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There was a brief respite in the rise in bond yields and the dollar overnight ahead of the release of the latest retail inflation print in the US. And that bodes well for equity markets in the Asia Pacific.

Overnight data showed that US producer prices rose less than anticipated in December. That’s as higher costs for goods were partially offset by stable services prices. The suggestion here is that inflation continued to cool after having remained sticky for several months. The producer price index for final demand rose 0.2%, compared with 0.4% in the previous month. It was pegged to come in at 0.3%.

Equity markets in the US, meanwhile, were choppy, giving up intraday gains as uncertainty about the inflation data persisted. The data will be out this evening and is being viewed as crucial in determining the course of monetary policy. The expectation that the Fed will hold off on further rate cuts has pushed bond yields and the dollar higher. The Dow and the S&P 500 closed higher by 0.5% and 0.1% respectively, while the Nasdaq Composite declined by 0.2%.

In the Asia Pacific region this morning, two of the three early risers are trading in the green. The Nikkei 225 was trading flat last I checked.

In other international news, Reuters has reported that negotiators were close to finalising details of a ceasefire in Gaza after talks in Qatar. We gave you a similar update yesterday, but a deal seems to be in the offing and it bears watching. Officials from mediators Qatar, Egypt and the US, as well as Israel and Hamas said an agreement for a truce in Gaza and release of hostages was closer than ever.

Qatar’s foreign ministry spokesperson Majed Al-Ansari earlier told a news conference that both sides were presented with a text and talks on the last details were under way. But a senior Hamas official told Reuters late on Tuesday that the Palestinian group had not delivered its response yet because it was still waiting for Israel to submit maps showing how its forces would withdraw from Gaza.

RBI MPC Goes To Rajeshwar Rao

In the top story back home, with Deputy Governor Michael Patra set to retire, the Reserve Bank of India has allocated the monetary policy department to Deputy Governor Rajeshwar Rao, which will come into effect from Wednesday. That’s according to a release sent out by the central bank. That means that Rao will take Patra’s place in the rate-setting Monetary Policy Committee of the RBI, starting in February. Rao is the senior-most person in the monetary policy department after Patra. In October, the government had extended Rao’s term for another year, the second such extension after his original term ended in October 2023.

The Income Tax Department has conducted a survey action against an educational trust run by the KR Mangalam Group, which operates several schools and colleges in Delhi-NCR. The trust allegedly misused tax exemptions and diverted substantial funds for the personal benefit of its promoters.

The tax department is also reviewing donations received by the trust over the years. Other educational trusts are reportedly under scrutiny for similar issues.

Premier Energies Ltd. said on Tuesday that its affiliates have received orders totaling Rs 1,460 crore from two large independent power producers and others. According to the exchange filing, its subsidiaries Premier Energies Global Environment Pvt., Premier Energies International Pvt. and Premier Energies Photovoltaic Pvt. had received the orders aggregating to Rs 1,460 crore. These orders include solar modules of Rs 1,041 crore and solar cells worth Rs 419 crore, the filing added.

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