Aurelia Butler

BUENOS AIRES (Reuters) -Argentina’s central bank raised the country’s benchmark interest rate to 133% from 118% on Thursday as inflation data came in worse than forecast, 10 days before voters go to the polls to choose a new president amid a deepening economic crisis.The hike came shortly after September inflation figures were released, landing above expectations at 12.7% monthly and 138% annually, worsening surging prices that have sapped wages and savings and pushed two out of every five people in Argentina below the poverty line.Argentina’s central bank is struggling to keep the benchmark interest rate in line with inflation expectations, with a central bank poll of analysts later in the day forecasting inflation to end the year at more than 180%.Some commentators questioned whether the latest hike was too late amid a worsening economic scenario.”It is no longer useful to raise the rate, expectations have gone away and raising it at this time is not going to contain the flight from pesos to dollars,” a national private banking manager said on condition of anonymity.The impacts of inflation has been worsened by the government’s near-18% devaluation of the peso in mid-August, which coincided with the prior central bank hike, where it increased the interest rate from 97% to 118%.A rapid freefall of Argentina’s peso has since followed, with the currency surpassing the psychological barrier of 1,000 pesos per U.S. dollar earlier this week as the country prepares to vote in general elections scheduled for Oct. 22.Voters will be choosing who to succeed outgoing leftist President Alberto Fernandez, with radical libertarian Javier Milei seen as the front-runner due to his shock first-place showing in the August primary.Milei, who is seeking to shut the central bank and dollarize the economy to tame inflation, recently recommended depositors avoid renewing bank holdings in pesos, arguing that the peso does not even serve as “excrement.”The central bank’s rate change on Thursday came after a last-minute decision not to raise the rate to 145% “following a leak,” after Reuters reported the higher figure, citing a source close to the bank. More

The Federal Reserve’s aggressive rate hikes to rope in sticky inflation has increased the potential for an economic slowdown, forcing several Wall Street titans to axe jobs. Shares of San Francisco, California-based LendingClub were up more than 3% in trading after the bell.The company expects the job cuts to result in annual cost savings of about $30 million to $35 million.”We continue to proactively implement various measures to navigate the persistent and ongoing macroeconomic headwinds and the resulting pressure in our marketplace, primarily driven by higher interest rates,” Chief Executive Officer Scott Sanborn said in a statement.The company had laid off 225 employees earlier this year and said its third-quarter expectations are inclusive of the majority of severance charges, which were recorded in the quarter.LendingClub expects third-quarter revenue to be between $198 million and $200 million and net income in the range of $4 million to $5 million.Analysts on average expect revenue of $199.4 million and profit of $2.75 million, according to LSEG data.The company is scheduled to report its third-quarter results on Oct. 25 after markets close. More

(Reuters) – A look at the day ahead in Asian markets from Jamie McGeever, financial markets columnist.As investors digest the market and policy implications of this week’s U.S. inflation figures, Asia’s focus on Friday turns to Chinese producer and consumer price inflation, and to what extent they indicate a cooling of wider deflationary pressures.Going by Wall Street’s decline on Thursday, sparked by a spike in long-dated U.S. bond yields following a weak 30-year auction, the mood will be one of caution, at best.China’s PPI and CPI top a packed Asian economic calendar that also includes Chinese trade data, third quarter GDP and an interest rate decision from Singapore, unemployment from South Korea, and wholesale inflation from India.China’s economy has been hit on several fronts this year. The currency hit a 16-year low, investors have dumped the country’s stocks and bonds, the property sector is imploding and disinflation is threatening to morph into outright deflation.Annual producer price inflation has been negative for a year, although consumer inflation only briefly dipped below zero in July. September’s PPI and CPI readings on Friday will be closely watched for signs that the economy is reflating.Economists polled by Reuters expect an annual PPI rate of -2.4% compared with -3.0% in August, and annual CPI to tick up to 0.2% from 0.1%. Slow progress.The bigger picture for markets, however, continues to be dominated by U.S. yields and the Fed policy outlook.Wall Street slumped on Thursday after the 30-year Treasury bond sale. The high yield investors demanded was around 4 basis points higher than the prevailing market rate at the time, the biggest ‘tail’ in nearly two years.The ebb and flow of investor sentiment this week, centered around moves in Treasury yields and the U.S. yield curve, is instructive.Essentially, it hasn’t really mattered if the curve has steepened or flattened – what has mattered is whether the moves have been led by bond buying or bond selling, either at the short or long end.On Thursday the yield curve flattened the most in a single day since March, a ‘bull’ flattening led by heavy buying of long-dated bonds. Stocks rose. On Friday the curve ‘bear steepened,’ led by heavy selling at the long end. Stocks fell.So markets end the week at the mercy of this push and pull over the U.S. rate outlook: strong signals from Fed officials and Fed minutes that rate hikes are probably over, against economic data that is still refusing to play ball.One clear winner, though, is the dollar. It jumped 0.7% on Thursday – its best day since July – pushing the yen back down toward the key 150.00 per dollar area. Japanese intervention speculation is bound to swirl on Friday if that level breaks.Here are key developments that could provide more direction to markets on Friday:- China PPI and CPI inflation (September)- China trade (September)- Singapore policy decision and GDP (Q3) (By Jamie McGeever; Editing by Josie Kao) More