The week’s powerful rally which sent US stocks to a new 52-week high has faded, with futs down small after a quiet overnight session on the day JPM officially ushers in Q2 earnings season as the post-CPI market rally pauses for breath as investors contemplate how recent US inflation data will impact upcoming Fed policy decisions. As of 6:45am ET S&P futures are flat at 4,542 while Nasdaq futures are down 0.1%. Bond yields are 3-5bp higher, and the USD has reversed higher after dropping the lowest level in more than a year. Commodities are mixed with energy lagging and base metals such as iron ore extending gains from yesterday. Yesterday’s dovish PPI and lower-than-expected initial claims supports the soft-landing narrative. Key focus today will be banks earnings; JPM, C and WFC report pre-market. Keep an eye on banks’ commentary on consumer health, credit trends and loan growth. We will also get the latest UMichsentiment data (consensus sees 65.5 vs. 64.4 prior); 1yr inflation expectation is estimated to fell to its lowest in two years

In premarket trading, mega-cap tech stocks are mixed; Banks are mostly higher. Microsoft rose 1.6% in premarket trading as UBS raised the recommendation on the software giant’s stock to buy from neutral, saying cloud infrastructure spending is starting to stabilize after a significant deceleration over the past year.  UnitedHealth Group Inc. gained after an earnings beat. Nikola soared as much as 25% set to extend Thursday’s 61% rally, after BayoTech agreed to buy up to 50 of its hydrogen-fuel-cell EVs over the next five years. If the gains hold until close, it will be the biggest weekly gain on record for the stock. Here are some other notable premarket movers:

• Acadia Pharmaceuticals (ACAD US) shares surged 20% in premarket trading after the biotech firm said it had expanded its licensing agreement with Neuren Pharmaceuticals to acquire the ex-North American rights for Daybue (trofinetide), which is used to treat Rett syndrome.
• Leslie’s (LESL US) shares drop 30% in premarket trading after the pool-supplies retailer cut its full-year adjusted earnings per share guidance. Analysts highlighted the sales weakness in the third quarter, with Piper Sandler downgrading their recommendation on the stock to neutral from overweight.
• Roivant Sciences (ROIV US) rose as much as 12% in premarket trading after a Wall Street Journal report the company is in talks to sell its treatment for inflammatory bowel disease to Roche Holding.
• Intuitive Machines (LUNR US) climbed as much as 32% in premarket trading, after the company said it successfully completed a spacecraft test run of its Nova-C lunar lander at the Houston Spaceport.

As Bloomberg notes, it’s been a week when almost everything rallied — from emerging markets to global bonds and the S&P 500 — all buoyed by faith that the Federal Reserve is finally winning the fight against inflation. While trading was subdued on Friday, investors are finishing the week with blockbuster gains across asset classes. MSCI’s global stock benchmark has leapt 3.5% in the past five days, the biggest advance since November.

“The market has been partying like it’s 1999 this week,” said DB’s Jim Reid. “It’s hard to stand in the way of that narrative at the moment regardless of what eventually happens.”

Bonds climbed too over the week with the US two-year rate, the most sensitive to short-term policy moves, dropping as much as 30 basis points.

The bullish trades reflect hope that the US is heading toward a “Goldilocks scenario” with inflation quickly easing while the economy avoids a recession. To be sure, the Fed is still likely to lift its benchmark rate later this month and central bankers continue to warn that more than one rate increase may still be necessary after that.  The earnings season also kicks off in the US today with lenders JPMorgan Chase, Wells Fargo and Citigroup reporting.

“The Fed has already won the battle against inflation,” Raffaele Bertoni, head of debt capital markets at Gulf Investment Corp., said on Bloomberg Television. “If they want to be serious in maintaining inflation under control, the focus should be more on the reduction of the balance sheet or the quantitative tightening rather than increasing rates further.”

Fed Bank of San Francisco President Mary Daly, however, told CNBC Thursday that it’s too soon for policymakers to say they have done enough to return US inflation to their target. Fed Governor Christopher Waller also said he expects the US central bank will need to raise rates twice more this year to bring inflation down to its target.

Traders are now looking to earnings reports to reignite the rally. The focus is going to be mostly on the corporate outlooks given that beating profit expectations seems to be a low hurdle, even as some estimates have started to rise slowly. “Given that consensus expectations appear reasonable and valuations are already rich (not only in tech), only strong beats are likely to result in substantial price gains, while even small misses may lead to sharper drops,” said Wolf von Rotberg, an equity strategist at Bank J Safra Sarasin.

European stocks are also little changed with the Stoxx 600 coming off a five-session winning streak. Among individual stock movers in Europe, Nokia Oyj slumped more than 8% after the Finnish vendor of 5G equipment lowered its guidance. Ericsson dropped almost 8% as analysts pointed to a weak margin outlook for the Swedish telecom equipment maker. Swiss money manager Partners Group Holding AG gained more than 7% after assets under management rose in the first half. Here are the most notable European movers:

• Partners Group shares gain as much as 7.8%, most since May, after it posted a “positive” update on its assets under management, helping offset negative expectations for the firm ahead of the results
• Heineken rises as much as 2.7% after being raised to buy at Goldman Sachs as the broker expects the world’s second-largest brewer to “fully benefit” from raw material cost deflation
• Axfood shares rise as much as 8.2% to a two-month high after the Swedish food retailer’s second-quarter operating profit beat estimates, with analysts pointing to strength in its discount chain
• Brunello Cucinelli shares gain as much as 2.1% after the luxury clothier reported what analysts called a strong sales update, and increased full-year guidance
• Vallourec shares climb as much as 7.3%, the most since May, after French tube maker sees 2Q exceeding prior expectations, with Jefferies saying deleveraging plans are working
• Nokia falls as much as 10%, the most since January 2021, after an unscheduled profit warning and outlook cut, hinting an expected recovery in the sector is further away than earlier projected
• Ericsson shares dropped as much as 9.2%, as analysts pointed to a weak margin outlook for the Swedish telecom equipment maker in the third quarter and worries of poor US demand
• Brenntag shares dropped as much as 4.1% after the chemicals distributor was downgraded to underweight from neutral at JPMorgan, saying it struggles with “significant demand weakness”
• Ashmore shares fell as much as 8.3%, the most since November, after the emerging markets-focused asset manager’s AUM disappointed, with Nubis saying investment performance remains “poor”
• EMS-Chemie falls as much as 3.3%, the most since April. While the company’s first-half figures were in line with low expectations its full-year outlook was reduced further, ZKB notes
• Sixt slides as much as 6.7% in Frankfurt trading after being downgraded to hold from buy at Deutsche Bank, expecting the car-rental firm’s profit to drop in 2023

Earlier in the session, Asian stocks were on course for their best week since Nov. 2022, with Chinese equities rallying and peak-rate bets on the Federal Reserve boosting risk sentiment. The MSCI Asia Pacific Index rises as much as 0.8%, with gains for the week nearing 5%. Stocks in Korea, Taiwan and New Zealand led the advance on Friday. Chinese equities have been at the center of the risk rally in Asia, as traders increasingly see an end to years of regulatory crackdowns on technology firms. Other than gains in tech bellwethers such as Alibaba Group Holding Ltd., the broader market also advanced on hopes of more policy stimulus. An index of Chinese companies in Hong Kong is set for the biggest weekly gains since the first week of 2023. Risk appetite was also boosted as the US dollar and Treasury yields fell with softer inflation data in the US. Traders are now pricing in just one more rate hike this year from the Fed. Chinese tech stocks were volatile Friday, with Xiaomi and Meituan falling, after the Hang Seng Tech Index rose for four days in its longest rising streak since mid-June. The Hang Seng Tech Index erases losses of as much as 0.9% in the morning to trade 0.1% higher. Meituan, which was among the best performing stocks on the gauge in the past four days, drops as much as 1.4% on Friday; Xiaomi -1.4%. EV makers Nio down as much as 4.7% and XPeng -7.7%. Stocks fluctuated in Japan as the yen headed for a seven-day winning streak, which would mark its best performance since 2018.

“Risk on in emerging markets, especially, in China makes sense,” David Chao, global market strategist for Asia Pacific at Invesco Asset Management told Bloomberg television in an interview. Chao sees Chinese equities emerging among the best performers in second half of 2023. Stocks in Thailand rose even as a leading candidate for the prime ministerial post failed to win endorsement from the Parliament.

In FX, the Bloomberg Dollar Spot Index is flat although still on course for its largest weekly decline since November. USD/JPY climbed 0.2% to 138 in a reversal of the yen’s longest bull streak since 2018. GBP/USD held ground above 1.31, while EUR/USD wavered around 1.12. The offshore yuan ticked higher. China has ample foreign exchange reserves and will “resolutely” prevent wild swings in the yuan exchange rate, People’s Bank of China Deputy Governor Liu Guoqiang said at a briefing Friday. The currency’s short-term movement cannot be predicted accurately, but it hasn’t deviated from its fundamentals, Liu added.

In rates, treasuries fell, trimming their biggest two-day gain since early May as two-year and 10-year yields hover around their lowest levels in one month/ Two-year yields rose four basis points to 4.67% and 10- year yields climbed three basis points to 3.79%

In commodities, oil headed for a third weekly gain as supply disruptions in Africa and a reduction in shipments from Russia tightened the market; crude futures are flat with WTI trading near $76.85. Spot gold falls 0.2%. Gold was set for the best week since April.

Bitcoin is under modest pressure despite the USD continuing to languish with drivers thin and the docket ahead relatively spares aside from crucial banking updates.

To the day ahead now, and earnings season will step up a gear as we hear from JPMorgan, Citigroup Wells Fargo and BlackRock. Otherwise, data releases include the University of Michigan’s preliminary consumer sentiment index for July.

Market Snapshot

• S&P 500 futures little changed at 4,542.00
• MXAP up 0.6% to 168.93
• MXAPJ up 0.9% to 535.06
• Nikkei little changed at 32,391.26
• Topix down 0.2% to 2,239.10
• Hang Seng Index up 0.3% to 19,413.78
• Shanghai Composite little changed at 3,237.70
• Sensex up 0.5% to 65,888.13
• Australia S&P/ASX 200 up 0.8% to 7,303.08
• Kospi up 1.4% to 2,628.30
• STOXX Europe 600 little changed at 461.66
• German 10Y yield little changed at 2.50%
• Euro little changed at $1.1231
• Brent Futures little changed at $81.33/bbl
• Gold spot down 0.2% to $1,957.38
• U.S. Dollar Index little changed at 99.76

Top Overnight News

• The PBOC signaled more targeted support may be on the cards for the property market as it sought to assure investors that the risks banks face from the sector are controllable. BBG
• The US has launched a round of diplomacy with China to help soften the blow from new tech export restrictions that are expected to be announced soon. SCMP
• China loses its title as the top exporter of goods to the US for the first time in 15 years, falling behind Mexico and Canada. Nikkei
• BOJ is having internal discussions about tweaking the YCC policy as soon as this month, although no final decision has been made (any change would likely be very minor). RTRS
• Australia will promote deputy governor Michele Bullock to take over the RBA, deciding against giving Philip Lowe another term. FT
• Europe asks its metals suppliers to make semiconductor materials amid worries about China restrictions, but this may require state aid. FT
• Odds are growing that the Fed’s 25bp rate hike later this month will be the final one of the cycle, but officials want to see more evidence of disinflation before declaring victory. WSJ
• DeSantis is considering a course correction as his campaign struggles to gain traction. ABC News
• AMZN has created a new internal organization aimed at helping customers utilize generative AI tools on AWS. Insider  

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded mostly higher after the positive lead from Wall St where yields continued to decline as PPI data followed suit to the softer consumer inflation and supported the case for just one more Fed rate hike. ASX 200 was firmer with gains in the index led by the tech sector after similar outperformance of US counterparts amid a decline in yields, while the announcement that RBA Deputy Governor Bullock will take over from Governor Lowe in September had little effect on markets and was largely seen as policy continuation. Nikkei 225 swung between gains and losses with headwinds from JPY strength and speculation that the BoJ could raise its inflation forecast above the 2% target at its meeting this month, which could pave the way for policy normalisation, while former BoJ Director Hayakawa expects the  BoJ to tweak yield curve control at the upcoming meeting by potentially raising the 10yr yield ceiling to 1.0%. Hang Seng and Shanghai Comp were positive albeit with gains capped despite the renewed support pledges by the PBoC to keep credit growth appropriate, as well as step up counter-cyclical adjustments and support for key sectors.

Top Asian News

• PBoC Deputy Governor Liu said China’s overall liquidity is ample and its credit structure improved in H1, while he also noted that financing costs stabilised and dropped in H1. Liu said the PBoC has ample policy tools and will step up counter-cyclical adjustments, as well as improve financial services for tech companies, guide banks to boost lending for tech companies and will increase support for SMEs and the green sector, according to Reuters.
• PBoC official said they will keep credit growth appropriate and step up support for key sectors, while the central bank will deepen interest rate reforms and will guide banks to increase lending to small firms and private firms. Furthermore, the official said there is ample room and various policy tools to cope with challenges, while they will use policy tools such as RRR and MLF, as well as innovate new policy tools if needed, according to Reuters.
• China’s top diplomat Wang Yi said US and China need to take practical actions to bring back ties onto the right track and that the US should adopt a rational and pragmatic attitude and meet China halfway. Wang also said the US must refrain from interfering in China’s internal affairs and stop suppressing China’s economy, trade, and technology, while the US must lift illegal and unreasonable sanctions against China, according to Xinhua.
• Australia named Deputy Governor Bullock as the next RBA Governor from September 18th, while Bullock said she is committed to ensuring that the Reserve Bank delivers on its policy and operational objectives.
• Chinese regulators are reportedly to meet with global investors in order to shore up economic confidence, via Reuters citing sources; focused on the current conditions of USD-denominated investment firms and the main challenges they face. Meeting will take place on Friday 21st July. Investors will be invited to provide suggestions on how to combat the challenges they are facing and to give their views on the Chinese economy.

European bourses are contained but remain on track to close the week out with marked gains, Stoxx 600 set for +3% WTD upside. Sectors are somewhat mixed with defensive names outperforming on the tentative tone while Telecom. lags after Nokia and Ericsson’s respective updates. Stateside, futures are near the unchanged mark as we await the final scheduled Fed speak before blackout commences alongside the formal commencement of Q2 earnings season. UnitedHealth Group Inc (UNH) Q2 2023 (USD): EPS 6.14 (exp. 6.01), Revenue 92.9bln (exp. 91.bln); FY23 adj. Net guidance 24.70-25.00/shr (exp. 24.76). +2.1% in pre-market trade. Nokia (NOKIA FH) – Q2 (EUR): Revenue 5.7bln (exp. 6.03bln), adj. EBIT Margin 11%. Cuts FY23 sales outlook to EUR 23.2-24.6bln (exp. 25.57bln, prev. 24.6-26.2bln). Weaker demand outlook in H2 is due to both the macro-economic environment and customers inventory digestion. UK CMA considers there is insufficient time remaining within the statutory period for a full and proper consideration of Microsoft’s (MSFT) submission re. the proposed Activision (ATVI) deal; revised period to end on 29th August 2023.

Top European News

• Nordic Mobile Equipment Makers Fall as Nokia Cuts Guidance
• Vallourec Jumps as Tube Maker Predicts Better-Than- Forecast 2
• Heineken Gains as Goldman Upgrades to Buy on Margin Outlook
• Sixt Drops; Deutsche Bank Downgrades on Weak Profit Momentum
• London Gatwick Airport Workers to Strike Over Pay, Union Says
• Nordic Banks Tested as Property Slumps: EMEA Earnings Week Ahead

FX

• DXY finds a base just above 99.500 after another heavy decline and approaching end of bleak week that started with the index peaking around 102.500.
• Aussie and Kiwi make way for Buck bounce as AUD/USD fades ahead of 0.6900 and NZD/USD from 0.6400+ at best.
• Yen retreats from 137.26 towards 138.50 as JGB-UST spreads re-widen.
• Euro and Pound pull up shy of 1.3150 and 1.1250 vs Dollar respectively, but EUR/USD evades 1bln option expiries at 1.1200, for now.
• BoJ to host the first long-term policy review workshop in December, to discuss monetary policy and financial systems. Second workshop in May 2024. To discuss analyses comprehensively until that point.
• PBoC set USD/CNY mid-point at 7.1318 vs exp. 7.1453 (prev. 7.1527)

Fixed Income

• Debt diverges towards the end of a hectic and mainly corrective bull-steepening week
• Bunds and Gilts above par between 133.18-132.69 and 95.02-94.53 respective bands, but T-note underwater within 113-01+/112-21 overnight range awaiting US import/export prices
• Fed’s Goolsbee and UoM sentiment with inflation expectation. JGBs volatile amidst contrasting BoJ vibes

Commodities

• A contained and catalyst-thin session thus far to conclude a busy week of macro developments before the Fed blackout begins and attention turns to the next round of Central Bank announcements.
• WTI Aug’23 and Brent Sep’23 are on track to conclude the week with gains of circa. USD 2.50/bbl and are currently at the upper-end of the week’s USD 72.67-77.33/bbl and USD 77.36-81.75/bbl respective parameters.
• Spot gold is a touch softer but holds above the USD 1950/oz handle around the USD 1954/oz 50-DMA; base metals more mixed as it stands.
• Qatar set September-loading Al-Shaheen crude term prices at USD 1.68/bbl above Dubai quotes.

Geopolitics

• Russian President Putin said new weapons supplies will further escalate the conflict in Ukraine and worsen the situation. It was separately reported that Putin also said he proposed to Wagner fighters at a meeting this month to continue serving in the military, while he added that Russia’s government and parliament must discuss the legal framework for private armies and said without a legal framework, ‘Wagner does not exist’, according to Kommersant.

US Event Calendar

• 08:30: June Import Price Index MoM, est. -0.1%, prior -0.6%; YoY, est. -6.1%, prior -5.9%
  • June Export Price Index MoM, est. -0.1%, prior -1.9%; YoY, est. -11.0%, prior -10.1%
• 10:00: July U. of Mich. Sentiment, est. 65.5, prior 64.4
  • U. of Mich. Expectations, est. 62.0, prior 61.5
  • U. of Mich. Current Conditions, est. 70.5, prior 69.0
  • U. of Mich. 1 Yr Inflation, est. 3.1%, prior 3.3%
  • U. of Mich. 5-10 Yr Inflation, est. 3.0%, prior 3.0%

DB’s Jim Reid concludes the overnight wrap

After a hectic week, I’m playing a gig at a good friend’s 50th birthday party tomorrow night. I haven’t done any practise so I’m relying on a set list that worked 20 years ago. Given the nature of the event I’m assuming the audience won’t have heard much new music in that period so we should all be ok. If it all goes well I’ll be digging out research from 20 years ago as well to see if I can pull off the same trick.

The market has been partying like it’s 1999 this week, with the rally showing no sign of letting up over the last 24 hours, with bonds and equities surging thanks to growing hopes of a soft landing. It’s hard to stand in the way of that narrative at the moment regardless of what eventually happens. Much of that was propelled by the previous day’s CPI release, but investors then got a further dose of optimism from a weaker-than-expected PPI print, as well as the weekly jobless claims that were below consensus. That supported a fresh multi-asset advance, with the S&P 500 (+0.85%) and NASDAQ (+1.58%) closing at 15-month highs, yields on 10yr Treasuries falling -9.4bps to 3.77%, and Brent Crude oil prices closing at a 2-month high of $81.36/bbl. And that’s all before we start Q2 US earnings season today.

These moves over the last week have been part of an astonishing turnaround in the market narrative. After all, it was only on Thursday of last week that the bumper ADP report sent the 2yr Treasury yield up to 5.12% intraday, which is its highest level since 2007. But since then, we’ve had the smallest monthly jobs growth (+209k) since December 2020, along with the weakest core CPI (+0.16%) since February 2021, and investors are pricing in a growing chance of multiple rate cuts next year.

When it came to those developments yesterday, the main story was that monthly PPI came in at just +0.1%, and the previous month was revised down a tenth to -0.4%. So more positive news on the inflation side. In turn, that took the year-on-year PPI close to deflationary territory at +0.1% (vs. +0.4% expected), which is the lowest it’s been since August 2020. In addition, the core PPI measure excluding food and energy was at a monthly +0.1% (vs. +0.2% expected), with the year-on-year measure down to +2.4% (vs. +2.6% expected).

That downside surprise helped cement the message from the previous day’s CPI report. In particular, it meant investors became increasingly confident that the next meeting would mark the final rate hike of the current cycle, despite the Fed’s signal in their recent dot plot for two more. For example, the terminal rate priced in for November came down -1.5bps to 5.37%. And looking further out into 2024, the year-end rate came down a further -18.7bps to 3.725%. Bear in mind that after the ADP report, futures were briefly pricing in a 4.51% rate for December 2024, so the recent newsflow has led markets to price around three more 25bp rate cuts compared to a week ago.

The prospect of more rate cuts meant that sovereign bonds got a lift on both sides of the Atlantic. Yields on 10yr Treasuries were down -9.4bps to 3.77%, and those on 2yr Treasuries fell -11.2bps to 4.64%. In Europe it was a similar story, with yields on 10yr bunds (-8.9bps), OATs (-8.8bps) and BTPs (-12.1bps) all coming down as well.

The US rates move came in spite of comments from San Francisco Fed President Daly, who said it was “really too early to say that we’ve declared victory on inflation”. Later in the day, the generally hawkish Federal Reserve Governor Waller noted that he still saw two more hikes this year as necessary, though he added that if the next two inflation prints “look like the last two, the data would suggest maybe stopping” by September. So it seems that many FOMC members are still sceptical of the slowing inflation data but keeping an open mind. We won’t hear from many more Fed speakers now, since today is the last day before their blackout period ahead of the next meeting. In other Fed news yesterday, we heard that St Louis Fed President Bullard, another of the most hawkish FOMC members, was stepping down from this role. He wasn’t a voter this year, but his views held sway.

For equities, these hopes of a soft landing meant that the US indices hit fresh landmarks, with both the S&P 500 (+0.85%) and the NASDAQ (+1.58%) at a 15-month high. Tech stocks led the advance, with the FANG+ index (+2.70%) reaching a new all-time high, passing its previous peak from November 2021, having now risen by +80.86% on a YTD basis. Meanwhile in Europe, the STOXX 600 (+0.61%) advanced for a 5th consecutive session for the first time since April. There were some positive earnings releases as well, with PepsiCo (+2.38%) raising its outlook. Today will see further reports from the major US financials as well, including JPMorgan, Citigroup, Wells Fargo and BlackRock.

All this optimism over the economic outlook was bolstered again by the weekly jobless claims. They showed the initial claims down to 237k in the week ending July 8 (vs. 250k expected), which took the 4-week moving average down to a one-month low of 246.75k. Continuing claims did edge up from 1720k to 1729k but was largely brushed aside. There was also some better-than-expected data out of the UK, since monthly GDP in May only contracted by -0.1% (vs. -0.3% expected), despite the impact from the coronation bank holiday.

Asian equity markets are largely extending the global rally and are on course for their best week this year. The KOSPI (+1.14%) is leading gains with the Hang Seng (+0.44%), the Nikkei (+0.23%), the Shanghai Composite (+0.016%) and the CSI (+0.07%) also trading higher. Outside of Asia, US stock futures are pausing for breath with those on the S&P 500 (-0.06%) just below flat while those on the NASDAQ 100 (+0.08%) slightly higher ahead of the big bank earnings today. US treasuries are back up around a basis point across the curve after the huge rally this week.

In FX, the dollar index (which measures it against six major peers) is hovering around at a 15-month low of 99.59. Meanwhile, the Japanese yen is rallying for the seventh day, trading below 138 per dollar, its strongest level since May as we go to print.

On commodities, there was some interesting news as Bloomberg reported that India were considering banning exports of all non-Basmati rice, citing “people familiar with the matter.” That comes against the backdrop of significant rises in rice prices, following concerns that El Nino conditions will lead to a drought. Speaking of the El Nino, we also had the latest monthly update from the US’ Climate Prediction Center yesterday. Their forecasts are broadly similar to before, but they slightly downgraded the chances that the current El Nino would develop into a strong one, with the probability down to 52% at the peak (vs. 56% last month).

To the day ahead now, and earnings season will step up a gear as we hear from JPMorgan, Citigroup Wells Fargo and BlackRock. Otherwise, data releases include the University of Michigan’s preliminary consumer sentiment index for July.

Authored by David Attlee via CoinTelegraph.com,

Russia’s central bank digital currency (CBDC) project, the digital ruble, has taken a step closer to reality.

On July 11, the lower chamber of the Federal Assembly of the Russian Federation, the State Duma, passed the digital ruble bill in the third reading.

The legislation now moves to the assembly’s upper chamber, the Federation Council, and, if passed, to the president’s desk.

The bill, which was last amended at the end of June, sets the legal definitions of “platform, ” participants,” and “users,” as well as the general guidelines for the CBDC ecosystem.

In the current framework, Russia’s central bank, the Bank of Russia (BoR), will become the principal operator of the digital ruble infrastructure. It also bears the responsibility for all the stored assets.

The main aim of the CBDC, according to the BoR, is to serve as a payment and transfer method. Hence, its users won’t be able to open savings accounts. As the BoR emphasizes, payments and transfers would be free for individual customers and cost 0.3% of the payment amount for corporate clients.

The bill was introduced to the State Duma in December 2022 and passed through its first reading in March 2023. In February, a subsidiary of the leading Russian government-owned gas company, Gazprombank, warned against possible risks for banks in the case of the fast transition to digital money. The Russian branch of McKinsey estimated the potential losses of traditional banks from the CBDC implementation at around 250 billion rubles ($3.5 billion) in five years. At the same time, the consultancy firm estimated retailers’ profit at $1.1 billion yearly.

In a recent interview, the deputy chairman of the central bank, Olga Skorobogatova, announced the mass rollout of the digital ruble for all Russian citizens by 2027. The CBDC will be tested in a pilot program between 2023 and 2024.

Authored by Chris Menahan via Information Liberation,

London Mayor Sadiq Khan on Monday claimed for the umpteenth time that cities cannot solve their crime problems through mass arrests — even though that has been proven to be false by El Salvadoran President Nayib Bukele.

“There is no place for crime in London,” Khan said on Twitter. “But we can’t arrest ourselves out of the problem.”

“From removing knives from our streets, to providing young Londoners with meaningful and engaging activities, I am committed to being tough on crime and its complex causes.”

There is no place for crime in London.

But we can’t arrest ourselves out of the problem.

From removing knives from our streets, to providing young Londoners with meaningful and engaging activities, I am committed to being tough on crime and its complex causes.

— Mayor of London, Sadiq Khan (@MayorofLondon) July 10, 2023

“We can’t arrest our way out of London’s crime problem,” Khan said more bluntly last year.

President Bukele has shown the entire world that with strong leadership you can in fact arrest your way out your nation’s crime problem.

Wouldn’t it be obvious that if we had the highest murder rate in the world, it was precisely because we had a lot of criminals on the streets that were supposed to be in jail in the first place? 🤷🏻‍♂️

It seems like basic logic has completely abandoned western civilization. https://t.co/rqsbG5Zbuf

— Nayib Bukele (@nayibbukele) July 10, 2023

Your own article contains the answer:

Country with the highest murder rate ≈ country with the highest number of criminals on the streets ≈ country with the highest number of persons that must be put in jail to stop the murders

Am I going too fast? https://t.co/sSvfo70nX1

— Nayib Bukele (@nayibbukele) July 11, 2023

He locked up every gang member he could find — nearly 2% of El Salvador’s population — and his nation transformed from the murder capital of the world to one of the safest countries in Central America.

While the West accuses him of all sorts of human rights abuses (which they are guilty of themselves) — the fact of the matter is he has a 92% approval rating — something Western leaders could only dream of.

Whatever human rights violations he may be guilty of, the fact of the matter is the average Salvadoran views the abuses of MS-13 and the 18th Street gang as infinitely worse.

That said, we don’t have to look to Bukele alone for guidance. Former New York City Mayor Rudy Giuliani and Mayor Michael Bloomberg made crime plummet in their city using far less harsh methods through stop-and-frisk.

London has its own “Stop and Search” program but it’s barely used because it has been panned as “racist.”

The city of London — much like every other major liberal Western city — could solve its crime problem if it wanted to but their leaders choose not to because they prioritize fighting “racism” over fighting crime.

Authored by Dave DeCamp via AntiWar.com,

Rheinmetall, Germany’s leading arms maker, will open a plant to manufacture tanks and other armored vehicles in Ukraine within the next 12 weeks as the West is looking to boost Ukraine’s weapons industry.

Rheinmetall CEO Armin Papperger told CNN that the company will also train Ukrainians how to use and maintain the tanks they manufacture at the plant. He said Ukrainians need to learn how to “help themselves” and cannot rely on Europeans and Americans for maintenance.

The German company will operate the factory with Ukroboronprom, a Ukrainian state-owned defense firm. Papperger said the facility will be located in western Ukraine.

Other Western arms companies are looking to establish factories in Ukraine, and Russia has warned that it could target the plants.

Dmitry Medvedev, the deputy chair of Russia’s security council, warned in June that Russia should respond to Western arms manufacturing in Ukraine with “salvos of Kalibr (cruise missiles) and other Russian pyrotechnic devices.”

Papperger insisted that the Rheinmetall plant would be able to be protected from any Russian attacks. “There are a lot of factories at the moment which are producing military goods [in Ukraine]. It is just another one — and we can protect that also,” he said.

The war in Ukraine has been a boon for Rheinmetall and other Western arms makers. Papperger said that the focus right now is producing more artillery rounds, and his company is working on ramping up its annual production of shells from 100,000 to 600,000.

Via Remix News,

The EU wants Ukraine to clean up its act…

Ukraine must implement reforms to fight corruption and strengthen its institutions if it wants to be eligible to join NATO, said Ursula von der Leyen, president of the European Commission, during the second day of the NATO summit in Vilnius.

Von der Leyen encouraged Ukraine to implement further reforms and pledged the support of the European Union. According to Hungarian newspaper Magyar Nemzet, von der Leyen’s statement “said in plain language that there was still so much corruption and opacity in Ukraine’s institutions that it could not yet get the green light to join NATO or the European Union.” However, the paper also noted that von der Leyen noted the country’s efforts were appreciated and it had made a lot of progress.

Ukraine needs long-term security.

At the @NATO Summit we are discussing how to best provide for this.

The EU contributes with investments, weapons, training and support to the reforms that can lead Ukraine into the EU and NATO. pic.twitter.com/0HRIPcAg36

— Ursula von der Leyen (@vonderleyen) July 12, 2023

The European Commission already identified systemic corruption in Ukraine in 2021. Although the EU had launched a number of initiatives to reduce the potential for corruption and proposed a wide range of measures, the EU commission’s report at the time found that no progress had been made on this issue in 2021.

At that time, there was a significant decline in the judiciary, and anti-corruption institutions were also under threat, according to the report. The authors also noted that oligarchs and vested interests are the biggest problem, as they are an obstacle to the rule of law and economic development in Ukraine.

Brussels is keen to bring Ukraine into the European Union. However, even EU officials do not dare mention in their reports anything concrete or substantial to suggest that Ukraine is ready for integration, and Von der Leyen’s remarks indicate that the situation has still not improved.

As Remix News reported last week, the Federation of Employers of Ukraine, representing Ukrainian entrepreneurs, issued an appeal to President Volodymyr Zelensky, demanding action to curb the abuse of power by government officials. The abuse of power by military officials and judges has crossed all lines, according to Ukrainian entrepreneurs, who are calling for the establishment of a public registry to identify corrupt officials. They further argue that corruption on an unprecedented scale is eroding Ukraine’s defensive capabilities.

Authored by ‘Carpe Diem’ via American Greatness,

For as long as I can remember, the Democratic Party has claimed to be a champion for all Americans, particularly for the working class, minorities and for those who are considered marginalized, oppressed or downtrodden.

But somewhere between fighting to keep slavery alive (Andrew Johnson); deliberately reducing the number of black civilian employees from the federal workforce and airing a film that glorified the Ku Klux Klan at the White House (Woodrow Wilson); throwing Japanese Americans into internment camps during World War II (Franklin Delano Roosevelt); promoting a culture of government dependence, poverty and fatherlessness (Lyndon Johnson);  creating racial tension by declaring cops racist—leading to further destruction of our inner cities, while mocking legitimate concerns of disgruntled blue collar midwesterners frustrated by decreasing wages, lack of employment opportunities—and an opioid epidemic hollowing out their communities (Barack Obama); the intentional failure to enforce our country’s immigration laws, contributing to a four decade high of inflation by spending trillions of taxpayer dollars on Democrat pet projects that mostly help special interest groups, referring to roughly half the country as violent extremists and weaponizing the Department of Justice—to throw his leading political rival in prison (Joe Biden); it seems fair to say the Democratic Party has fallen well short of being a champion for anyone, except for its own desperate attempt to stay in power at any and all costs.

For a party that abhors the Founding Fathers and seeks to delegitimize their contributions, rejects and regards the principles of the Constitution as meaningless, and regularly criticizes the country for failing to live up to its stated goal of forming a more perfect union, perhaps it might be time for the Democratic Party to look itself in the mirror.

The entirety of the Democratic Party platform in 2023 is predicated on fear mongering and based on easily verifiable lies about the Republican Party.

It typically sounds something like this: Republicans want to make it harder for minorities to vote, they only want to give tax breaks to the wealthy, they’re banning books and ignoring inconvenient aspects of American history, they don’t want poor kids to be able to go to college, they’re anti-immigration, they want to deprive Americans from receiving healthcare, they don’t believe trans people exist, they don’t think women have a right to make their own medical decisions, and police are writ large racist and randomly hunting down black people, etc.

Not a single one of those absurd claims, which are promulgated regularly in the pages of The New York Times, The Washington Post, and other leftist propaganda outlets has one iota of credibility. But that hasn’t prevented Democrat politicians, Hollywood, academia and the legacy media from repeating these erroneous charges into ad nauseum.

Take, for instance, the ridiculous claim that Republican led states like Georgia want to make it harder for minorities to vote. Considering that the Peach State just set a record for voter turnout in the Midterms—in which over one million people voted—Republican leaders did a pretty poor job of discouraging citizens from casting their ballots.

It is hardly discriminatory to require every single American to present a valid form of ID that clearly verifies who the individual is. Nothing about that is inherently racist, but it certainly is racist to imply that black people for some reason either do not have an ID, or do not possess the means to obtain a driver’s license. If the DMV is suddenly denying licenses to black people—one would imagine the Biden DOJ would have started an investigation.

But I digress.

What about the Democrats’ fallacious charge that Republicans only want to give tax breaks to the wealthy? Once again, that is simply not borne out by any shred of evidence.

An analysis of IRS tax data showed that the Trump tax cuts disproportionately benefited those earning less than $50,000 per year. Those with an adjusted gross income (AGI) of $15,000 to $50,000 saw an average tax cut of 16 percent to 26 percent in 2018, while those who earned $50,000 to $100,000 received a tax break between 15 percent to 17 percent.

Those earning between $100,000 to $500,000 in AGI saw their personal income taxes decrease by around 11 percent to 13 percent and no one with an AGI of at least $500,000 received an average tax cut above 9 percent. The average tax cut for those in income brackets starting at $1 million was less than 6 percent.

In other words, under Trump’s tax plan, the more money an individual earned, the higher their income was effectively taxed. But don’t let the facts get in the way of the Democrats narrative.

How about the Biden White House’s specious claim that Republicans are banning books and refusing to teach about slavery? In reality, Florida Governor Ron DeSantis removed books from libraries and classrooms in 23 school districts across the state that contained pornographic content and other types of violent and inappropriate material. One would think the Democrats would be fine with keeping pornography away from elementary schools, but apparently not.

Furthermore, under statute, s. 1003.42(2)(f), F.S. It is a requirement for Florida schools to teach African American history. But teaching students about slavery is different from segregating a classroom along racial lines into groups of evil white “oppressors” and “oppressed,” groups, while pontificating to seven year olds that America remains an irredeemably racist country. Sadly that remains the Democrats preferred view of this country.

What about the now irrelevant Bernie Sanders and his ilk who claim Republicans don’t want poor kids to be able to go to college. For starters those from upper income families would have likely benefited more than lower income households if Biden’s failed attempt to unconstitutionally cancel billions of dollars of student loan debt had passed—so it would not have even helped those who it was intended to benefit.

Second, not everyone wants to go to college, but for those who do wish to go, the taxpayers should not be subsidizing those who obtain useless degrees in topics like feminist, gender and sexuality studies, which will almost certainly lead to graduates becoming dumber, while remaining unemployed without any tangible skills.

How about the Democrats’ sophist charge that Republicans are anti-immigration? In reality they’re not against immigration, they’re against illegal immigration! It is not compassionate to let millions of unvetted migrants pour across our country, while they suppress our wages, overwhelm public resources, commit violent crimes, and traffic in drugs and humans. It is not a serious argument to justify support for illegal immigration by proclaiming that migrants are more willing to do jobs other Americans are less likely to want to do. There is nothing humane about failing to secure our southern border or treating citizens from other countries better than we treat our own.

What about the Democrats who foolishly claim Republicans want to deprive Americans from receiving healthcare? The reality is, socialized healthcare is a disaster that will cause millions of Americans to lose their healthcare plans, while lowering the quality of care. It will almost certainly raise the cost of coverage and increase wait times. Just ask all the Canadians who would rather spend money and travel to the U.S. so they can be treated for cancer or surgery sooner.

How about the Democrats who claim that Republicans don’t believe trans people exist? For starters, anyone can identify as whatever they want, but that does not make it reality. I can go around telling people I’m a giraffe, but I do not have the right to compel people to believe me. Second, when the delusions of a small group of people threaten the competitive nature of women’s sports, and can lead to inappropriate locker room interactions, that is when the charade should immediately end. The Democratic Party has long claimed to care about empowering women, but lately they seem to be more interested in empowering men who say they are women.

What about the Democrats who claim Republicans don’t think women have a right to make their own medical decisions? Most of the American public supports a 15 week ban on abortion—which means most people are in favor of protecting the innocent life of an unborn child—while also ensuring the safety of the mother. Unfortunately, the Democrats do not view an unborn child as a human, even if it has a heartbeat. The party that supposedly cares about human beings supports abortion on demand, up until and including the birth of a child. That does not seem too charitable.

How about the Democrats false claim that police are writ large racist and randomly hunting down black people? This is simply not borne out by the data. There is zero evidence that black people are killed by police at a higher rate than white people are. In fact the evidence shows that a police officer is 18 ½ more likely to be killed by a black male, than an unarmed black male is to be killed by a police officer. but that hasn’t stopped Democrat demagogues from repeating the lie anyway to further divide the country for political gain.

So which groups benefit from Democratic policies?

Outside of Democrat special interest groups, the president’s corrupt son, and our chief adversaries around the world, I can’t think of anyone. But it’s clearly not me or you.

Do children living in inner cities who attend failing public schools controlled by Democrat teachers unions who wanted to keep them home during COVID? How about those living in high crime areas where the police are nowhere to be found after Democrat politicians spent years defaming and defunding them? How about Jewish communities, who have faced a rise in antisemitic attacks, while Democrat politicians consistently side with Israel hating terrorist groups like Hamas and Hezbollah? What about the Asian community that the Democratic Party now penalizes for scoring too high on standardized exams in order to achieve a more “equitable” racial quota. How about those who support pro-life groups? How about everyday Americans who have been crushed by Bidenflation and the Left’s war on American energy production? What about those who did not want to lose their job or business—due to their refusal to take a COVID vaccine that does not appear to work the way the “health experts” told us it would.

The Republican Party is far from perfect, but the Democratic Party is plain evil.

There was a shocking number in today’s latest monthly US Budget Deficit report. No, it wasn’t that US government outlays unexpectedly soared 15% to $646 billion in June, up almost $100 billion from a year ago…

… while tax receipts slumped 9.2% from $461 billion to $418 billion, resulting in a TTM government receipt drop of over 7.3%, the biggest since June 2020 when the US was reeling from the covid lockdown recession; in fact never have before tax receipts suffered such a big drop without the US entering a recession.

Needless to say, surging government outlays coupled with shrinking tax revenues meant that in June, the US budget deficit nearly tripled from $89 billion a year ago to $228 billion, far greater than the consensus estimate of $175 billion. One can only imagine which Ukrainian billionaire oligarch’s money laundering bank account is currently enjoying the benefits of that unexpected incremental $50 billion US deficit hole: we know for a fact that the FBI will never get to the bottom of that one, since they can’t even figure out who dumped a bunch of blow inside the White House – the most protected and surveilled structure in the entire world.

And with the monthly deficits coming in higher than expected and also far higher than a year ago, it is also not at all surprising that the cumulative deficit 9 months into the fiscal year is already the 3rd highest on record, surpassed only by the crisis years of 2020 and 2021: at $1.393 trillion, the fiscal 2022 YTD deficit is already up 170% compared to the same period last year.

Again, while sad, none of the above numbers are surprising: they merely confirm that the US is on an ever faster-track to fiscal death, but not before the Fed is forced to monetize the debt once again (one wonders what financial crisis the Jekyll Island folks will invoke this time to greenlight the next multi-trillion QE).

No, the one number that was truly shocking was found all the way on page 9, deep inside Table 3 of the latest Treasury Monthly Statement: the only highlighted below, and which shows that in the 9 months of the current fiscal year, the US has already accumulated a record $652 billion in gross debt interest.

This number was more than 25% higher compared to the Interest Expense payment for the comparable period a year ago, which amounted to $521 billion.

Soaring interest rates, driven by the panicked Fed’s scramble to undo its epic policy failure of 2020 and 2021 when the Fed kept rates at zero for far too long while injecting trillions into various asset bubbles, have been the key driver of the deficit, with the Federal Reserve boosting its benchmark rate by 5% since it began hiking in March last year. Five-year Treasury yields are now about 3.96%, versus 1.35% at the start of last year. As lower-yielding securities mature, the Treasury faces steady increases in the rates it pays on outstanding debt: that’s right – even when the Fed starts cutting rates, due to the delay of rolling over maturing debt, actual interest payments will keep rising for the foreseeable future.

For context, the weighted average interest for total outstanding debt at the end of June was only 2.76%, a level that’s not been surpassed since January 2012, according to the Treasury. That’s up from 1.80% a year before, the department’s data show, and if the Fed indeed keeps rates “higher for longer”, the blended rate on the debt will surpass 4% in one year.

That would be a complete disaster for the US, and it would mean that interest payments on total US debt of $32.3 trillion would hit $1.3 trillion within 12 months, potentially making interest on the debt the single biggest US government expenditure and surpassing social security!

But we don’t even have to wait that long until the exploding interest on US government debt becomes a major talking point ahead of the coming presidential elections. According to the St Louis Fed’s FRED and the BEA, the interest payments by the Federal Government have now surpassed $900 billion for the first time ever, and within a quarter will hit probably rise above $1 trillion, a historic benchmark that will probably begin the countdown to the US Minsky Moment.

One of the most incompetent puppets in the Biden admin (and there are countless), Treasury Secretary Janet Yellen, has played down concerns about higher rates. She has instead flagged that the ratio of interest payments to GDP, after adjustment for inflation, remains historically low. The problem with Yellen’s argument is that GDP will crater after the next recession (which will also spark the next financial crisis, one which Yellen will not live to see), but US debt will never again drop in either absolute or relative terms, as the good folks at the CBO have been so kind to make clear to even such intellectual midgets as the former Fed chairwoman.

In short, the endgame has now arrived, and all the US can do now is rearrange the deck chairs .