July 31, 2023
United States:
Traders Brace for $102 Billion Wave of Treasury Bond Sales
The US Treasury is set this week to begin a ramp-up in issuance of longer-dated securities that’s likely to stretch into next year, forced by a rapidly deteriorating budget deficit and soaring interest rates.
For the first time since early 2021, the Treasury will boost its so-called quarterly refunding of longer-term Treasuries, to $102 billion from $96 billion, the consensus among dealers suggests. While down from the record levels hit during the Covid-19 crisis, that’s well above pre-pandemic levels.
United Kingdom:
Biggest UK Banks Under Fire for Not Passing On Rate Rises
Banks including HSBC Holdings Plc, Barclays Plc and NatWest Group Plc have only passed through about a quarter of interest rate rises to savers, the Financial Conduct Authority said as it warned of “robust action” for firms that don’t transfer benefits to consumers.
Nine of Britain’s biggest lenders such as Lloyds Banking Group, Banco Santander SA and Virgin Money UK Plc passed on an average of 28% of base rate rises between January and May in their instant access savings offers, compared with an average of 80% in the five years through 2009, the FCA said in a report on Monday.
Asia:
China Economic Recovery Weakens, Spurring Measures From Beijing
China’s economic activity lost more steam in July with manufacturing contracting again and the services sector weakening, as Beijing promises small measures of support to boost consumption.
The official manufacturing purchasing managers’ index rose slightly to 49.3, beating economists’ estimates but still remaining below the 50 mark that separates expansion from contraction. The non-manufacturing gauge — which measures activity in the services and construction sectors — eased to 51.5, weaker than expectations. A sub-index focused on services waned to 51.5 from June’s 52.8.
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