This morning in a pre-recorded televised announcement, Putin declared a partial military mobilisation in Russia to formally enact a war economy to support the Ukraine invasion, as well as call reservists to help mitigate recent battle losses. He said during the announcement that “the West wants to destroy our country”. The mobilisation is set to begin this Wednesday, with weapon production to be boosted but no more details added.
The comments come as Russia’s invasion of Ukraine has recently started to lose momentum as a Ukrainian counter-offensive is gaining momentum. Territories and cities recently recovered by Kyiv have also shown signs of mass burials, which could indicate mass killings of civilians and therefore war crimes. Several world leaders including Ukraine’s Zelensky and France’s Macron have called for an international investigation of the mass killing by the international court.
This war in Ukraine has put Germany under a lot of stress in recent months as it imported the majority of its energy requirements from Russia. With Russia closing the tap in retaliation to Western sanctions in recent weeks, the German government is looking for alternatives and just nationalised energy giant Uniper. The government had already agreed to bail out the gas importer in July when prices had been multiplied by 5 since February 2020, and the government is now set to take a 56% stake in the Finnish company, a subsidiary of Finland’s Fortum, for €500 million. A statement released this morning by Fortum read: “Since the stabilisation package for Uniper was agreed in July, Uniper’s situation has further deteriorated rapidly and significantly; as such, new measures to resolve the situation have been agreed”. The move will help households and businesses in Germany with ever rising cost of energy as inflation reached 7.9% in August.
Inflation in Japan reached 2.8% in August, data this morning shows, ahead of the Bank of Japan interest rate decision on Thursday. The country of the rising sun stays far from European level of inflation and as such expectations remains for the BoJ to keep interest rates at -0.10%.
Cable saw the dollar rally ahead of today’s Fed announcement. GBPUSD opened at 1.1434 and closed at 1.1379.
EURUSD followed a similar trend. The pair opened at 1.0023 and closed at 0.9970 yesterday.
GBPEUR remained stable yesterday. The pair opened at 1.1406 and closed at 1.1410.
