New Zealand’s central bank keeps rates steady for the 1st time in 2 years
The RBNZ was one of the central banks in advanced economies to start raising rates as the world recovers from the Covid-19 pandemic © Mark Coote/Bloomberg
The Reserve Bank of New Zealand left interest rates unchanged at its meeting on Wednesday for the first time in nearly two years, as one of the world’s most hawkish central banks eases its monetary tightening.
The official cash rate was kept at 5.5 percent, raised 12 times by 0.25 percent since August 2021. The rate “should remain at a restrictive level for the foreseeable future”, the central bank added.
The RBNZ was one of the earliest central banks in advanced economies to start raising rates as the world recovered from the Covid-19 pandemic. He often warns that persistent inflation means higher interest rates are necessary.
Asia-Pacific currencies rise against the dollar on US CPI data
Asia-Pacific currencies rose on Wednesday, as traders awaited US inflation data that is expected to show a modest rise in prices in June.
The yen gained 0.6 percent to trade at ¥139.46 per US dollar, near its strongest level in nearly a month, while the renminbi strengthened 0.3 percent to Rmb7.1853.
The Australian dollar rose 0.5 percent to A$0.672.
US consumer price index data due on Wednesday is expected to show a 3.1 percent rise in June, the slowest rate of inflation since March 2021, according to a Reuters poll.
That has fueled expectations that the Federal Reserve will stick with a break in its fiscal tightening cycle.
What to see in Asia today
Shinichi Ueno, former head of advertising agency ADK. Tokyo District Court to rule on 2020 Olympics bribery scandal on Wednesday © Kiyoshi Ota/Bloomberg
Events: In South Korea, the trial begins of Choi Jin-seok, a former Samsung executive accused of stealing sensitive information to help set up a chip factory in China. The Tokyo District Court is set to sentence Shinichi Uno, the former head of advertising agency ADK, over the 2020 Olympic Games bribery scandal. Reserve Bank of Australia Governor Philip Lowe delivers a speech on the economy, while the Reserve Bank of New Zealand reviews monetary policy.
Corporate Results: India’s Tata Consultancy Services has issued its first quarterly trading update.
Economic Data: Japan machinery orders release of May data by Cabinet Office. The country’s producer price index reading is also expected. Malaysia releases industrial production and retail sales figures, while India releases the latest consumer price index and industrial production numbers. The Philippines releases foreign investment data for the month of May and New Zealand announces visitor arrivals for the month.
Markets: Futures contracts were seen higher in Hong Kong and Tokyo on Wednesday morning. The S&P 500 rose 0.7 percent and the Nasdaq Composite 0.5 percent on Tuesday, after inflation data that traders will look to for clues about the future path of US interest rate hikes.
Biden and Erdogan discuss bilateral ties in ‘first step’ meeting
US President Joe Biden discussed bilateral relations with Turkish counterpart Recep Tayyip Erdogan and praised his decision to support Sweden’s bid to join NATO at a meeting at the Military Alliance Summit in Vilnius, Lithuania.
The leaders discussed their defense and economic priorities and shared interests such as their support for Ukraine against Russian aggression and “maintaining stability in the Aegean,” according to the White House.
The Turkish leader said the meeting with Biden was the “first step” in mending strained relations between the countries. “Earlier our meetings were just warm-ups, but now we are starting a new process.”
Salesforce posted biggest jump in 4 months on plans to raise prices
Salesforce posted its biggest one-day gain in four months, the first increase in seven years, after the software group announced price hikes for some of its products.
The San Francisco-based company said it would raise list prices by an average of 9 percent in August for its products, including Sales Cloud and Tableau.
Shares closed up 3.9 percent on Tuesday, their biggest jump since mid-March. That extended a rally that has left them nearly two-thirds higher since the start of the year.
Salesforce has taken steps to focus on profits in an effort to appease activist investors. The group called a truce with Elliott Investment Management in March.
Zelensky told the summit that Ukraine would ‘strengthen’ the NATO alliance
President Volodymyr Zelensky told a rally in Vilnius that “Ukraine will further strengthen the alliance” after NATO leaders agreed at a summit to invite Kiev to join.
Zelensky said he arrived in Vilnius “with confidence in the decision” to offer Ukraine to join the defense group, “with confidence in our partners, with confidence in a strong NATO that does not hesitate, does not waste time and looks back at any aggressor.”
Speaking to a roaring crowd on Tuesday evening, Zelensky said he believed the fight in Ukraine was in defense of all of Europe.
The UK Postal Workers Union deals with Royal Mail back
A Royal Mail employee delivers the post in Chelmsford. The Communications Workers Union said more than three-quarters of the 67% of members who voted supported its deal © Chris Ratcliffe/Bloomberg
UK postal workers have backed a deal over changes to pay and working practices at Royal Mail, which deeply disrupted mailing services and ended a dispute that led to the biggest crisis in the 507-year-old organisation’s history.
The Communications Workers Union said on Tuesday that more than three-quarters of the 67 percent of members who voted supported its deal agreed with Royal Mail in April.
The announcement follows 18 days of strike action during the final quarter of 2022, amid a dispute centered on Royal Mail’s plans to adapt working methods in response to growing demand for online shopping deliveries and competition from the likes of Amazon.
