SQUAWK BOX, TUESDAY 31ST MAY, 2022

Israel retaliates against Iran, reportedly carrying out a limited operation against the country. Iranian state TV said missiles were deployed to down drones over the central city of Isfahan. Asian equities are in the red as a result with oil rising and the dollar catches a bid as investors go risk-off. At the IMF/World Bank Spring Meetings in Washington, we hear exclusively from German finance minister Christian Lindner who says the EU and the U.S. must cooperate closely in the face of trade competition from China. We hear from top ECB policy makers who are increasingly converging on the month of June as the likely beginning of rate cuts, barring any particularly bad news along the way. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

As ECB policy makers increasingly appear to agree on a June rate cut, Bundesbank President Joachim Nagel tells CNBC that caveats still remain. In the U.S., a Boeing whistleblower testifies in the Senate, blasting his former employer over safety negligence and calling for the grounding of the Dreamliner. UBS is eyeing further lay-offs with cuts likely to fall in banking, markets and wealth management divisions. ABB hikes its full-year guidance after a Q1 beat on a stronger-than-expected order book.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Federal Reserve Chairman Jerome Powell has said that inflation is likely to delay rate cuts this year and says recent data has not provided the central bank with enough confidence to move. However, ECB President Christine Lagarde tells our colleagues Stateside that cuts are due soon, barring any major shocks. The IMF raises global forecasts for growth and hikes its U.S. outlook. The group’s First Deputy MD tells CNBC that the Fed’s prudence is justified. And a lack of demand from Chinese consumers weigh on French luxury giant LVMH’s Q1 sales.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Chinese GDP data comes in better than expected for the first quarter by a wide margin but monthly figures are softer, painting a mixed picture for the world’s second-largest economy. In the U.S., the major indices are in the red while yields spike. The greenback also hits a five-month high as very strong retail sales numbers dampens rate cut expectations even further. In Asia there are 2 per cent declines across equities. Investors are braced for potential policy intervention in Japan to shore up the yen. In autos news, Tesla is set to cut 10 per cent of its workforce as the EV maker struggles with waning consumer interest in the sector.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Israel is mulling its options after Iran’s first ever attack on Israeli territory over the weekend, using more than 300 missiles and drones. G-7 nations and the UN Security Council condemn the attack, seeking to diffuse tensions and avert any regional escalation. German Chancellor Olaf Scholz lands in Chongqing, China with a delegation of CEOs looking to shore up economic relations with Berlin’s biggest trading partner. Samsung overtakes Apple to become the largest smart phone maker after iPhone sales falter in the first quarter. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. producer prices come in soft, rising just 0.2 per cent and alleviate some jitters about persistent inflation. The Nasdaq posts a new fresh high with Apple leading the way. The iPhone maker enjoys its best day in nearly a year while Amazon hits a new record high. Shares at Morgan Stanley plunge after reports that the bank’s wealth management arm is under investigation by multiple regulators. German industrial titan ThyssenKrupp warns it may cut steel production by up to 20 per cent with job cuts also looming at a key plant.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. equities sell off and futures dip as traders scale back expectations for a June rate cut on the back of hotter-than-expected inflation - now eyeing a first move in September. Chinese deflationary pressures point to the potential for more government stimulus, as CPI cools more than expected, and producer prices slide. The Swiss government strengthens its rules for the country's banking sector as it looks to prevent another collapse of banks that are “too big to fail”. And, the ECB gets set for its latest rate decision, with investors eyeing signs of divergence from the Fed.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Fitch downgrades its outlook on China to negative from stable, citing increasing risks to the country's public finances. Global equities oscillate as investors brace for today's key U.S. inflation print, looking for clues on the Fed's next move. The FAA also launches an investigation into Boeing's whistleblower claims, piling more pressure on the plane maker as jet deliveries more than halve. And, Accor CEO Sébastien Bazin tells CNBC the Paris Olympics is an opportunity for France to refresh its image for an international audience.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

US Treasury yields hit four-month highs as traders look ahead to Wednesday’s inflation print, while JP Morgan CEO Jamie Dimon warns inflation may prove more stubborn than expected. A subsidy war is also heating up as the White House awards chip giant TSMC over $6 billion in grants, with Samsung reportedly set to get a similar deal. Meanwhile, Ether prices post their biggest jump in more than a month over speculation the cryptocurrency could see ETF applications approved soon. And, prices of gold hit another all-time high, the 15th record close this year.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The US jobs report beats expectations, sending equities higher and tempering expectations the Fed will start easing in June. Meanwhile, the UBS CEO Sergio Ermotti calls on Europe to create more competitive banks, telling CNBC at the Ambrosetti Forum the integration of Credit Suisse is a case study for the continent. US Treasury Secretary Janet Yellen threads the diplomatic needle as she urges China to rein in excess capacity, but China's commerce minister pushes back at accusations of overcapacity during a visit to Europe, rebutting claims the country's EV industry has benefited from unfair subsidies. And, Europe's largest travel group Tui gets set to ring the opening bell in Frankfurt, upgrading to the Prime Standard market after ditching its London listing.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.