The Central Bank of Russia raised interest rates by 200 basis points, lifting the benchmark interest rate to 18%.
U.S. major stock indices closed higher across the board. Apple Vice President: Eagerly looking forward to continuing innovation hand in hand with Chinese suppliers.
U.S. core PCE price index rose 2.6% year-on-year in June, slightly higher than expected.
International precious metal futures generally closed higher, while international oil prices fell across the board.
The Central Bank of Russia raised interest rates by 200 basis points
Lifting the benchmark interest rate to 18%
According to China News Service, on the local time of the 26th, the Central Bank of Russia raised interest rates by 200 basis points, increasing the benchmark interest rate from 16% to 18%.
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The Central Bank of Russia stated that domestic inflationary pressures in Russia have intensified and are significantly higher than the Central Bank's forecast in April. Higher inflation expectations have reinforced the inertia of persistent inflation. The growth rate of domestic demand continues to far exceed the expansion of the supply of goods and services. To bring inflation back down again, further tightening of monetary policy is needed, and stricter monetary conditions than expected must be implemented to bring inflation back to the target level. The Central Bank will assess the feasibility of further raising the benchmark interest rate at upcoming meetings.
The Central Bank also raised its 2024 inflation forecast from 4.3%-4.8% to 6.5%-7%. Considering the current monetary policy, the 2025 inflation forecast was lowered to 4%-4.5%, and the 2026 inflation forecast remained unchanged at 4%.
The Central Bank pointed out that the economic operation indicators for the second quarter of 2024 indicate that the Russian economy continues to grow rapidly. Consumption activity remains active due to a significant increase in household income and enhanced consumer confidence. Strong investment demand is supported by fiscal stimulus and robust corporate profits. At the same time, labor shortages continue to worsen. In this situation, the growth of domestic demand has not led to a corresponding expansion of the supply of goods and services, but has increased corporate costs, thereby increasing inflationary pressures.The Central Bank of Russia has indicated that, in the medium term, the main inflation risks are associated with changes in Russia's foreign trade conditions (including the impact of geopolitical tensions), the persistence of high inflation expectations, and the Russian economy's upward deviation from the balanced growth trajectory.
Furthermore, in its latest macroeconomic forecast, the Russian Central Bank expects the Russian economy to grow by 3.5%-4% in 2024, higher than the previously forecasted 2.5%-3.5%.
U.S. Stock Markets Close Higher Across the Board
All three major U.S. stock market indices closed higher. At the close, the Dow Jones Industrial Average rose by 1.64%, to 40,589.34 points. The S&P 500 index increased by 1.11%, to 5,459.1 points. The Nasdaq Composite gained 1.03%, to 17,357.88 points. For the week, the Dow Jones Industrial Average rose by 0.75%, the S&P 500 index fell by 0.83%, and the Nasdaq Composite declined by 2.08%.
Semiconductor stocks collectively rose, with ASML increasing by 2.99%, Qualcomm by 2.66%, Micron Technology by 1.82%, Broadcom by 1.59%, Advanced Micro Devices by 1.21%, TSMC by 1.04%, Intel by 0.8%, and NVIDIA by 0.69%.
Apple Vice President: Eagerly Looking Forward to Continuing Innovation with Chinese Suppliers
On the afternoon of July 26th Beijing time, Apple Vice President and Managing Director of Greater China, Isabel Ge Mahe, stated on her personal Weibo account that she and Apple's Chief Operating Officer (COO), Jeff Williams, visited Foxconn and Lens Technology. It is reported that Apple plans to expand its advanced Applied Materials Research Lab to Shenzhen.
On July 26th Eastern time, Apple's stock price slightly rose by 0.22%, closing at $217.96.
Ge Mahe expressed on Weibo: "Jeff and I had an amazing day visiting the teams of two major suppliers in Guangdong! We witnessed the latest advancements in iPhone production at Foxconn's Guanlan site. Lens Technology provides thousands of components for our entire product line, and their manufacturing has achieved a high level of automation. We are eagerly looking forward to continuing to innovate hand in hand with suppliers here and across all of China."
It is reported that the Shenzhen Applied Materials Research Lab is currently expected to invest over one billion yuan, mainly responsible for hardware development, intelligent manufacturing, and joint research and development with local suppliers. This will enhance the testing and research capabilities for products such as iPhone, iPad, and Vision Pro. Apple has stated that the lab's proximity to production and assembly bases facilitates cooperation between engineers and suppliers, allowing for real-time adjustments and helping suppliers to improve efficiency and save time.US Core PCE Price Index Rises 2.6% YoY in June
In macroeconomic terms, the US Core PCE Price Index for June rose 2.6% year-over-year (YoY), exceeding expectations of a 2.5% increase, with the previous month's figure also at 2.6%; it increased by 0.2% month-over-month (MoM), which was higher than the expected 0.1% increase, and the previous month's figure was also up by 0.1%. The PCE Price Index itself rose by 2.5% YoY, meeting expectations, with the previous month's figure at 2.6%; it increased by 0.1% MoM, as expected, and was unchanged from the previous month's figure.
US Personal Consumption Expenditures Rise 0.3% MoM in June
In June, US personal consumption expenditures increased by 0.3% MoM, as expected, with the previous month's figure revised from a 0.2% increase to a 0.4% increase; personal income increased by 0.2% MoM, lower than the expected 0.4% increase, with the previous month's figure revised from a 0.5% increase to a 0.4% increase; real personal consumption expenditures increased by 0.2% MoM, lower than the expected 0.3% increase, with the previous month's figure revised from a 0.3% increase to a 0.4% increase.
US University of Michigan Consumer Sentiment Index Final Value for July at 66.4
The final value of the University of Michigan Consumer Sentiment Index for July was 66.4, as expected, with the initial value also at 66, and the final value for June at 68.2.
US One-Year Inflation Expectations Final Value for July at 2.9%
The final value of the one-year inflation expectations for July was 2.9%, as expected, with the initial value also at 2.9%, and the final value for June at 3.0%.
International Precious Metals Futures Close Higher
On July 26th, Eastern Time, international precious metals futures closed higher. COMEX gold futures rose by 1.37%, trading at $2385.7 per ounce, with a weekly decline of 0.56%. COMEX silver futures increased by 0.34%, trading at $28.07 per ounce, with a weekly decline of 4.19%.
International Oil Prices Decline Across the Board
International oil prices declined across the board. The August US oil contract fell by 2.35%, trading at $76.44 per barrel, with a weekly decline of 2.8%. The September Brent oil contract fell by 2.11%, trading at $79.67 per barrel, with a weekly decline of 3.58%.