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AstraZeneca US phase III vaccine trial shows 79% efficacy in preventing symptomatic cases

AstraZeneca publishes the data from a study of more than 30,000 volunteers

The vaccine was also shown to be 100% effective at preventing severe disease, death and hospitalisation. So, that is arguably the more important statistic.
In any case, this should bolster the approval process for the vaccine in the US – which may help to ease some of fears about the efficacy and use as debated in Europe lately.

Nikkei 225 closes lower by 2.07% at 29,174.15

No reprieve for Japanese stocks after BOJ ETF decision

Nikkei 22-03
Even the Topix fell by 1.1% on the day, despite BOJ efforts to reaffirm that they will still step into the market to purchase ETFs if and when necessary.
As much as the BOJ claims that removing the numerical value on a set amount of purchases does not mean lesser commitment, it just isn’t the same.
Elsewhere, Chinese markets are keeping more resilient and rebounding after the lira collapse sparked a wave of risk aversion early on in Asian trading.
The Hang Seng is up 0.1% while the Shanghai Composite is up 1.1% on the day.
Meanwhile, S&P 500 futures are flat while Nasdaq futures are up 0.6% as Treasury yields keep lower going into European morning trade.

It may be difficult for Turkey to avoid another currency crisis – SocGen

The Turkish lira is the talk of the town to start the week

The currency plunged to a low of 8.47 against the dollar earlier today, opening with a gap of over 15% after the removal of Turkish central bank governor, Naci Agbal.
USD/TRY
Société Générale’s London-based strategist, Phoenix Kalen, argues that the move by Erdogan leaves the country “beyond the point of no return” and that may lead to a fresh record low in the lira – forecasting a move to 9.70 against the dollar in Q2.
Adding that:

“Without much remaining reserves to defend the currency, and considering an expected exodus in foreign and local investor capital, it may be difficult for Turkey to avoid another currency crisis in the coming months.”

The firm now forecasts USD/TRY at 9.70 in Q2, 9.0 by Q3 before settling at 9.30 in Q4.

Bank of Japan Governor Kuroda says his 2% inflation target is helping stabilise FX rates

BOJ Gov Kuroda says there is no need to change the 2% inflation target, its a global standard and must not change.

And, more:
  • More flexible ETF buyings to improve nimbleness
Given the performance of Japanese stocks today he might want to get on the bid!
More:
  • have not considered selling ETF holdings at all, or of halting purchases
  • decided to buy ETFs that are linked to the TOPIX to avoid impact on individual stocks
  • need to watch financial stability carefully
  • monetary easing will last for a considerably long time ahead

Another hit coming to automotive chip supply – fire halts production at Renesas

Renesas Electronics is one of the biggest suppliers of automotive chips, the firm had to halt production at a Japanese plant on Friday after a fire. fire broke out in one of its clean rooms This will have another supply reducing impact on semiconductor chips for the automobile industry. Chief Executive Officer Hidetoshi Shibata said on Sunday that the firm is targeting to resume production at the plant within a month.

Goldman Sachs expect up to another USD 4 trillion in stimulus from Biden

Goldman Sachs say that ina addition to the $1.9tln approved last week

  • the next round of fiscal legislation … our economists (expect) a package that will include at least $2 trillion in infrastructure spending and could reach $4 trillion if it also funds health care, education, and child care initiatives. 
I do not know how the Fed can hold back rate hikes if another $4tln flows into the economy in fiscal aid.
GS do add though:
  • Our economists expect the next package will be paid for in part by higher tax rates
So that’ll be some subtraction.
More from GS:
  • The tax plan proposed by President Biden in his election campaign would raise the statutory corporate tax rate on domestic income from 21% to 28%, partially reversing the cut from a rate of 35% passed in the 2017 Tax Cuts and Jobs Act. The plan would also raise the tax rate on foreign income (also called the “GILTI” tax) and institute a minimum corporate tax rate. 

Fed’s Barkin says the dot plot is not FOMC policy

Barkin is the president and CEO of the Federal Reserve Bank of Richmond, he has some comments crossing on the wires.

Speaking in a Bloomberg TV interview.

 

  • you want yields to respond to what happening in the economy
  • yields reflecting good news on vaccines, fiscal aid
  • really hopeful that we’re at the back end of pandemic
  • the Fed’s interest-rate dot plot is not Federal Open Market Committee policy
  • Fed has tools to handle unwanted inflation
  • inflation is not a one-year phenomenon, it’s multi-year
  • expect to see price pressures in 2021
  • expect strong demand, met by some supply-chain issues
  • the US economy will have strong spring and summer
Re that headline I put in the, headline …. the dot plot is part of the Fed’s forward guidance. Barkin’s comments are in line with other comments from Fed officials, they are toeing the party line since Chair Powell laid down the law and told them all to shut up about tapering a month or so back.

 

Barkin is the president and CEO of the Federal Reserve Bank of Richmond, he has some comments crossing on the wires.