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China

In China, bad debt managers are increasingly working to assist distressed property developers.

China is pouring money into the struggling real estate market, so it comes as no surprise that something more would be put in place to soften the blow.

Equities

The general market sentiment remains cautious, Eurostoxx +0.2 percent, Germany DAX +0.7 percent, France CAC 40 +0.2 percentUK FTSE flat & Spain IBEX +0.3 percent.

There are some faint positive tones, but nothing that leaps out too strongly. The focus will be on the US consumer inflation report later in the day, which will set the tone for the remainder of the trading day. With US futures not doing much so early on the day, the risk sentiment is leaning toward being more cautious. The S&P 500 futures are down 0.1 percent, the Nasdaq futures are down 0.1 percent, and the Dow futures are up 0.1 percent.

Major currencies

• Tentative tones anticipating the publication of US CPI data.
• Changes are low across major currencies, with the day’s ranges remaining rather tight for the most part.
• Cable is up little to 1.3550 as buyers rely on the 200-hour moving average At 1.3529, although gains are still more limited closer to 1.3600, so there’s that. Meanwhile, the EUR/USD is still hovering around its 100-day moving average of 1.1416, so there isn’t much indication of movement there either.
• The AUD/USD is trading at two-week highs, but gains are expected to remain below 0.7200 until there is more conviction to push over that level following the important risk event later today.
• Everything is focused on the publication of US CPI data, so there isn’t much more to learn from price activity right now.

ECB

• The European Central Bank has stated that it would not give capital and leverage relief to banks.
• ECB requires banks to hold marginally more capital in 2022.
• Says SREP results show banks have solid capital and liquidity positions, with scores broadly stable.
• Overall capital requirements and guidance increase marginally to stand at 15.1 percent of risk-weighted assets in 2022
• That is up from 14.9 percent in 2021
• Regarding the move, the ECB states: “We established capital room for banks at the start of the epidemic, which allowed them to continue lending to families and businesses. Today, we’re shedding light on the way back to normalcy. We are reaffirming the previously anticipated timescale for resuming routine supervision of banks’ capital adequacy and leverage.”