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The main contract of industrial silicon rose by more than 3% and is now quoted at 8,995 yuan/ton.On September 15, the overnight shibor was 1.4080%, up 4.10 basis points; the 7-day shibor was 1.4700%, up 1.00 basis points; the 14-day shibor was 1.5040%, down 2.00 basis points; the January shibor was 1.5330%, up 0.10 basis points; and the March shibor was 1.5530%, the same as the previous trading day.According to futures data on September 15, overnight shibor was 1.4080%, up 4.10 basis points; 7-day shibor was 1.4700%, up 1.00 basis points; 14-day shibor was 1.5040%, down 2.00 basis points; January shibor was 1.5330%, up 0.10 basis points; March shibor was 1.5530%, the same as the previous trading day.On September 15th, Pop Mart (09992.HK) plunged nearly 9% on Monday, its biggest drop since April, hitting its lowest level in over a month, after JPMorgan Chase downgraded its rating to neutral, citing a "lack of catalysts and unattractive valuation." This followed social media posts pointing to weak demand for its new "SKULLPANDA" product, and JPMorgans downgrade heightened market concerns about waning popularity. JPMorgan analysts Kevin Yin and others stated in a report: "Current valuations already reflect perfect expectations. Any minor fundamental disappointment or negative media coverage (such as falling pre-owned prices or third-party licensing issues) could trigger a share price decline." Although the stock has still risen over 180% this year, its 12-month forward price-to-earnings ratio is now close to 23 times.On September 15th, the market generally expected the Federal Reserve to cut interest rates by 25 basis points this week, but uncertainty remained about the direction of the policy once it was implemented. Marc Giannoni, Barclays chief US economist, stated that with inflation remaining subdued, the FOMC will judge that downside risks to achieving its employment goals are increasing. He added that the Feds economic projections remained largely unchanged, but the dot plot indicated three rate cuts (each 25 basis points) this year, one each in 2026 and 2027, while the median long-term interest rate forecast remained unchanged at 3.0%.

The Era of Low Interest Rates Is Over

Cory Russell

Apr 13, 2022 10:47


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There will undoubtedly be plenty written about the last decade and longer, during which interest rates were lowered and held at levels last seen decades, if not centuries ago.


Markets are increasingly wary of major central banks, particularly the world's most powerful, who are planning to front-load interest rate rises in order to contain the inflation genie that has been let out of the bottle in order to restore rates back to neutral as fast as possible.


This morning, the widely followed US 10-year Treasury yield climbed to fresh cycle highs at 2.83 percent. Surprisingly, higher real rates and inflation expectations were almost equally responsible for the rise. The latter indicates that the market believes there is still opportunity for the Fed to accelerate its rate of tightening.

Red hot US inflation incoming

The March CPI announcement in the United States takes center stage today.


The headline figure is predicted to rise by 1.2 percent month over month and 8.4 percent year over year. The core measure, which excludes the volatile food and energy sectors, is expected to increase by 0.5 percent month over month and 6.6 percent year over year. With the persistently high rate of monthly price hikes supporting the Fed's red alert inflation mode, all of these measurements will be new multi-decade highs.


This suggests that a substantial pullback in the current yield upswing is unlikely very soon. Even European bonds have fallen in value, with rates recently breaching critical levels ahead of the ECB meeting on Thursday. Yesterday, the 10-year German government bond touched its highest yield since 2015, at 0.78 percent. This was remained negative as of early March, demonstrating the bond markets' recent seismic shifts.

USD in pole position, stocks suffering

The sudden increase in rates, along with persistent geopolitical tensions and growing uncertainties about growth, caused stock markets to become more risk-averse.


The Nasdaq, which is heavily weighted in technology, has down more than 2%, with futures pointing to additional losses today.


This week, many large US banks report profits, kicking off the earnings season in earnest. Overall bank revenues are expected to decline by 10%, with investment banking fees falling by 26%, according to analysts.


Meanwhile, the King Dollar is benefiting from its safe-haven reputation as interest rates rise. The DXY broke beyond the 100-point barrier earlier today, as the euro struggled to hold on to its gains after the first round of voting in the French presidential election.


The USD/JPY, however, has been the FX pair most influenced by the long-end adjustment in bonds. Even the Japanese authorities' uncommon jawboning this morning hasn't deterred the persistent bidders in this major.


Most experienced traders believe that no real intervention will begin until 130, with the June 2015 high at 125.85 serving as the next resistance level to be overcome.

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