Federal Reserve Board of Governors member Waller spoke just after the US cash equity close on Thursday, which is in early morning here in Asia. More accurately, Waller’s written speech was published on the Fed website. The virtual event that Waller was due to speak at was abruptly cancelled due to an intrusion, a “Zoom Bombing” is what the kids call it apparently. A Q&A that was set to follow the speech didn’t happen.

Waller’s remarks were, as is often the case with him, hawkish, perhaps more hawkish than was expected. Market impact was minimal though.

There was a decent flow of news and data during the session.

We had Japanese inflation data in the form of Tokyo area CPI for February. Tokyo data is collected, collated, and published around three weeks before the national CPI data and is viewed as a reasonable, not perfect, indicator of the national result still to come. The headline rate in Tokyo dropped to 3.4% in February, from 4.4% in January, and also came in under the 4.1% expected. Not so encouraging was the result for CPI excluding food and energy, referred to as core-core inflation and the closest of the Japanese inflation measures to US core inflation. This came in at 3.2% against the 3.1% expected and 3.0% recorded in January. All three indicators of CPI were above the Bank of Japan's 2% target.

From Australia we had slumping housing finance data yet again. Higher rates are impacting, driving credit-seeking for house purchases lower.

The US Commerce Department announced export restrictions for dozens of Chinese entities. While there were negative stock market price impacts for those firms (where listed) overall the Shanghai Composite has stayed positive as I post.

PBOC governor Yi Gang, along with deputy governors, spoke. In summary, the Governor indicated that real interest rates in China are at appropriate levels but there is scope to add long-term liquidity through RRR cuts. Doing so would support the real economy.

Asian equity markets:

  • Japan’s Nikkei 225 +1.6%

  • China’s Shanghai Composite +0.2%

  • Hong Kong’s Hang Seng +0.7%

  • South Korea’s KOSPI +0.2%

  • Australia’s S&P/ASX 200 +0.5%

Bitcoin wrap 03 March 2023

The crypto complex slumped sharply lower. I suspect its fallout from this as no other smoking gun was apparent yet:

Also, Coinbase CEO Brian Armstrong is calling for the US government to provide a "clear" regulatory framework for crypto. An op-ed from him via CNBC.