October 01, 2024
United States:
US Funding-Market Volatility Fuels Spike in Key SOFR Benchmark
A key rate underlying the US financial system jumped sharply at the end of September, an indication that volatility surrounding the end of the quarter has returned.
The Secured Overnight Financing Rate — an important one-day lending benchmark linked to activity in the repurchase agreement market — rose to 4.96% as of Sept. 30, according to the latest Federal Reserve Bank of New York data published Tuesday.
Europe:
Euro-Zone Inflation Drops Below 2%, Backing ECB Cut Bets
Euro-area inflation slowed below the European Central Bank’s 2% target for the first time since 2021 — backing investor bets that interest rates may be lowered more quickly than previously anticipated.
Consumer prices rose 1.8% from a year ago in September, down from 2.2% in the previous month as energy costs fell sharply, Eurostat said Tuesday. The reading matched a Bloomberg survey of analysts — as was core inflation, which eased to 2.7%.
Asia:
BOJ Should Weigh Rate Hikes With Caution, New Minister Warns
The Bank of Japan should exercise caution when considering further interest rate hikes to ensure the country truly defeats deflation, according to Japan’s incoming Minister for Economic Revitalization Ryosei Akazawa.
Akazawa spoke to reporters after new Prime Minister Shigeru Ishiba’s cabinet was officially announced. Akazawa is known for his close ties to Ishiba, who won the ruling party’s closely contested leadership race last week.
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