Global Macro Update

Inflation remains in focus amid tariff talk as Trump confirmed tariffs on Mexico and Canada, set to take effect on March 4, "will go forward." - seismic shift in Geopolitical alliances as well- markets view last week's? data as precursor for? possible negative surprises undermining the base case of US exceptionalism.

Story that Microsoft is cancelling AI data center leases is one reason to? believe that stock market regime change is underway where AI hype may not sell any more -Big Tech still has relatively little to show for all their billions spent on AI, and investors are starting to get antsy.

Given Nvidia’s centrality in the AI narrative, its earnings tomorrow -which? has taken on a Super Bowl-like quality of their own -? might be the clinching evidence ? (Nvidia? has been flat since June)Debt issuance looks set to rise, regardless of how the European Commission decides to relax the rules surrounding the Stability and Growth pact.? Back and forth trading 1.0430 - 1.0460

New-found sense of confidence in China increasingly asserts -? markets ramp up their optimism that Chinese govt policy pivot last Sept was real, despite? stimulus not having been sufficient to transform consumer sentiment & reverse deflation

Bank of Korea cut its benchmark rate from 3% to 2.75%, a widely anticipated move.

Starmer has his task cut out? when he meets Trump on Thursday - Macron had already tested the? ground- GBP /USD has risen around 4.4% from its? major swing low to 1.2100 in mid-Jan? on expectations of "special relationship” but? it is wholly illusory now.1.2612 has held sofar- looks fragile post Thursday.

Interestingly, only? 17.5 % of Japanese currently have a passport, compared with 25 %? before? pandemic - inflation and yen depreciation majorly blamed. Jan services PPI data came in? at +3.1% y/y. 149.30- 151.30 range back in play .

Flows of largest player of recent times? matter - Payback day for "stability" of the past? - the lexicon that there are "no free lunches"? holds good here and the experience should stand in good stead going forward -? Rumours of Massive expiry at fix today in offshore forward position -On shore position managed with Whole sale swap & Retail rollovers.? 86.75 86.95 .