Putin's Political Control Challenged by Mercenary Uprising
On Saturday, Russian President Vladimir Putin narrowly avoided a mutiny in Moscow against Yevgeny Prigozhin as media reported that a deal had been brokered rebellious mercenary leader.
The crisis began when Yevgeny Prigozhin, head of Wagner Group and former Kremlin caterer, prepared to bring heavily armed convoys to the capital. In response, authorities had to deploy tanks and troops for defense purposes. Although this marks the first military challenge against a Russian president since 1993, it remains unlikely that tensions will dissipate anytime soon.
As Ukraine continues its efforts in breaking through Russian lines and retaking occupied lands, they see opportunity amidst Moscow's chaos. However, some allies fear this upheaval could strengthen hardliners who wish to intensify war efforts or make Putin more unpredictable as he cracks down further at home on those seen as disloyal.
Despite past threats against his authority being overcome by facing public protests and economic crises from abroad – for now – there is no immediate challenge visible towards Putin’s control; however doubts regarding his political invincibility persistently grow.
Japan Warns Against Excessive Currency Market Moves
Masato Kanda, Japan's top currency diplomat warned recently that any excessive fluctuations in currency markets would be met with action from authorities due to their negative impact on economy fundamentals. He also mentioned that they were focusing primarily on pace rather than levels of yen moves.
Investors have been selling yen following the Bank of Japan's decision to maintain ultra-low interest rates and massive stimulus, in contrast with other central banks tightening monetary policy against rising inflation. The dollar touch seven-month highs against USDJPY in New York on Friday.
The week ahead is dominated by US-centric data releases such as core PCE print, which is the Fed's preferred measure of inflation. Additionally, key releases include durable goods orders, GDP and Michigan consumer sentiment.
Global Slowdown Concerns Heighten Amid Russian Crisis
Oil prices are climbing as investors assess potential consequences from an attempted mutiny in Russia against President Putin’s long-standing rule. Although Crude Oil WTI Futures experienced losses last week, global benchmark Brent saw gains. However, concerns over a global slowdown remain prevalent due to increasing recessionary signals caused by tight monetary policies threatening economic growth.
As oil prices face pressure amid heightened tensions in Moscow resulting from internal instability within Russia, geopolitical risks continue to rise. Meanwhile, markets anticipate further challenges for demand outlook due to factors such as the Federal Reserve's aggressive monetary tightening campaign and China's lukewarm recovery efforts—factors that have contributed to price pressures thus far this year.