Dollar gains as growth worry sparks flight to safety; Aussie weakens

The dollar held near a two-week high on Friday, as demand for safe-haven assets rose on uncertainties about the path of U.S.-China trade negotiations and broader worries about slowing global growth. “The dollar is being supported by worries over global growth and external factors,” said Sim Moh Siong, currency strategist at Bank of Singapore. “Markets are waiting to see what policy measures can stabilise growth worldwide…until then, it’s hard to see the dollar weakening.” The dollar index, a g


The dollar held near a two-week high on Friday, as demand for safe-haven assets rose on uncertainties about the path of U.S.-China trade negotiations and broader worries about slowing global growth. “The dollar is being supported by worries over global growth and external factors,” said Sim Moh Siong, currency strategist at Bank of Singapore. “Markets are waiting to see what policy measures can stabilise growth worldwide…until then, it’s hard to see the dollar weakening.” The dollar index, a g
Dollar gains as growth worry sparks flight to safety; Aussie weakens Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-02-08  Authors: matt cardy, getty images
Keywords: news, cnbc, companies, safety, policy, index, global, weakens, bank, worry, sparks, growth, aussie, gains, flight, versus, trade, euro, european, dollar


Dollar gains as growth worry sparks flight to safety; Aussie weakens

The dollar held near a two-week high on Friday, as demand for safe-haven assets rose on uncertainties about the path of U.S.-China trade negotiations and broader worries about slowing global growth.

Such concerns were brought to the fore on Thursday after the European Commission sharply cut its forecasts for euro zone economic growth this year and next on expectations the bloc’s largest countries will be held back by global trade tensions and domestic challenges.

Investors’ anxieties about the global economy were also compounded by comments from U.S. President Donald Trump, who said he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline to achieve a trade deal.

“The dollar is being supported by worries over global growth and external factors,” said Sim Moh Siong, currency strategist at Bank of Singapore.

“Markets are waiting to see what policy measures can stabilise growth worldwide…until then, it’s hard to see the dollar weakening.”

The dollar index, a gauge of its value versus six major peers was up by around 0.1 percent at 96.59, sitting just shy of its two-week high.

The index has gained for six straight sessions in a row. This was mainly due to a weaker euro, which has around 58 percent weightage in the index, and came despite the Federal Reserve’s dovish shift on interest rates last week.

The Aussie dollar fell 0.3 percent to $0.7076 in Asian trade as the Reserve Bank of Australia cut its growth forecasts.

The Aussie has shed 2.4 percent of its value so far this week after the central bank signalled a shift from its long-standing tightening bias earlier this week.

But some analysts see limited downside for the Aussie.

“Aussie dollar should find technical support at $0.70 versus the dollar..quite a lot of bad news is priced in already and rising iron-ore prices should also be supportive,” Bank of Singapore’s Sim added.

The euro was marginally lower at $1.1338, on track to post its fifth straight day of losses. The single currency has been stumbling due to weaker-than-expected growth data out of the euro zone and expectations that the European Central Bank will keep monetary policy accommodative this year.

Philip Wee, currency strategist at DBS, thinks it is likely the euro will depreciate below $1.10 this year on Europe’s relatively weaker growth and inflation outlook against that of the United States.

The yen was steady at 109.74. Analysts think Japanese demand for foreign bonds has supported dollar/yen. The greenback gained around 0.8 percent versus the yen over the last week.

Sterling was marginally lower at $1.2950. Traders expect the British pound to remain volatile in the near term due to the uncertainty surrounding Brexit.

The United Kingdom is currently on course to leave the European Union on March 29 without a deal unless British Prime Minister Theresa May can convince the bloc to reopen the divorce agreement she reached in November.

The greenback was 0.1 percent higher versus the Canadian dollar at C$1.3319, on track to post its largest percentage gain since mid-June. Canada is a major producer of commodities, including oil, and the loonie has been under pressure due to falling energy prices.

The Bank of Canada said in January that low oil prices and a weak housing market hurt the economy in the fourth quarter of 2018 and would continue to drag on growth in the first quarter of this year. Traders expect the central bank to keep rates steady at its next policy meeting in March.


Company: cnbc, Activity: cnbc, Date: 2019-02-08  Authors: matt cardy, getty images
Keywords: news, cnbc, companies, safety, policy, index, global, weakens, bank, worry, sparks, growth, aussie, gains, flight, versus, trade, euro, european, dollar


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Greenback firm on US jobs data; Aussie dollar weakens

Data on Friday showed that the U.S. economy created 304,000 jobs in January, the highest in 11 months, and above street estimates. The greenback was marginally higher versus the yen at 109.53, following its largest percentage gain in almost a month during Friday’s U.S. session. Despite the strong labour market, the U.S. central bank is widely expected to keep rates steady this year thanks to heightened worries over global growth, especially in China. However, most analysts do not see much upside


Data on Friday showed that the U.S. economy created 304,000 jobs in January, the highest in 11 months, and above street estimates. The greenback was marginally higher versus the yen at 109.53, following its largest percentage gain in almost a month during Friday’s U.S. session. Despite the strong labour market, the U.S. central bank is widely expected to keep rates steady this year thanks to heightened worries over global growth, especially in China. However, most analysts do not see much upside
Greenback firm on US jobs data; Aussie dollar weakens Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-02-04  Authors: matt cardy, getty images
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Greenback firm on US jobs data; Aussie dollar weakens

The dollar hovered near a one-week high against the yen on Monday, buoyed by stronger-than-expected U.S. jobs and factory data, although the Federal Reserve’s cautious policy outlook and thinned holiday trade in Asia are likely to cap further gains.

Data on Friday showed that the U.S. economy created 304,000 jobs in January, the highest in 11 months, and above street estimates.

The greenback was marginally higher versus the yen at 109.53, following its largest percentage gain in almost a month during Friday’s U.S. session.

“The non-farm payroll was a strong number and is supporting the dollar. A dovish Fed had hit the dollar/yen but rising stocks and solid U.S. data have led to this bounce back,” said Nick Twidale, chief operating officer at Rakuten Securities.

The solid jobs report also allayed concerns of the slowdown in the U.S. economy, leading traders to trim expectations the Fed would need to cut interest rates to support the economy later this year.

The benchmark 10-year U.S. Treasury yield was 2.69 percent, rebounding from a four-week low of 2.619 percent earlier last week. Rising U.S. yields are most likely to support the dollar in the near term.

In broader moves, currency markets stayed in tight ranges in early Asian trade, with euro trading flat at $1.1455.

China’s financial markets are closed all week for the Lunar New Year holiday. Other Asian markets are also closed for parts of the week, keeping wider market activity subdued.

The Australian dollar was lower by 0.2 percent at $0.7234 while the kiwi was marginally higher at $0.6901. The Aussie was hit after the release of weaker-than-expected building approvals data.

Traders are now focusing on the Reserve Bank of Australia’s monetary policy meeting on Tuesday, where it is widely expected to keep the cash rate steady. Weakening economic data has led analysts to feel the RBA would most likely keep monetary policy accommodative.

Futures markets imply around a 50-50 chance the RBA will cut the 1.5 percent cash rate by the end of the year, despite its repeated assertions that the next move would be up.

“Market expectations have emerged for a rate cut as opposed to the RBA’s view that the next move in rates is an increase. The RBA will also need to temper its optimistic economic outlook” in Tuesday’s monetary policy statement, said Philip Wee, currency strategist at DBS, in a note.

The dollar index, a gauge of its value versus six major peers, was steady at 95.58.

Despite the strong labour market, the U.S. central bank is widely expected to keep rates steady this year thanks to heightened worries over global growth, especially in China. Growth in the euro area has also been weaker-than-expected with Europe’s main economic engines, France and Germany, slowing down.

Rising U.S. interest rates were the main driver of the greenback’s outperformance last year. However, most analysts do not see much upside in the dollar this year as U.S. borrowing costs are widely expected to remain steady.

Elsewhere, sterling was flat at $1.3083 in early Asian trade. Traders expect the British pound to remain volatile as Brexit uncertainty remains high. The Bank of England is scheduled to meet later this week and widely expected to keep interest rates steady.


Company: cnbc, Activity: cnbc, Date: 2019-02-04  Authors: matt cardy, getty images
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Yen weakens in Asian trade; Aussie, kiwi dollar strengthen

The safe-haven yen fell versus its peers on Wednesday as risk appetite marginally improved in Asian trading, though concerns over slowing global growth and U.S.-Sino trade tensions are likely to cap gains in riskier assets. Against the Aussie dollar, it fell by 0.5 percent. “Nervousness around global growth and trade tensions is certainly a factor driving the markets right now,” said Michael McCarthy, chief markets strategist at CMC Markets. On Monday, the International Monetary Fund (IMF) cut i


The safe-haven yen fell versus its peers on Wednesday as risk appetite marginally improved in Asian trading, though concerns over slowing global growth and U.S.-Sino trade tensions are likely to cap gains in riskier assets. Against the Aussie dollar, it fell by 0.5 percent. “Nervousness around global growth and trade tensions is certainly a factor driving the markets right now,” said Michael McCarthy, chief markets strategist at CMC Markets. On Monday, the International Monetary Fund (IMF) cut i
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Company: cnbc, Activity: cnbc, Date: 2019-01-23  Authors: torsakarin, istock, getty images
Keywords: news, cnbc, companies, traders, growth, versus, trade, yen, aussie, tensions, brexit, kiwi, global, markets, strengthen, slowing, weakens, dollar, asian


Yen weakens in Asian trade; Aussie, kiwi dollar strengthen

The safe-haven yen fell versus its peers on Wednesday as risk appetite marginally improved in Asian trading, though concerns over slowing global growth and U.S.-Sino trade tensions are likely to cap gains in riskier assets.

The yen weakened by 0.25 percent versus the greenback to 109.62. Against the Aussie dollar, it fell by 0.5 percent.

As expected, the Bank of Japan kept monetary policy unchanged and trimmed its inflation forecast, with a larger-than-expected drop in December export data earlier in the day underlining the need for continued support for the trade-reliant economy.

The Australian dollar gained 0.2 percent versus the greenback to $0.7137.

Currency markets have been whipsawed over recent weeks as traders tried to come to terms with a range of issues from Brexit to slowing global growth and the outlook for major central banks.

“Nervousness around global growth and trade tensions is certainly a factor driving the markets right now,” said Michael McCarthy, chief markets strategist at CMC Markets.

“Markets have also seen a spectacular run since late December..so the recent correction in equities can also be due to positioning.”

On Monday, the International Monetary Fund (IMF) cut its 2019 and 2020 global growth forecasts, citing a bigger-than-expected slowdown in China and the eurozone, and said failure to resolve trade tensions could further destabilize a slowing global economy.

Growth in China last year was the slowest since 1990 and is set to weaken further this year before stimulus measures start to kick in.

Investors are hoping for a breakthrough in U.S.-Sino trade talks, with the tariff dispute between the world’s largest economies already rippling through financial markets and global demand.

A report by the Financial Times that the United States had rejected China’s offer for preparatory trade talks dampened risk sentiment overnight, though it was later denied by a White House adviser.

The dollar index was marginally higher at 96.32. Traders in interest rate futures are wagering that the Federal Reserve will stand pat on rates in 2019 in the face of risks both at home and globally.

The dollar rally last year was mainly driven by the Fed’s four rate hikes, so traders expect a pause in the tightening cycle to cap the U.S. currency.

The euro was steady at $1.1367, while sterling edged up marginally to $1.2961, having gaining 0.5 percent in the previous session.

Data on Tuesday showed that Britain’s labor market remained robust despite an economic slowdown ahead of Brexit. Average weekly earnings, including bonuses, rose by 3.4 percent on the year, the biggest rise since mid-2008.

Sterling is sitting close to its highs last seen in mid-November, a sign that traders expect Britain to avoid a chaotic exit from the European Union despite the looming March 29 Brexit date.

Since Prime Minister Theresa May’s divorce deal with the EU was rejected by lawmakers last week in the biggest defeat in modern British history, lawmakers have been trying to plot a course out of the crisis, yet no option has the majority support of parliament.

“The market is now completely discounting the prospect of a hard Brexit, though the political risk still remains in play and volatility is sure to ratchet higher if no clear path is visible to the market,” said Kathy Lien, managing director of currency strategy at BK Asset Management,

The New Zealand dollar gained 0.5 percent in early Asian trade to $0.6780 after data showed that inflation edged higher in the fourth quarter and reducing the possibility of an interest rate cut.


Company: cnbc, Activity: cnbc, Date: 2019-01-23  Authors: torsakarin, istock, getty images
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Supreme Court takes no action on DACA, weakens Trump hand in shutdown talks

President Donald Trump’s expectations that the Supreme Court would hand him a win in talks over the government shutdown now look likely to come to nothing. The Trump administration announced in 2017 that it would phase out the program, but that decision was ultimately held up in court. Trump projected confidence that the court would take up the matter quickly and deliver him a win. At least three times since the shutdown began last month, Trump said a quick ruling on DACA would force Democrats t


President Donald Trump’s expectations that the Supreme Court would hand him a win in talks over the government shutdown now look likely to come to nothing. The Trump administration announced in 2017 that it would phase out the program, but that decision was ultimately held up in court. Trump projected confidence that the court would take up the matter quickly and deliver him a win. At least three times since the shutdown began last month, Trump said a quick ruling on DACA would force Democrats t
Supreme Court takes no action on DACA, weakens Trump hand in shutdown talks Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-01-22  Authors: tucker higgins, jacob pramuk, samuel corum, anadolu agency, getty images
Keywords: news, cnbc, companies, protections, shutdown, supreme, action, case, trumps, hand, wall, court, takes, daca, trump, talks, democrats, weakens, win


Supreme Court takes no action on DACA, weakens Trump hand in shutdown talks

President Donald Trump’s expectations that the Supreme Court would hand him a win in talks over the government shutdown now look likely to come to nothing.

The justices took no action Tuesday on a case before them concerning the legality of the administration’s decision to end the Obama-era immigration policy known as Deferred Action for Childhood Arrivals, or DACA.

The inaction effectively allows the program to continue, reducing Trump’s already limited leverage in a high-stakes impasse over money for his proposed border wall.

DACA allows certain young migrants who were brought to the United States illegally as children to avoid deportation and receive permits to work in the country. Approximately 800,000 young undocumented immigrants have received work permits under the 2012 program, according to the Pew Research Center.

The Trump administration announced in 2017 that it would phase out the program, but that decision was ultimately held up in court. The Supreme Court’s schedule is now full for the year, making it unlikely that the justices will be able to review the matter this term, pushing off a decision until possibly 2020.

Trump projected confidence that the court would take up the matter quickly and deliver him a win. At least three times since the shutdown began last month, Trump said a quick ruling on DACA would force Democrats to strike a deal.

“It will be in the United States Supreme Court,” Trump said of the DACA case during a Jan. 2 Cabinet meeting. “So if we win that case — and I say this for all to hear — we’ll be easily able to make a deal on DACA and the wall as a combination. But until we win that case, they don’t want to really talk about DACA.”

On Saturday, Trump offered to extend DACA’s legal protections for the immigrants, as well as those for people fleeing humanitarian crises in their home countries, for three years in exchange for wall money and an end to the closure.

But with DACA looking safe for the time being, Democrats now have even less incentive to accept a limited three-year extension. That hurts Trump, who hoped a strengthened conservative 5-4 majority on the court would boost his negotiating power.

Democratic leaders quickly rejected Trump’s weekend proposal. House Speaker Nancy Pelosi called it “a compilation of several previously rejected initiatives, each of which is unacceptable and in total, do not represent a good faith effort to restore certainty to people’s lives.”

Senate Minority Leader Chuck Schumer blasted the plan as “not a compromise” and blamed Trump for taking away the protections in the first place.

Legal experts and some Democratic lawmakers noted that the proposed three-year extension of DACA protections falls short of terms discussed as part of a possible immigration deal between Trump and Democrats that crumbled last year.

Polls show Americans increasingly blame Trump for the closure, as 800,000 federal workers face a second lost paycheck Friday and the impasse disrupts government services and economic growth.

In December, the president said he would be “proud to shut down the government for border security” and “take the mantle” if funding lapsed. In tweets Tuesday, he pledged not to back down from his wall demand as Democrats flatly refuse to pass funding for the project.


Company: cnbc, Activity: cnbc, Date: 2019-01-22  Authors: tucker higgins, jacob pramuk, samuel corum, anadolu agency, getty images
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Gold prices rise as Fed rate tone weakens dollar

Spot gold rose 0.4 percent to $1,290.84 per ounce as at 0310 GMT, heading for a fourth straight weekly gain. U.S. gold futures were up 0.3 percent at $1,290.8 per ounce. “The weaker dollar and a more dovish Fed are the two most alluring factors for gold,” said Stephen Innes, APAC trading head at OANDA. “The (gold) market is holding back a little as they are concerned the equity market could rally significantly on trade war truce,” Innes said. Palladium 0.4 percent to $1,326.75 per ounce, and was


Spot gold rose 0.4 percent to $1,290.84 per ounce as at 0310 GMT, heading for a fourth straight weekly gain. U.S. gold futures were up 0.3 percent at $1,290.8 per ounce. “The weaker dollar and a more dovish Fed are the two most alluring factors for gold,” said Stephen Innes, APAC trading head at OANDA. “The (gold) market is holding back a little as they are concerned the equity market could rally significantly on trade war truce,” Innes said. Palladium 0.4 percent to $1,326.75 per ounce, and was
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Gold prices rise as Fed rate tone weakens dollar

Gold prices climbed on Friday as the dollar fell back on expectations the U.S. central bank may pause interest rates hikes if the U.S. economy slows this year, while investors awaited news on progress in the Sino-U.S. trade talks.

Spot gold rose 0.4 percent to $1,290.84 per ounce as at 0310 GMT, heading for a fourth straight weekly gain. The yellow metal is up 0.4 percent so far this week.

U.S. gold futures were up 0.3 percent at $1,290.8 per ounce.

“The weaker dollar and a more dovish Fed are the two most alluring factors for gold,” said Stephen Innes, APAC trading head at OANDA.

“There are concerns for the U.S. economy to slow down, perhaps towards the end of 2019 and into 2020, so the markets are pricing rate cuts.”

The dollar slipped against other major currencies, after having rebounded from three-month lows on Thursday following Federal Reserve Chairman Jerome Powell’s comment which suggested the central bank is not done tightening monetary policy just yet.

A partial U.S. government shutdown extended into its 20th day and provided little comfort to the U.S. currency, after President Donald Trump threatened on Thursday to use emergency powers to bypass U.S. Congress to pay for a wall on the U.S.-Mexico border.

“The (gold) market is holding back a little as they are concerned the equity market could rally significantly on trade war truce,” Innes said.

Asian equities inched up to one-month highs, but the rally’s momentum slowed partly as investors sought more clarity on whether the United States and China could make headways on their talks on trade as well as intellectual property rights.

“Dilemma over the U.S.-Sino trade dispute is still raising eyebrows and needs clarity,” said Sugandha Sachdeva, vice-president – metals, energy and currency research, Religare Broking Ltd.

“Once trade issues are resolved, the dollar is likely to remain suppressed, losing its appeal as a safe haven…Gold on the other hand would stand to benefit.”

Also aiding gold’s upward trend are concerns of weakening global growth, further emphasized by somber data out of Switzerland and France on Thursday.

“Gold will likely approach the short term resistance of $1,310 per ounce, from where some profit-booking can be seen,” said Religare Broking’s Sachdeva, adding that near term support can be seen at $1,275 per ounce.

Spot gold is expected to retest a resistance at $1,299 per ounce, with a good chance of breaking above this level and rising further to $1,311, according to Reuters technical analyst Wang Tao.

Palladium 0.4 percent to $1,326.75 per ounce, and was up about 2 percent for the week.

Silver climbed 0.6 percent to $15.65. However, it was poised to snap three sessions of weekly gains.

Platinum was up 0.2 percent at $821.60 per ounce.


Company: cnbc, Activity: cnbc, Date: 2019-01-11  Authors: getty images
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Yen weakens but moves capped by global growth worries

The safe-haven yen weakened versus the dollar on Friday on hopes upcoming U.S.-China trade talks would make some progress, but broader market confidence remained weak amid worries over slowing global growth. Market sentiment perked up after China confirmed that trade talks with the United States will be held at the vice ministerial level in Beijing on Jan. 7-8. The yen weakened 0.5 percent to 108.18 while riskier currencies such as the Australian dollar gained 0.2 percent to $0.7020. The Fed rai


The safe-haven yen weakened versus the dollar on Friday on hopes upcoming U.S.-China trade talks would make some progress, but broader market confidence remained weak amid worries over slowing global growth. Market sentiment perked up after China confirmed that trade talks with the United States will be held at the vice ministerial level in Beijing on Jan. 7-8. The yen weakened 0.5 percent to 108.18 while riskier currencies such as the Australian dollar gained 0.2 percent to $0.7020. The Fed rai
Yen weakens but moves capped by global growth worries Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-01-04  Authors: dan kitwood, getty images
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Yen weakens but moves capped by global growth worries

The safe-haven yen weakened versus the dollar on Friday on hopes upcoming U.S.-China trade talks would make some progress, but broader market confidence remained weak amid worries over slowing global growth.

Market sentiment perked up after China confirmed that trade talks with the United States will be held at the vice ministerial level in Beijing on Jan. 7-8. Trade tensions between the world’s two largest economies had rattled financial markets for most of 2018.

The yen weakened 0.5 percent to 108.18 while riskier currencies such as the Australian dollar gained 0.2 percent to $0.7020.

“Sentiment has shifted slightly towards the positive side, which is why we are seeing the yen weaken while Aussie dollar is rising,” said Margaret Yang, markets analyst at CMC Markets.

However, fears of a sharp slowdown in economic growth and a failure of the trade talks are likely to keep investors from diving back into riskier assets in a big way in the coming weeks.

Weaker-than-expected U.S. factory activity has heightened investor expectations the Federal Reserve will not raise rates in 2019, and possibly even cut them in 2020. Data has also been weak out of China and Europe.

Spooked by signs of fresh troubles in the world’s largest economy, investors rushed to the safety of bonds. The U.S. two-year Treasury note yield dropped below 2.4 percent on Thursday, reaching parity with the federal funds effective rate for the first time since 2008.

The Fed raised rates four times in 2018 on the back of strong growth and a robust labour market. However, with financial conditions tightening, most analysts now do not expect the Fed to raise rates in 2019.

Indeed, interest rate futures markets are now fully pricing in a rate cut by April next year.

In an interview with Bloomberg on Thursday, Dallas Fed President Robert Kaplan acknowledged issues such as the deceleration of global growth, tightening of financial conditions and widening credit spreads.

“My own view is we shouldn’t take any further action on interest rates until these issues are resolved for better or for worse…,” Kaplan said.

“So I would be an advocate of taking no action during the first couple of quarters of this year…we should be patient and give some time for this economy and watch how this situation unfolds.”

A dovish Fed would likely keep the greenback under pressure in the coming months, giving central banks in emerging markets room to cut rates if economic conditions sharply deteriorate.

“A weaker dollar should benefit emerging market currencies, but for now they are hamstrung by all the uncertainty around China,” said Ray Attrill, head of currency strategy at NAB.

The dollar index was relatively unchanged at 96.3. The index fell 0.56 percent in the previous session.

The euro and sterling were unchanged from Thursday’s close at $1.1393 and $1.2636, respectively.


Company: cnbc, Activity: cnbc, Date: 2019-01-04  Authors: dan kitwood, getty images
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Dollar weakens as US bond yields fall, trade tariff postponement supports riskier currencies

The dollar slipped in Asia on Tuesday as U.S. Treasury yields fell to three-month lows, a sign some investors were wagering the Federal Reserve would slow the pace of its rate hikes. The U.S. 10-year Treasury yield fell to 2.94 percent on Tuesday, its lowest level since mid September. “Falling U.S. yields are a negative for the dollar, especially versus the major currencies,” said Rodrigo Catril, senior currency strategist at NAB. Catril added that U.S. Treasury yields are near crucial technical


The dollar slipped in Asia on Tuesday as U.S. Treasury yields fell to three-month lows, a sign some investors were wagering the Federal Reserve would slow the pace of its rate hikes. The U.S. 10-year Treasury yield fell to 2.94 percent on Tuesday, its lowest level since mid September. “Falling U.S. yields are a negative for the dollar, especially versus the major currencies,” said Rodrigo Catril, senior currency strategist at NAB. Catril added that U.S. Treasury yields are near crucial technical
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Dollar weakens as US bond yields fall, trade tariff postponement supports riskier currencies

The dollar slipped in Asia on Tuesday as U.S. Treasury yields fell to three-month lows, a sign some investors were wagering the Federal Reserve would slow the pace of its rate hikes.

The weakness in the dollar comes against the backdrop of a temporary truce in the US-China trade conflict, which has bolstered investor confidence in riskier currencies versus the safe-haven greenback.

The U.S. 10-year Treasury yield fell to 2.94 percent on Tuesday, its lowest level since mid September. The difference in yield between the U.S. 2-year and 10-year tightened to its smallest since July 2007.

The two-10-year yield curve is a key focus for investors as an inversion is seen as predictor of a U.S. recession. A yield curve is said to be inverted when yields on longer-dated maturity bonds are lower than shorter-dated maturity bonds.

The yield curve has flattened as continuing interest rate hikes send short-dated yields higher, while longer-dated Treasuries are supported by tepid inflation and slowing global growth.

“Falling U.S. yields are a negative for the dollar, especially versus the major currencies,” said Rodrigo Catril, senior currency strategist at NAB.

Catril added that U.S. Treasury yields are near crucial technical support levels, a break of which could add further pressure on U.S. yields and the dollar.

The dollar index, a gauge of its value versus six major peers, was off 0.23 percent at 96.8.

The dollar had been supported for most of 2018 by a robust U.S. economy and a relatively hawkish Fed, which is widely expected to raise its policy interest rate later this month.

Markets have priced in an 87 percent probability of a rate hike at the Fed’s Dec. 18-19 meeting.

The dollar came under pressure last week when the market took comments from Fed Chair Jerome Powell as signalling a slower pace of rate hikes.

A more dovish tone from the Fed last week has led markets to question how many times the central bank will hike rates in 2019.

“Given data remains strong, we think the Fed will hike twice in 2019 and that’s more than what the market is pricing in right now…we remain moderately bullish on the dollar,” said Nick Twidale, chief operating officer at Rakuten Securities.

Currencies such as the Chinese yuan, which were battered in the US-China trade war, are expected to trade stronger versus the greenback in the coming weeks as investor sentiment improves.

The dollar fell 0.5 percent against the offshore yuan to 6.8375. On Monday, it lost 1.07 percent, its steepest percentage fall since Aug. 25.

“For now, it seems China has got the best out of G20 and we expect the yuan to remain supported,” added Twidale.

However, he warned that markets need to see a further easing in trade tensions for the risk-on rally to continue.

The Australian dollar gained 0.3 percent in Asian trade at $0.7376. The Reserve Bank of Australia kept its policy cash rate unchanged on Tuesday in a widely expected move.

The yen traded at 113.13 to the dollar, with the greenback losing 0.4 percent versus the Japanese currency.

Elsewhere, sterling was gained 0.2 percent to trade at $1.2744 due to broad dollar weakness. On Monday, the pound fell below $1.27 for the first time since Oct. 31.

Sterling has posted losses for three consecutive weeks as traders bet that British Prime Minister Theresa May will not be able to pass her Brexit deal through parliament on Dec. 11.


Company: cnbc, Activity: cnbc, Date: 2018-12-04  Authors: tyrone siu
Keywords: news, cnbc, companies, trade, dollar, yuan, tariff, weakens, fall, yield, treasury, fed, versus, rate, fell, postponement, yields, riskier, currencies, supports


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Dollar weakens as US-China trade truce revives demand for riskier currencies

Riskier currencies such as the Australian dollar and New Zealand dollar rallied by more than 0.5 percent each, while safe haven currencies such as the yen and the Swiss franc traded weaker in early Asian trade, signalling a clear risk-on move in the financial markets. “The trade truce is definitely risk positive for the markets…we expect dollar safe haven buying to fade and riskier currencies such as the Aussie and Kiwi dollar to scale higher,” said Rodrigo Catril, senior currency strategist a


Riskier currencies such as the Australian dollar and New Zealand dollar rallied by more than 0.5 percent each, while safe haven currencies such as the yen and the Swiss franc traded weaker in early Asian trade, signalling a clear risk-on move in the financial markets. “The trade truce is definitely risk positive for the markets…we expect dollar safe haven buying to fade and riskier currencies such as the Aussie and Kiwi dollar to scale higher,” said Rodrigo Catril, senior currency strategist a
Dollar weakens as US-China trade truce revives demand for riskier currencies Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-12-03
Keywords: news, cnbc, companies, weakens, currency, revives, marketsthe, versus, riskier, trade, uschina, dollar, currencies, traded, weaker, truce, demand, value, yen


Dollar weakens as US-China trade truce revives demand for riskier currencies

The dollar fell across the board on Monday as investor demand for riskier assets rose after China and the U.S. agreed to a cease-fire in a trade dispute that has shaken global markets.

The White House said on Saturday that President Donald Trump told China’s President Xi Jinping at the G-20 talks in Argentina that he would not boost tariffs on $200 billion of Chinese goods to 25 percent on Jan. 1 as previously announced.

China and United States will try to bridge their differences via new talks aimed at reaching a deal within 90 days.

Riskier currencies such as the Australian dollar and New Zealand dollar rallied by more than 0.5 percent each, while safe haven currencies such as the yen and the Swiss franc traded weaker in early Asian trade, signalling a clear risk-on move in the financial markets.

“The trade truce is definitely risk positive for the markets…we expect dollar safe haven buying to fade and riskier currencies such as the Aussie and Kiwi dollar to scale higher,” said Rodrigo Catril, senior currency strategist at NAB.

Catril noted that crosses such as the Aussie/yen and kiwi/yen are likely to see further upside as currency traders react to the temporary truce between the world’s two largest economies.

The dollar index, a gauge of its value versus six major peers, traded down 0.13 percent at 97.14.

The dollar lost 0.54 percent versus the offshore yuan, its steepest percentage fall since Oct. 1, to quote at 6.9134.

The safe-haven yen weakened to 113.68 on Monday, with the greenback gaining 0.2 percent, reflecting the prevailing risk-on mood. The euro gained 0.34 percent on the yen to 128.89, briefly hitting an intra-day high of 129.37, its highest level since Nov. 9.

The euro changed hands gained 0.16 percent to $1.1333 amid heavy dollar selling.

However, some analysts warned many issues had to be resolved for risk sentiment to stay positive in the medium term.

“Ultimately, it remains a high order for China to fulfil the U.S. demands on structural issues…at a time when the major issues that the U.S. has raised represent a challenge to China’s rise, a long-lasting and meaningful de-escalation remains very challenging,” said Daniel Been, head of currency research at ANZ.

Apart from trade, investor focus will also return to the U.S. monetary policy, with the Federal Reserve expected to raise interest rates by 25 basis points later in December, which would be its fourth rate hike this year.

“The developments over the weekend will give the Fed some more confidence to raise rates in 2019,” said Michael McCarthy, chief market strategist at CMC markets.

The dollar had come under pressure last week when the market took comments by Federal Reserve Chair Jerome Powell as hinting at a slower pace of rate hikes.

Powell is scheduled to testify before a congressional Joint Economic Committee later this week.

The British pound traded weaker versus the dollar at $1.2740 losing around 0.1 percent of its value. Sterling has posted losses for three consecutive weeks as traders bet that British Prime Minister Theresa May will not be able to pass her Brexit deal through parliament on Dec. 11.


Company: cnbc, Activity: cnbc, Date: 2018-12-03
Keywords: news, cnbc, companies, weakens, currency, revives, marketsthe, versus, riskier, trade, uschina, dollar, currencies, traded, weaker, truce, demand, value, yen


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Dollar at 16-month peak, yen weakens as Bank of Japan keeps monetary policy steady

In a widely expected move, the BOJ maintained its short-term interest rate target at minus 0.1 percent and a pledge to guide 10-year government bond yields around zero percent. The yen changed hands at 113.24 on the dollar, remaining under pressure in Asia after earlier sliding to three-week lows at 113.32. The U.S. 10-year treasury bond yields rose for the third consecutive trading session on Wednesday and were last at 3.13 percent. The 10-year Japanese government bond yield was 0.12 percent, h


In a widely expected move, the BOJ maintained its short-term interest rate target at minus 0.1 percent and a pledge to guide 10-year government bond yields around zero percent. The yen changed hands at 113.24 on the dollar, remaining under pressure in Asia after earlier sliding to three-week lows at 113.32. The U.S. 10-year treasury bond yields rose for the third consecutive trading session on Wednesday and were last at 3.13 percent. The 10-year Japanese government bond yield was 0.12 percent, h
Dollar at 16-month peak, yen weakens as Bank of Japan keeps monetary policy steady Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-10-31
Keywords: news, cnbc, companies, yields, bond, dollar, data, peak, policy, steady, currency, yen, monetary, bank, weakens, japan, euro, expected, versus, keeps


Dollar at 16-month peak, yen weakens as Bank of Japan keeps monetary policy steady

The Japanese yen edged lower against the dollar on Wednesday after the Bank of Japan signaled it was a long way off from exiting crisis-era stimulus, while the greenback scaled 16-month highs versus its key rivals on continued strength in the U.S. economy.

The Bank of Japan (BoJ) kept monetary policy steady on Wednesday and cut its price forecasts, reinforcing market expectations that subdued inflation will force it to maintain its massive stimulus program for the time being.

In a widely expected move, the BOJ maintained its short-term interest rate target at minus 0.1 percent and a pledge to guide 10-year government bond yields around zero percent.

The yen changed hands at 113.24 on the dollar, remaining under pressure in Asia after earlier sliding to three-week lows at 113.32. The dollar had gained 0.6 percent on the yen the previous day.

“I still see the main driver for the dollar/yen to be U.S. 10 year bond yields and the overall level of risk aversion in the system which can be gauged by the VIX index,” said Sim Moh Siong, currency strategist at Bank of Singapore.

The U.S. 10-year treasury bond yields rose for the third consecutive trading session on Wednesday and were last at 3.13 percent. The 10-year Japanese government bond yield was 0.12 percent, highlighting the wide gap in favor of the dollar.

The dollar index, a gauge of its value versus six major peers, climbed to a fresh 16-month high to hit 97.06.

The U.S. currency benefited from stronger than expected U.S. economic data as well as deteriorating fundamentals for the euro, which makes up around 58 percent of the index.

U.S. consumer confidence rose to an 18-year high in October, driven largely a robust labor market, suggesting strong economic growth could persist in the near term. That follows last week’s data which showed the U.S. economy slowed less than expected in the third quarter.

In contrast, economic data out of Europe disappointed analysts as the euro zone economy grew less than expected in the third quarter.

The euro changed hands at $1.1343, steady from its New York close, though it has lost 2.3 percent versus the greenback in October.

Political uncertainty in Germany, following chancellor Angela Merkel’s decision to step down in 2021, is also pressuring the single currency. Moreover, the stand-off between Rome and Brussels over Italy’s free spending budget, which is in breach of the European Union’s fiscal rules, has weighed on the euro.

Philip Wee, currency strategist at DBS, said in a note to clients that the gloomy backdrop might push the euro down to $1.12 in the current quarter, and is tipping an even lower $1.05-1.10 range in the first half of 2019.

The sterling held close to its mid-August lows, hovering at $1.2705, after credit ratings agency Standard & Poor’s said a ‘no-deal’ Brexit would be likely to tip Britain into a recession on Tuesday.

Some immediate catalysts for the sterling traders could come from the Bank of England’s monetary policy meeting on Thursday, when it is expected to keep interest rates on hold and detail conditions necessary for policy tightening.

The yuan was relatively flat in onshore trading at 6.9663, though it remains on a downward path after it fell to its lowest level in a decade this week.

With no sign of a let-up in the Sino-U.S. trade war, investors are betting on more weakness ahead and expect authorities will eventually allow the yuan to breach the key 7 to the dollar level for the first time since the global financial crisis.

The Australian dollar dipped 0.3 percent to $0.7084 after the release of tepid inflation data reinforced views that a rate increase remains a distant prospect.


Company: cnbc, Activity: cnbc, Date: 2018-10-31
Keywords: news, cnbc, companies, yields, bond, dollar, data, peak, policy, steady, currency, yen, monetary, bank, weakens, japan, euro, expected, versus, keeps


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Hurricane Willa weakens while hurtling inland from Mexico’s Pacific coast

Hurricane Willa’s fierce winds began to ease as the powerful storm barreled inland over Mexico early on Wednesday, leaving power outages and toppled trees on the coast but no deaths, an official said. “Rapid weakening should begin soon,” the National Hurricane Center said late on Tuesday, as the eye of the storm moved toward the capital of Durango state. “It was really strong,” said Cecilia Crespo, a police spokeswoman in Escuinapa, a seaside town near to where the storm plowed inland. Willa had


Hurricane Willa’s fierce winds began to ease as the powerful storm barreled inland over Mexico early on Wednesday, leaving power outages and toppled trees on the coast but no deaths, an official said. “Rapid weakening should begin soon,” the National Hurricane Center said late on Tuesday, as the eye of the storm moved toward the capital of Durango state. “It was really strong,” said Cecilia Crespo, a police spokeswoman in Escuinapa, a seaside town near to where the storm plowed inland. Willa had
Hurricane Willa weakens while hurtling inland from Mexico’s Pacific coast Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-10-24  Authors: source
Keywords: news, cnbc, companies, mph, kph, near, mexico, inland, storm, city, coast, hurricane, mexicos, moved, pacific, winds, trees, hurtling, weakens, willa


Hurricane Willa weakens while hurtling inland from Mexico's Pacific coast

Hurricane Willa’s fierce winds began to ease as the powerful storm barreled inland over Mexico early on Wednesday, leaving power outages and toppled trees on the coast but no deaths, an official said.

Willa, a Category 3 storm on the five-step Saffir-Simpson scale, hit late on Tuesday near the town of Isla del Bosque in the northwestern state of Sinaloa with winds of 120 mph (195 kph), thrashing buildings with rain in the coastal towns and resorts where thousands of people moved to safety.

“The population took cover in time, and this is the result,” said Luis Felipe Puente, head of the country’s Civil Protection agency, adding that roads would be open on Wednesday.

“Rapid weakening should begin soon,” the National Hurricane Center said late on Tuesday, as the eye of the storm moved toward the capital of Durango state.

The storm was one of the most powerful hurricanes to hit Mexico from the Pacific in recent years.

“It was really strong,” said Cecilia Crespo, a police spokeswoman in Escuinapa, a seaside town near to where the storm plowed inland. “It knocked down trees, lamps, poles, walls,” she added by telephone. “There’s no electricity.”

The storm drove into Mexico about 50 miles (80 km) south of Mazatlan, a major city and tourist resort in Sinaloa. Willa had reached rare Category 5 status on Monday with winds near 160 mph (260 kph) before it began to lose power.

Willa weakened as it moved inland but was still blowing winds of 115 mph (185 kph) more than an hour after it struck the coast.

Speaking by telephone, Jose Garcia, another resident of the hardest-hit area, said he had hunkered down with others in an Escuinapa hotel waiting for the storm to pass, listening to it rattle buildings as it drove onwards.

“People were very alarmed,” the 60-year-old said.

The storm did not strike hard in Mazatlan’s historic city center, which was nearly deserted ahead of its arrival.

“My house is made of sheet metal, wood and cardboard, and I’m scared it will fall on top of me,” said Rosa Maria Carrillo, 36, at a city shelter with her five children.


Company: cnbc, Activity: cnbc, Date: 2018-10-24  Authors: source
Keywords: news, cnbc, companies, mph, kph, near, mexico, inland, storm, city, coast, hurricane, mexicos, moved, pacific, winds, trees, hurtling, weakens, willa


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