Bank of Israel buys $6.8 billion of forex in January, reserves jump to new record
The Bank of Israel said on Sunday it bought $6.832 billion of foreign currency in January, helping to weaken the shekel from a 24-year peak and taking forex reserves to a new record high of $179.5 billion. Last month, the central bank said it would buy $30 billion of forex in 2021 to try and stem the shekel’s appreciation, after buying $21 billion in 2020.
The shekel hit 3.11 per dollar on Jan. 14, its strongest level since April 1996. With the help of the central bank’s intervention, it has eased back to a rate of 3.29, although the Bank of Israel believes that part of the shekel’s strength stems from a weak dollar globally. Policymakers have also cited strong foreign investment flows into Israel, a wide current account surplus and optimism that a rapid COVID-19 vaccine rollout will quickly lead to an economic recovery after three lockdowns.
The central bank also said it bought 4.2 billion shekels ($1.3 billion) of Israeli government bonds last month to bring its total since March, when it began the programme, to 50.4 billion shekels. Its balance of corporate bond purchases held steady at 3.5 billion shekels. The Bank of Israel has said it would buy as much as 85 billion shekels of government bonds.
As part of a plan to encourage credit to small businesses, the bank said it loaned another 3.1 billion shekels to the banking system last month to bring its loan total during the COVID-19 pandemic to 22.7 billion shekels.
https://www.reuters.com/article/israel-cenbank-reserves/update-1-bank-of-israel-buys-6-8-bln-of-forex-in-jan-reserves-jump-to-new-record-idUSL8N2KD09K
good morning B
nice and warm laters
got to wearing shorts yesterday
Dry though-could do without that but zero complaints
58-0054 USAF KC-135 tanker west back to Pittsburgh Int'l after it's dooty over DL, NJ and PA
Renaissance Hit With $5 Billion in Redemptions Since Dec. 1
Renaissance Technologies, the investing giant that just posted its worst-ever returns across its public funds, has been hit with at least $5 billion in redemptions.
Clients pulled a net $1.85 billion across the three hedge funds in December and requested a net $1.9 billion back in January, according to investor letters seen by Bloomberg. Investors are poised to yank another $1.65 billion this month, the letters show. Those figures could be offset if there are any inflows in February or if investors decided to walk back any of their redemption requests.
Billionaire Jim Simons’s firm, a quant-investing pioneer, is coming off a rough year. Its three public hedge funds posted double-digit losses in 2020 as their algorithms were thrown out of whack by market swings the computers had never seen before. At the same time, its fund for employees and insiders soared 76% last year, Institutional Investor reported. Renaissance’s Institutional Equities fund, the biggest of the external vehicles, lost 19% in 2020, the letters show. That fund got the biggest chunk of the redemptions. The Institutional Diversified Alpha fund dropped 32% and the Institutional Diversified Global Equities fund fell 31%.
A spokesman for the East Setauket, New York-based firm declined to comment.
Renaissance told clients in a September letter that its losses were due to being under-hedged during March’s collapse and then over-hedged in the rebound from April through June. That happened because its trading models “overcompensated” for the original trouble.
Renaissance again addressed its dismal numbers in a December letter. “Although recent performance has been terrible and worse than prior performance would have suggested was likely for 2020,” the firm said, its model “anticipates that in track records as long as ours, some risk-return ratios every bit as bad as the ones we are now seeing are not shocking.” The broader lesson is that “one should expect even good investments to perform horribly from time to time.”Renaissance is the world’s largest quantitative hedge fund firm. It was founded in 1982 by Simons, a former codebreaker for the National Security Agency. Last month, he announced that he’s stepping down as chairman of the firm, which managed about $60 billion at the time. He will remain a board member.
https://www.bnnbloomberg.ca/renaissance-hit-with-5-billion-in-redemptions-since-dec-1-1.1560370
Chinese vessels enter Japan's waters near Senkakus for 2 straight days
Chinese coast guard vessels on Sunday entered Japan's territorial waters near the China-claimed Senkaku Islands for the second day in a row. The Japan Coast Guard said two Chinese coast guard ships intruded into the waters near the group of uninhabited islets in the East China Sea around 3:50 a.m. and exited after 9 a.m.
The incursions come after a new law took effect in China at the start of this month explicitly allowing the Chinese coast guard to use weapons against foreign ships that Beijing sees as illegally entering its waters. After entering Japan's waters on Sunday, the Chinese vessels pointed their bows toward a Japanese fishing boat and made a move to approach it at approximately 22 kilometers south-southeast of Taisho, one of the islets, according to the coast guard.
It is the fifth time this year that Chinese vessels have entered Japanese waters, according to the 11th Regional Coast Guard Headquarters based in Naha, Okinawa Prefecture. On Saturday, the incursion lasted about eight and a half hours, with Tokyo lodging a protest with Beijing through multiple diplomatic channels. The fishing boat with five people on board has been guarded by patrol boats, while the coast guard warned the Chinese vessels to immediately leave the waters, the headquarters said.
As happened on Saturday, two other Chinese coast guard vessels, one of which was equipped with what appeared to be a cannon, cruised in the so-called contiguous zone just outside Japan's territorial waters near the Senkakus, it said. It was the ninth straight day that Chinese vessels were spotted near the Japan-administrated islets if the contiguous zone is included. Chinese coast guard vessels have regularly been sent around the Senkakus, especially under the leadership of President Xi Jinping who is aiming to make the country a maritime power.
Last year, Chinese ships were confirmed sailing in the contiguous zone for a total of 333 days, an all-time high.
In addition to its claim to the Senkakus, which it calls Diaoyu, China has maritime sovereignty disputes with several Southeast Asian countries in the South China Sea and is often criticized for its unilateral attempts to change the status quo in the region.
https://mainichi.jp/english/articles/20210207/p2g/00m/0na/010000c
SAM689 USAF C-32A (used as secondary AF2 and by the State Dept.) departed San Antonio Int'l after an overnight-inbound from Salt Lake City ground stop and JBA depart yesterday prior to arrival at Hickam AFB Oahu
EJU5Y28 USAFSOC C-32B bakc to Eglin from Cannon AFB, NM ground stop
DRAGO53 and 63 USAF B-52 Stratofortress south from Minot AFB, ND
See Cap 2
59-1461 USAF KC-135 tanker from Milwaukee over DL, NJ, PA
No scheduled return to JBA on Pedotus schedule-that can be amended quickly though.
S.Africa suspends use of AstraZeneca vaccine after trial showing limited protection
South Africa will suspend use of the AstraZeneca vaccine in its immunisation programme while scientists advise on the best way to proceed, Health Minister Zweli Mkhize said on Sunday. Mkhize was speaking after trial data showed the AstraZeneca vaccine offered only limited protection against mild disease caused by the 501Y.V2 coronavirus variant first identified in South Africa.
https://www.reuters.com/article/health-coronavirus-safrica/s-africa-suspends-use-of-astrazeneca-vaccine-after-trial-showing-limited-protection-idUSL8N2KD0I9
China drains liquidity from markets ahead of Lunar New Year
China has withdrawn 320 billion yuan ($49.5 billion) from financial markets in about two weeks, as authorities focus on removing excess liquidity to tame the surge in property and asset prices. It is rare for China to curb liquidity ahead of the Lunar New Year holiday, which starts on Thursday this year. The move could hinder the country's economic recovery from the coronavirus-induced slump, with effects spilling into overseas markets as well. Though the People's Bank of China said Friday it would inject 100 billion yuan into the markets ahead of the holiday, another 100 billion yuan worth of operations matured that day, resulting in no net change to liquidity. The two-week interbank lending rate remains relatively high at almost 3%. The overnight rate topped 6% at one point in late January.
China's central bank usually increases liquidity in the weeks leading up to Lunar New Year, when many Chinese return to their hometowns or travel. The bank had injected 600 billion yuan into the markets by a week out in 2020, and 500 billion yuan in 2019. Less demand for cash than usual is possible, as authorities discourage travel due to the pandemic. But the PBOC's real motive for decreasing liquidity is "to prevent an excessive rise in property and stock prices and to lower credit risks in the future," Founder Securities analyst Qi Sheng said. Many market insiders agree with Qi. Chinese President Xi Jinping is working to curtail speculation in the property market, yet housing demand remains strong in big cities like Shanghai, Beijing and Shenzhen.
Condo developer China Vanke reported a 30% jump in home sales on the year for January to 7.14 billion yuan. Sales appear to be trending upward, though it is difficult to draw a meaningful comparison from 2020, when COVID-19 upended economic activity. China injected troves of cash into the market last year to carry its economy through the pandemic. But the increased liquidity has boosted asset prices recently. The Shanghai Composite Index topped 3,600 last month, at one point gaining as much as 36% from its low in March 2020. To prevent a property bubble, China has tightened restrictions on property sales in over 30 cities since summer, including a cap on the number of homes a family can buy. In cities like Shanghai and Ningbo, residents now face waiting periods to buy a new home after a divorce. Banks also are adopting a lengthier screening process and caps on mortgages, in line with official guidance. Investment bank China International Capital Corp. predicts the country's money supply will increase about 9% in 2021, compared with over 10% in 2020.
Beijing's recent moves could sap the economy. But China's gross domestic product is expected to grow at a brisk 7% to 8% in 2021, and the government can afford some setbacks if it means preventing bigger issues down the line.
https://asia.nikkei.com/Business/Markets/China-drains-liquidity-from-markets-ahead-of-Lunar-New-Year
State Dept AC 01-0040 C-40B returning to JBA from Ft. Lauderdale ground stop
59-1461 USAF KC-135 tanker back to Milwaukee after DL,NJ,PA trackin'
SAM595 USAF G5 back to Peterson AFB from NAS Jax overnight
DRAGO53 USAF B-52 Stratofortress over Bradenton/St. Petersburg FL headin north nao at 19k ft