Central banks to be blamed for inflation

Graeme Wheeler, former New Zealand central bank governor, and Bryce Wilkinson, have co-authored a paper that looks at the central banks and their mistakes since 2019. They state for instance that the main cause of inflationary pressures lies in the errors of judgement made by central banks in conducting monetary policy during the Covid-19 pandemic.

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Bearish sentiment rules markets

Rate hikes from all central banks worldwide are pushing markets lower. In the last week, DAX 40 fell by 4%, S&P 500 by 6%, and Dow Jones by 5%. Commodities followed, with WTI Crude Oil down 8% and natural gas down 11% for the week.

BoE raised rates by 50 bps

The Bank of England joined Federal Reserve and raised interest rates as expected by 50 bps to fight high inflation. This marks the 7th consecutive rate hike, pushing borrowing costs to the highest since 2008.

Fed increases rates by 0.75%

The Federal Reserve increased its federal funds rate by 0.75% to 3.25%, intensifying its fight against inflation. US markets staged another late-day reversal, giving up their gains. With the Fed’s most recent increase, the short-term benchmark rate is at its highest since 2008.

US Dollar Index at record highs

The dollar index reached 111, the highest point since June 2002. The crisis in Ukraine is expected to worsen as President Putin announced a partial military mobilization in Russia, and investors are fleeing for safety. At the same time, they wait for the FOMC decision later in the day.

Equities open lower due to fear

On Monday, European and American equities markets were poised to open lower as investors refrained ahead of a huge week for central bank decisions. This week is highlighted by Fed, which will likely deliver another supersized rate boost to manage soaring inflation.

US CPI slowing down – but not as expected

Today we saw a release of updated inflation number of the inflation in US. While the core CPI has decreased in August to 8.3% from previous 8.5% in July YoY, the market was expecting a decrease to 8.1%. This means that CPI is not slowing down as fast as expected. Most risk-on assets are thus seeing red candles, while risk-off assets are in green.

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Russia is about to legalize crypto

Russia took the first step toward legalizing crypto, and it benefits everyone. Kommersant reported that the country’s Deputy Finance Minister Alexei Moiseev and the Bank of Russia have settled on using cryptocurrency for cross-border payments. Locals are permitted to process international payments using crypto.

Bearish sentiment rules markets

Rate hikes from all central banks worldwide are pushing markets lower. In the last week, DAX 40 fell by 4%, S&P 500 by 6%, and Dow Jones by 5%. Commodities followed, with WTI Crude Oil down 8% and natural gas down 11% for the week.

Vitalik Buterin expects others to use PoS

All blockchains, including Dogecoin and Zcash, according to Ethereum co-founder Vitalik Buterin, should switch to proof of stake. Vitalik believes that now that the Ethereum merge is complete, other blockchains should follow.  “As proof of stake matures, I expect it to just increase in legitimacy more and more over time,” said Vitalik.

European stock indices tumble

The sell-off on major European markets continues on Friday as investors fear the tightening wave of monetary policy would harm global growth. After dropping below 400 points on Thursday for the first time since January 2021, the STOXX 600 is down approximately 0.7%. DAX 40 is down 0.8%, setting a new two-month low.

PMI falls in several countries

Eurozone Purchasing Managers’ Index (PMI) fell to 48.9 in September of 2022 from 49.8 in August, and Germany Services PMI also dropped to 45.4 from 47.7. UK Services PMI also falls from 50.9 to 49.2, but France surprises with a rebound from 51.2 to 53.

Lumber is down 70% in 6 months

The housing sector is witnessing a dramatic slowdown and rising rates. As a result, lumber futures fell by 7% to $450, a level last seen in September 2021 and down nearly 70% from their March peak. In addition, August saw the seventh straight month of existing house sales declines, reaching their lowest level since May 2020.

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Did MIT invent a new type of cheap battery?

Have MIT engineers invented a replacement for the lithium-ion battery? These are used in conjunction with, for example, electric cars.

Honda has to cut production due to chip shortage

Honda has to cut production by 40% at one factory and 30% at another. This is primarily due to a shortage of chips.

Poland has enough gas and coal for the winter

Poland has secured supplies of natural gas and coal for the upcoming winter heating season. It managed to do so without Russian supplies.

Mercedes is making parts to stock up – afraid of gas

Mercedes-Benz is worried about possible gas rationing in the winter. It is therefore manufacturing parts for inventory.