Global Markets Calm After Russia Turmoil

Markets have started the week very quietly, with no apparent risk-off premium due to internal turmoil in Russia, which now appears to be over.


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  1. The weekend saw a seeming rebellion against the Russian government, or at least the military, by the private Wagner Group which has been fighting for Russia in large numbers in Ukraine. The group declared a march on Moscow and occupied two Russian cities on the way before retreating when only a few hundred miles from Moscow. The revolt was called off on Saturday evening, with the leader of the Wagner Group apparently going into exile in Belarus, and the Russian military beginning work on absorbing the Wagner Group. Markets seem to have reacted very calmly to these developments.
  2. Japan’s main Forex “diplomat” Masato Kanda said today that the relevant authorities will have a response to any excessive moves in the currency market, calling recent depreciations in the Yen “rapid”. This reflects increasing concern that the strong fall of the Yen will begin to affect Japan’s strongly recovering economy negatively. We are seeing the Japanese Yen fall to multi-year lows against several currencies (EUR/JPY has reached a 15-year high, GBP/JPY a 7-year high, USD/JPY a 7-month high), and trend traders will note that Japan often talks tough over a weakening Yen, but frequently does nothing to stop it. However, trend traders will be wary of intervention to prop up the Yen by the Bank of Japan, although this would likely be very difficult to achieve.
  3. Bitcoin advanced strongly last week to a new 1-year high price, but there are initial signs that the key resistance level at $30,534 is holding.
  4. Friday saw mostly worse than expected PMI data in services and manufacturing in the UK, Germany, and France, while US Services performed better than expected. This puts an emphasis on the relative strength of the US economy.
  5. There are no high-impact data releases scheduled today, so it is likely to be a very quiet Monday in the markets.
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