FED Decision, Powell Speech


During its meeting on Wednesday, FED left the rate unchanged at 0-0.25% and projected the benchmark to stay near zero at least until the end of 2022. The FED chair Jay Powell delivered a dovish assessment of the U.S. economic outlook, he said asset purchases will continue until they will see a meaningful and sustained recovery in the labour market. Another Powell`s comment stated that FED is “not even thinking about raising rates” was in line with expectations. US indexes closed mixed on Wednesday; S&P lost 0.5% while Nasdaq added 0.7%. The yield on 10Y USTs dipped by 10 bps to 0.728% while the USD weakened by 0.4% vs basket of currencies and reached its lowest level in 3 months.


Despite the rise in US crude oil inventories to the record high (538.1M BBL) the oil prices were little changed offset by weaker dollar. Brent closed the day 0.1% lower at USD 41.15 a barrel while WTI gained 0.2% to USD 39.02.


Asian stocks are trading lower today, Topix is down by 1.8%, Hang Seng dropped by 1% following the FEDs decision to keep rates on hold for some time.


European equities closed lower on Wednesday after the OECD published their downbeat forecast of the economic recovery. FTSE slid 0.1%, CAC 40 closed 0.8% lower. The yield on 10Y DBR fell 2 bps to -0.403%.


The MinFin placed a total of RUB 53.3bn at its auctions yesterday what is more than two times lower than four-week average. The total demand for bonds was RUB 237.9 bn. Russian currency appreciated vd USD by 0,2%. Sovereign Eurobonds weakened on Wednesday, RUSSIA 39 lost half a point in price.


SSA sovereigns (NGERIA, ANGOL) trading down a point this morning in line with EM sentiment after being stable yesterday.