Headlines:
- Russia-Ukraine talks in Belarus have started
- Russian central bank says stock trading on Moscow Exchange will not open on Monday
- Kremlin says that it hopes talks with Ukraine will start imminently
- Ukraine says main goal of talks is immediate ceasefire, withdrawal of Russian troops
- Russian negotiator says interested to reach an agreement with Ukraine as soon as possible
- UK takes further restrictive economic measures targeting the Russian central bank
- Russian ruble sinks by nearly 30% as sanctions bite
- Spain February preliminary CPI +7.4% vs +6.1% y/y prior
- Switzerland Q4 GDP +0.3% vs +0.4% q/q expected
Markets:
- CHF leads, EUR lags on the day
- European equities lower; S&P 500 futures down 1.5%
- US 10-year yields down 7.1 bps to 1.913%
- Gold up 1.1% to $1,907
- WTI up 4.2% to $93.64
- Bitcoin down 1.7% to $38,349
Russia-Ukraine war clouds are hanging over markets to start the week, with a negative risk tone observed amid sanctions on Russian banks and its central bank. The moves were aimed to destabilise the ruble and it did, even with the CBR responding by hiking its key rate from 9.5% to 20% at the start of the session. USD/RUB climbed by over 30% at one point to 110 before reversing lower to 94 levels at the moment.
After a nervous opening, major currencies are showing less signs of distress as commodity currencies roar back with AUD/USD climbing up from 0.7155 to 0.7220 and NZD/USD from 0.6658 to 0.6740. USD/CAD also trimmed gains from 1.2810 to 1.2735 before keeping around 1.2750 currently.
The pound also saw a solid reversal, closing its opening gap lower from 1.3315 to 1.3410. Meanwhile, the euro managed to shed some of its major drop earlier in the day with a push from 1.1123 to 1.1232 before settling closer to 1.1200 now.
Elsewhere, equities are still marked lower but are at least less subdued than in Asia trading. S&P 500 futures have trimmed declines of around 2.5% earlier to around 1.5% as we await Wall Street to enter the fray.
Russia-Ukraine talks in Belarus are still giving hope for something more constructive in the next day or so but we'll see where that takes us and how that will impact risk sentiment next.
