4 February 2022 – The euro is still not history, even though many eulogies have already been made for it. The ECB’s decision to keep interest rates at current levels and to stop PEPP purchases comes as no surprise. And the Japanese want to increase automobile production significantly.
The Euro Doesn’t Want to Die
After having been pronounced dead several times, the euro has taken the announcement by the European Central Bank (ECB) that it does not intend to raise interest rates for the time being well and has rallied against the dollar. The announcement to stop PEPP purchases at the end of March 2022 is also not unexpected. Central banks do not usually carry out spontaneous and unexpected interest rate hikes.
Speculators seek greener pastures
Nevertheless, speculators on the stock markets reacted with a bit of unease yesterday, causing the stock indices to close in the red. This probably indicates a shift process, i.e. the proverbial search for greener pastures for capital that would have benefited from an interest rate hike. For one thing is certain, the liquid assets must be reinvested, as they are currently losing value too quickly in liquid form. In addition, Meta, the Facebook parent company, published bad figures, which “wiped out” $200 billion.
Base metals on the LME unimpressed
The LME base metals have apparently not even noticed the ECB announcement. Other realities prevail here.
Japanese carmakers want to increase production significantly
And from Japan, rising production figures for automobiles are forecast, which is also justified by the fact that the semiconductor crisis is losing its horror. Japanese production is expected to rise by at least 23%. German carmakers will hardly want to cut back, as can be seen from the rising demand for steel in the car industry.
- China raises tax rebates for nickel, lithium, manganese and cobalt scrap
- Commodity prices do not stick to outdated models
- Steel prices rise, bullish demand
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Disclaimer: Many things here represent our opinion. Others are information from the Internet. We can therefore never claim to be correct or complete. And never base a business decision solely on the news you receive from us.