NYCB Attracts Over $1 Billion Equity Investment

1) NYCB Attracts Over $1 Billion Equity Investment
New York Community Bancorp (NYCB), which is in trouble with commercial real estate (CRE) issues, has succeeded in attracting more than $1 billion in equity investment. Liberty Strategic Capital, led by former U.S. Treasury Secretary Steven Mnuchin, has decided to invest $450 million, Hudson Bay Capital has decided to invest $250 million, and Reverance Capital Partners has decided to invest $200 million. Mnuchin emphasized, “When evaluating this investment, we had NYCB’s credit risk profile in mind,” adding, “We believe there is enough capital now in case we need to increase our reserves to meet the coverage ratio or higher than the level of large banks in the future with more than $1 billion in capital investments.”

2) Powell, ‘At some point this year it would be appropriate to start cutting interest rates’
Fed Chair Jerome Powell said it would be appropriate to start cutting rates “at some point this year” and made clear he was not ready to do so. His comments align with the consistent message sent by almost all Fed members in recent weeks. With the U.S. economy and labor market strong, monetary policymakers have time to wait for further evidence that inflation is returning to its 2% target before cutting rates. “We believe policy rates appear to be at their peak in this tightening cycle,” he said, adding, “If the economy is largely going as expected, it may be appropriate to start rewinding policy tightening at some point this year. However, the economic outlook is uncertain and continued progress toward the 2% inflation target is not guaranteed.”

3) U.S.A.P. Employment in Feb
Private U.S. companies increased their hiring at a moderate pace in February, showing that labor demand across the industry is resilient. According to figures released by ADP, a U.S. private labor market research firm, the number of ADP employees increased by 140,000 in February. “Employment growth is still solid,” said ADP’s Nella Richardson, “Wages are on the decline, but they are still higher than inflation.” Bloomberg Economics said wage pressure is likely to slow down at a time when demand for labor continues to weaken and workers are more passive in changing jobs, and the Fed, which is currently focused on inflation, diagnoses that risks could change more evenly in the future

4) Canadian central bank ‘too early to discuss cuts’
Canada’s central bank has kept its policy rate unchanged at 5% for a fifth consecutive session as market expected, acknowledging progress in inflation, but reiterating that it is still “too early” to consider cutting rates. The statement kept the final phrase “still concerned about the risks that threaten the inflation outlook, especially the persistence of underlying inflation.” “Today’s decision reflects an assessment that the 5% policy rate is still appropriate, and it is still too early to consider lowering the policy rate,” Governor Tiff McClum said. “While recent inflation indicators suggest that monetary policy is largely working as expected, future progress in inflation is expected to be gradual and uneven, and upward risks of inflation remain.”

5) U.S. asks allies to press China further in semiconductor sector
The U.S. government is pressuring allies including South Korea, Japan, Germany and the Netherlands to further tighten access to semiconductor technology in China. This is aimed at closing loopholes in export control measures implemented over the past two years and preventing China from making progress on its semiconductor rollout, the sources said. The Biden administration has asked the Dutch government to cooperate with ASML Holding to suspend services or repairs for Chinese customers who had already purchased the cutting-edge semiconductor manufacturing equipment before the restrictions went into effect this year. The U.S. also reportedly wants Japanese companies to restrict exports of special chemicals essential for semiconductor manufacturing, including photoresists, to China. It also expects more countries, including Germany and South Korea, to join such export control blocks
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