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HomePound jumps as Bank of England warns no interest rate cuts coming...

Pound jumps as Bank of England warns no interest rate cuts coming soon

Vladimir Putin’s war with Ukraine is putting the Russian economy under “considerable strain”, as Moscow grapples with hyperinflation, a falling ruble and soaring defense spending, a briefing says. new US statement.

The assessment argues that as a result of the war and sanctions imposed by the West, the Russian economy is now 5% smaller than before.

According to a draft statement prepared by the US Treasury and reported by the Financial Times, Moscow is now forced to spend more than $100bn (£79bn) on defense – around a third of its total spending. government.

At the same time, the stretched budget forced the country to limit public sector salary increases at a time when inflation remained at 7.5%.

The labor market is also extremely tight because of the number of Russians sent to war.

It is said to be the most comprehensive assessment of the damage caused by war and Western sanctions on the Russian economy to date and comes as some US lawmakers are wavering in their support. households send aid to Ukraine.

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What happened overnight

A strong recovery in the US yesterday took the Dow Jones industrial average of the top 30 US companies to a record after the Federal Reserve said interest rate cuts would scare investors. are looking forward to possibly taking place next year.

The Dow Jones index rose 1.4% to 37,000 and surpassed its previous peak of 36,799.65 since the beginning of last year.

The widely followed S&P 500 index rose 1.4% and was close to its own record. The Nasdaq Composite index, which is heavily weighted toward technology stocks, rose 1.4%.

US markets have been bullish since October amid hopes that cuts may be imminent, reducing business investment costs and encouraging consumer spending.

US Treasury yields fell after the Fed made a dovish announcement on its interest rate plan for next year. Benchmark 10-year bond yields fell to their lowest since August – reaching 4.0183%, from 4.206% late Tuesday.

Asian stocks rose sharply on Thursday, with the broadest index of Asia-Pacific shares outside Japan rising 1.8% – the biggest one-day percentage gain in a month.

Mainland China blue-chips rose 0.2%, while Hong Kong’s benchmark index rose 1.2%. Australian shares rose 1.6%.

However, Japan’s Nikkei index decreased by 0.7% due to the strong rise of the Yen.

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