Russia raised its main interest rate the most since 1998 as the currency plunged to a record and investors pulled money from the stock market on concern that President Vladimir Putin will invade Ukraine.
Rand retreats 1% to 10.8655 per dollar by 6:44pm in Johannesburg, 2nd day falling as Ukraine crisis escalates; drops 0.7% vs euro. * Rand is worst decliner among 16 major currencies; 3-mo. implied volatility vs dollar climbs 3bps to 14.35, most out of 16 major currencies * S&P GSCI commodities index +1.8% to 661; spot gold +2.1% to $1,353.80/oz; platinum +1% to $1,461.13/oz * Yld on South African govt bonds due Dec. 2026 rises 4bps to 8.6%, highest level on closing basis since Feb. 24; yld on 10-yr Treasuries -5bps to 2.61% * Foreign investors bought ZAR636m of South African debt Feb. 28; inflows for week ending Feb. 28 ZAR4.61b, paring net sales this yr to ZAR15.1b. * TODAY: Kagiso Manufacturing PMI climbed to 51.7 in Feb. vs 49.9 pvs mo.; median est. of 6 economists in Bloomberg survey was 50.2; Naamsa vehicle sales contracted 3.1% in Feb. vs decline of 6.8% pvs mo. * Escalation of Ukraine crisis represents major shock to risky assets; expect high-beta E
Declines that erased $1.7 trillion from global stocks as currencies from Turkey to Argentina slid are proving a Wall Street maxim, according to Brian Barish of Cambiar Investors LLC: selling can start anywhere.
Central bankers in eastern Europe see their policies unaffected by the U.S. Federal Reserve’s withdrawal of stimulus as their economies benefit from the neighboring euro area emerging from a record-long recession.
The yuan may weaken following China’s decision to widen the currency’s trading band for the first time since 2007, according to Benoit Anne, the London- based head of emerging markets strategy at Societe Generale SA.