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Samsung Electronics: We will continue to work hard and persist in sincere dialogue until the very last moment to prevent the worst-case scenario from occurring.On May 13, the Russian Ministry of Defense announced that the ceasefire agreement ended at midnight on May 11, and Russian armed forces continued special military operations. Russian forces struck Ukrainian military airfields, ammunition depots, fuel depots, and other targets in 56 areas, shooting down 108 fixed-wing drones. The General Staff of the Ukrainian Armed Forces reported on May 12 that 174 battles occurred in the front-line areas over the past day, with Ukrainian forces repelling Russian offensives on multiple fronts and shooting down 1,252 Russian drones.Japans March trade balance will be released in ten minutes.On May 13th, the head of Samsung Electronics Korean union stated that the company and the union failed to reach an agreement on wages on Wednesday, and a strike by over 50,000 employees is expected, potentially disrupting the production of artificial intelligence and other chips. Previously, under government mediation, the two sides held marathon negotiations lasting several hours on Monday and Tuesday. Union representative Choi Seung-ho stated that the company did not respond to the unions demands for reforming the compensation plan, including eliminating the current 50% bonus cap on annual base salary and instead calculating bonuses solely based on operating profit. The union had previously stated that if its demands were not met, employees would begin an 18-day strike starting May 21st. The union representative stated that there are currently no plans to restart negotiations with management before the strike date, but he is willing to consider a "reasonable proposal" from the company. The National Labor Relations Commission of Korea stated that it had proposed "multiple alternatives," but "given the significant differences in the positions of both sides and the unions request to suspend negotiations," it decided to end the mediation process.South Korea added only 74,000 jobs in April, the weakest performance since a year-on-year decrease of 52,000 in December 2024, following data released Wednesday by Statistics Korea. The job gains in February and March were both in the 200,000 range. The unemployment rate was 2.9%, unchanged from the same period last year. The number of unemployed was 853,000, a decrease of 2,000 year-on-year. By sector, employment in the health and social welfare services industry increased by 261,000 year-on-year, arts, sports and leisure-related services by 54,000, and real estate by 49,000. Employment in the science and technology services industry decreased by 115,000, and manufacturing by 55,000. Statistics Korea noted that the record decline in employment in the science and technology services industry since it was classified separately in 2013 is mainly due to the base effect of strong employment growth in previous years.

GBP/USD falls to around 1.2370 as the BoE considers taking swift action ahead of UK inflation and US purchasing managers' indices

Alina Haynes

Apr 17, 2023 13:53

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On Monday morning, the GBP/USD currency pair retested an intraday low of 1.2390 after extending Sunday's decline from a 10-month high. To provoke adverse after breaking a four-week uptrend, the Cable pair explains the most recent concerns emanating from the United Kingdom (UK) and the optimism surrounding the Federal Reserve (Fed).

 

According to the Financial Times (FT), "The Bank of England is considering a major overhaul of its deposit guarantee scheme, including increasing the amount covered for businesses and compelling banks to pre-fund the system to a greater extent to ensure faster access to cash when a lender collapses."  The revelation fuels banking concerns in the United Kingdom and places pressure on the Cable duo.

 

UK Chancellor Jeremy Hunt's concerns about US subsidies may also be exerting downward pressure on the GBP/USD exchange rate as British firms rush to claim benefits before leaving the country. According to the news, "Chancellor Jeremy Hunt warned Sky News that Britain should be wary of any new subsidies, warning that they could undermine the economy and possibly even spark a protectionist trade war."

 

A larger-than-expected decline in US retail sales was unable to offset positive data from US industrial production and the University of Michigan's (UoM) consumer confidence index from the previous day. Despite this, US retail sales decreased by 1.0% in March compared to the predicted -0.4% decline and February's -0.2% decline. As opposed to the 0.2% market consensus and previous reading, Industrial Production increased by 0.4% in the month in question. The preliminary result of the University of Michigan's (UoM) Consumer Confidence Index for April, which increased to 63.5 from 62.0 analysts' expectations and previous readings, was also encouraging. In addition, inflation forecasts for the next year increased from 3.6% in March to 4.6% in April, while inflation forecasts for the next five years decreased by 2.9% during the same month.

 

Notably, Fed officials have recently appeared more hawkish than their BoE counterparts, which has exerted additional pressure on the GBP/USD exchange rate.

 

In this environment, the S&P 500 Futures exhibit modest gains following Wall Street's pessimistic close, while bond yields remain unchanged following weekly increases.

 

Moving forward, the current week is crucial for GBP/USD speculators as it contains a variety of high-quality inflation, employment, and UK PMI data. These data may be used to support the Bank of England's (BoE) officials' waning hawkish inclination and may keep bears in play. However, the US PMIs and Fed discussions should not be disregarded when looking for clear guidelines.

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