September 26, 2023
United States:
Bond Traders Roiled by Fed See US Shutdown as Next Big Wild Card
To judge by recent history, a US government shutdown won’t be a huge event for the bond market. If anything, it could even provide a little short-term relief, since Treasuries usually rally when investors need somewhere to hide.
But it’s also adding a big dose of what financial markets hate the most: uncertainty.
Europe:
German Banks Slam Higher Reserve Requirements as Tax on Deposits
The lobby group that represents Deutsche Bank AG and Commerzbank AG pushed back against the prospect of an increase in the amount of money that lenders must park at the European Central Bank.
Raising such requirements would be equivalent to a tax, according to Heiner Herkenhoff, who heads the Association of German Banks. The step would dent earnings, constraining banks’ ability to pay higher interest to savers and their capacity to lend, he warned.
Asia:
Japan Warns Again on Yen After Dollar Breaches 149 Mark
Japan’s finance minister issued his second salvo of warnings to players in foreign-exchange markets in a day after the yen reached its lowest against the dollar since October, the month authorities last intervened to prop up the currency.
“As I said at the morning press conference, I’m watching market trends with a high sense of urgency,” Finance Minister Shunichi Suzuki said Tuesday afternoon.
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