The latest business and finance news, as stock markets rally after last night’s Federal Reserve meeting
SNB imposes negative rates to weaken the franc
Q&A: Negative rates explains
The agenda: Markets cheers by the Fed
German firms appear to be shrugging off the Russian crisis, and Europe’s economic problems.
The IFO survey of German morale, just released, has risen to 105.5 up from 104.7 last month. That’s the highest reading since August.
Heads-up; Vladimir Putin’s press conference is about to start in Moscow. We’re running a separate liveblog, as it’s going to last for several hours:
The @guardian is liveblogging Putin press conference. I’m in the hall and my colleague @Haroon_Siddique is in London. http://t.co/3GwlrJF6eH
Announcement on the tannoy at Putin press conference asks journalists not to bring toys and furry animals into the hall.
Over in Berlin, German chancellor Angela Merkel has warned that sanctions against Russia over Ukraine remain unavoidable as long as Moscow does not respect Ukrainian sovereignty.
“As long as we do not reach this goal … sanctions remain unavoidable, though I would like to reiterate that they were not and are not an end in themselves.”
The Russian rouble is volatile around this morning, as traders await Vladimir Putin’s annual press conference, from 9am.
It’s currently down 2.2% against the US dollar at 61.5 roubles/$1, having hit a low of 58/$1 in early trading.
Not just @bmw , @GM now also reacting to #Russia. GM Halts car sales due to rouble volatility @business
Greek three-year bonds weakened this morning after MPs rejected the government’s presidential candidate last night, pushing up the yield on the debt.
Greek 3yr yields jump by 17bps as #Greece’s PM Samaras still 20 MP’s short for 3rd round of Presidential election. pic.twitter.com/getazQQCKs
European stock markets have risen in early trading, taking their lead from Wall Street’s rally last night.
The German DAX and French CAC both surged 1.7%, while the FTSE 100 is up a more modest 0.5% or 30 points at 6366.
Markets had been expecting such a move and, despite signs of some disagreement on the committee as three members dissented, the shift is a signal of confidence in the sustainability of the US recovery.
Fed Chair Yellen reassured that policy continued to depend upon the data, with no move likely within the next “couple of meetings”.
Why has the Swiss central bank announced negative interest rates today?
Because it wants to weaken its currency, the Swiss franc, by penalising banks who hold deposits.
Timing of #SNB is pretty interesting … just a week after the SNB’s last policy meeting – #rouble trouble perhaps?
The Swiss franc has weakened sharply after Switzerland’s central bank surprised the markets by announcing it would impose negative deposit rates of 0.25% on commercial bank deposits.
The franc fell by half a cent, to 1.2095 francs against the euro, a two month low.
The SNB reaffirms its commitment to the minimum exchange rate of CHF 1.20 per euro, and will continue to enforce it with the utmost determination. It remains the key instrument to avoid an undesirable tightening of monetary conditions resulting from a Swiss franc appreciation.
Over the past few days, a number of factors have prompted increased demand for safe investments. The introduction of negative interest rates makes it less attractive to hold Swiss franc investments, and thereby supports the minimum exchange rate.
Good morning, and welcome to our rolling coverage of the financial markets, the world economy, the eurozone and business.
And #SNB introduces negative interest rates as the great monetary policy experiment continues …