The US dollar is getting weaker against the euro and the pound sterling in trading on Monday.
This week traders’ attention is focused on January data on consumer price dynamics in the states. Experts fear that the report of the U.S. Labor Department to be published on Tuesday will confirm that the fight against inflation is far from over, thus dispelling hopes that the cycle of monetary tightening by the Federal Reserve System (FRS) will soon be over.
According to an expert consensus forecast cited by Trading Economics, U.S. consumer prices rose 6.2% year-over-year in January, up from 6.5% in December.
“Depending on what the inflation data are, we could see either markets breathe a sigh of relief or risk aversion accelerate,” said Standard Chartered Plc analyst Eric Robertsen.
“The more the Fed extends the cycle of rate hikes and delays the transition to rate cuts, the more likely it is that the U.S. economy will “hard land” and that the U.S. central bank will have to lower the rate more aggressively in the future,” Robertsen was quoted as saying by Bloomberg.
University of Michigan data released Friday showed that Americans’ inflation expectations for the medium term (next year) rose to 4.2% in February from 3.9% in January.
The ICE-calculated index showing the dollar’s performance against six currencies (euro, Swiss franc, yen, Canadian dollar, pound sterling and Swedish krona) added 0.11% on Monday, while the broader WSJ Dollar Index gained 0.22%.
The euro/dollar pair is trading at $1.0669 as of 8:10 a.m., up from $1.0679 at the close of the previous session.
The pound is at $1.2047, up from $1.2060 on Friday.
The dollar’s value against the yen rose to 132.17 yen from 131.4 yen in previous trading.
On Tuesday the Japanese government will submit a candidate for the post of the Central Bank head to the parliament. On Friday the Japanese mass media informed that Prime-Minister Fumio Kishida chose Kazuo Ueda, 71-year-old, from the list of candidates for the post. The current head of the Bank of Japan, Haruhiko Kuroda, will step down in early April.
Initially, investors interpreted the decision to choose Ueda as a potential “hawkish” signal, said Bloomberg. That opinion, however, changed after his speech to reporters, during which he said he believes the Bank of Japan’s current ultra-soft policy should remain unchanged.
The management of Ukraine’s largest mineral water producer IDS Ukraine is concerned about the announcement by the National Agency for the Search and Management of Assets Derived from Corruption and Other Crimes (ARMA) of a tender for the selection of the manager of corporate rights of the company and doubts that the transfer of the company management to other persons will have a positive impact on its operations.
“The company’s management is concerned about beginning the selection of a manager for the assets of the nation’s largest drinking water producer. After all, since the transfer of corporate rights to ARMA in November 2022, no actions have been taken by the company, which would require a change in the management of IDS Ukraine, including compliance with all restrictions imposed, “- reported on the website of IDS Ukraine on Monday.
At the same time, it is pointed out that the transfer of IDS Ukraine management to other persons is unlikely to have a positive impact on the company’s activities, because previously ARMA has not shown successful cases of working with the assets under its management.
The company reminded that its management effectively managed the business in a super-complicated environment of Russian military invasion in which it retained its market share at the level of 2021, although it reduced its sales by 29%.
The organizational efficiency of the business has remained constant overall over the past 20 years, despite repeated changes in ownership structure throughout. “Confirmation of the latter is unconditional leadership and impeccable business reputation of the company, so we are convinced that there is no need to change the management of the company and its employees”, – was stated in the message.
The management of IDS Ukraine hopes that “the government is interested in preserving Ukraine’s largest water producer and will not allow changes in the management structure, which proved its efficiency in the past and in the current difficult conditions,” reads the press release.
IDS Ukraine stressed that it continued to produce drinking water and promote further development of the category of non-alcoholic beverages in Ukraine. Thus, in 2022 the production of non-carbonated water “Myrhorodska Lahidna” was resumed, in 2023 the production of energy drink “Wola” was launched, the first batch of 40 thousand cans was distributed among the defenders of Ukraine who are on the frontline.
Also, according to the company, IDS Ukraine remained the biggest taxpayer in the industry, transferring 699 million hryvnias to the budgets of all levels last year, even taking into account temporary occupation of one of its enterprises in Hola Prystan in Kherson region.
The press release reminds that within the framework of cooperation with 194 foundations and volunteer organizations, the mineral water producer in 2022 provided charitable assistance to the amount of over UAH 100 million, including free product to the needs of the military, hospitals, displaced persons and de-occupied territories in the amount of over UAH 67 million. Moreover, in January 2023 alone the company delivered 120 thousand liters of drinking water to the de-occupied Kherson.
At the moment, IDS Ukraine provides 3 thousand Ukrainians with work, as well as continues to pay all mobilized employees – their total amount in 2022 reached 18.7 million UAH.
As earlier reported, the general director of IDS Ukraine Marko Tkachuk said in reply to Interfax-Ukraine news agency inquiry that the transfer of corporate rights of the company totaling more than UAH 10 billion to ARMA will not affect the economic activities of the group.
He reminded that the decision about the transfer of corporate rights of the sanctioned IDS shareholders with Russian citizenship to ARMA was made by Kiev Shevchenko District Court on November 9 and 11, 2022.
On November 23, the Bureau of Economic Security of Ukraine (BES) reported that the corporate rights of the Russian shareholders of IDS Ukraine were arrested to prevent them from taking the assets of seven drinking water production and sales companies out of Ukraine. According to the BEB, these enterprises are actually owned by them through a non-resident offshore company under their control.
IDS Ukraine is a Ukrainian group of companies founded in 1996, the largest national producer of bottled water. The holding includes Morshynsky mineral water plant “Oskar”, “Mirgorod mineral water plant”, a distribution company “IDS” and water delivery operator “IDS Aqua Service”.
GK owns trade marks “Morshynska”, “Mirgorodskaya”, “Alaska” and “Aqua Life”.
According to the rating of the 100 most expensive Ukrainian brands, compiled by the publication “NV” and MPP Consulting company in 2021, the market value of “Morshynska” brand of IDS Group Ukraine holding was $ 533 million. The total amount of capital investment over the past five years amounted to 2.3 billion UAH.
Oil prices are down on Monday after rising more than 2% on Friday on information about Russia’s intention to reduce production.
April Brent crude futures on London’s ICE Futures exchange stood at $85.58 a barrel by 7:10 a.m. Monday, down $0.81 (0.94%) from the previous session’s closing price. Those contracts rose $1.89 (2.2%) to $86.39 a barrel on Friday.
The price of WTI futures for March crude oil fell by $0.92 (1.15%) to $78.8 per barrel at electronic auctions of New York Mercantile Exchange (NYMEX) by that time. The contract value grew by $1.66 (2.1%) to $79.72 per barrel at the end of previous session.
Over the previous week Brent gained 8.1% and WTI gained 8.6%.
Russian Deputy Prime Minister Alexander Novak told reporters on Friday that the country intended to cut oil production by 500,000 bpd in March.
Most analysts have already put the likelihood of Russia cutting oil production by 700,000 to 900,000 barrels in 2023 on prices, said CIBC Private Wealth US senior trader Rebecca Babin.
“The key factor that could lead to prices moving out of the current range is the dynamics of Chinese demand,” she says.
The L-70 anti-aircraft guns were sent from Lithuania to Ukraine on Friday, LRT reported.
“They will be able to destroy enemy planes, helicopters and UAVs at a distance of up to 5 kilometers in any weather conditions,” the report says.
It is noted that in addition to the anti-aircraft guns, ammunition and other equipment necessary for the operation of these units will also be transferred to Ukraine in the near future.
Exit and entry movement for vehicles weighing more than 7.5 tons without cargo will be opened from February 13 at the planned “Nijankovychi-Malhovice” checkpoint on the Ukrainian-Polish border, the Western Regional Department of the State Border Service reports on Facebook.
“From 8 a.m. on February 13 … will begin the implementation of the passage operations of cargo vehicles with a maximum weight of more than 7.5 tons, without cargo. The passage of trucks will be carried out around the clock in the direction of departure from Ukraine and on the entrance”, – said the officer of the press service of the Lviv border detachment Oleksandra Kuchkovskaya.
The new checkpoint is expected to unload the existing checkpoints on the border with Poland and speed up cargo and passenger logistics at the border. The point also provides for the movement of cars and the possibility of crossing for pedestrians.
As reported, the project of the mentioned crossing has been frozen since 2007. Work on its development intensified after a full-scale invasion by Russia, when the need to expand the capacity of existing border crossing points and the construction of new ones came to the fore. The construction of the Nijankovichi-Malhowice border crossing point was completed in cooperation with the Polish side under the Open Border project and became possible after the completion of the Nijankovich-Drohobych-Stryj road section, which leads to the border crossing point.
A total of 7 checkpoints for cars operate on the border with Poland: Dorohusk-Yagodin, Hrebenne-Rava-Russkaya, Korcheva-Krakivets, Kroszenko-Smilnytsia, Medyka-Sheginy. Points Zosin-Ustilug and Budomir-Hrushev are designed for crossing by vehicles weighing up to 3.5 tons.
