Ukrainian President Zelenskyy: We are ready to sign ceasefire guarantees
Ukrainian President Volodymyr Zelenskyy said during the European trading session on Monday that the nation wants the United States (US) to ensure that Russia honor the energy ceasefire announced over the weekend.
US President Trump announced through a post on Truth Social that both Russia and Ukraine have agreed to an energy ceasefire, a temporary agreement in which both parties agree to stop attacking energy facilities. Ukraine had been excessively attacking Moscow’s energy infrastructure to curtail its funding.
“Effective immediately, there is an ENERGY CEASEFIRE in the War between Russia and Ukraine. Both parties have agreed. Do not break it!” Trump wrote.
Comments
If Russia rejects energy truce this winter, Ukraine will respond.
Russia must halt attacks on Ukraine energy infrastructure for us to stop refinery strikes.
Ukraine is prepared to honor energy ceasefire if Russia reciprocates.
Russian refineries did not catch fire last night.
Awaiting details of talks between Americans and Russians, this energy ceasefire could succeed.
Americans must ensure Russians honor energy ceasefire.
Ukraine ready to sign ceasefire guarantees.
Fewer internet bots active after Ukraine strikes on Yandex data centres.
We need American pressure on Russia, not sanctions relief so we can achieve an energy ceasefire.
Ready to discuss election if a full ceasefire is agreed.
Market reaction
While the comments from Ukrainian President Zelenskyy don't reflect any indication that he would be unwilling to cooperate on a ceasefire, there is a sharp recovery seen in oil prices. In European trade, the WTI Oil price has turned almost 1% positive to near $91.80 after recovery early losses.
Risk sentiment FAQs
In the world of financial jargon the two widely used terms “risk-on” and “risk off'' refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest.
Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit.
The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity.
The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
