The U.S. Federal Reserve decided on Wednesday evening to keep interest rates unchanged, as expected. The rate remains at 5.25 to 5.50 percent. This unanimous decision follows the latest rate hike in July 2023. The euro/dollar trades at 1.0800 this morning.

The latest employment data from ADP showed that job growth in the private sector of the United States increased in January but less than analysts had predicted. There was an increase of 107,000 jobs, following a revised growth of 158,000 in December, which was initially estimated at 164,000 jobs. Analysts had expected a growth of about 150,000 jobs for January. Wages in January increased by 5.2 percent on an annual basis, which is slightly less than the increase of 5.4 percent seen in the preceding month.

Mixed signals came from China regarding economic activity. The Purchasing Managers’ Index for the manufacturing sector showed a marginal improvement from 49.0 to 49.2, which still indicates a contraction. However, a slight increase in growth in the services sector was reported, with an increase in the Purchasing Managers’ Index from 50.4 to 50.7.

A surprising increase in crude oil inventories in the United States occurred according to the latest report on energy stocks. In the week ending on January 26, the inventory increased by 1.2 million barrels to 421.9 million barrels. This occurred while market analysts had expected a decrease of about 0.8 million barrels.

The 6M Euribor decreased with 3 basis points to 3.84% compared to previous business day. The 10Y Swap decreased with 9 basis points to 2.56% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

U.S. consumer confidence increased significantly in January, reaching its highest level in two years as reported by The Conference Board. The index climbed from 108.0 in December to 114.8, marking the third consecutive month of increases.

The euro experienced a slight decline against the dollar Tuesday morning following a series of GDP figures from the Eurozone, which indicated zero growth in the fourth quarter after a contraction of 0.1 percent in the previous quarter. Currency strategists expect the dollar to maintain its gains against European currencies in the coming days.

Spain’s economic growth picked up in the fourth quarter, showing a stronger expansion compared to the previous quarter, according to the Spanish Statistical Office. Quarterly growth was 0.6 percent, up from 0.4 percent in the third quarter, while the annual growth rate for the country’s GDP in the fourth quarter was 2.0 percent, slightly higher than the 1.9 percent in the third quarter.

In January, consumer confidence in the Eurozone fell slightly, with the index dropping by 1.0 point to -16.1, remaining well below the long-term average as reported by the European Commission. While the overall economic sentiment in the Eurozone decreased minimally from 96.3 to 96.2, against expectations of an increase to 96.5, confidence in the services sector did see an improvement.

The 6M Euribor is unchanged at 3.87% compared to previous business day. The 10Y Swap increased with 3 basis points to 2.65% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

According to the latest figures from the Dutch Central Bank, it appears that household bank balances have significantly increased in the past year. In 2023, balances have risen by nearly €15 billion.

A court in Hong Kong ordered the liquidation of real estate giant China Evergrande Group on Monday. The Chinese real estate developer, with over $300 billion in debt, failed to submit a suitable restructuring plan after months of delays.

The number of individuals unfit for work in the Netherlands is on the rise compared to the previous year. The Dutch Employee Insurance Agency anticipates handling 852,800 disability benefits this year, as opposed to 840,100 in the preceding year.

The 6M Euribor decreased with 4 basis points to 3.87% compared to previous business day. The 10Y Swap decreased with 6 basis points to 2.62% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

Oil prices rose again on Friday. Both the prices for a barrel of West Texas Intermediate and Brent increased by as much as 1%, resulting in the highest price levels in two months. On a weekly basis, prices increased by over 6%. Possible explanations for the increase include factors such as news about additional stimulus measures in China, unexpectedly large inventory declines, and ongoing tensions in the Middle East.

The financing of small businesses is under pressure, as indicated by the Financing Monitor of Statistics Netherlands (CBS). Despite a substantial need for funding in SMEs, these businesses struggle to navigate the path to financiers. A mere 42% sought financing last year, with 58% of micro-businesses abandoning their search prematurely, marking a 10% increase from 2022. While internal financing is common, it compromises financial resilience. Additionally, the share of bank financing has, for the first time, dropped below 50%, with over 40% opting for alternative sources like crowdfunding, leasing, and factoring companies.

German consumer confidence for February unexpectedly worsened, as revealed by measurements from research firm GfK, which conducts forward-looking assessments. The confidence index dropped to -29.7, compared to -25.4 the previous month, adjusted from an earlier forecast of -25.1.

The 6M Euribor decreased with 1 basis point to 3.91% compared to previous business day. The 10Y Swap increased with 1 basis point to 2.68% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

The President of the European Central Bank, Christine Lagarde, stated that it is still too early for interest rate cuts. This statement was made on Thursday during an explanation of the decision to maintain the key interest rates. As a result, the base rate remains at 4.50%, the marginal lending facility at 4.75%, and the deposit facility at 4.00%.

The U.S. economy unexpectedly showed strong growth in the fourth quarter. According to preliminary figures published on Thursday by the Bureau of Economic Analysis, the increase compared to the previous year was 3.3%. Economists consulted by the Reuters news agency had anticipated a growth of 2.0%. Although economic growth is lower than the previous quarter, when the figure was 4.9%, it once again confirms that the U.S. economy continues to perform well, despite the interest rate hikes by the Federal Reserve last year.

The number of new applications for unemployment benefits in the United States for the week ending on January 20 increased significantly more than anticipated, according to Thursday’s data from the U.S. Department of Labor. The number of new claims for unemployment benefits rose by 25,000 to reach 214,000. Economists expected 199,000 applications.

The 6M Euribor decreased with 2 basis points to 3.92% compared to previous business day. The 10Y Swap decreased with 6 basis points to 2.67% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

Economic activity in the Eurozone showed a smaller contraction in January than in the previous month, according to preliminary data released on Wednesday. Although a decline was observed, the services sector index did not meet expectations with a score of 48.4, lower than the 48.8 in December. However, the purchasing managers index for manufacturing showed an unexpected rise from 44.4 to 46.6, while analysts had forecast a moderate improvement to just 44.8. This led to a slight increase in the composite index from 47.6 to 47.9, still just below the predicted 48.0.

In the United States, preliminary figures indicated recovery in the industrial sector and an acceleration in the service sector. The preliminary service sector index rose from 51.4 to 52.9, reaching the highest level in 7 months. The purchasing managers index for manufacturing improved from 47.9 to 50.3. Consequently, the composite purchasing managers index climbed from 50.9 in December to 52.3 this month.

A decrease in crude oil inventories by 9.2 million barrels was reported, which was a significantly higher decrease than the expected 1.4 million barrels decrease. Inventories stood at 420.7 million barrels at the end of last week. Gasoline inventories, however, rose by 4.9 million barrels, marking a greater increase than the forecasted 1.5 million barrels increase. Gasoline inventories stood at 253.0 million barrels at the end of last week.

The 6M Euribor increased with 1 basis point to 3.94% compared to previous business day. The 10Y Swap decreased with 2 basis points to 2.73% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

The observed impact of the disruption in the Red Sea on the European economy has so far been limited to extended delivery times, without significant effects on key economic indicators. As the global economy continues to underperform, the tensions in the Middle East have no significant influence on energy prices and consumer prices due to ample supply, decreasing demand, and companies absorbing higher costs. The ongoing disruptions in the Red Sea could lead to high inflation in the eurozone falling more slowly than expected, despite the ECB’s forecast that it will decrease from 5.4% in 2023 to 2.7% in 2024.

In December, unemployment rose in almost one third of the U.S. states (15 of 50), while it remained unchanged in the majority of the states and in the District of Columbia; Massachusetts and Rhode Island experienced the largest increase with 0.3 percentage points. The national unemployment figures remained stable at 3.7%, despite the economy adding 216,000 new jobs in December, an increase from the 173,000 in November.

Oil prices have fallen after reaching the highest level of this year, with West Texas Intermediate down 0.5 percent to $74.37 and Brent crude down 0.6 percent to $79.55 per barrel. The decline is attributed to the reopening of Libya’s largest oil field and a less unrest in the Red Sea, while at the same time freezing cold hampers oil production in North Dakota and drone attacks from Ukraine disrupt Russian oil exports.

The 6M Euribor increased with 2 basis points to 3.93% compared to previous business day. The 10Y Swap increased with 6 basis points to 2.75% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

Consumer sentiment in January was slightly less negative than in December, as reported by the Statistics Netherlands (CBS). This marks the fifth consecutive month of improved consumer confidence. Concurrently, the CBS indicates that businesses invested 3.6 percent less in November, following a growth of over 2 percent in October.

Gas prices continue to decline due to oversupply, relative political stability, weather influences, and surplus sustainable energy. Currently, the 1-month forward gas contract (per MWh) is priced at €27. ING expects a continuation of the downward trend to new lows of €26 per megawatt-hour and subsequently to €24. However, Banca d’Italia expresses concerns about the potential impact of the recovery in Chinese demand on global gas prices.

Since 2013, the CBS has reported an annual increase in existing home prices compared to the previous year. During that period, home prices nearly doubled. However, according to the latest CBS figures, 2023 marked a change, with a decrease of 2.8%.

The 6M Euribor decreased with 2 basis points to 3.91% compared to previous business day. The 10Y Swap decreased with 3 basis points to 2.69% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

In December, retail sales in the United Kingdom fell more sharply than expected, with a monthly volume decline of 3.2% compared to economists’ anticipated decrease of 0.5%. On an annual basis, volumes dropped by 2.4%, contrary to economists’ expectations of a 1.2% increase. Volumes were 4.8% lower than in February 2020, just before the onset of the COVID-19 crisis. Despite these declines, the value of sales was 13.9% higher than pre-COVID levels, attributed to increased prices.

Savings deposit rates in the Netherlands have recently dropped across all terms, following a period of rising rates over the past 18 months. This shift is linked to declining market interest rates due to inflation normalization. For instance, the average interest for a five-year fixed deposit fell from 3.6% to 2.9%. Dutch consumers have increased their allocation to fixed deposits, reaching nearly 17% in November, the highest in a decade, according to De Nederlandsche Bank.

In December, passively managed index funds and ETFs in the United States surpassed their actively managed counterparts in total assets, with $13.3 trillion compared to $13.2 trillion for active funds. This shift reflects the enduring popularity of ETFs and a trend toward passive investment strategies. Over the past decade, passive funds have steadily gained market share, with the launch of the first index fund by Vanguard in 1976 influencing this transformation.

The 6M Euribor increased with 7 basis points to 3.93% compared to previous business day. The 10Y Swap decreased with 1 basis point to 2.72% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.

According to government data released on Friday, consumer prices in Japan rose less in December compared to the previous month. The annual inflation rate, including the effects of fresh food and energy, stood at 2.6%, lower than the 2.8% reported a month earlier. Excluding the impact of price changes in fresh food, the year-on-year inflation rate was 2.3%, compared to 2.5% in the previous month. These figures align with economists’ expectations, who had also predicted an inflation rate of 2.3%. Inflation has now remained above the Bank of Japan’s targeted level of 2% for twenty consecutive months.

On Thursday, a large majority of the Senate in the United States approved a temporary budget measure that covers government funding until March, averting a shutdown on Friday. The Senate voted 77 in favor to 18 against the measure. This marks the third time a temporary budget has been passed for the fiscal year 2024, which began in October.

On Thursday, Statistics Netherlands reported that unemployment in the Netherlands increased slightly in December. On a monthly basis, the unemployment rate rose from 3.5% to 3.6%, which also represents the annual average for the entire year 2023. Throughout the year 2023, the average number of unemployed individuals slightly increased compared to the previous year, from 350,000 to 359,000. The net labor force participation rate increased in 2023 to 73.1, compared to 72.2 in 2022.

The 6M Euribor decreased with 1 basis point to 3.86% compared to previous business day. The 10Y Swap increased with 4 basis points to 2.73% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.