UK-EU negotiations nearing conclusion

[The British economy will be overtaken by Poland in 2030]

The leader of Britain's opposition Labor Party, Keir Starmer, will warn in an upcoming speech, citing World Bank data, that Poland's economy will overtake the UK's by 2030 and by 2040 without a leadership change. In 2010, the economies of Romania and Hungary will also surpass that of the United Kingdom.

[The UK and the EU will "finally negotiate", and the new arrangements for Northern Ireland are expected to be reached]

The British Prime Minister's Office announced that Prime Minister Rishi Sunak will conduct "final negotiations" with European Commission President Ursula von der Leyen on a number of new arrangements in Northern Ireland after Britain leaves the European Union. Public opinion generally expects that the two sides are expected to reach an agreement to resolve the trade disputes that have hindered the development of UK-EU relations for a long time.

[The probability of the Bank of England raising interest rates by 50 basis points in March is small]

Investors expect the Bank of England to raise interest rates by 27 basis points at its March meeting, compared with expectations for a 20 basis point hike at the previous meeting, meaning investors now see a 50 basis point hike in March as a possibility Sex is small. This shift may be due to the market's belief that the Fed will continue to raise policy rates. But after the UK's core services CPI unexpectedly fell to 6.0% in January, there are downside risks to the pricing of the Bank of England's interest rate hike. By Friday, the market may only consider the Bank of England's decision to keep interest rates unchanged or raise interest rates at the March meeting 25 basis points.

[The month-on-month increase in CPI in the euro zone in February will receive attention]

Inflation data in the euro area in February is the focus of the bond market this week. Although we expect the annual rate of CPI in the euro area to fall sharply from 8.6% to 8.0% in February, market participants may pay more attention to the month-on-month growth. 0.4%. Referring to the information obtained in the latest US inflation data, the monthly rate of inflation is more meaningful than the annual rate of decline. The Harmonized Index of Consumer Prices (HICP) in the euro area will rise by 0.6% month-on-month and 8.2% year-on-year in February.

[The final value of the consumer confidence index in the euro area in February]

Optimism in the eurozone economy appears to have reached its limit as economic sentiment begins to turn a corner. The data was weaker than in January, while a negative revision was made to the previous month (revised -20.7). Combined with an earlier slowdown in money supply and real money growth, today's data is not good for the euro.

[The Federal Reserve implements interest rate hike measures to curb the highest level of inflation]

The Federal Reserve has implemented a series of rate hikes to curb the highest level of inflation in about 41 years. Markets widely expect several more rate hikes before the Fed pauses to assess the impact of tightening policy on the economy. However, this report suggests that there may be a way to go. “Simulations of our baseline model suggest that the Fed will need to tighten policy significantly further to achieve its inflation target by the end of 2025,” the researchers said.

[Risk aversion triggers yen strength]

The yen strengthened against other G10 and Asian currencies in early trade as risk aversion could help support the yen's safe-haven appeal. A "blowout" reading of U.S. core PCE data on Friday weighed on the risk environment, as the Federal Reserve's rate hike expectations have been recalibrated to be more hawkish in the wake of the data.