The UK economy enters a recession in the fourth quarter: The UK economy contracted by 0.3% in the last quarter of 2023,
entering a technical recession for the first time since the aftermath
of the COVID-19 outbreak in the first half of 2020
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The UK economy enters a recession in the fourth quarter.
The dollar has risen since the Federal Reserve’s recent statements.
The yen stabilises with Japanese authorities’ warnings of intervention.
The UK economy enters a recession in the fourth quarter
The UK economy contracted by 0.3% in the last quarter of 2023, entering a technical recession
for the first time since the aftermath of the COVID-19 outbreak in the first half of 2020,
with rising inflation, record borrowing costs, and weak foreign demand. On an annual basis,
the British economy contracted by 0.2% in the fourth quarter.
The dollar rose after the Federal Reserve’s recent statements
The dollar index rose around 104.4 and is hovering near its highest levels in six weeks,
supported by hawkish statements from a Federal Reserve official.
On Wednesday, Federal Reserve Governor Christopher Waller said the central bank
might backtrack on cutting interest rates amid strong inflation data.
The markets see a 60% chance of a Federal Reserve interest rate cut in June,
down from about 70% last week.
Investors are now looking forward to the latest report on the U.S. personal
consumption expenditures price index on Friday,
which is the Federal Reserve’s preferred inflation measure.
The yen stabilises with Japanese authorities’ warnings of intervention
The Japanese yen stabilised near 151 yen to the dollar,
recovering somewhat after falling to its lowest level 34 years earlier this week
with Japanese authorities indicating their readiness to intervene in currency markets.
Finance Minister Shunichi Suzuki warned that “decisive steps” would be taken against excessive currency movements.
Masato Kanda, the top currency diplomat, said he “would not rule out any steps to
respond to disorderly movements in the currency market.”
The yen’s rapid decline came amid speculation that the Bank of Japan’s monetary policy
remained accommodative despite the recent shift against negative interest rates.
Bank of Japan board member Naoki Tamura recently stated that the risk of inflation sharply exceeds,
and the demand for the central bank to tighten monetary policy quickly remains low.
The UK economy enters a recession in the fourth quarter: