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Commons Chaos

Thought for Thursday, House of Commons ceasefire vote decision, minutes released from Federal Reserve monetary policy meeting, geo-political update in Russia and Gaza, and looking at today's data.

Thought for Thursday

One blames politicians, not for inconsistency but for obstinacy. They are the interpreters, not the masters, of our fate. It is their job, in fact, to register the fact accompli – John Maynard Keynes

The House of Commons was quite the spectacle yesterday – on two occasions- the one that got most press attention was the speaker of the house, Sir Lindsay Hoyle, breaking precedent to allow Labour to put an amendment into a vote which otherwise would have caused Sir Keir Starmer the biggest rebellion (and headache) of his leadership.

 

The vote was to call for an immediate ceasefire in Gaza and Sir Keir would have been looking at possibly two shadow cabinet resignations had the vote been presented without his amendments – which were designed to be clearer about the circumstances under which a ceasefire could take place – and as such he lobbied the Speaker directly in a bid to get this through. The fact that this was granted looks like favouritism, but the Speaker has come out and apologized and said that his intention was to give more of the House a say in such a sensitive issue.

 

Understandably, the Tory party and the SNP were unhappy about this and abstained from the vote but are now possibly looking to run a candidate against the Speaker at the general election – something that normally wouldn’t happen.

Before this, the spotlight was on Kemi Badenoch, or rather it would have been had she been in the Commons for PMQs. The business secretary is finding herself caught up in a disagreement with the former chair of the Post Office, Henry Staunton, who made some disparaging claims about the government’s handling of the compensation due to postmasters, for which Ms Badenoch immediately took to Twitter and rebuked and called him a liar. Mr Staunton seems to have come up with evidence that he was not lying and that means that Ms Badenoch might well be on thin ice with a libel claim underneath it.

 

On top of that, the business secretary was directly contradicted yesterday by Canada over her claims that trade talks were ‘ongoing’. The FT reports that she explicitly told MPs on the 29 January that trade talks were ongoing with Canada to avoid a 31 March tariff cliff edge for UK car makers. However, the Canadian high commissioner to the UK has written to the business select committee to insist that these talks have not happened! Click here to read the FT article.

 

The last thing Rishi wants is another MP embroiled by scandal, but with Kemi Badenoch the bookies favourite to succeed him, he’s probably less upset that it is this particular MP!

Back to Economics

The Federal Reserve released the minutes of their last monetary policy meeting last night, which confirmed that there is unease about cutting rates and risking going too soon in the face of sticky inflation. The minutes from the January meeting showed the majority of committee members shared this concern, whilst a couple highlighted the risks to the economy of not cutting – though with GDP flying relative to just about every other major economy, that concern is perhaps harder to justify.

The market reaction was to sell stocks, but even that reversed as investors used the opportunity to ‘buy the dip’ with the market closing fractionally higher.

One stock, which is very much the belle of the ball, was Nvidia who announced record earnings as they continue to benefit from being the market leader in the AI chip space. Their quarterly revenues rose 265% to a new record and are expecting even more this quarter. The boom in their share price, which has risen more than 700% in the last 18 months, pushes them into the position of third most valuable listed company in the US – behind only Apple and Microsoft.

In Geo-politics

An Iranian commander has confirmed that they have sent hundreds of ballistic missiles to Russia, with more to follow. “There is no reason to hide it. We are allowed to export weapons to any country that we wish to.”  So far more than 400 missiles of varying capabilities have been shipped since an agreement between the two countries was reached in January, with the route particularly straight forward as these can be shipped directly between countries via the Caspian sea, crossing only into either Azerbaijan, Turkmenistan or Kazakhstan waters enroute – none of which are likely to have any objection. Reuters has the story, click here to read.

In the Gaza Israel situation, negotiators from various parties are racing to get a ceasefire agreed before Ramadan starts on Sunday 10 March. CNN has a detailed look at the stakeholders and what is trying to be achieved, as well as the stumbling blocks and resistance along the way, click here to read.

Looking to Today

US PMI figures will be worth a watch – again, probably underscoring just how strong the US economy is! On the other side of the coin, UK and European PMIs are released this morning, where investors will be hoping that the decline isn’t as steep as forecast. European inflation numbers will also be worth a watch, as the ECB could be the first of the main central banks to cut rates, as things stand.

Have a great day.

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