Fulcrum Perspectives

An interactive blog sharing the Fulcrum team's policy updates and analysis, as well as book recommendations, travel observations, and cultural experiences - all of which we hope will be of interest to you.

Francis Kelly Francis Kelly

U.S. Financial Regulatory Week Ahead

March 4 - 8, 2024

This coming week will be momentous in the Washington regulatory world as the SEC finally unveils its long-awaited climate disclosure rules on Wednesday.  The new rules are designed to require corporations to disclose their carbon footprint in SEC filings.  Climate activists and the Biden Administration view these rules as the cornerstone of their climate strategy, while corporations dread the likely enormous scope of the reporting requirements and accompanying liabilities.

But in recent weeks, SEC Chair Gary Gensler appears to have scaled back the draft requirements, worrying climate activists he may have watered them down too much.  Whatever emerges Wednesday, business organizations are almost certain to file federal lawsuits challenging the proposals.  And considering the SEC’s track record in federal court under Chair Gensler, the betting line is not in the SEC’s favor (we are still trying to figure out when Congress gave the SEC authority to regulate carbon emissions – isn’t that the Environmental Protection Agency’s job?  Just asking…).

Also, this week, Federal Reserve Board Chair Jay Powell will give his semi-annual Monetary Policy Report before the House Financial Services Committee (on Wednesday) and the Senate Banking Committee (on Thursday).  Powell will undoubtedly be asked tough questions about the Fed’s proposed bank capital rules, which seem increasingly imperiled by opposition from a growing variety of critics – including two Fed Governors (Christopher Waller and Michelle Bowman), who have been quite outspoken in their criticism of the proposal.

Also this week, we will be listening closely as Federal Reserve Board Vice Chair for Supervision Michael Barr, Acting Comptroller of the Currency Michael J. Hsu, and FDIC Chairman Martin J. Gruenberg The 2024 National Interagency Community Reinvestment Conference where they will be defending the new Community Reinvestment regulations – which are also the target of a major lawsuit from banking and industry advocacy groups.  

Finally, it will be worth paying close attention to the Federal Trade Commission’s workshop entitled “Private Capital, Public Impact: An FTC Workshop on Private Equity in Health Care.” Department of Justice Assistant Attorney General for Antitrust Jonathan Kanter will also participate likely signals antitrust action by both regulators against the PE world, a longtime target of Progressive Democratic Senators led by Senator Elizabeth Warren (D-MA).

Below are all the significant public events we are looking at in the coming week:

Below are all the significant public events we are looking at in the coming week:

U.S. Congressional Hearings 

U.S. Senate

 

 

US Regulatory Meetings & Events

Interagency Meetings/Events

 

  • Wednesday & Thursday, March 6 & 7: Federal Reserve Board Chair Jay Powell delivers the Semiannual Monetary Policy Report to Congress before the House Financial Services Committee (Wednesday) and Senate Banking Committee (Thursday) - see above for each testimony video link.

Federal Reserve Board and Federal Reserve Banks

  

U.S. Treasury Department

  • No significant events are scheduled at this time.

  

Securities and Exchange Commission

 

Commodities Futures Trading Commission

 

  • Wednesday, March 6, 10:00 a.m. – The CFTC Global Markets Advisory Committee will meet.  They will discuss increased liquidity in U.S. Treasury markets and the upcoming transition to T+1 securities settlement. Additionally, Financial Stability Board Secretary General John Schindler will address the Committee to discuss Basel III.

 

  

FINRA

  • No significant events are scheduled at this time.

  

Federal Deposit Insurance Corporation

  

Office of the Comptroller of the Currency

  

The Consumer Financial Protection Bureau

  • Friday, March 8, 1:00 p.m. – The CFTC’s Spring 2024 Credit Union Advisory Council meets virtually. 

 

National Credit Union Administration

·       No significant events are scheduled at this time.

 

Federal Trade Commission & Department of Justice Antitrust Division

 

  • Wednesday, March 6, 9:00 a.m. – 5:00 p.m. – The FTC hosts its 8th Annual PrivacyCon 2024.  The conference brings together a diverse group of stakeholders, including researchers, academics, industry representatives, consumer advocates, and government regulators, to discuss the latest research and trends related to consumer privacy and data security. 

  

Farm Credit Administration

  • No significant events are scheduled at this time.

 

Farm Credit System Insurance Corporation

  • No significant events are scheduled at this time.

 

Import/Export Bank

  • No significant events are scheduled at this time.

     

World Bank

  • No significant events are scheduled at this time.

 

 

Trade Associations & Think Tank Events

 

Trade Association Events/Public Events

 

 

Think Tank Events

 

Please let us know if you have any questions or would like to be added to our email distribution list.

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Francis Kelly Francis Kelly

Recommended Weekend Reads

March 1 - 3, 2024

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list. 

Supply Chain Security

  • “How Russia’s Invasion of Ukraine Impacts Global Food Security”  Australian Strategic Policy Institute

    Russia and Ukraine are key suppliers to the global food market and together constituted 12% of global food trade between 2019 and 2021. However, since 2022, the export of grain, sunflower oil, and other products from Ukraine has been drastically cut by Russia’s blockade of the Black Sea ports. The Black Sea grain initiative was established to ensure the safe passage of grain from Ukraine, but Russia withdrew from the agreement. Blocking these exports has contributed to an increase in global crop and food prices, which were already higher than pre-COVID-19 levels. Higher food prices have worsened hunger and poverty around the world, with 345 million people now in immediate danger from acute food insecurity. In addition, disruptions in the Suez Canal due to attacks on ships in the Red Sea along with plummeting transits in the Panama Canal due to dwindling water levels from climate change-induced drought have compounded global food insecurity.

  • “Washington Tackles a New National Security Threat: Chinese Made Cranes”  Carnegie Endowment for International Peace

    Last week, the Biden Administration rolled out a coordinated set of efforts to mitigate cybersecurity risks to U.S. port infrastructure and supply chains. These plans included an ambitious international project to improve U.S. manufacturing competitiveness in a strategic sector: port equipment.  The primary and explicit motivation for these actions, according to national security officials, arises from the complex threat posed by the People’s Republic of China (PRC). However, even the fairly strong remedies proposed are likely to fall well short of the mark without extraordinary compliance from unenthusiastic commercial actors. There is also no timeline for producing a viable, technical substitute for China’s outsized role in U.S. maritime transport systems.

 

Critical Minerals

  • “Washington Wants to Revive a Critical Minerals Mega-Railway Through Africa”   Foreign Policy

    As geopolitical tensions electrify the global scramble for critical minerals—the raw materials that underpin advanced defense systems and clean energy technologies—the United States and China have been racing to expand their influence over the mineral market in Africa. In one of the most ambitious U.S. infrastructure bids in Africa yet, the Biden administration has pledged to lend hundreds of millions of dollars toward reviving the Lobito Corridor, a 1,200-mile-long railway that would transport critical minerals from the Democratic Republic of the Congo and Zambia to the Angolan coast. The DRC is home to the world’s biggest cobalt reserves, while Zambia is rich in copper. 

  •   “Critical Minerals: 5 Things to Watch in a Consolidation Year”   Control Risks

    Control Risks looks at the key trends that are likely to impact global supply-chain for critical minerals in 2024.  These include: 1) gigafactories will make demand estimates concrete, 2) trade controls will go global, 3) producing countries face a maturity test, 4) technology disruptions will shape new trends, and 5) risers and fallers: winners and losers will become clear.

 

Economic & Trade Policy 

  • “Will AI Save or Sink the U.S. Economy?”  Peterson Institute for International Economics

    It would seem that researchers and policymakers are counting on artificial intelligence tools to reverse the global productivity slowdown identified by many as the key element to foster higher future growth. But how confident can we be about that prospect? Not very, it turns out.  So the author turned ChatGPT-4 itself: How is AI going to improve labor productivity?  The answers were surprising.

  • “Climate Policy Reform Options in 2025”  National Bureau of Economic Research

    Abstract: With the expiration of many tax cuts and unmet climate targets, 2025 could be a crucial year for climate policy in the United States. Using an integrated model of energy supply and demand, this paper aims to assess climate policies that the U.S. federal government may consider in 2025 and to evaluate emissions reductions, fiscal costs and revenues, and household energy expenditures across a range of policy scenarios. Model results suggest that the emissions reductions of the Inflation Reduction Act are significantly augmented under scenarios that add a modest carbon fee or, to a lesser extent, that implement a clean electricity standard in the power sector. Second, net fiscal costs can be substantially reduced in scenarios that include a carbon fee, especially if fossil fuel exports are taxed. Third, expanding the IRA tax credits yields modest additional emissions reductions with higher fiscal costs. Finally, although none of the policy combinations across these scenarios achieve the U.S. target of a 50-52% economy-wide emissions reduction by 2030 from 2005 levels, the carbon fee and clean electricity standard scenarios achieve these levels between 2030 and 2035.

  • “Memo to the Fed: Stop the News Conferences”  Random Observations for Students of Economics/Greg Mankiw’s Blog

    Noted Harvard University Economics Professor Greg Mankiw argues that Fed Chair Jay Powell’s news conferences are the opposite of good economics communications and that he should stop.

 

China 

  • “China Isn’t Just Spending More; It’s Spending Smarter”  RealClearDefense

    China’s inflation-adjusted military spending is at least three times larger than it was in the year 2000 and by some counts is hundreds of millions of dollars larger than the official numbers suggest. Yet even these dramatic top-line estimates do not tell the whole story of China’s military rise because it has also increased efficiencies within its defense budget – meaning that, unlike the United States, China isn’t just spending more, it’s spending smarter.

 

Russia 

  • “Nuclear Destruction, The War’s Popularity, and Boosting Birth Rates”  Meduza

    News agencies around the world reported on Russian President Vladimir Putin’s nuclear threats made during his annual state of the nation speech before the Russian Duma.  But they did not report on what he spent more than half of his two-hour speech on: Domestic policy in general and, in great detail, how serious the demographic decline has become for Russia.  Putin announced a number of new initiatives aimed at boosting birth rates, including one program he calls “Family” which will spend close to a billion dollars just encouraging Russians to have children as well as special mortgage programs and “maternity capital” programs for the next seven years.  Currently, the Russian population is on track to decline by at least 10 percent over the next 20 years, per Russia’s Federal State Statistics Service.  Add to that the more than an estimated 300,000 war casualties, and the hundreds of thousands of draft-age Russian men who have fled the country, and the country is in a demographic free-fall.  

  • “Global Perspectives on Ending the Russia-Ukraine War”  Council of Councils

    The Council of Councils, an imitative of the Council on Foreign Relations seeing to connect leading foreign policy institutes in policy discussions and analysis,  published last week a memo where think tank scholars from 13 countries offered their thought-provoking and unique thoughts on how the Ukraine War could be brought to an end.

 

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Francis Kelly Francis Kelly

The Global Week Ahead

February 25 - March 3, 2024

Sunday, February 25, 2024

This coming week, there will be a keen global focus on the U.S. House of Representatives, which is returning to work after a ten-day break for two big reasons. First, the federal government will begin to shut down on March 1 unless the House can agree on a spending plan this week. Conservative Republicans oppose passing another short-term spending bill (as does Speaker of the House Michael Johnson (R-LA).

Secondly, tied up in this ongoing political drama is the question of what the House will do about passing a critical aid package for Ukraine (and Israel and Taiwan) to help shore up the beleaguered nation’s defenses in the face of a mounting Russian counter-attack. The same group of conservative House Republicans are opposed to voting on the package unless there are more robust U.S. border security measures than those negotiated by Republican and Democratic senators earlier this month.   As of this writing, a continued stalemate is likely on the U.S. budget and the Ukraine aid bill – which means a government shutdown is likely.

As uncertainty and concern grow over how to assist Ukraine, French President Emmanuel Macron has called an ad-hoc meeting of E.U. leaders in Paris on Monday to shore up E.U. support for Ukraine going forward. What comes out of that meeting may impact the U.S. House to speed up consideration of the Ukraine aid package. The meeting also comes the day before The E.U. presents its new Defense Industrial Strategy (EDIS) and European Defense Investment Program (EDIP). Both were developed to help restock and acquire new defense equipment and technology. 

Meanwhile, markets will watch the G20 Finance Minister and Central Bank Governor meetings in São Paul, Brazil, this week. Brazil is the chair of the G20 this year. But it is also a member of the BRICs, and Brazilian President Luiz Inácio Lula da Silva (“Lula”) is taking advantage of the meeting to gather the BRICS finance ministers and central bank governors together for their first-ever meeting just before the G20 meetings.  

Another major global meeting this week is the 13th Ministerial Conference (MC13) of the World Trade Organization (WTO), held in Abu Dhabi. With all the continuous chatter about the death of globalization and free trade, the meeting outcomes will be closely watched to see just how true or false that chatter has been.

Turning to the global economic radar screen, markets will be looking at the Fed’s favorite inflation measure, the PCE, to give some new indication of when the Fed may begin to lower rates. 

A number of Fed Governor speeches are scheduled this week, too, which may help guide markets a bit more on what to expect.  

In Asia, China releases PMI data, while Japan is scheduled to release CPI data. In Europe, Germany and France are scheduled to release PMI prints and major labor market data releases from across the Eurozone.

Here is what else we are watching around the world in the coming week:

Sunday, February 25, 2024:

Global

  • Israel is expected to send formal notification to the International Court of Justice in the Hague in response to a Court order last month in the wake of South Africa’s accusations Israel has committed genocide in its invasion of the Gaza Strip.

 

Americas

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Belarus holds parliamentary elections.

  • The EU Foreign Affairs Council (Trade) meets in Abu Dhabi through February 29.  The meeting will be held on the margins of the 13th Ministerial Conference (MC13) of the World Trade Organization (WTO), which will be held in Abu Dhabi, United Arab Emirates, from 26 to 29 February 2024.

  • Junior doctors in the UK begin a five-day walkout over pay.  They are expected to be back by midnight on February 29.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Israel Composite Economic Index

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

 

Monday, February 26, 2024 

Global

 

Americas

Political/Social Events –

  • The U.S. Senate will sit for the impeachment trial of Homeland Security Secretary Alejandro Mayorkas.  The eventual impeachment vote is widely expected to fail.

  • Argentina’s Union of State Employees (ATE) will have its transportation and health workers strike over the government's austerity program.

Economic Reports/Events –

  • Kansas City Federal Reserve Bank President Jeffrey Schmid to speak on the economic and monetary policy outlook before the Economic Club of Oklahoma City.

  • Canada Manufacturing Sales Prel (January)

  • Colombia Business Confidence (January)

  • USA New Home Sales (January), Dallas Fed Manufacturing Index (February), 3-Month, 6-Month, 2-Year, 5-Year Note Auction, Building Permits Final (January)

 

Asia

Political/Social Events –

  • China’s National People’s Congress Standing Committee will meet for two days to prepare the final agenda for the Congress’ annual meeting, which starts on March 5.  The agenda is expected to focus on the national budget, socio-economic development planning for 2024, and other domestic issues.

  • Thailand and the U.S. will hold the annual Cobra Gold military exercises, the longest-running military exercises in Southeast Asia.  More than 30 countries will participate and will involve more than 4,000 soldiers.

Economic Reports/Events –

  • Singapore Industrial Production (January)

 

Europe

Political/Social Events –

  • French President Emmanuel Macron will host a meeting of EU leaders in Paris to discuss Ukraine support and how the EU can further bolster aid.

  • The EU Agriculture and Fisheries Council meets in Brussels.  They are expected to exchange views on ways of ensuring rapid and structural responses to the current crisis that the agricultural sector is facing.  Farmers across the EU have been protesting over restrictive climate change requirements, competitive agricultural issues, and other matters for weeks.

  • There will be an informal meeting of the EU Gender Equality Ministers through February 27 in Brussels.

  • Czech Prime Minister Petr Fiala will meet Polish Prime Minister Donald Tusk in Prague, Czech Republic.

  • The Hungarian parliament reconvenes after a multiweek break and is expected to vote on Sweden’s NATO accession.

  • Verdi, one of Germany’s largest unions, has called for a nationwide six-day transport strike over wages.

  • The Mobile World Congress begins in Madrid, Spain, and goes through February 29.  It is the world’s biggest event focusing on mobile communications. Speakers include Vodafone chief executive Margherita Della Valle and Dell Technologies chair and CEO Michael Dell.

Economic Reports/Events –

  • ECB President Christine Lagarde participates in a plenary debate on the ECB Annual Report 2022 in Strasbourg, France.

  • Bank of England Deputy Governor Sarah Breeden opens the Bank of England Agenda for Research (BEAR) conference in London.

  • Spain PPI (January)

  • Ireland Construction Output (Q4)

  • Great Britain CBI Distributive Trades (February)

  • France 3-, 6-, 12-Month BTF Auction

 

Middle East

Political/Social Events –

  • Kuwait celebrates Liberation Day, marking the day the country was liberated from Iraqi occupation in 1999.

Economic Reports/Events –

  • Israel Interest Rate Decision

 

Africa

Political/Social Events –

  • Senegal will hold a national dialogue through Feb. 27 to reach an agreement on a new date for the country's postponed presidential election.

Economic Reports/Events –

  • Nothing significant to report.

 

 

Tuesday, February 27, 2024 

Global

 

Americas

Political/Social Events –

  • Michigan holds its 2024 presidential primary.

  • The Dominican Republic celebrates Independence Day, marking the day in 1844 the country gained independence from Haiti.

Economic Reports/Events –

  • Federal Reserve Vice Chair for Supervision Michael Barr gives a virtual speech on “Counterparty Credit Risk” at the Conference on Counterparty Risk Management.

  • Brazil BCB Focus Market Readout, Current Account (January), Foreign Direct Investment (January), IPCA mid-month CPI (February)

  • Mexico Balance of Trade (January)

  • USA Durable Goods Orders (January), Durable Goods Orders Ex Transportation, Defense, and Non-Defense (January), Redbook (Feb/24), S&P/CaseShiller Home Price DEC, House Price Index DEC, CB Consumer Confidence (February), Richmond Fed Manufacturing and Services Index (February), Dallas Fed Services Index, 7-Year Note Auction, API Crude Oil Stock Change (Feb/23)

  • Argentina Retail Sales DEC

 

Asia

Political/Social Events –

  • Hong Kong will announce its annual budget for 2024-2025.  Hong Kong’s Financial Secretary has predicted a deficit of more than $100 million HK dollars, double the initial estimates.  Analysts believe the deficit is a result of declining land values and smaller stamp duties.

Economic Reports/Events –

  • Japan Inflation Rate (January)

  • Malaysia PPI (January)

  • Vietnam Foreign Direct Investment (February)

  • Taiwan Export Orders (January), Current Account (Q4), M2 Money Supply (January)

  • Hong Kong Imports/ Exports/ Balance of Trade (January)

  • Singapore 20 Year Bond Yield, MAS 12- and 4-Week Bill Auction

 

Europe

Political/Social Events –

Economic Reports/Events –

 

Middle East

Political/Social Events –

  • Israel holds municipal elections.

  • Russian Deputy Prime Minister Alexander Novak is expected to travel to Tehran to participate in the Iran-Russia Intergovernmental Commission on Trade and Economic Cooperation.  The two countries may announce the signing of a deal creating a gas hub.

Economic Reports/Events –

  • Qatar GDP Growth Rate Q3

 

Africa

Political/Social Events –

  • Nigeria’s coalition of trade unions will protest nationally through February 28 over the rising cost of living.

Economic Reports/Events –

  • Zimbabwe Inflation Rate (February)

  • Nigeria Interest Rate Decision

 

 

Wednesday, February 28, 2024 

Global

 

Americas

Political/Social Events –

Economic Reports/Events –

  • Atlanta Federal Reserve Bank President Raphael Bostic to speak on monetary policy and the economy before the Greater North Fulton Chamber of Commerce, Fulton County, Georgia.

  • Boston Federal Reserve Bank President Susan Collins to speak and participate in a fireside chat before an event hosted by the Center for Business, Government, and Society at the Dartmouth College Tuck School of Business.

  • New York Federal Reserve Bank President John Williams to participate in a hybrid economic briefing organized by the Long Island Association.

  • Brazil IGP-M Inflation (February), Bank Lending (January)

  • Chile Unemployment Rate (January)

  • USA MBA 30-Year Mortgage Rate (Feb/23), MBA Mortgage Applications (Feb/23), MBA Mortgage Market Index (Feb/23), MBA Mortgage Refinance Index (Feb/23), MBA Purchase Index (Feb/23), GDP Growth Rate  2nd Est (Q4), GDP Price Index  2nd Est (Q4), Goods Trade Balance Adv (January), Retail Inventories Ex Autos  Adv (January), Wholesale Inventories  Adv (January), Core PCE Prices  2nd Est (Q4), GDP Sales  2nd Est (Q4), PCE Prices  2nd Est (Q4), Real Consumer Spending  2nd Est (Q4), EIA Crude Oil Stocks Change (Feb/23), EIA Gasoline Stocks Change (Feb/23), EIA Crude Oil Imports Change (Feb/23), EIA Cushing Crude Oil Stocks Change (Feb/23), EIA Distillate Fuel Production Change (Feb/23), EIA Distillate Stocks Change (Feb/23), EIA Gasoline Production Change (Feb/23), EIA Heating Oil Stocks Change (Feb/23), EIA Refinery Crude Runs Change (Feb/23), NY Fed Treasury Purchases 22.5 to 30 yrs, 17-Week Bill Auction, Fed Bostic Speech

  • Canada Current Account (Q4), Average Weekly Earnings DEC

  • Uruguay Unemployment Rate (January)

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Australia Construction Work Done (Q4), Monthly CPI Indicator (January), CoreLogic Dwelling Prices (February), RBA Payments System Board Meeting

  • New Zealand RBNZ Interest Rate Decision and Press Conference

  • Thailand Industrial Production (January), Retail Sales DEC

  • Japan Coincident Index Final DEC, Leading Economic Index Final DEC

  • Hong Kong GDP Growth Rate Final (Q4)

  • Sri Lanka Balance of Trade (January)

 

Europe

Political/Social Events –

Economic Reports/Events –

  • ECB President Christine Lagarde and ECB Board Member Cipollone will participate in the G20 Finance Ministers' and Central Bank Governors' meeting in São Paulo, Brazil.

  • ECB Board Member Elizabeth McCaul gives a keynote speech at an industry outreach conference on counterparty credit risk management (CCR) organized by the Federal Reserve Bank of New York in collaboration with the Basel Committee on Banking Supervision (BCBS) in New York

  • Bank of England Monetary Policy Committee member Catherine Mann speaks at the Financial Times’s Future Forum online event.

  • Turkey Balance of Trade Final (January), Economic Confidence Index (February), Exports and Imports Final (January)

  • Slovakia Business Confidence (February), Consumer Confidence (February)

  • Italy Business Confidence (February), Consumer Confidence (February), 10- and 5-Year BTP Auction

  • Switzerland Economic Sentiment Index (February)

  • Slovenia harmonized Inflation Rate (February), Retail Sales (January)

  • Euro Area Economic Sentiment (February), Consumer Confidence Final (February), Consumer Inflation Expectations (February), Industrial Sentiment (February), Selling Price Expectations (February), Services Sentiment (February), ECB McCaul Speech

  • Ireland Retail Sales (January)

  • Great Britain 7-Year Treasury Gilt Auction

  • Germany 15-Year Bund Auction

  • Spain Business Confidence (February)

  • Russia Unemployment Rate (January), Business Confidence (February), Corporate Profits DEC, Industrial Production (January), Real Wage Growth DEC, Retail Sales  (January), GDP  (January), GDP (December)

 

Middle East

Political/Social Events –

 

Africa

Political/Social Events –

  • The 56th session of the Economic Commission for Africa will take place in Victoria Falls, Zimbabwe. Ministers for finance and economic development, alongside central bank governors, will discuss Africa’s development agenda.

Economic Reports/Events –

  • Nothing significant to report.

  

 

Thursday, February 29, 2024

Global

  • It is Leap Day.

 

Americas

Political/Social Events –

  • U.S. Secretary of Defense Lloyd Austin will testify before the House Armed Services Committee to explain his recent secret hospitalization.

Economic Reports/Events –

  • Cleveland Federal Reserve Bank President Loretta Mester to speak on "Financial Stability/Regulation" before the Columbia University/Bank Policy Institute 2024 Bank Regulation Research Conference in New York.

  • New York Federal Reserve Bank President John Williams to participate in a moderated discussion before hybrid Citizens Budget Commission 92nd Annual Gala in New York.

  • Atlanta Federal Reserve Bank President Raphael Bostic to speak on the economic outlook, monetary policy and the state of the banking industry before the 2024 Banking Outlook Conference hosted by the Federal Reserve Bank of Atlanta.

  • Brazil Gross Debt to GDP (January), Nominal Budget Balance (January), Unemployment Rate (January)

  • Canada CFIB Business Barometer (February), GDP Growth Rate Annualized (Q4), GDP Implicit Price (Q4), 2-Year Bond Auction

  • Chile Copper Production (January), Industrial Production (January),  Manufacturing Production  (January), Retail Sales  (January)

  • Mexico Unemployment Rate (January)

  • USA Core PCE Price Index  (January), Personal Income  (January), Personal Spending  (January), Initial Jobless Claims (Feb/24), PCE Price Index  (January), Continuing Jobless Claims (February)/17, Core PCE Price Index  (January), Jobless Claims 4-week Average (Feb/24), Chicago PMI (February), Pending Home Sales  (January), EIA Natural Gas Stocks Change (Feb/23), Fed Bostic Speech, Fed Goolsbee Speech, Kansas Fed Composite Index (February), Kansas Fed Manufacturing Index (February), 4- and 8-Week Bill Auction, 15-, 30-Year Mortgage Rate (Feb/28), Fed Mester Speech

  • Colombia Cement Production (January), Unemployment Rate (January)

  • Uruguay Balance of Trade (January)

 

Asia

Political/Social Events –

Economic Reports/Events –

  • Bank of Japan Member of the Policy Board Hajime Takata gives a speech at a meeting with local business leaders in Shiga, Japan.

  • Japan Industrial Production Prel (January), Retail Sales (January), Foreign Bond Investment (Feb/24), Industrial Production Prel (January), Retail Sales (January), Stock Investment by Foreigners (Feb/24), 2-Year JGB Auction, Housing Starts (January), Construction Orders (January)

  • New Zealand ANZ Business Confidence (February)

  • Australia Housing Credit (January), Retail Sales Prel (January), Building Capital Expenditure (Q4), Plant Machinery Capital Expenditure (Q4), Private Capital Expenditure (Q4), Private Sector Credit (January)

  • Singapore Bank Lending (January), Export Prices (January), Import Prices (January), PPI (January), 6-Month T-Bill Auction

  • Vietnam Balance of Trade (February), Industrial Production (February), Inflation Rate (February), Retail Sales (February), Tourist Arrivals (February)

  • Philippines Budget Balance DEC

  • Malaysia M3 Money Supply (January)

  • Thailand Current Account (January), Private Investment and Consumption (January)

  • Taiwan GDP Growth Rate Final (Q4), Industrial Production (January), Retail Sales (January), Unemployment Rate (January)

  • Sri Lanka Inflation Rate (February)

  • India Government Budget Value (January), Infrastructure Output (January), GDP Growth Rate (Q4), Fiscal Year GDP Growth Final 2023-24

  • Pakistan Consumer Confidence (February)

 

Europe

Political/Social Events –

  • Russian President Vladimir Putin will give his annual address to the Russian Federal Assembly.   The speech is constitutionally required and will likely focus on the state of the Russian economy and the state of the War on Ukraine.

  • There will be an informal meeting of EU education ministers in Brussels through March 1.

  • In the UK, there will be a parliamentary by-election in Rochdale.

Economic Reports/Events –

  • France Non-Farm Payrolls (Q4), Private Non-Farm Payrolls Final (Q4), Inflation Rate Prel (February), GDP Growth Rate Final (Q4), Inflation Rate Prel (February), Harmonized Inflation Rate Prel (February), Household Consumption (January), PPI (January)

  • Germany Retail Sales (January), Unemployed Rate (February), Baden Wuerttemberg CPI (February), Bavaria CPI (February), Brandenburg CPI (February), Hesse CPI (February), North Rhine Westphalia CPI (February), Saxony CPI (February), Inflation Rate Prel (February), Harmonized Inflation Rate Prel (February)

  • Turkey GDP Growth Rate (Q4), MPC Meeting Summary, Foreign Exchange Reserves (Feb/23)

  • Hungary PPI (January)

  • Spain Inflation Rate Prel (February), Core Inflation Rate Prel (February), Harmonized Inflation Rate Prel (February), Current Account DEC

  • Switzerland GDP Growth Rate (Q4), KOF Leading Indicators (February)

  • Italy Industrial Sales DEC

  • Poland GDP Growth Rate Final (Q4)

  • Slovenia CPI (February), Inflation Rate (February)

  • Great Britain BoE Consumer Credit (January), Mortgage Approvals (February), Mortgage Lending (January), M4 Money Supply (January), Net Lending to Individuals (January), Nationwide Housing Prices (February)

  • Greece PPI (January), Retail Sales DEC

  • Ireland Harmonized Inflation Rate Prel (February)

  • Serbia GDP Growth Rate Final (Q4), Industrial Production (January), Retail Sales (January), Unemployment Rate (Q4)

  • Russia M2 Money Supply (January)

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Zimbabwe M3 Money Supply (January), Private Sector Credit (January), PPI  (January), Balance of Trade (January)

  • Nigeria Foreign Exchange Reserves (February)

  • Kenya Inflation Rate (February)

  • South Africa Budget Balance (January)

  

 

Friday, March 1, 2024

Global

  • Japan assumes the chair of the UN Security Council for the month of March.

  • Today is the first day of the meteorological spring (winter in the Northern Hemisphere is almost over!).

 

Americas

Political/Social Events –

Economic Reports/Events –

  • Federal Reserve Board Governor Christopher Waller responds to a paper entitled “Quantitative Tightening Around the Globe: What Have We Learned?” at the 2024 U.S. Monetary Policy Forum in New York.

  • Federal Reserve Board Governor Adriana D. Kugler gives a speech entitled “Pursuing the Dual Mandate”  at the 2024 Stanford Institute for Economic Policy Research Economic Summit, Stanford, California.

  • San Francisco Federal Reserve Bank President Mary Daly to participate in panel, "AI and the Labor Market" before the 2024 U.S. Monetary Policy Forum hosted by the Chicago Booth School of Business.

  • Atlanta Federal Reserve Bank President Raphael Bostic to speak on the economic outlook and real estate trends before the University of Florida's Kelley A. Bergstrom Real Estate Center 2024 Trends and Strategies Conference.

  • Brazil IPC-Fipe Inflation (February), GDP Growth Rate (Q4), S&P Global Manufacturing PMI (February)

  • Mexico Foreign Exchange Reserves (January), Business Confidence (February), S&P Global Manufacturing PMI (February), Fiscal Balance (January)

  • Chile IMACEC Economic Activity (January)

  • Canada S&P Global Manufacturing PMI (February)

  • USA S&P Global Manufacturing PMI Final (February), ISM Manufacturing PMI (February), ISM Manufacturing Employment (February), Michigan Consumer Sentiment Final (February), Construction Spending  (January), ISM Manufacturing New Orders/Prices (February), Michigan 5 Year Inflation Expectations Final (February), Michigan Consumer Expectations Final (February), Michigan Current Conditions Final (February), Michigan Inflation Expectations Final (February), Baker Hughes Oil Rig Count MAR/01, Baker Hughes Total Rigs Count MAR/01

  • Colombia Davivienda Manufacturing PMI (February)

  • Peru Inflation Rate (February)

  • Argentina Tax Revenue (February)

 

Asia

Political/Social Events –

  • South Korea celebrates Independence Movement Day, marking the day in 1919 when one of the first public displays of resistance against Japanese occupation occurred.

Economic Reports/Events –

  • New Zealand ANZ Roy Morgan Consumer Confidence (February), Building Permits (January)

  • Australia Judo Bank Manufacturing PMI Final (February), Commodity Prices (February)

  • Japan Unemployment Rate (January), Jobs/applications ratio (January), Jibun Bank Manufacturing PMI Final (February), Consumer Confidence (February)

  • South Korea Imports/ Exports/ Balance of Trade (February)

  • Indonesia S&P Global Manufacturing PMI (February), Inflation Rate (February), Tourist Arrivals (January)

  • Malaysia S&P Global Manufacturing PMI (February)

  • Philippines S&P Global Manufacturing PMI (February), PPI (January)

  • Taiwan S&P Global Manufacturing PMI (February), Consumer Confidence (February)

  • Thailand S&P Global Manufacturing PMI (February), Imports/ Exports/ Balance of Trade (January), Business Confidence (February)

  • Vietnam S&P Global Manufacturing PMI (February)

  • China NBS Non-Manufacturing, Manufacturing, & General PMI (February), Caixin Manufacturing PMI (February)

  • India HSBC Manufacturing PMI Final (February), Foreign Exchange Reserves (Feb/23),

  • Kazakhstan Tengri Partners Manufacturing PMI (February), Inflation Rate (February)

  • Hong Kong Retail Sales (January)

  • Pakistan Balance of Trade (February), Inflation Rate (February), Wholesale Prices (February)

 

Europe

Political/Social Events –

Economic Reports/Events –

  • Bank of England Chief Economist Huw Pill will give a speech at the Cardiff University Business School, Cardiff, UK.

  • Ireland AIB Manufacturing PMI (February), Average Weekly Earnings (Q4), Current Account (Q4)

  • Russia S&P Global Manufacturing PMI (February)

  • Turkey Istanbul Chamber of Industry Manufacturing PMI (February)

  • Hungary Balance of Trade Final DEC, GDP Growth Rate Final (Q4), HALPIM Manufacturing PMI (February)

  • Switzerland Retail Sales (January), procure.ch Manufacturing PMI (February)

  • Poland S&P Global Manufacturing PMI (February)

  • Spain HCOB Manufacturing PMI (February), New Car Sales (February)

  • Italy HCOB Manufacturing PMI (February), Unemployment Rate (January), Full Year GDP Growth 2024, Inflation Rate Prel (February), harmonized Inflation Rate Prel (February), Government Budget 2023, New Car Registrations (February)

  • France HCOB Manufacturing PMI (February)

  • Germany HCOB Manufacturing PMI (February)

  • Euro Area HCOB Manufacturing PMI (February), Inflation Rate (February), Unemployment Rate (January), CPI Flash (February)

  • Greece S&P Global Manufacturing PMI (February), Unemployment Rate (January)

  • Great Britain S&P Global Manufacturing PMI Final (February)

  • Ukraine Current Account (January)

 

Middle East

Political/Social Events –

  • Iran will hold elections for the 290-seat parliament and the 88-seat Assembly of Experts.  the Assembly of Experts serves to advise Supreme Leader Ayatollah Ali Khamenei.

  • Turkey will host the 3rd Antalya Diplomacy Forum.  More than 20 heads of state and 80 ministers will attend the event, which runs through March 3.   The theme of the forum is “Advancing Diplomacy in Times of Turmoil.”

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • The Russia-Tanzania Conference will be hosted by the Institute for African Studies of the Russian Academy of Sciences in Dar es Salaam. 

Economic Reports/Events –

  • Nigeria Stanbic IBTC Bank Nigeria PMI (February)

  • South Africa ABSA Manufacturing PMI (February), Total New Vehicle Sales (February)

 

 

 

Saturday, March 2, 2024 

Global

  • Nothing significant to report.

 

Americas

Political/Social Events –

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Singapore SIPMM Manufacturing PMI (February)

 

Europe

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Spain Unemployment Change (February)

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Today is Adwa Victory Day in Ethiopia, celebrating the country’s victory over Italy in 1896.

Economic Reports/Events –

  • Nothing significant to report.

 

Sunday, March 3, 2024

Global

  • Nothing significant to report.

 

Americas

Political/Social Events –

  • El Salvador holds local elections.

Economic Reports/Events –

  • Nothing significant to report.

 

Asia

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Europe

Political/Social Events –

  • Today is Bulgaria Liberation Day, celebrating the Treaty of San Stefano, recognizing the nation’s independence in 1879.

Economic Reports/Events –

  • Nothing significant to report.

 

Middle East

Political/Social Events –

  • Nothing significant to report.

Economic Reports/Events –

  • Nothing significant to report.

 

Africa

Political/Social Events –

  • Senegal has a constitutional deadline today to hold presidential elections (which they are likely to fail to do).

Economic Reports/Events –

  • Nothing significant to report.

 

 

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U.S. Financial Regulatory Week Ahead

February 26 - March 1, 2024

This coming week, Securities and Exchange Commission Chair Gary Gensler may unveil is long-awaited and highly controversial proposed disclosure requirements for greenhouse gas emissions by corporations.  The draft has been circulated to the other SEC Commissioners.  It was reported this past week some of the more ambitious elements of the proposal have been pulled but industry is still bracing for a tough set of proposals, which is likely to face an immediate federal court challenge.   Among the reported changes, Gensler has dropped a requirement for U.S.-listed companies to disclose Scope 3 emissions which are emissions emitted by a company’s supply chain and the consumption of its products by customers.

Also this week, the New York Fed, in collaboration with the Bank of International Settlements (BIS) and the Federal Reserve Board, are hosting a two-day conference on counterparty risk.  The event will be yet another effort by Federal Reserve Board Vice Chair Michael Barr to defend the Fed’s new bank capital rule.  Banking supervisors from Europe as well as a number of senior industry executives are going to participate.

Looking back at last week, it was a fairly quiet week as it was shortened in Washington by the President’s Day holiday.  But one major event of note was the Financial Stability Oversight Board (FSOC) meeting on Friday.  The readout from the meeting showed FSOC members were briefed on and had considerable discussions about the commercial real estate market and bank exposure.  Clearly, this is growing concern for regulators.

Additionally, SEC Chair Gary Gensler briefed the Council Chair on the SEC’s regulatory initiatives, including on the securities settlement cycle, central clearing and dealer registration, short-term funding markets, and private fund reporting.  

Below are all the significant public events we are looking at in the coming week:

U.S. Congressional Hearings 

U.S. Senate

  • There are no significant hearings or events scheduled at this time.

 

House of Representatives

  • There are no significant hearings or events scheduled at this time.

 

 

US Regulatory Meetings & Events

Federal Reserve Board and Federal Reserve Banks

  • February 27 -28 – The Federal Reserve Bank of New York, in collaboration with the Board of Governors of the Federal Reserve System and the Basel Committee on Banking Supervision at the Bank for International Settlement, will host a conference on counterparty credit risk management at the New York Fed.

  • February 27, 9:05 a.m. – Federal Reserve Vice Chair for Supervision Michael Barr gives a virtual speech on “Counterparty Credit Risk” at the Conference on Counterparty Risk Management.

  • March 1, 10:15 a.m. – Federal Reserve Board Governor Christopher Waller responds to a paper entitled “Quantitative Tightening Around the Globe: What Have We Learned?” at the 2024 U.S. Monetary Policy Forum in New York.

  • ·March 1, 3:30 p.m. PST - Federal Reserve Board Governor Adriana D. Kugler gives a speech entitled “Pursuing the Dual Mandate”  at the 2024 Stanford Institute for Economic Policy Research Economic Summit, Stanford, California.

 

U.S. Treasury Department

  • February 27 – March 2 – Treasury Secretary Janet Yellen will travel to São Paulo, Brazil, to participate in the G20 Finance Ministers and Central Bank Governors meetings and events on the sidelines and then will continue to Santiago, Chile, for bilateral engagements.  

 

Securities and Exchange Commission

  • February 27, 10:00 a.m. – The SEC hosts the Small Business Capital Formation Advisory Committee meeting.  The agenda can be found HERE.

  • February 29, 10:00 a.m. – The SEC holds a Closed Meeting.

  • March 1, 11:00 a.m. – The SEC holds its 2024 Investor Advocacy Clinic Summit in Washington, D.C. The agenda can be found HERE.

  

Commodities Futures Trading Commission

  • February 28, 11:30 a.m. – The CFTC holds a closed meeting.

  • February 29, 1:00 p.m. – CFTC Commissioner Kristin N. Johnson will participate in a fireside chat at FINRA’s DC office as a part of their Black History Month programming.

 

FINRA

  • February 29, 1:00 p.m. – FINRA hosts CFTC Commissioner Kristin N. Johnson will participate in a fireside chat at FINRA’s DC office as a part of their Black History Month programming.

 

Federal Deposit Insurance Corporation

  • There are no significant events scheduled at this time.

 

Office of the Comptroller of the Currency

  • There are no significant events scheduled at this time.

 

The Consumer Financial Protection Bureau

  • There are no significant events scheduled at this time.

 

National Credit Union Administration

  • There are no significant events scheduled at this time.

 

Federal Trade Commission & Department of Justice Antitrust Division

  • There are no significant events scheduled at this time.

 

Farm Credit Administration

  • There are no significant events scheduled at this time.

 

Farm Credit System Insurance Corporation

  • There are no significant events scheduled at this time.

 

Export/Import Bank

  • February 28, 3:00 p.m. – The ExIm Bank holds a virtual meeting to discuss EXIM policies and programs to provide competitive financing to expand United States exports and comments for inclusion in EXIM's Report to the U.S. Congress on Global Export Credit Competition.

 

World Bank/IMF

  • There are no significant events scheduled at this time.

 

 

Trade Associations & Think Tank Events 

Trade Association Events/Public Events

 

Think Tank Events

  • February 27, 8:00 a.m. – The Economic Club of Washington, D.C., holds a discussion with Marc Rowan, co-founder and CEO of Apollo Global Management Inc.

  • February 27, 1:00 p.m. – The Brookings Institution holds an event entitled “Meeting climate goals through tax reform.”  Senate Budget Committee Chairman Sheldon Whitehouse (D-R.I.) and Richard Rubin of the Wall Street Journal will have a fireside chat among other speakers.

  • February 27, 1:00 p.m. – The Brookings Institute holds a workshop entitled “Financial Markets Data and Research from the Commodity Futures Trading Commission.”   A number of senior CFTC economists will participate.

  • February 27, 1:00 p.m. – The Peterson Institute for International Economics holds a webcast entitled “World Bank Global Economic Prospects Report: The magic of investment accelerations.”  M. Ayhan Kose, deputy chief economist and director of the Prospects Group at the World Bank, and Kersten Stamm, an economist in the Prospects Group of the World Bank's Development Economics, will speak.

  • February 29, 1:00 p.m. – The Peterson Institute for International Economics holds a webcast entitled “Globalization, the US Economy, and Political Backlash.”  Lazard CEO Peter Orszag will speak.

 

 Please let us know if you have any questions or would like to be added to our email distribution list.

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Recommended Weekend Reads

February 23 - 25, 2024

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list.  Or sign-up for our Substack “Perspectives” to get our latest work:

China

  • “Tracking China’s Control of Overseas Ports”  Council on Foreign Relations Interactive Report

    This interactive map tracks China’s growing maritime influence through investments in strategic overseas ports. Users can plot the location of each port and view satellite images alongside detailed information on the share of Chinese ownership, the total amount of Chinese investment, and the port’s suitability for use by the Chinese military. China operates or has ownership in at least one port in every continent except Antarctica. Of the 101 projects, 92 are active, whereas the remaining 9 port projects have become inactive due to cancellation or suspension by the end of September 2023. Reasons for cancellation or suspension include environmental concerns, souring of political relations, financial problems, and security issues raised domestically and internationally. Suspended projects, such as China’s construction of the Khalifa Port in the United Arab Emirates, could resume construction.


Latin America

  • “Exporting Autocracy: China’s Role in Democratic Backsliding in Latin American and the Caribbean”  Center for Strategic and International Studies

    This report seeks to more fully enumerate the nature of China’s impact on democracy in Latin America and the Caribbean (LAC). It posits two independent but correlated mechanisms through which China contributes to democratic backsliding. First, the PRC propagates its model of authoritarian governance through its soft power engagements in media, education, and people-to-people diplomacy, as well as through its security assistance, which often features tools enabling mass surveillance and the curtailment of civil and political rights. Second, China protects regimes undergoing democratic backsliding by providing economic and diplomatic cover even as these governments become increasingly isolated from the rest of the international system, in effect extending these governments beyond their natural lifespan. Having recognized the specific risk vectors China’s engagement poses in LAC, the report seeks to articulate the beginnings of a democracy-first grand strategy for the United States to pursue. Such a strategy should proceed along the lines of the “insulate, curtail, compete” framework outlined in a previous CSIS report. 

    “Challenges to Sheinbaum’s Fiscal Policy”   Wilson Center’s Mexico Institute

    Claudia Sheinbaum Pardo leads the race for the Mexican presidency, yet the complex political and fiscal legacy of her predecessor, Andrés Manuel López Obrador (AMLO), represents both an advantage and a burden to her campaign. While she aims for the continuity of her mentor’s key policies in education, energy, and economic development, Mexico’s current fiscal landscape leaves doubts on how her programs might be funded, requiring careful consideration and strategic policymaking.

Economics

  • “Financial Markets’ Perceptions of the FOMC’s Data-Dependent Monetary Policy”  Federal Reserve Bank of Cleveland

    Abstract: Over the past ten years, the Federal Open Market Committee (FOMC) has repeatedly emphasized that future policy is data-dependent. In this Economic Commentary, we investigate how financial markets expected future interest rates to change with the release of new data on inflation and labor market conditions. We find that the surprises in economic indicators have a stronger effect on the 2-year Treasury yield than on the expected federal funds rate to be set in the next FOMC meeting. This implies that markets understand that under the data-dependent approach, policy decisions do not heavily rely on the most recent data or short-run fluctuations but, rather, rely more on the persistent trend of the economy. In addition, we observe that expected future interest rates have become more sensitive to surprises in inflation after 2022, suggesting that the FOMC’s determination to reduce inflation has been well-understood by the markets.

  • “Trade War and Peace: U.S. – China Trade and Tariff Risk from 2015 – 2050”  National Bureau of Economic Research Working Paper

    Abstract: We use the dynamics of U.S. imports across goods in the period around the U.S.-China trade war with a model of exporter dynamics to estimate the dynamic path of the probability of transiting between Normal Trade Relations and a trade war state. We find (i) there was no increase in the likelihood of a trade war before 2018; (ii) the trade war was initially expected to end quickly, but its expected duration grew substantially after 2020; and (iii) the trade war reduced the likelihood that China would face Non-Normal Trade Relations tariffs in the future. Our findings imply that the expected mean future U.S. tariff on China rose more under President Biden than under President Trump. We also show that the trade response to the trade war is similar to the response to the 1980 liberalization that initially granted China access to U.S. markets at NTR terms and was expected to be quickly reversed.

Energy Markets

  • “Sanctions on Russia and the Splintering of the World Oil Market”  American Enterprise Institute

    After the West’s imposition of sanctions on Russia’s oil industry, there is a larger share of world oil production under sanction than at any time in decades. Sanctions impose costs on Iran, Russia, and Venezuela by forcing them to sell oil below market prices. However, sanctions also provide benefits to countries that buy cheap oil. China, India, and Turkey have been major beneficiaries of cheaper oil. Sanctions also make oil markets less efficient and more opaque. Policymakers must calibrate current and future oil sanctions to maximize cost imposition on adversaries while limiting the extent to which they make oil markets more inefficient.

European Security Policy

  • “The future of European defense and security”   McKinsey & Company

    Much has been said and written about Europe’s urgent need to build up its defense capabilities.  But what does that exactly mean?  What precisely does the EU need to do and what challenges do EU governments, and the defense and security sectors face to achieve an effective level of defense?  McKinsey takes a deep dive to find those answers in this study.

Charts of the Week

How Russia Uses China to Get Around Sanctions

The Bell – a truly independent Russian economic news source – reports on how, since most leading economies placed tough sanctions on Russia following the invasion of Ukraine, Russian companies (and the Kremlin) have worked tirelessly to get around the sanctions.  And they have found China to be the best place to get much of what they need for home consumption – as well as obtaining a lot of products known as “dual purpose” items – e.g., for civilian and military use.

Russian imports from China reached a record $111 billion in 2023, according to Chinese customs data analyzed by The Bell — up 47% on 2022, and 65% higher than in 2021, the last full year before the invasion. 

High-tech goods are among the top three Chinese exports to Russia. That’s no surprise: under sanctions, many Russian companies had to find new sources of equipment, spare parts, electronics and vehicles. In 2023, Russia significantly increased its imports of computers from China, as well as compressors, machine tools and their spare parts, turbines, optical devices and other advanced manufacturing equipment. The Bell lays it out in these excellent charts below:

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Francis Kelly Francis Kelly

My Presentation to the Iowa Soybean Association and Interview with “The State of Soy” on India’s Promise

I was delighted to talk with Aaron Putze , Chief Officer, Strategy and Brand Management of the Iowa Soybean Association (ISA) following my recent presentation at the ISA. We spoke of the global markets for soy and how India - now the largest country in the world, having surpassed China this past summer - is likely to become a major market for the US.

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Francis Kelly Francis Kelly

The Global Week Ahead

February 18 - 26, 2024

The coming week is one of sad anniversaries and a likely major geopolitical inflection point in the Middle East.  It is also a big week the U.S. presidential campaigns as to whether or not former President Donald Trump can lock up the Republican nomination for president.

First, to the anniversary:  Saturday will be the second anniversary of Russia’s (second) invasion of Ukraine.  We say “second” to remind readers President Vladimir Putin first militarily invaded the Donbas and Crimean regions of Ukraine in 2014, annexing them under Russian control.  After signing the Minsk Agreements in 2015 to cease military actions against Ukraine, he then broke those agreements when he launched a full-scale invasion of Ukraine in 2022.

The major geopolitical inflection point we will be watching closely this week is Israel’s pending ground offensive against Hamas forces in Rafah, the last Palestinian refuge on the southern edge of the Gaza Strip.  Global leaders ranging from  President Joe Biden to numerous leaders who gathered at the Munich Security Conference this past weekend have strongly urged Israeli Prime Minister Benjamin Netanyahu to not press ahead with the assault, seeking ways to find a negotiated cease-fire in return for Israeli hostages held by Hamas.  As those negotiations have proven fruitless, it appears Netanyahu will press forward, likely to prove a turning point in Israeli-U.S. relations.

Staying on geopolitical events taking place this week, markets will watch closely as Brazil hosts a meeting of G20 foreign ministers in Rio de Janeiro.  Brazil is the chair of the G20 in 2024, and Brazilian President Lula da Silva (“Lula”) appears determined to use the opportunity to bring greater world focus on Southern Tier issues ranging from hunger to sustainable development to having a more significant say in global governance.  Over the weekend, Lula inflamed relations with Israel by comparing the military campaign in Gaza to the Holocaust.  The situations in Gaza, the Red Sea, and Ukraine will be keen discussion points.  But with Russian Foreign Minister Sergey Lavrov attending the meetings, any new resolutions among foreign ministers aimed either at Russia or Iran are likely to be blocked.

Also, this coming week, the E.U. is expected to deploy 700 soldiers – mainly from Germany, France, and Italy – to support further military operations in the Red Sea against Iranian-backed Houthi attacks on commercial shipping.  Germany already has a defense frigate participating in the joint operation with U.S. and U.K. naval ships.

Here in the U.S., the Republican Presidential Primary in South Carolina will be held Saturday.  Most observers see it as the last obstacle to former President Donald Trump’s path to renomination if he can beat former South Carolina Governor Nikki Hailey.  Current polls suggest Trump is well ahead of Hailey. 

The U.S. Congress is out of session for the Presidents Day holiday this week.   But when they return, they face yet another imminent deadline of March 1 to pass the 2024 budget – or another Continuing Resolution to keep the government open.  Additionally, House Republican leadership faces growing pressure also to take up and pass a $95 billion aid package for Ukraine, Israel, and Taiwan.  House Speaker Michael Johnson (R-LA) has said he does not intend to bring up the Senate-passed package for a vote unless it contains provisions providing greater security on the U.S. southern border.

Turning to the significant global economic and financial calendar this week, markets will focus on the release of the Federal Reserve’s meeting minutes on Wednesday and the European Central Bank’s minutes being released on Thursday.  Markets will also look at China’s monetary policy decision this Sunday before Chinese markets reopen Monday following the Lunar New Year holiday.  Otherwise, it is a relatively light economic release calendar this week. 

Below is what else we are watching around the world this coming week:

Sunday, February 18, 2024 

Global 

  • UN Secretary-General António Guterres travels to Doha, Qatar, for a follow-up meeting of Special Envoys from Member States and regional organizations on Afghanistan that he is convening on 18 and 19 February. The objective of the meeting is to discuss how to approach increasing international engagement in a more coherent, coordinated, and structured manner, including through consideration of the recommendations of the independent assessment on Afghanistan. Nothing significant to report. 

  

Americas 

Political/Social Events – 

  • US Secretary of Homeland Security Alejandro Mayorkas will travel to Vienna, Austria, to meet with People’s Republic of China (PRC) State Councilor and Minister of Public Security Wang Xiaohong.  Mayorkas and Wang will discuss cooperation on counternarcotics as a follow-up to the inaugural meeting of the U.S.-PRC Counternarcotics Working Group. They will also discuss efforts to counter child sexual exploitation and abuse and other law enforcement priorities.  

  • The Dominican Republican holds local elections. 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Asia 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Europe 

Political/Social Events – 

  • A bipartisan delegation of U.S. senators will visit Budapest, Hungary, in an attempt to convince Prime Minister Viktor Orban to ratify Sweden's NATO membership bid. The senators making the trip are Senator Jeanne Shaheen, co-chair of the Senate NATO Observer Group, member of the Committee on Foreign Relations and Committee on Appropriations; Senator Thom Tillis, co-chair of the Senate NATO Observer Group;

  • Senator Chris Murphy, member of the Committee on Foreign Relations and Committee on Appropriations; and Senator Chris Van Hollen, member of the Committee on Foreign Relations and Committee on Appropriations.

Economic Reports/Events – 

  • Nothing significant to report. 

  

Middle East 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Africa 

Political/Social Events – 

  • Gambia celebrates Independence Day, marking the date when the country was granted its independence from the UK in 1965. 

Economic Reports/Events – 

  • Nothing significant to report.  

 

Monday, February 19, 2024 

Global 

  

Americas 

Political/Social Events – 

  • The US observes President’s Day, a national holiday.  Markets are closed, as is the federal government.

  • Russian Foreign Minister Sergei Lavrov travels to Havana, Cuba for high-level talks. Lavrov will then travel on to Venezuela to meet with President Nicolas Maduro and Vice President Delcy Rodriquez in advance of Maduro’s expected visit to Russia sometime this spring.  Lavrov will also use the trip to Venezuela to meet with a high-level delegation of Bolivian diplomats. He will then travel to Rio de Janeiro, Brazil, to participate in the G20 Foreign Ministers meeting.

Economic Reports/Events – 

  • Brazil IBC-BR Economic Activity (December), Business Confidence Report (February), BCB Focus Market Readout 

  • Canada PPI Report (January), Raw Materials Prices (January) 

  • Paraguay Interest Rate Decision Report 

  

Asia 

Political/Social Events – 

Economic Reports/Events – 

  • China Current Account (Q4) 

  • New Zealand Composite PCI (January), Services PSI (January) 

  • Japan Machinery Orders (December), 52-Week Bill Auction 

  • Indonesia Property Price Index (Q4) 

  • Thailand Full Year GDP Growth, GDP Growth Rate (Q4) 

  

Europe 

Political/Social Events – 

  • The EU is expected to approve the launch of a naval task force, joining with US and UK naval forces, to protect shipping in the Red Sea from Houthi militant attacks.

commercial vessels.

  • European Commission President Ursula von der Leyen will launch her bid for a second term as EC President during an event hosted by her Christian Democratic Union party in Germany.

  • German Chancellor Olaf Scholz will meet South Korean President Yoon Suk Yeol in Berlin, Germany.  South Korea is seeking greater investment and trade opportunities in the EU and also is seeking greater German investment in South Korea.

  • The EU Foreign Affairs Council meets in Brussels. They are expected to discuss the situation in Gaza, the Ukraine War, the situation in the Sahel (and how to perhaps engage further with the region) and offer an exchange of views on Belarus. 

  • There will be an informal meeting of EU Tourism Ministers through February 20 in Brussels. 

Economic Reports/Events – 

  • Spain Balance of Trade (December), Consumer Confidence (January) 

  • Serbia CPI Report (January), Inflation Rate Report (January) 

  • Belarus GDP Report (January) 

  

Middle East 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Israel GDP Growth Annualized (Q4), Unemployment Rate Report (January) 

  • Oman Inflation Rate 

  • Qatar Inflation Rate (January) 

 

Africa 

Political/Social Events – 

Economic Reports/Events – 

  • Ivory Coast Inflation Report (January) 

  • Nigeria Unemployment Rate (Q3) 

  • Ethiopia Inflation Rate (January) 

 

 

Tuesday, February 20, 2024 

Global 

  • Nothing significant to report. 

  

Americas 

Political/Social Events – 

  • US Secretary of State Antony Blinken travels to Brazil to attend the G20 Foreign Ministers meeting.

  • In New York, the trial of ex-Honduran president Juan Orlando Hernandez on drug trafficking charges begins.

Economic Reports/Events – 

  • Canada Inflation Rate (January), CPI Median (January)  

  • USA CB Leading Index (January), 3-, 6-month, 52-week Bill Auction 

  • Argentina Balance of Trade (January) 

  • El Salvador Balance of Trade (January) 

 

Asia 

Political/Social Events – 

  • Indian Prime Minister Narendra Modi will visit Jammu and Kashmir, his first trip to the province since the 2019 abrogation of Article 370 of India's constitution, which granted Jammu and Kashmir a semi-autonomous status.

  • The INDUS X Conference will be held in New Delhi through February 21. Co-hosted by the US-India Business Council and the Society of Indian Defense Manufacturers in collaboration with the US Department of Defense and the Indian Ministry of Defense.  The conference is seen as a significant step toward further building and accelerating the strategic defense partnership between the US and India. INDUS-X stands for “US-India Defense Accelerator Ecosystem” and was first launched in 2023 in Washington, D.C. in advance of Indian Prime Minister Narendra Modi’s State Visit to the United States.

  • The Asia-Pacific Forum on Sustainable Development, hosted by the UN, will be held in Bangkok, Thailand. 

Economic Reports/Events – 

  • South Korea Consumer Confidence (February) 

  • Australia RBA Meeting Minutes 

  • China Loan Prime Rate (February) 

  • Japan 20-Year JGB Auction 

  • Malaysia Imports/ Exports/ Trade Reports (January 

  • Hong Kong Unemployment Rate (January) 

  • Singapore MAS 12- and 4-Week Bill Auction 

  • New Zealand Global Dairy Trade Price Index (Feb/20) 

  

Europe 

Political/Social Events – 

  • The EU-Georgia Association Council meets in Brussels. Chaired by the EU High Representative for Foreign Affairs and Security Policy Josep Borrell and Georgian Prime Minister of Georgia Irakli Kobakhidze, they are expected to discuss Georgia’s EU accession path, political dialogue and reform, trade, and conflict resolution.  

  • The EU General Affairs Council meets in Brussels. They will discuss the rule of law in Poland.

  • Polish farmers are expected to protest against EU measures to tackle climate change and the massive import of Ukrainian products.

  • Economic Reports/Events – 

  • Bank of England Governor Andrew Bailey testifies on the economy and monetary policy before the Parliament’s Treasury Committee.

  • Switzerland Balance of Trade (January) 

  • Euro Area Current Account (December), Construction Output (December) 

  • Greece Current Account (December) 

  • Italy Construction Output (December), Current Account (December) 

  • Poland Corporate Sector Wages (January), Employment Growth (January), Industrial Production (January), PPI (January) 

  • Great Britain 30-Year Treasury Gilt Auction 

  • Germany 2-Year Schatz Auction 

  • Turkey Central Government Debt Report (January) 

  • Slovakia Current Account (December), Unemployment Rate (January) 

  

Middle East 

Political/Social Events – 

  • Today is the anniversary of the Moroccan Arab Spring uprising.

Economic Reports/Events – 

  • Kuwait Inflation Rate (January) 

  • Oman Inflation Rate (January), M2 Money Supply (December), Total Credit (December) 

  • Israel Inflation Expectations (February) 

  

Africa 

Political/Social Events – 

  • The Cameroon–European Union Business Week will gather public and private sector stakeholders from both sides in Yaoundé, Cameroon.

Economic Reports/Events – 

  • South Africa Leading Business Cycle Indicator (December), Unemployment Rate (Q4) 

  • Mozambique GDP Growth Rate (Q4) 

 

 

Wednesday, February 21, 2024 

Global 

  

Americas 

Political/Social Events – 

  • U.S. House Select Committee on the Chinese Communist Party chair Mike Gallagher will lead a congressional delegation to visit Taiwanese President-elect William Lai in Taipei, Taiwan.

  • The Conservative Political Action Committee (CPAC) 2024 meeting takes place in Washington, D.C. through February 24.  Former President Donald Trump will speak as will former UK Prime Minister Liz Truss, Argentine President Javier Milei, and other conservative leaders.

Economic Reports/Events – 

  • Federal Reserve Board Governor Michelle Bowman speaks at the Exchequer Club of Washington, D.C. 

  • Atlanta Federal Reserve Bank President Raphael Bostic to give welcome remarks before the Airports Council International CFO Summit hosted by the Regional Economic Information Network (REIN) of the Federal Reserve Bank of Atlanta. 

  • Mexico Retail Sales (December) 

  • US Federal Reserve Board Open Market Committee Minutes, USA Mortgage Reports (Feb/16), MBA Purchase Index (Feb/16), Redbook (Feb/17), 17-Week Bill Auction, 2-Year FRN Auction, 20-Year Bond, API Crude Oil Stock Change (February) 

  • Canada New Housing Price Index (January), 10-Year Bond Auction  

  • Costa Rica Balance of Trade (January) 

  

Asia 

Political/Social Events – 

  • APEC holds a meeting of Deputy Finance Ministers and Deputy Central Bankers in Arequipa, Peru.

  • The Raisina Dialogue 2024 begins in New Delhi and runs through February 23.  The Dialogue is India’s premier geopolitical and geoeconomics conference.  

Economic Reports/Events – 

  • South Korea Business Confidence (February), PPI (January and Q4) 

  • New Zealand PPI Report (Q4) 

  • Japan Reuters Tankan (February), Imports/ Exports/ Balance of Trade (January) 

  • Australia Westpac Leading Index (January), Wage Price Index (Q4) 

  • Indonesia Interest Rate Decision, Loan Growth (January), Facility Rate (February), Lending Facility Rate (February) 

  • India M3 Money Supply (Feb/09) 

  • Thailand New Car Sales (January) 

  

Europe 

Political/Social Events – 

Economic Reports/Events – 

  • ECB Board Member Edouard Fernandez-Bollo participates in a roundtable discussion entitled "Sustainability risks in the banking sector" at EUROFI High-Level Seminar 2024, organized in association with the Belgian Presidency of the Council of the EU in Ghent, Belgium. 

  • ECB Board Member Anneli Tuominen participates in a panel discussion entitled "Cyber and digital operational resilience: key pending issues (DORA CTPP oversight, EU and international cyber initiatives, digital infrastructure…" at EUROFI High-Level Seminar 2024 organized in association with the Belgian Presidency of the Council of the EU in Ghent, Belgium.

  • Bank of England Member of the Monetary Policy Committee Swati Dhingra gives a speech at the Market News International Connect event entitled “Recent BoE Projections – Key Factors/Judgments” in London.

  • ECB Non-Monetary Policy Meeting, Euro Area New Car Registrations (January), 3- and 6-Month Auction, Consumer Confidence Flash (February) 

  • Turkey Consumer Confidence (February) 

  • Great Britain Public Sector Net Borrowing (January), 5-Year Treasury Gilt Auction, CBI Industrial Trends Orders (February) 

  • Germany 10-Year Bund Auction 

  • Ireland Residential Property Prices (December) 

  • Slovenia Unemployment Rate (December) 

  • Russia PPI (January) 

  

Middle East 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Saudi Arabia Imports/ Exports/ Balance of Trade (December) 

  • Lebanon Inflation Rate (January) 

  • Qatar M2 Money Supply (January), Total Credit Growth (January) 

  

Africa 

Political/Social Events – 

  • The second edition of Africa’s Green Economy Summit will be held in Cape Town, bringing together investors, African leaders, and policy-makers.

Economic Reports/Events – 

  • South Africa Inflation Rate (January), 2024/2025 Budget 

 

 

Thursday, February 22, 2024 

Global 

  • The UN Security Council is scheduled to hold a briefing, followed by consultations on the Middle East. 

  

Americas 

Political/Social Events – 

  • Newly re-elected Salvadoran President Nayib Bukele travels to the US to speak at the Conservative Political Action Conference (CPAC) in Maryland.

  • The IM-1 lunar lander, designed by Intuitive Machines, the first privately financed mission to the moon, is scheduled to land on the lunar surface today.

St. Lucia celebrates Independence Day.

Economic Reports/Events – 

  

Asia 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • New Zealand Imports/ Exports/ Balance of Trade (January) 

  • Australia Judo Bank Services PMI Flash (February) 

  • Japan Foreign Bond Investment, Jibun Bank PMI Flash, 3-Month Bill Auction 

  • South Korea Interest Rate Decision 

  • New Zealand Credit Card Spending (January) 

  • Indonesia Current Account (Q4) 

  • India HSBC Composite PMI Flash (February), Monetary Policy Meeting Minutes, HSBC PMI Flash (February) 

  • Hong Kong Consumer Price Index CPI (January), Inflation Rate (January) 

 

Europe 

Political/Social Events – 

Economic Reports/Events – 

  • ECB Board Member Edouard Fernandez-Bollo participates in a roundtable discussion entitled "Diversity in the EU banking system: contribution to financing needs, future challenges and way forward" at EUROFI High-Level Seminar 2024, organized in association with the Belgian Presidency of the Council of the EU in Ghent, Belgium. 

  • ECB Board Member Anneli Tuominen participates in a panel discussion entitled "EU bank crisis management framework: can an agreement be achieved for medium-sized banks?" at EUROFI High-Level Seminar 2024, organized in association with the Belgian Presidency of the Council of the EU in Ghent, Belgium. 

  • ECB Monetary Policy meeting minutes released. 

  • Hungary Gross Wage (December) 

  • France Business Confidence (February), Business Climate Indicator (February), HCOB Composite PMI Flash (February) 

  • Slovakia Harmonized Inflation Rate (January) 

  • Germany HCOB PMI Flash (February) 

  • Italy Inflation Rate Final (January) 

  • Poland Retail Sales (January), M3 Money Supply (January) 

  • Slovenia Consumer Confidence (February) 

  • Great Britain S&P Global PMI Flash (February), Consumer Confidence (February), Car Production (January) 

  • Euro Area Inflation Rate (January), CPI Final (January), Eurogroup Meeting, HCOB PMI Flash 

  • Ireland Wholesale Prices (January) 

  • Serbia PPI (January) 

  • Turkey TCMB Interest Rate Decision, Overnight Borrowing and Lending Rate (February), Foreign Exchange Reserves (Feb/16) 

  • Ireland Consumer Confidence (February) 

  

Middle East 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Israel Manufacturing Production (December), Manufacturing PMI (January) 

  

Africa 

Political/Social Events – 

  • Algeria celebrates the National Day of Fraternity and Cohesion, marking the anniversary of the protests that united the country in 2019.

Economic Reports/Events – 

  • Nigeria GDP Growth Rate (Q4) 

  • Ghana PPI (January)  

 

Friday, February 23, 2024 

Global 

  • The UN General Assembly will hold its 56th plenary meeting. On the agenda is the situation in the temporarily occupied territories of Ukraine.    

  • The UN Security Council is scheduled to hold a briefing on Ukraine. UN Secretary-General António Guterres is expected to deliver remarks.   

  

Americas 

Political/Social Events – 

  • US Secretary of State Antony Blinken meets with Argentinian President Javier Milei in Buenos Aires.

  • Guyana celebrates Republic Day.

Economic Reports/Events – 

  • Brazil FGV Consumer Confidence (February), Federal Tax Revenues (January) 

  • Chile PPI (January) 

  • Canada Budget Balance (December), Manufacturing & Wholesale Sales MoM Prel (January) 

  • Argentina Consumer Confidence (February), Leading Indicator (January) 

  • Mexico Current Account (Q4) 

  • Paraguay PPI (January) 

  • USA Baker Hughes Total Rigs Count (Feb/23) 

Asia 

Political/Social Events – 

  • Today is the Emperor’s Birthday in Japan. It is a public holiday, and financial markets are closed.

Economic Reports/Events – 

  • New Zealand Retail Sales (Q4) 

  • China House Price Index (January), FDI (YTD) (January) 

  • Indonesia M2 Money Supply (January) 

  • Malaysia Inflation Rate (January), Leading Index (December) 

  • Singapore Inflation Rate (January), CPI (January) 

  • Kazakhstan Interest Rate Decision  

  • India Foreign Exchange Reserves (Feb/16), Deposit Growth (Feb/09), Bank Loan Growth (Feb/09) 

  

Europe 

Political/Social Events – 

  • Russia celebrates Defender of the Fatherland Day (also known as Men’s Day due to compulsory military service for most Russian men).  Financial markets are closed.

Economic Reports/Events – 

  • ECB President Christine Lagarde participates in the Eurogroup meeting in Ghent, Brussels. She will hold a press conference afterward. Later, she will participate in an informal ECOFIN meeting. 

  • ECB Member Isabel Schnabel gives a lecture entitled "Has the fight against inflation been won?" at Bocconi University in Milan, Italy. Later in the day, she gives a speech at Forum Analysis in Milan. 

  • ECB Member Kerstin af Jochnick participates in a panel discussion entitled "European financial stability: what are the main emerging risks? (strains from indebtedness, banking risks …)?" at EUROFI High-Level Seminar 2024 organized in association with the Belgian Presidency of the Council of the EU in Ghent, Belgium. 

  • Euro Area Consumer Inflation Expectation (January)  

  • Germany GDP Growth Rate Final (Q4), Ifo Expectations (February), Ifo Current Conditions (February), Ifo Business Climate (February) 

  • Turkey Capacity Utilization (February), Business Confidence (February), Tourist Arrivals (January) 

  • Hungary Unemployment Rate (January) 

  • Switzerland Non-Farm Payrolls (Q4), Industrial Production (January) 

  • Poland Unemployment Rate (January) 

  • Slovenia Tourist Arrivals (January), PPI (January), Business Confidence (February) 

  • Italy BTP Short-Term and Index-Linked Auction  

  • Belarus Industrial Production (January) 

  

Middle East 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Africa 

Political/Social Events – 

  • Nothing significant to report.

Economic Reports/Events – 

  • Nothing significant to report. 

 

 

Saturday, February 24, 2024 

Global 

  • Today is the 2nd anniversary of Russia’s invasion of Ukraine. 

  

Americas 

Political/Social Events – 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Asia 

Political/Social Events – 

  • Cambodia Senate Elections are held. 58 seats are up for election, and 49 are expected to go to the ruling Cambodian People’s Party and nine to the opposition Candlelight Party.

  • Taiwan Semiconductor Manufacturing Co. will open its first Japan factory in the southwestern prefecture of Kumamoto. The world's biggest chip foundry wants to shift production away from Taiwan amid growing geopolitical uncertainties.  

  • In Taiwan, the Lantern Festival is celebrated, marking the end of the country’s lunar new year.

Economic Reports/Events – 

  •   Nothing significant to report. 

 

Europe 

Political/Social Events – 

  • The EU will likely announce a new round of sanctions on Russia-linked entities before the second anniversary of the invasion of Ukraine.

  • Today is Estonia's Independence Day.

  • Belarus Parliamentary Election  

Economic Reports/Events – 

  •   Nothing significant to report. 

 

Middle East 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Africa 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Nothing significant to report. 

 

Sunday, February 25, 2024 

Global 

  • Nothing significant to report. 

  

Americas 

Political/Social Events – 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Asia 

Political/Social Events – 

  • Cambodia holds legislative elections.  

Economic Reports/Events – 

  • Nothing significant to report. 

  

Europe 

Political/Social Events – 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Middle East 

Political/Social Events – 

  • Today is Kuwait National Day.

Economic Reports/Events – 

  • Israel Composite Economic Index (January) 

  

Africa 

Political/Social Events – 

  • Nothing significant to report. 

Economic Reports/Events – 

  • Nothing significant to report. 

  

Please let us know if you have any questions or if we can be helpful in any way.

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Francis Kelly Francis Kelly

U.S. Financial Regulatory Week Ahead

February 19 - 23, 2024

The coming week is short in Washington, with Monday being a federal holiday (Presidents Day).   The U.S. Senate and House of Representatives are out of session for the week, and federal regulators have a light schedule.

But we will be watching one significant event this coming week:  The Financial Stability Oversight Council (FSOC) will meet this coming Friday.  The preliminary agenda for the executive session includes the Securities and Exchange Commission’s regulatory agenda; recent banking and commercial real estate developments; the Consumer Financial Protection Bureau’s proposed rule to define larger participants of a market for general-use digital consumer payment applications; the Council’s priorities for 2024; and the Office of Financial Research’s work to collect data on non-centrally cleared bilateral repurchase agreement transactions.

Looking back at events from last week, the Federal Reserve, FDIC, and OCC released their economic scenarios for their 2024 stress testing.  Stress testing requires banks to have between $10 billion and $250 billion to undergo the supervisory scenarios.

Also last week, the markets sat up and paid close attention to Federal Reserve Vice Chair for Supervision Michael Barr’s speech at Columbia University School of Law when he addressed the Fed’s focus on commercial real estate risk.  Barr said the Fed is “closely focused” on how commercial real estate risk is being managed by banks.  Coming nearly one year after Silicon Valley Bank failed due to unrealized real estate losses, Barr’s comments suggested what many have expected: likely downgrades of confidential bank health ratings and Fed disciplinary actions.

Speaking of the FDIC, the Special Committee of the FDIC’s Board of Directors overseeing an independent third-party review of the agency’s workplace culture issued an interesting statement on Thursday.  Reminding readers of the investigation and that the law firm of Cleary Gottlieb was managing the independent review, the statement said, “...more than 350 people have contacted” Cleary Gottlieb.  Our view is that even a fraction of that number of serious complaints will not be good for FDIC Chair Marty Gruenberg or the agency overall. 

Below are all the significant public events we are looking at in the coming week:

U.S. Congressional Hearings

 

U.S. Senate

  • The Senate is out of session this week.

 

House of Representatives

  • The House of Representatives is out of session this week.

 

US Regulatory Meetings & Events 

Federal Reserve Board and Federal Reserve Banks

 

U.S. Treasury Department

  • February 16 – 22: Treasury  Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson will travel to Europe to coordinate with European allies on further efforts to deny Russia the resources it needs to prosecute its unjust war.  He will visit Munich, Germany; Brussels, Belgium; and Paris, France. 

  • February 23: The Financial Stability Oversight Council (FSOC) will meet. The preliminary agenda for the executive session includes the Securities and Exchange Commission’s regulatory agenda; recent banking and commercial real estate developments; the Consumer Financial Protection Bureau’s proposed rule to define larger participants of a market for general-use digital consumer payment applications; the Council’s priorities for 2024; and the Office of Financial Research’s work to collect data on non-centrally cleared bilateral repurchase agreement transactions.

 

Securities and Exchange Commission

  • There are no significant events scheduled at this time.

 

Commodities Futures Trading Commission

  • February 20, 4:30 a.m. EST/10:30 a.m. GMT+1 – CFTC Commissioner Caroline D. Pham will speak at a roundtable of the American Chamber of Commerce to the European Union on AI in financial services in Brussels, Belgium.

  • February 20, 7:00 a.m. EST/1:00 p.m. GMT+1 – CFTC Commissioner Caroline D. Pham will participate by video in a Hogan Lovells panel discussion on “Regulatory Challenges in Artificial Intelligence in Financial Services.”  Her remarks will be virtual to the event, which is being held in Rome.

  • February 20, 11:00 a.m. EST/5:00 p.m. GMT+1 – CFTC Commissioner Caroline D. Pham will speak on a panel: “Can we build a globally harmonized regime? An international perspective” at the European Parliament and the Global Blockchain Business Council seminar: “The Future of the Digital Finance Strategy of the EU: A Global Perspective” in Brussels, Belgium.

  • February 23, 12:30 p.m. – CFTC Commissioner Kristin N. Johnson will deliver the keynote address at the New York City Bar Emerging Technologies Symposium in New York.

 

FINRA

  • There are no significant events scheduled at this time.

 

Federal Deposit Insurance Corporation

  • There are no significant events scheduled at this time.

 

Office of the Comptroller of the Currency

  • There are no significant events scheduled at this time.

 

The Consumer Financial Protection Bureau

  • There are no significant events scheduled at this time.

 

National Credit Union Administration

  • There are no significant events scheduled at this time. 

Federal Trade Commission & Department of Justice Antitrust Division

·       February 20, 11:30 a.m. – The Federal Trade Commission holds a Closed Commission meeting.

 

Farm Credit Administration

  • There are no significant events scheduled at this time.

 

Farm Credit System Insurance Corporation

  • There are no significant events scheduled at this time.

 

Import/Export Bank

 

World Bank

  • There are no significant events scheduled at this time.

 

 

Trade Associations & Think Tank Events

Trade Association Events/Public Events

Think Tank Events

Please let us know if you have any questions or would like to be added to our email distribution list.

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Francis Kelly Francis Kelly

Breakfast with Lech Walesa

One of the Greatest Leaders of the 20th Century Reminds Us to have Solidarity with the Cause of Freedom and Liberty

Last week, I was asked to join a small breakfast with Lech Walesa, the former President of Poland, Nobel Peace Prize laureate, leader of the Polish Solidarity Movement which smashed Communism in Poland and set in motion the demise of the Soviet Union, and, at his core, a hard-working union leader from the docks of Gdańsk Shipyard. Walesa was in town to encourage the U.S. Congress to approve aid to Ukraine - something the Republican Leadership of the House of Representatives seems loath to do.

Walesa came with dire warnings of Russia’s intent (does anyone know better the strain of dictatorial rule that now occupies the Kremlin? What the malign effect a die-hard former KGB agent is having on his country, Eastern Europe, and the world? It is worth noting Putin has put a $5 million price on Walesa’s head - quite a bounty on a man who is 82 years old and long out of power. But I should not say out of power - Walesa will always have extraordinary power because he is a Man of the Truth, a Man who only speaks the Truth, a man determined we all listen to the Truth.

That Truth is we must understand Putin’s intention is not just Ukraine. It is regain what was lost when the ossified Soviet Union fell - the Baltics, Moldova, Georgia, likely Romania and Bulgaria. Whatever he can take by force. And why? Because Russia is now a dying country. The demographics grimly bear that fact out as the young of Russia see no point in having children - or for that matter, staying in Russia. Migration figures are stunning (example: More than 100,000 computer experts/specialists/scientists left Russia in 2022 alone. That is not a brain drain - that is a complete brain disappearance).

For me, the breakfast was quite emotional at times. Walesa spoke of his “friends” Ronald Reagan and St. John Paul II - titans of the last century who left us all an glowing example of leadership and courage to stand up to sheer evil, to never cower, and to trust God will lead us to victory.

God bless Lech Walesa and all those brave Polish dock workers who stood - unarmed and alone - against the Evil Empire. They didn’t just save Poland - they saved the world. It would be good if we all stopped to listen to Walesa’s message today and remember - indeed, embrace and take up — the courage he, Reagan, and St. John Paul II exhibited.

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Francis Kelly Francis Kelly

Recommended Weekend Reads

February 16 - 18 2024

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list. 

 

The Middle East

  • “Inside Johnny Depp’s Epic Bromance with Saudi Crown Prince MBS”  Vanity Fair

    With his willingness to spend billions of dollars in a relentless drive to transform his country into a cultural and economic superpower, Saudi Deputy Crown Prince Mohammed Bin Salman (MBS), is shaking up the world order. To decipher his increasingly consequential moods, methods, and moves, global leaders rely on thousands of diplomats, linguists, and spies. They should probably just call actor Johnny Depp. Over the past year, Depp has spent more than seven weeks in Saudi Arabia, staying in royal palaces and camps, traversing the country by yacht and helicopter, and even flying to London and back on MBS’s personal 747 for a quick trip to attend the Jeff Beck Memorial Concert at the Royal Albert Hall. In that time, Depp and MBS have become real friends. “They made a genuine connection,” says a friend of Depp’s. “It’s a shock to many of the people who know [Depp], but it’s what happened.” Insiders say Depp is now weighing a seven-figure annual contract to promote Saudi Arabia’s cultural renaissance.

 

  • “Troubled Waters in Conflict and a Changing Climate: Transboundary Basins Across the Middle East and North Africa”  Malcolm Kerr Carnegie Middle East Center

    North Africa is home to key transboundary water basins with significant differences in their rivers’ capacities to cope with drought, rising temperatures, and increasingly limited water supplies. Climate change adds a layer of insecurity, as it is causing protracted droughts, lower yields of food crops, sea-level rises, greater frequency and intensity of sand and dust storms, accelerated desertification, reduced snowpack, and increased human displacement from low-lying coastal areas. All of this has become quite evident in the region. The eastern Mediterranean experienced protracted droughts during the 2000s, and predictions of rising temperatures and decreasing precipitation have been borne out in recent years.  Indeed, extreme summer heat waves were recorded across the eastern Mediterranean and beyond in 2020 and 2021, with Iraq and several Gulf countries experiencing temperatures that surpassed 50 degrees Celsius (122 degrees Fahrenheit). Flooding displaced people and caused damage in Egypt in 2020, and wildfires spread through parts of Lebanon and Syria in 2019 and 2020. As droughts increase in intensity and frequency, water resources, food security, and food production are adversely affected. The problem is exacerbated by unsustainable practices such as wasteful irrigation and the depletion of groundwater aquifers.

     

China

  • “The increasing challenge of obtaining information from Xi’s China”  Merics

    The online availability of crucial information on contemporary China is under threat. While the government is becoming less forthcoming in sharing information with the public, they are also requiring third-party data providers to implement restrictions on foreign access. This increases challenges in assessing China’s future development in key fields for companies, governments, and researchers alike. Geopolitical tensions are a principal driver behind the disappearing data. China’s authorities are concerned that online information can be used in ways to harm its development or discredit its policies. Controlling the sources foreign observers can use to study and analyze the country is one way for Beijing to control the narrative. Still, non-geopolitical considerations are also at play. Internet bottlenecks, concerns about personal information protection, and even the discretion of individual webmasters are adding to the risks of information disappearing. 

 

  • “China’s Pathfinder Update: Lack of Policy Solutions in Second Half of 2023 Belies Official Data”  Rhodium Group

    Through the second half of 2023, the gap between China’s impressive official data and visibly underwhelming consumer demand, unresolved local government debt problems, and an unprecedented drop in foreign direct investment was stark. The China Pathfinder framework scans for evidence of market policy reorientation to fix these problems. But in this coverage period (July–December 2023), Beijing’s response was limited. Officials redoubled efforts (and incentives) to encourage foreign investment and trade, pledged to loosen cross-border data transfer rules, and increased deficit spending limits to stoke anemic demand. China’s government also simultaneously threatened economists with consequences for even talking about bearish signals and discontinued unflattering economic data, severely aggravating credibility concerns. Policymakers did next to nothing to tackle the real structural problems. Though we expect the severity of 2022–23 declines to set China up for a modest cyclical rebound in 2024, long-term growth potential will disappoint until fundamentals are addressed.

  

Estonia/Baltic Security/Russia

  • “International Security and Estonia 2024”  Estonian Foreign Intelligence Service

    In their 9th annual report, the Estonian Intelligence Service reports make clear the country is increasingly concerned about Russian military aggression against the NATO member nation and the greater Baltic region if Ukraine is defeated.  It goes on to “focus on China and Russia’s relationship and their common opposition to the West, even though China’s plans are much more global and longer term than those of Russia, which is preoccupied with its war. China’s ambitions to reshape the rule-based world order are exemplified by its efforts to build a technological ecosystem on Chinese terms, aiming to create deliberate dependencies.”

U.S. Economics

  • “Has Intergenerational Progress Stalled? Income Growth Over Five Generations of Americans”  Federal Reserve Board’s Finance and Economics Discussion Series

    Abstract: We find that each of the past four generations of Americans was better off than the previous one, using a post-tax, post-transfer income measure constructed annually from 1963-2022 based on the Current Population Survey Annual Social and Economic Supplement. At age 36–40, Millennials had a real median household income that was 18 percent higher than that of the previous generation at the same age. This rate of intergenerational progress was slower than that experienced by the Silent Generation (34 percent) and Baby Boomers (27 percent), but similar to that experienced by Generation X (16 percent). Slower progress for Generation X and Millennials is due to their stalled growth in work hours—holding work hours constant, they experienced a greater intergenerational increase in real market income than Baby Boomers. Intergenerational progress for Millennials under age 30 has remained robust as well, although their income growth largely results from higher reliance on their parents. We also find that the higher educational costs incurred by younger generations are far outweighed by their lifetime income gains.

 

Supply Chain Issues

  • “Preparing Supply Chains for a Coming War”  American Enterprise Institute

    In this report, the authors make the point the U.S. urgently needs to build resilience apart from China and not be singularly dependent on Taiwan for key national security needs – something the US has significant dependence on. Addressing US dependency requires inverting Congress’s approach from inputs, such as critical minerals, to outputs, such as planes and missiles. While the fiscal year (FY) 2024 National Defense Authorization Act contains language addressing supply chains, the Department of Defense should submit four key changes in the FY2025 president’s budget.

Charts of the Week

Trade Flows in the Red Sea, Around the Cape of Good Hope, and through the Panama Canal October 2023 – February 2024

The Reserve Bank of St. Louis published this week a new report on the impact of Houthi attacks on the Red Sea on shipping as well as the impact of the ongoing drought slowing shipping through the Panama Canal.  The report shows shipping prices that have experienced the greatest increase in recent months have been those in the Suez region, as expected.

Shipping costs in this region increased by approximately 180% on average from Oct. 20, 2023, to their peak on Jan. 26, 2024. As firms reroute shipments, the companies that continue to ship through the Suez Canal are likely raising prices to compensate for the higher risk, as well as to take advantage of the reduced shipping supply.

More surprisingly, according to the St. Louis Fed, shipping costs increased globally despite the local nature of the shock. Indeed, global freight rates, according to the Freightos index, increased by approximately 120% relative to those in late October. While some of this increase captures the impact of higher shipping costs in the Red Sea, prices have risen across all routes. For instance, shipping costs along the Pacific routes have increased by roughly 70% relative to those in late October, while those along the Atlantic routes have done so by around 20% over this period.

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