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☆ Dollar steadies before inflation test; yen brushes off Tokyo CPI
▼ + stars: | 2024-05-31 | by ( ) www.cnbc.com time to read: +4 min

The dollar was licking wounds against peer currencies on Friday after a downward revision to U.S. GDP for the first quarter suggested room for rate cuts this year, while investors braced for inflation data. The dollar index , which measures the currency against six major peers, consolidated around 104.82 after dipping as low as 104.63 overnight. Softer U.S. consumer price inflation data earlier in May rekindled rate cut expectations for this year, weakening the dollar across the board and setting it on track to post its first monthly losses in 2024. "All told, the Tokyo CPI leaves us confident that nationwide underlying inflation will fall below 2% as soon as July." Price data for the euro zone is due on Friday, following a stronger-than-expected April inflation reading for Germany on Wednesday.

Persons: John Williams, Matt Simpson, Index's Simpson, Marcel Thieliant, Sterling, bitcoin Organizations: Treasury, greenback, New York Fed, Index, PCE, Capital Economics, Japan's Ministry of Finance, Germany Locations: U.S, Tokyo, Asia

☆ Chinese policies disruptive to the rest of the world: U.S.' Shambaugh
▼ + stars: | 2024-05-24 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailChinese policies disruptive to the rest of the world: U.S.' ShambaughJay Shambaugh, under secretary of the U.S Treasury for International Affairs, joins CNBC's Charlotte Reed from the G7 Finance Ministers Meeting in Stresa to discuss U.S.-China trade issues.

Persons: Jay Shambaugh, Charlotte Reed Organizations: U.S Treasury, International Affairs, U.S Locations: Stresa, China

☆ Strategist on fair value for U.S. 10-year treasury yield
▼ + stars: | 2024-04-30 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailStrategist on fair value for U.S. 10-year treasury yield given significant risk in budget deficitRon Temple of Lazard discusses his outlook for U.S Treasury yields and the structural challenges facing U.S. budget.

Persons: Ron Temple, Lazard Organizations: Treasury

☆ Where do Treasury yields go from here? Morgan Stanley's Jim Caron weighs in
▼ + stars: | 2024-02-22 | by ( Weizhen Tan | ) www.cnbc.com time to read: +3 min

Treasury yields shot up last year, and investors flocked to allocating to cash which have yielded around 5% or even more. Morgan Stanley Investment Management's Jim Caron believes the 10-year Treasury yield is very likely to hover between 5% and 5.5%. Caron, who is chief investment officer at its Portfolio Solutions Group, explained that historically, 10-year Treasury yields are "usually a good match" for nominal gross domestic product. How rising yields affect stocks But are rising yields bad for stocks, as commonly thought? "If yields are rising because the economy is running hot, and data and labor markets are stronger, the rising yields need not negatively affect stocks."

Persons: Morgan Stanley, Jim Caron, Caron, CNBC's Organizations: Treasury, U.S . Federal, Morgan, Morgan Stanley Investment, Solutions Locations: U.S

☆ Dollar holds firm before Fed rates decision
▼ + stars: | 2024-01-31 | by ( ) www.cnbc.com time to read: +3 min

On the day, the dollar index was up 0.1% to 103.51, just below Monday's 103.82 which matched last week's seven-week high. The Federal Reserve meanwhile is expected to hold U.S. interest rates steady on Wednesday but flag cuts are coming by dropping language indicating it is weighing further hikes. Interest rate futures price a roughly 43% chance of a Fed rate cut in March, down from 73% at the start of the year. A slowdown in Germany would foreshadow the same in Eurozone numbers due on Thursday and reinforce market expectations that European policymakers could start rate cuts earlier than the ECB has signalled. Expectations of interest rate cuts in China have driven a strong rally in the bond market this month while the yuan has been squeezed by flight from China's crumbling equity markets.

Persons: Jerome, Powell, Dane Cekov Organizations: Bank of Japan, Federal Reserve, Federal, U.S, French EU, ECB, Bank of Locations: U.S, Germany, China

☆ Fixed income strategist sees 10-year Treasury yields below 4 percent by the end of 2024
▼ + stars: | 2023-11-28 | by ( ) www.cnbc.com time to read: 1 min

In this videoShare Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailFixed income strategist sees 10-year Treasury yields below 4 percent by the end of 2024Amy Xie Patrick of Pendal discusses fixed income strategies and explains why she believes U.S treasury yields will continue to fall.

Persons: Amy Xie Patrick, Pendal

☆ Rich countries are stumbling into a debt trap
▼ + stars: | 2023-11-03 | by ( Felix Martin | ) www.reuters.com time to read: +7 min

Unlike many corporations and households, the U.S. government did not lock in the low interest rates of the last decade by issuing long-dated debt, preferring instead to skew funding towards bills and short-term bonds. The second route out of the debt trap is to target the primary fiscal surplus, choosing a combination of spending cuts and tax hikes that will stabilise the public debt. That leaves the third route to debt sustainability – keeping real interest rates low. But in the short run, it allows a government to tame the debt ratio without fiscal austerity, and even if growth is sluggish. Governments are indeed stuck in a classic debt trap.

Persons: Joe Biden, Fumio Kishida, Volodymyr Zelenskiy, Kacper, Everett Dirksen, you’re, Dirksen’s, Stanley Druckenmiller, Joe Biden’s, Peter Thal Larsen, Thomas Shum Organizations: Japan's, NATO, REUTERS, Reuters, Congressional, Office, International Monetary Fund, U.S, Treasury, Reuters Graphics Reuters Graphics, Medicaid, Federal, Bank of Japan, Thomson Locations: Ukraine, Vilnius, Lithuania, Illinois, U.S, Britain

☆ Rupee rises on oil pullback; dollar liquidity remains inadequate
▼ + stars: | 2023-10-25 | by ( Nimesh Vora | ) www.reuters.com time to read: +2 min

A customer hands Indian currency notes to an attendant at a fuel station in Mumbai, India, August 13, 2018. REUTERS/Francis Mascarenhas/File photo Acquire Licensing RightsMUMBAI, Oct 25 (Reuters) - The Indian rupee rose marginally on Wednesday, helped by retreating oil prices and U.S Treasury yields, while the dollar/rupee cash swap rate indicated that dollar liquidity was less than sufficient. The rupee was at 83.1500 to the U.S. dollar at 11:53 a.m. IST, up from its previous close of 83.1925 but slightly below its open at 83.0650. Meanwhile, USD/INR swap rate for today over tomorrow was at 0.15 paisa following the expiry of the Reserve Bank of India's $5 billion swap on Monday. At 0.15 paisa, the imputed rupee lending rate for raising dollars is 6%, which is 80 basis points below the rupee call rate.

Persons: Francis Mascarenhas, Brent, Morgan Stanley, Nimesh Vora, Varun Organizations: REUTERS, Rights, Treasury, U.S, Reserve Bank, India's, Thomson Locations: Mumbai, India, Rights MUMBAI, Asia, U.S

In turn, higher rates will dampen interest-sensitive expenditure and likely lead to slower growth in oil consumption in 2024. Services are less energy-intensive but more labour-intensive than manufacturing, so the sector’s inflation rate tends to be more persistent and a better indicator of the overall amount of inflationary pressure within the economy. Most rate traders anticipate the central bank will be forced to keep overnight rates higher for longer to squeeze persistent inflation out of the economy. In the short term, the renewed expansion of the U.S. manufacturing and service sectors is supporting oil consumption and prices. In the medium term, however, the higher-for-longer rates needed to bring inflation back to target will likely depress business activity and slow oil consumption growth in 2024.

Persons: Eduardo Munoz, John Kemp, Rod Nickel Organizations: Exxon, REUTERS, Institute, Supply, Federal Reserve, Treasury, Thomson, Reuters Locations: Newport , New Jersey, U.S, United States, Europe, Ukraine

☆ US equity funds see outflows for sixth week in a row
▼ + stars: | 2023-09-08 | by ( ) www.reuters.com time to read: +2 min

According to LSEG data, investors withdrew a net $5.96 billion out of U.S. equity funds during the week, compared with about $4.42 billion worth net withdrawn the previous week. Investors offloaded about $3.96 billion worth of equity large-cap funds compared with about $110 million worth of net selling in the previous week. Small- mid-, and multi-cap funds also witnessed $1.56 billion, $365 million and $4 million worth of net selling, respectively. U.S. bond funds witnessed outflows for a fourth successive week, with about $622 million in net selling. Government bond funds also saw about $260 million worth of outflows, the first in five weeks.

Persons: Andrew Kelly, Gaurav Dogra, Patturaja, Emelia Sithole Organizations: New York Stock Exchange, REUTERS, Investors, Treasury, Reuters Graphics Reuters, Money, Thomson, & $ Locations: New York City, U.S, China, Europe, Bengaluru

The 2-year Treasury yield was last down by about 2 basis point at 4.947%. Investors are assessing what could be next in store for interest rates, looking to economic developments for clues about the Federal Reserve's next moves. Some investors and analysts saw this as a potential signal that inflationary pressures may continue for longer, which could in turn impact the Fed's next interest rate decisions. Waller also left the window open for a further interest rate hike. Several Fed officials are also expected to make further remarks this week, which could provide investors with fresh hints about the monetary policy outlook.

Persons: Christopher Waller, Waller Organizations: Treasury, U.S Treasury, Federal Reserve, Investors, Federal Locations: Saudi Arabia

☆ Biden order curbing investment to China expected next week-sources
▼ + stars: | 2023-08-04 | by ( Karen Freifeld | ) www.reuters.com time to read: +3 min

REUTERS/Jonathan Ernst/File PhotoAug 4 (Reuters) - President Joe Biden is expected to issue his long-awaited executive order to screen outbound investments in sensitive technologies to China early next week, according to people familiar with the matter. The order is expected to target U.S. private equity, venture capital and joint venture investments in China in semiconductors, quantum computing and artificial intelligence. Most investments captured by the order will require that the government be notified about them. The regulations are not expected to take effect right away and the administration will solicit comment on its proposals, according to sources. Sources have told Reuters the investments that will be restricted are expected to track export control rules for China issued by the U.S. Department of Commerce in October.

Persons: Joe Biden, Jonathan Ernst, Cordell Hull, Janet Yellen's, Laura Black, Emily Kilcrease, Karen Freifeld, Anna Driver Organizations: Auburn Manufacturing, REUTERS, U.S . Commerce Department, U.S, Foreign Investment, Reuters, U.S . Department of Commerce, Thomson Locations: U.S, Auburn , Maine, China, Yellen, United States

☆ Biden order curbing investment to China expected next week
▼ + stars: | 2023-08-04 | by ( ) www.cnbc.com time to read: +3 min

President Joe Biden is expected to issue his long-awaited executive order to screen outbound investments in sensitive technologies to China early next week, according to people familiar with the matter. The order is expected to target U.S. private equity, venture capital and joint venture investments in China in semiconductors, quantum computing and artificial intelligence. Most investments captured by the order will require that the government be notified about them. The regulations are not expected to take effect right away and the administration will solicit comment on its proposals, according to sources. Sources have told Reuters the investments that will be restricted are expected to track export control rules for China issued by the U.S. Department of Commerce in October.

Persons: Joe Biden, Xi Jinping, Cordell Hull, Janet Yellen's, Laura Black, Emily Kilcrease Organizations: U.S . Commerce Department, U.S, Foreign Investment, Reuters, U.S . Department of Commerce Locations: Bali , Indonesia, China, U.S, Yellen, United States

☆ Rich nations pledge to unlock hundreds of billions of dollars for climate fight
▼ + stars: | 2023-06-23 | by ( ) www.cnbc.com time to read: +2 min

World leaders and finance leaders attend the closing session of the New Global Financial Pact Summit, in Paris on June 23, 2023. The leaders, gathered at a summit in Paris to thrash out funding for the climate transition and post-COVID debt burdens of poor countries, said their plans would secure billions of dollars of matching investment from the private sector. An overdue pledge of $100 billion in climate finance for developing nations was also now in sight, they said. The announcements mark a scaling up of action from the development banks in the fight against climate change and set a direction for further change ahead of their annual meetings later in the year. However, some climate activists were critical of the results.

Persons: Lewis Joly, LEWIS JOLY, Janet Yellen, Harjeet Singh Organizations: New Global Financial, Getty Images, Bank, World Bank, International Monetary Fund, Reuters, U.S, IMF, Paris Summit, Climate Action Locations: Paris

May 28 (Reuters) - Global investors are gaming out how a tentative deal to raise the United States debt ceiling could ripple through markets, as lawmakers strive to pass the agreement through Congress before a June 5 deadline. U.S. five-year credit default swaps narrowed, meaning that the cost of insuring against exposure to a U.S. debt default fell. “The debt ceiling agreement is only the first step in saving the government from the brink of illiquidity.”The deal suspends the debt ceiling until January 2025 in exchange for caps on spending and cuts in government programs. U.S. Treasury Secretary Janet Yellen on Friday set a deadline for raising the federal debt limit, saying the government would default if Congress does not increase the debt ceiling by June 5. Optimism that a debt ceiling deal was near and hefty gains in AI-related stocks helped the S&P 500 (.SPX) close at its highest level since August 2022 on Friday.

☆ Treasury yields mixed as investors weigh U.S. economic outlook
▼ + stars: | 2023-05-17 | by ( Sophie Kiderlin | In | ) www.cnbc.com time to read: +1 min

One basis point is equivalent to 0.01%. ET, the yield on the 10-year Treasury was down by close to two basis point to 3.5301%. Meanwhile, the 2-year Treasury yield was last trading over one basis point higher at 4.0886%. U.S Treasury yields were mixed on Wednesday as investors assessed what could be next for the economy amid concerns about the debt ceiling and a recession. On Wednesday, investors will be following further Fed speaker comments, as well as the release of building permit and housing starts data for April.

☆ Treasury yields rise as investors consider economic outlook
▼ + stars: | 2023-03-28 | by ( Sophie Kiderlin | ) www.cnbc.com time to read: +1 min

ET, the yield on the 10-year Treasury was trading at 3.5507% after rising over two basis points. The yield on the 2-year Treasury was more than five basis points higher at 4.0186%. U.S Treasury yields climbed on Tuesday as investors assessed what could be on the horizon for the U.S. economy and Federal reserve policy decisions. Investors considered the outlook for the economy as fears about a widespread banking crisis eased. Many investors have been concerned about whether the pace of rate hikes and keeping rates higher for longer could drag the U.S. economy into a recession.

☆ Treasury yields dip ahead of Fed interest rate decision
▼ + stars: | 2023-03-22 | by ( Sophie Kiderlin | ) www.cnbc.com time to read: +1 min

U.S Treasury yields fell on Wednesday as investors awaited the Federal Reserve's latest interest rate decision and guidance on the central bank's monetary policy path. Investors prepared themselves for the Fed's next interest rate decision, which is expected to be announced after the central bank's policy meeting concludes on Wednesday. A 25 basis point increase is widely anticipated. That would be the ninth consecutive interest rate hike and the second quarter-point increase in a row after a series of bigger rate hikes were implemented throughout 2022. Just a few weeks ago, many investors believed Fed officials would reaccelerate the pace of rate hikes and announce a 50 basis point increase.

The boost was shortlived and fears of a banking crisis gripped the market on Friday, with shares of First Republic Bank (FRC.N), which also suspended its dividend payout, dropping 24.5%. The KBW regional banking index (.KRX) and the S&P 500 banks index (.SPXBK) fell over 9% each in the week. Investors are now looking ahead to the Federal Reserve's interest rate decision, due next week, to gauge how it will tame inflation. Money market participants now see a 67% chance of the Fed raising rates by 25 basis points on March 22. . Declining issues outnumbered advancers by a 5.46-to-1 ratio on the NYSE by a 3.56-to-1 ratio on the Nasdaq.

Shares of First Republic fell 20.7% in early trading after the bank suspended its dividend payout. The KBW regional banking index (.KRX) and the S&P 500 banks index (.SPXBK) fell over 2% each. "Deposits have fled from regional banks like First Republic into the big banks who are now bailing them out by putting the deposits back in. "Until you stop the deposit flight from regional banks into the systemically important banks that are too big to fail, it doesn't matter how much money you pour into the bucket." The S&P index recorded two new 52-week highs and four new lows, while the Nasdaq recorded seven new highs and 75 new lows.

☆ 2-year Treasury yield tumbles as investors assess the state of the economy following SVB fallout
▼ + stars: | 2023-03-13 | by ( Sophie Kiderlin | ) www.cnbc.com time to read: +1 min

ET, the yield on the 10-year Treasury was down by close to 14 basis points to 3.5562%. The yield on the 2-year Treasury was last trading at 4.2739% after declining by over 31 basis points. U.S Treasury yields declined on Monday as investors assessed the state of the economy after the collapse of Silicon Valley Bank and looked to key inflation data due this week. Investors processed the fallout from the collapse of Silicon Valley Bank and considered its impact on the economy. February's consumer inflation report and the latest reading of the core inflation rate are expected Tuesday, followed by wholesale inflation data on Wednesday.

BENGALURU, Feb 24 (Reuters) - The United States and China will hold deputy-level talks between their finance officials on Friday to discuss debt and other issues on the sidelines of a G20 finance meet in India, two sources familiar with the matter told Reuters. U.S. Treasury Secretary Janet Yellen said on Thursday, ahead of a meeting of G20 finance ministers and central bank governors near Bengaluru, that communication between the United States and China was important for "the sake of the entire globe". China's Ministry of Finance and its central bank did not immediately respond to a request seeking comment. The United States has repeatedly criticised China over what it considers to be "foot-dragging" on debt relief for dozens of low-and middle-income countries including Sri Lanka. China, the world's largest bilateral creditor, urged G20 nations on Friday to conduct a fair, objective and in-depth analysis of the causes of global debt issues and to "resolve the problem in a comprehensive and effective manner."

☆ Yields are popping again. Here's how investors can take advantage of that, according to the pros
▼ + stars: | 2023-02-14 | by ( Weizhen Tan | ) www.cnbc.com time to read: +3 min

How can investors ride on higher yields? Buy high-quality or short-term fixed income BlackRock Investment Institute said it likes high-quality credit and short-end government bonds "as interest rates stay higher for longer." "Fixed income finally offers 'income' after yields surged globally. "We believe that investors should hold around 2% of cash in their portfolios and should use short-term fixed income (anything below a 2-year maturity) as a proxy for cash," Alvarado added. Wells Fargo Investment Institute's tactical portfolios are allocating between 2% (for "aggressive growth investors") and 17% (for conservative income investors) to short-term fixed income.

☆ Unions press Biden administration to not change EV tax credit rules
▼ + stars: | 2023-01-20 | by ( David Shepardson | ) www.reuters.com time to read: +2 min

WASHINGTON, Jan 20 (Reuters) - Major unions and public interest and environmental groups are urging President Joe Biden to reject efforts by the European Union and other foreign governments to revise U.S. electric vehicle tax incentives. Foreign governments have been pressing the Biden administration to do more to expand credit eligibility. The letter rejected the suggestion from foreign governments that the EV tax incentives violate World Trade Organization and free trade rules. The EU in December praised the U.S. Treasury Department decision to allow EVs leased by consumers to qualify for up to $7,500 in commercial clean vehicle tax credits. South Korea, Europe and some automakers in December had sought approval from Treasury to use the commercial electric vehicle tax credit to boost consumer EV access.

☆ Expansionist dreams threaten ECB digital euro plan
▼ + stars: | 2023-01-17 | by ( Rebecca Christie | ) www.reuters.com time to read: +4 min

The idea of a digital euro with the same reserve backing as its physical equivalent is thus partly about Frankfurt controlling the process. At best, a digital euro could bring more citizens into the banking system, particularly those who don’t have enough money for traditional financial services products. That jars with central bankers’ preference to limit the digital euro to the EU at first. The euro does not need a digital currency, but its members have signalled they want one. Reuters GraphicsFollow @rebeccawire on TwitterCONTEXT NEWSEuro area finance ministers issued a statement on the so-called digital euro on Jan. 16, calling for political oversight and an international approach of a European central bank digital currency (CBDC).

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