUMN: The West each day continues to buy hundreds of millions of dollars worth of natural resources from Russia, indirectly financing the Ukrainian crisis | 🇺🇦🇷🇺⛽️🔥⚒️#Ukraine #OOTT via @bopinion https://t.co/x0I4CJyut0
— Javier Blas (@JavierBlas) February 23, 2022
Leonardo DiCaprio has bought an equity stake in the French champagne house Telmont, its majority owner Rémy Cointreau has announced, writes Jenn Selby in the Guardian.
The Hollywood A-lister and environmental activist, 47, said he was drawn to the 100-year-old brand based in Damery due to its ecological credentials.
“From protecting biodiversity on its land, to using 100% renewable electricity, Champagne Telmont is determined to radically lower its environmental footprint, making me proud to join as an investor,” the star of Titanic, Inception and Don’t Look Up said.
Telmont was founded in 1912 near Épernay in northern France by local winegrower Henri Lhôpital in the wake of the Champagne Riots – a series of disturbances caused by four years of bad harvests. In 1911, he wrote the song Gloire au Champagne, the lyrics of which urged winemakers to uphold the high standards of quality that went into making the sparkling beverage.
Data round-up: Eurozone inflation at all-time high
Inflation in the eurozone ticked up to 5.1% in January, from 5% in December, according to final figures from Eurostat, the European Union’s statistics office, released today.
The lowest annual rates were registered in France (3.3%), Portugal (3.4%) and Sweden (3.9%). The highest annual rates were recorded in Lithuania (12.3%), Estonia (11.0%) and Czechia (8.8%). Compared with December, annual inflation fell in eight member states and rose in 19.
In Germany, inflation slowed to 5.1% from 5.7% while France recorded a much lower rate of 3.3%, down from 3.4%. Spain’s rate also slowed, to 6.2% from 6.6%, while Italian inflation picked up to 5.1% from 4.2%.
Eurozone Inflation: +5.1% YoY
— Hedgeye (@Hedgeye) February 23, 2022
(up from 5.0%)
All-time high.
Energy biggest contributor, up +28.8% pic.twitter.com/JtSiWh1PSF
Separately, consumer confidence in Germany showed an unexpected drop, because of high inflation and high Covid-19 infection rates. The firm compiling the survey, GfK, is forecasting -8.1 points in consumer sentiment for March, down 1.4 points from February (-6.7 points). However, there was a slight increase in the measure for economic expectations.
Rolf Bürkl, GfK consumer expert, said:
Above all, expectations of a significant easing in price trends at the beginning of the year have been shattered for the time being, as inflation rates continue to hover at a high level.
Nevertheless, the outlook for the coming months is quite positive: Only recently it was decided to lift profound pandemic restrictions. This gives cause for hope that consumer spending will also return as a result. If this were to be supported by moderate price inflation, consumer sentiment could finally recover in the long term as well.
BOE governor promises to visit care home
To sum up what we reported earlier:
The governor of the Bank of England promised to visit a care home after angering low paid workers by suggesting they help bring inflation down by refraining from making wage demands. He said he was concerned about “second round” effects from rising inflation, i.e. higher wages.
Care workers who on average earn £9.01 an hour called for him to work a day in their shoes, and today Andrew Bailey told MPs he would “certainly go to a care home”.
He told the Treasury select committee he didn’t know what care workers earned, and said his own salary was somewhere over £500,000. In fact, including pension payments, his pay package amounts to more than £575,000 a year. Meanwhile, 77% of care workers are paid below the living wage foundation rate.
The GMB trade union welcomed his promise to see care work in person but said: “Members working in care homes will want to know why he thinks they shouldn’t ask for a big pay rise, when monstrous bonuses are once again being enjoyed by bankers”.
In fairness, Bailey repeatedly expressed concern for the “least well-off” today, and suggested that banks should exercise restraint when paying out bonuses.
Updated
Here’s a round-up of today’s main stories.
Market summary
Let’s have a quick look at the markets.
Russia’s rouble has weakened again, reversing gains made yesterday (which came after Monday’s hefty 3.3% drop), heading back towards 80 to the dollar, as investors digested sanction packages imposed on Russia by western governments.
The rouble is trading at 79.75 to the dollar, down 1.2%, and at 90.4 against the euro, down 1%.
Russia is celebrating the Defender of the Fatherland public holiday today, which means many traders are away from their desks.
Russian dollar bonds have extended their losses on news of sanctions, with longer-dated ones dropping more than 4 cents.
On the commodities markets, crude oil has retreated. Brent, the global benchmark, has slipped 0.2% to $96.65 a barrel while US light crude is trading down 0.3% at $91.66 a barrel. Brent crude went over $99 a barrel yesterday, the highest since early September 2014, and approaching the $100 mark. Some experts say it is only a matter of time until it breaches this level, and could push higher to $120 a barrel.
European stock markets have followed Asian shares higher and notched up chunky gains of more than 1% earlier. They have given up some of those gains, and the German and Italian markets are now now up 0.6%, while the French exchange is still close to a 1% gain. London’s FTSE 100 is 0.4% ahead at 7,526.
Here is our full story on the UK’s plans to stop Russia selling sovereign debt in London as part of its sanctions package, similar to moves by the US and Canada.
The Treasury select committee hearing has now ended.
The hearing has moved on to the subject of sanctions against Russia and how that will affect London’s standing as a financial centre. Liz Truss, the foreign secretary, talked this morning about blocking Russia from selling sovereign debt in London.
Bank of England governor Andrew Bailey said the central bank fully supported the government’s sanctions and would give any help required.
These sanctions are very important.
It is absolutely important that these sanctions are applied with rigour. It is clear they’ve got to be applied with rigour.
The situation is so serious... I don’t think that saying ‘well this could be a bit damaging to London as a financial centre’ is just really an argument that holds water.
Clearing transactions will also be affected, and asked about the impact, Baily replied:
Obviously rigorously applied sanctions would have a substantial impact.
Asked about any risks to UK banks, Bailey said:
The UK banks’ exposure to Russia is very low.
I don’t see a systemic risk to the UK banking system.
Updated
Haskel, who also sits on the board of the UK Statistics Authority, said the Office for National Statistics had met with the food writer and activist Jack Monroe to discuss ways of measuring food price inflation accurately.
She has exposed how prices for cheaper food products have soared as availability fell –– with some supermarkets ditching basic pasta, for example –– contributing to rising hunger and poverty. But changes to ‘basic’ products are not captured in the official inflation figures.
Haskel said the ONS used to publish different inflation indices before the pandemic, and that’s going to be restored. The statistics office has already provided a more detailed breakdown of changes in the cost of living, which was welcomed by Monroe last month.
Updated
Returning to the Treasury select committee hearing, Bank of England policymaker Jonathan Haskel said the tight labour market is actually a good thing for people. Before the pandemic, roughly two unemployed people were chasing every vacancy; now it’s one worker chasing every vacancy, he said.
Sanofi and GSK seek approval for Covid-19 vaccine
The French and British drugmakers Sanofi and GSK will seek approval from regulators, including in the US and the European Union, for their Covid-19 vaccine, after reporting positive results from late-stage clinical trials.
The companies said the phase 3 efficacy trials showed that two doses of the jab provided:
- 100% efficacy against severe Covid-19 disease and hospitalisations
- 75% efficacy against moderate or severe Covid-19 disease
- 57.9% efficacy against any symptomatic Covid-19 disease, in line with expected vaccine effectiveness in today’s environment dominated by variants of concern
The vaccine, which had been delayed by an initial dosing error and early disappointing results in older people, can also be used as a booster. A separate booster trial showed that it led to a “significant increase in neutralising antibodies of 18- to 30-fold” across all age groups, when used in people who had doses of mRNA vaccines (from Pfizer/BioNTech and Moderna) and other jabs such as the Oxford/AstraZeneca one.
Thomas Triomphe, executive vice president of Sanofi Vaccines, said:
We’re very pleased with these data, which confirm our strong science and the benefits of our Covid-19 vaccine. The Sanofi-GSK vaccine demonstrates a universal ability to boost all platforms and across all ages.
We also observed robust efficacy of the vaccine as a primary series in today’s challenging epidemiological environment. No other global Phase 3 efficacy study has been undertaken during this period with so many variants of concern, including Omicron, and these efficacy data are similar to the recent clinical data from authorised vaccines.
GSK is providing an adjuvant to the vaccine that boosts the body’s immunity response. Roger Connor, president of GSK Vaccines, said:
The evolving epidemiology of Covid-19 demonstrates the need for a variety of vaccines. Our adjuvanted protein-based vaccine candidate uses a well-established approach that has been applied widely to prevent infection with other viruses including pandemic flu. We are confident that this vaccine can play an important role as we continue to address this pandemic and prepare for the post-pandemic period.
Updated
Broadbent said the increase in UK energy bills this year is twice as big as any single year in the 1970s. And Bailey said there is no public policy response that can limit the impact of this.
Household energy bills are going up by 54% in April under the price cap set out by the regulator Ofgem.
Andrew Bailey may have to rebuild cred (if possible). He said inflation was ‘transitory’. Then 2%, 5%, 6% and now 7.25%. Not a good win-loss ratio on predictions. Then says ‘don’t ask for a pay-rise, take the hit’. Maybe OK for him. Not so much the rest of us #costoflivingcrisis
— Langton Capital (@langtoncapital) February 23, 2022
You can watch the hearing live here.
Hinting at further interest rate hikes, Bailey sees a clear risk of inflation sticking at a high level.
He said that there is “very clearly” a risk that high inflation gets embedded in Britain if there is a cycle of higher prices pushing up wages.
It’s not just wage setting, it’s also price setting... it’s both.
There is very clearly an upside risk there. The upside risk .... comes through from the second-round effects.
He also mentioned the high energy prices, and the Ukraine crisis, while saying that “energy prices tend to revert to mean”.
The Bank of England has already raised interest rates twice since December, from 0.1% to 0.5% this month, and is expected to move again in March. Four of its nine monetary policymakers voted for a bigger, half-point increase to 0.75% this month.
Updated
Bailey promised to visit a care home on one of his regional visits, to assess the situation of care home workers, when asked by Labour MP Angela Eagle on the Treasury select committee. There was also this slightly uncomfortable exchange:
Ouch - exchange with between @angelaeagle and Andrew Bailey on his salary vs the average wage of a care worker. pic.twitter.com/eojOTBFmgW
— Andy Bruce (@BruceReuters) February 23, 2022
Updated
BOE's Bailey urges banks to show restraint on bonuses
Bailey urged banks to exercise restraint when paying out bonuses. When asked what he thought of banks paying out bumper bonuses –- HSBC yesterday and Barclays today –– he said, in a message to the banks:
Please reflect on the economic situation we are in. There is a very big shock coming from outside.
This [the inflation shock from soaring gas, oil and food prices] hits the least well off hardest.
My concern is that the least well-off will come off worst.
Updated
Bank of England governor Andrew Bailey said that if we get second-round effects from higher inflation (such as rising wages and higher inflation expectations among the public), the central bank will need to respond by raising interest rates.
I’m not saying people should not take pay rises.
My concern is the second-round effects If everybody tries to get ahead of the [inflation] shock we’ve had from outside ... it gets worse.
The real risk that worries me here is the ones with the least bargaining power ... get the worst outcome ...and end up absorbing the worst of the external shock.
Updated
The Treasury select committee is quizzing Bank of England governor Andrew Bailey, deputy governor Ben Broadbent, as well as Jonathan Haskel and Professor Silvana Tenreyro, both external members of the monetary policy committee.
Haskel, a professor of economics at Imperial College London, just said that the Bank doesn’t want the “blip” of soaring gas and oil prices to become permanently embedded inflation.
Truss: UK to stop Russia selling sovereign debt in London
Britain’s foreign secretary Liz Truss has been talking about how Britain will stop Russia selling sovereign debt in London.
She told Sky News:
We’ve been very clear that we’re going to limit Russian access to British markets. We’re going to stop the Russian government with raising sovereign debt in the United Kingdom.
She added that there would be
even more tough sanctions on key oligarchs, on key organisations in Russia, limiting Russia’s access to the financial markets, if there is a full-scale invasion of Ukraine.
Limiting sovereign debt sales in London will require additional legislation, Reuters said, citing Western officials. Clearing transactions would also be affected by the sanctions.
However, armed with the world’s fourth-largest foreign exchange reserves of more than $630bn, and Brent crude trading close to $97 a barrel, Russia probably won’t need to sell large amounts of foreign-denominated debt in future.
Truss did not discuss whether Britain would also stop the trade inn sovereign debt that has already been issued. The US government broadened restrictions on trading of Russian government debt yesterday, banning trade in bonds issued after 1 March in the secondary market.
US investors have been banned from buying new dollar-denominated Russian debt since 2014, when Russia annexed Crimea. US banks have also been barred form participating in the primary market for foreign-denominated government bonds since 2019.
Vladimir Putin said today that Moscow is ready to look for “diplomatic solutions” over Ukraine -- but stressed that the country’s interests were non-negotiable. The comments came amid fresh shelling in east Ukraine.
More on our Ukraine crisis live blog here.
In Ukraine, Serhiy Kryvonos, a retired special forces general and former deputy secretary of the national security and defence council, said “the whole country will be fighting back” if there is a full-blown invasion. He predicted that this could lead to 5 to 10 million people leaving Ukraine and fleeing to the west and elsewhere.
Boris Johnson’s office and the Treasury are calling in finance bosses and regulators to discuss how to ensure the sanctions on Russia are effective, the BBC’s political editor Laura Kuenssberg has tweeted.
No 10 and Treasury calling in finance bosses and regulators later to talk about how to make sure sanctions are effective
— Laura Kuenssberg (@bbclaurak) February 23, 2022
Likely also PM will announce some additional military support for Ukraine, not clear yet specifically what that will be
— Laura Kuenssberg (@bbclaurak) February 23, 2022
European shares are up more strongly now.
- UK’s FTSE 100 up 32 points, or 0.4%, at 7,526
- Germany’s Dax up nearly 1% at 14,839
- France’s CAC up 1% at 6,855
- Italy’s FTSE MiB up 0.8% at 26,258
Barclays has also appointed its first female finance director. As Tushar Morzaria is stepping down as group finance director, the bank promoted Anna Cross, currently his deputy.
Cross, a qualified chartered accountant, joined Barclays in 2013, and previously worked in finance roles at Lloyds Banking Group, Halifax Bank of Scotland, and Asda.
The Barclays chairman, Nigel Higgins said:
The board is delighted to have, in Anna Cross, such a strong internal successor. Anna was identified over a year ago as the board’s preferred successor, following a review of potential internal and external candidates.
European shares edge higher at the open
European markets have edged up at the open, with the UK’s FTSE 100 trading 40 points higher at 7,532, a 0.5% gain, while France’s CAC and Spain’s Ibex rose 0.3%. Italy’s FTSE MiB has recorded a chunky gain of 1.16%.
Barclays is the top riser on the FTSE 100 in London, up 2.7% to 195.3p, after more than doubling pre-tax profits to £8.4bn thanks to a boom in deal-making. It has also frozen its former boss Jes Staley’s share awards. More on that soon.
Updated
Barclays boosts bonuses, freezes Jes Staley share awards
Barclays is the latest UK bank to boost bonuses following a surge in annual profits linked to the release of cash originally put aside to cushion the blow of the Covid crisis, reports our banking correspondent Kalyeena Makortoff.
The lender confirmed it had increased its staff bonus pool by more than 17% to £1.3bn for 2021, having paid out nearly £1.1bn a year earlier even as the pandemic raged.
However, it has frozen share awards for its former chief executive Jes Staley, who stepped down in November after an investigation by the City watchdog, the Financial Conduct Authority, over how he described his links to the sex offender and disgraced financier Jeffrey Epstein. Staley received millions of pounds worth of shares that will not vest as scheduled.
He was replaced as CEO by CS Venkatakrishnan. The findings of the investigation have not yet been made public.
The news came as the bank reported an annual pre-tax profit of £8.4bn, more than doubling the £3.1bn reported for the whole of 2020. The surge in profits was due to the improving economic outlook, which meant Barclays was able to release £653m from reserves originally set aside to offset a potential jump in loan defaults during the pandemic.
That compares with the £4.8bn it was forced to put aside amid fears that customer debts would sour in 2020.
Updated
Rio Tinto warns on aluminium supply disruption
Aluminium prices are holding near their highest levels in more than 13 years, as sanctions on Russia have raised fears over supply disruptions.
The chief executive of the London-listed mining group Rio Tinto, Jakob Stausholm, said US sanctions could affect Russia’s aluminium industry. He told reporters:
It’s a very difficult situation... Specifically in our business, there could be disruptions primarily in the aluminium industry if we are going to see sanctions.
You could also see disruptions in the steel industry, but probably less so.
Three-month aluminium on the London Metal Exchange is trading broadly unchanged at $3,302.5 a tonne. Prices hit $3,380 yesterday, a tad below the record set in 2008 of $3,380.15.
Nickel prices eased 0.1% to $24,525 a tonne, after hitting the highest level since August 2011 yesterday.
Introduction: IMF starts talks in Ukraine, markets remain tense
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
The mission of the International Monetary Fund is starting discussions in Ukraine for the second review of the Fund-supported programme, the global lender said today. (The meetings will be conducted virtually.)
Ukraine hopes that the talks will result in disbursement of $700m under the $5bn IMF programme, and reassure markets that have been rattled by the deepening crisis.
Western nations and Japan unveiled new sanctions yesterday in response to Vladimir Putin’s decision to order troops into separate regions of Eastern Ukraine and to formally recognise them as independent states.
The United States, European Union, UK, Australia, Canada and Japan announced sanctions targeting banks and Russian elites, while the German chancellor Olaf Scholz halted the Nord Stream 2 pipeline, a major gas project from Russia.
Britain will also stop Russia selling sovereign debt in London, with similar moves by the US and Canada.
Asian stock markets edged cautiously higher after yesterday’s losses, with the exception of Japan’s Nikkei, which fell 1.7%. Hong Kong’s Hang Seng rose 0.67%, the Shanghai Composite index gained almost 1% and the South Korean Kospi rose 0.47%. European markets are expected to follow suit when they open.
Ipek Ozkardeskaya, senior analyst at the bank Swissquote, said:
More sanctions are expected in the coming days, but the measures that have been announced so far are not as heavy as feared.
Market mood is not cheerful but the softer-than-feared sanctions somewhat help lifting the mood. The risk appetite is limited, of course, except in some key assets including oil and commodities.
European natural gas futures jumped 8% yesterday, the barrel of Brent crude flirted with the $100 mark, as the US crude spiked above $96 before easing back to the $93 level this morning. Although we had news that oil prices are high enough to boost the US production throughout the year, Iraq and Nigeria are apparently not willing to pump faster, even the prices hit three-digit numbers. Price pullbacks are seen as interesting buy opportunities as the trend remains comfortably positive.
This morning we get to hear from Bank of England Governor Andrew Bailey, as well as monetary policy committee members Ben Broadbent, Jonathan Haskel and Silvana Tenreyro, when they are quizzed by MPs on the Treasury Select Committee, on interest rates, and the cost of living.
The Agenda
- 7.45am GMT: French business confidence
- 9.30am GMT: Treasury Select Committee quizzes Bank of England governor Andrew Bailey and other policymakers
- 10am GMT: Eurozone inflation final for January (forecast: 5.1%)
