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☆ Yen sinks to 15-year low vs euro, Aussie jumps as central banks diverge
▼ + stars: | 2023-05-02 | by ( Kevin Buckland | ) www.reuters.com time to read: +3 min

TOKYO (Reuters) - The yen continued its steep descent on Tuesday, reaching a 15-year low to the euro, as the implications of a steadfastly dovish Bank of Japan continued to reverberate days after the decision. FILE PHOTO: Japanese Yen and U.S. dollar banknotes are seen in this illustration taken March 10, 2023. REUTERS/Dado Ruvic/IllustrationMeanwhile, the Aussie dollar leapt to a one-week high after the Reserve Bank of Australia (RBA) surprised with a rate hike and signalled more tightening may come. The central bank lifted the cash rate to 3.85% and said “some further” tightening may be required to ensure that inflation returns to target in a reasonable timeframe. The European Central Bank (ECB), meanwhile, is widely expected to raise rates for a seventh straight meeting the following day, with a 50 basis-point increase on the table.

☆ Yen sinks to 15-year low vs euro as dovish BOJ contrasts with ECB
▼ + stars: | 2023-05-02 | by ( Kevin Buckland | ) www.reuters.com time to read: +3 min

TOKYO (Reuters) - The yen continued its steep descent on Tuesday, reaching a 15-year low to the euro, as the implications of a steadfastly dovish Bank of Japan kept foreign exchange markets busy engaging in so called ‘carry-trades’. FILE PHOTO: Japanese Yen and U.S. dollar banknotes are seen in this illustration taken March 10, 2023. The euro was steady at 150.965 yen after earlier touching 151.03 for the first time since September 2008. The greenback was about flat at 137.375 yen, and earlier rose to 137.58 for the first time since March 8. At the RBA, traders are laying 87% odds for no change to policy, although about 11 bps of tightening is priced for the August meeting.

☆ After Pandemic Rebound, U.S. Manufacturing Droops
▼ + stars: | 2023-05-02 | by ( Lydia Depillis | ) www.nytimes.com time to read: +1 min

The pandemic had a bright silver lining for Elkhart, Ind. The city, renowned as the capital of recreational vehicle production, had a surge in demand as cooped-up families took to the highways and avoided hotels. The area has lost nearly 7,000 manufacturing jobs over the past year, and unemployment is now above the national average. Thor Industries, which owns a wide portfolio of RV brands, saw its sales tumble 39.4 percent from the quarter a year ago. That’s manufacturing in America in 2023.

☆ Gold prices flat on caution ahead of Fed meeting
▼ + stars: | 2023-05-02 | by ( ) www.cnbc.com time to read: +1 min

Gold prices were flat on Tuesday, as cautious market participants awaited fresh cues from top central banks on their monetary policy plans, especially from the U.S. Federal Reserve. The Fed, which meets on May 2-3, is widely expected to raise interest rates by 25 basis points. Gold prices could move towards $2,000 if the Fed highlights recession worries and hints at a pause in the rate hike cycle, said Ajay Kedia, director at Kedia Commodities in Mumbai. U.S. manufacturing contracted in April but there was a build-up of inflation pressures, supporting expectations of Fed rate hike, according to data released on Monday. In the previous session, gold prices briefly rose above $2,000 after JP Morgan's acquisition of First Republic Bank's assets.

May 2 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever. The White House said First Republic was "severely mismanaged," the takeover protects depositors and the current banking turmoil bears no resemblance to 2008. Anyone who went long mega tech and short regional U.S. banks on Dec. 31 will be sitting pretty today. Expectations for further tightening this year are far from certain, and are gradually being pushed into the third quarter. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

China's manufacturing activity unexpectedly fell in April, official data showed on Sunday, the first contraction since December in the manufacturing purchasing managers' index. China is expected to be the biggest factor driving oil demand growth this year, he added. The U.S. Federal Reserve, which meets on May 2-3, is expected to increase interest rates by another 25 basis points. The U.S. dollar rose against a basket of currencies, making oil more expensive for other currency holders. Oil prices drew some support from U.S. manufacturing activity pulling off a three-year low in April, as new orders improved slightly and employment rebounded.

JPMorgan Chase & Co's (JPM.N) shares rose 3.1% to a near two-month high after the deal was announced earlier in the day. The S&P 500 Banks index (.SPXBK) gained 1.1%, while the KBW Regional Banking index (.KRX) shed 1.5%. Shares of regional banks PNC Financial (PNC.N) and Citizens Financial (CFG.N), that were among the bidders for First Republic, dropped 4.7% and 5.2%, respectively. "But regional banks will face higher cost of doing business for some time until confidence is rebuilt or there is a different regulatory scheme." Analysts now expect first-quarter earnings for S&P 500 companies to fall 1.9% from a year earlier, compared with a 5.1% fall expected at the start of April, according to Refinitiv data.

☆ Wall St stocks, dollar gain with data; Fed, earnings in the wings
▼ + stars: | 2023-05-01 | by ( Sinéad Carew | ) www.reuters.com time to read: +4 min

Also, weaker Chinese manufacturing data was outweighing support from OPEC+ supply cuts slated for this month. In currencies, the dollar index rose 0.383%, with the euro down 0.45% to $1.097. In Treasuries, yields on benchmark 10-year notes were up 9.7 basis points to 3.549%, from 3.452% late on Friday. The yield on the 2-year note was last was up 7.3 basis points at 4.1366%. Gold gave up all of its gains in volatile trading after the better-than-expected U.S. manufacturing data.

☆ US manufacturing contacts again in April but pulls off 3-year low
▼ + stars: | 2023-05-01 | by ( Lucia Mutikani | ) www.reuters.com time to read: +5 min

The ISM said its manufacturing PMI increased to 47.1 last month from 46.3 in March, which was the lowest reading since May 2020. It was the sixth straight month that the PMI remained below the 50 threshold, which indicates contraction in manufacturing. The proportion of manufacturing GDP with a composite PMI calculation at or below 45 percent - a good barometer of overall manufacturing weakness - was 12 percent in April, compared to 25 percent in March, said Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee. Only two of the six biggest manufacturing industries, petroleum and coal products as well as transportation equipment, reported growth last month. The ISM survey's forward-looking new orders sub-index rose to 45.7 last month from 44.3 in March.

The S&P 500 Banks index (.SPXBK) gained 1.4%. Big banks such as Bank of America (BAC.N) and Wells Fargo & Co (WFC.N) rose 0.3% and 2.8%, respectively. First Republic's woes kicked off last week on a bleak note, but upbeat earnings from Alphabet Inc (GOOGL.O), Microsoft Corp (MSFT.O) and Meta Platforms Inc (META.O) helped the benchmark S&P 500 (.SPX) notch its second consecutive month of gain on Friday. Analysts now expect first-quarter earnings for S&P 500 companies to fall 1.9% from a year earlier, compared with a 5.1% fall expected at the start of April, according to Refinitiv data. The S&P index recorded 21 new 52-week highs and no new low, while the Nasdaq recorded 48 new highs and 47 new lows.

☆ Morning Bid: Another one bites the dust
▼ + stars: | 2023-05-01 | by ( ) www.reuters.com time to read: +3 min

May 1 (Reuters) - A look at the day ahead in U.S. and global markets from Amanda Cooper. Just when you thought it was safe to go back into the banking system, First Republic Bank has folded and U.S. regulators have agreed to sell its assets to JPMorgan. A Reuters poll of economists offers a forecast of 46.7 for the ISM manufacturing index, which would mark an improvement on March's three-year low of 46.3, but it would still be the sixth straight month of contraction. ISM Manufacturing PMIEvents to watch out for on Monday:* U.S. Institute for Supply Management index* S&P Global Manufacturing PMI final index* Three- and six-month Treasury bill auctions. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ Wall St stocks end lower, dollar gains after data; Fed, earnings in the wings
▼ + stars: | 2023-05-01 | by ( Sinéad Carew | ) www.reuters.com time to read: +4 min

Crude oil prices were lower as weak economic data from China and expectations of another Fed interest rate hike on Wednesday outweighed support from OPEC+ supply cuts due this month. U.S. Treasury 10-year yields added to gains throughout the session, adding to a boost from the release of economic data Monday. In Treasuries, benchmark 10-year notes were up 12.4 basis points to 3.576%, from 3.452% late on Friday. The 2-year note was last was up 7.5 basis points to yield 4.1386%, from 4.064%. Gold prices edged lower as the dollar rose after better-than-expected U.S. manufacturing data.

☆ US manufacturing contracts again in April, but pace slows
▼ + stars: | 2023-05-01 | by ( Lucia Mutikani | ) www.reuters.com time to read: +6 min

The ISM said its manufacturing PMI increased to 47.1 last month from 46.3 in March, which was the lowest reading since May 2020. The ISM said 73% of manufacturing gross domestic product was contracting, up from 70% in March. "The proportion of manufacturing GDP with a composite PMI calculation at or below 45 percent - a good barometer of overall manufacturing weakness - was 12 percent in April, compared to 25 percent in March," said Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee. Only two of the six biggest manufacturing industries, petroleum and coal products as well as transportation equipment, reported growth. Higher prices align with government data showing wages and salaries in the manufacturing industry growing solidly in the first quarter.

☆ Wall Street Investors Recession Bet May Cause Bond, Stock Market Crash
▼ + stars: | 2023-04-27 | by ( Neil Dutta | ) www.businessinsider.com time to read: +10 min

And it's becoming increasingly clear that the bond market is reading the economic tea leaves all wrong. On the economic side, the bond market view would probably look something like the Fed's latest GDP projections. So if the bond market ends up being right about the economy, there would be a serious, ugly wake-up call for the stock market. I don't think the Wall Street aphorism about the bond market being "right" holds up this time. On the other hand, the bond market would take it squarely on the chin.

REUTERS/Leah MillisWASHINGTON, April 26 (Reuters) - Incumbent President Joe Biden entered the 2024 election race on Tuesday with something he didn't have two-and-a-half years ago: a record in the White House. Critics also say that increased federal spending under Biden, including $750 million on climate change and tax breaks, also drove inflation higher. Biden may have worse cards in 2024, with unemployment likely to rise as growth slows, interest rates remaining high and inflation holding above pre-pandemic levels. Biden also dismissed the sentences of thousands of people with federal offenses for simple marijuana possession, a disproportionately non-white group. The Biden administration also has faced scrutiny over its handling of record numbers of unaccompanied children crossing the U.S.-Mexico border illegally.

☆ Exclusive: Biden to veto legislation to block solar tariff waivers -officials
▼ + stars: | 2023-04-24 | by ( Jeff Mason | ) www.reuters.com time to read: +2 min

WASHINGTON, April 24 (Reuters) - U.S. President Joe Biden will veto congressional efforts to overturn his policy to waive solar tariffs on four Southeast Asian nations for two years, White House officials told Reuters on Monday. In June, Biden waived tariffs on solar panels from Cambodia, Malaysia, Thailand and Vietnam in an effort to create a "bridge" while U.S. manufacturing ramped up. The White House argues that Biden's policy has worked and points to an increase in domestic solar production since Biden came into office. The United States is on track to increase domestic solar panel manufacturing capacity 8-fold by the end of 2024, another official said. Biden does not plan to issue an extension on the tariff waivers after the 2-year period has concluded because domestic manufacturing has taken off.

Steep falls in the shares of these companies and regional banks, a major source of investor concern, dragged down the main indices. This is the first major economic indicator since new Bank of Japan Governor Kazuo Ueda took over earlier this month. Foreign investors poured nearly $12 billion into Japanese equities last week, their biggest weekly net purchases since at least January 2018. Here are three key developments that could provide more direction to markets on Friday:- Japan inflation (March)- Japan and Australia flash PMIs (April)- South Korea producer price inflation (March)By Jamie McGeever;Our Standards: The Thomson Reuters Trust Principles. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

The dollar index , which tracks the currency against a basket of its peers, was little changed at 101.96 after climbing 0.27% on Wednesday. "The banking results continue to show that the U.S. bank funding situation is stabilizing," said Bank of Singapore currency strategist Sim Moh Siong. "You have the UK CPI that turned out hotter than expected, at the same time the New Zealand CPI which turned out lower than expected, which are driving the sterling and kiwi," he added. New Zealand's consumer price index (CPI) for the first quarter came in below expectations on Thursday, but remained near historic highs. That followed hotter than expected CPI figures in Britain that boosted bets for a rate hike from the Bank of England in May.

☆ US retail sales post second straight monthly drop; factory output falls
▼ + stars: | 2023-04-14 | by ( Lucia Mutikani | ) www.reuters.com time to read: +5 min

Retail sales dropped 1.0% last month, the Commerce Department said. Data for February was revised up to show retail sales falling 0.2% instead of 0.4% as previously reported. Retail sales are mostly goods, which are typically bought on credit, and are not adjusted for inflation. Sales at food services and drinking places, the only services category in the retail sales report, edged up 0.1%. Excluding automobiles, gasoline, building materials and food services, retail sales slipped 0.3% last month.

☆ Singapore’s rate pause points to new reality
▼ + stars: | 2023-04-14 | by ( ) www.reuters.com time to read: +2 min

SINGAPORE, April 14 (Reuters Breakingviews) - Singapore’s surprise decision on Friday to keep its monetary policy unchanged leaves one thing unsaid. The Lion City, whose trade volumes dwarf the size of its economy, joins Australia, India and South Korea in standing pat. Singapore has repeatedly warned this would damage the Lion City’s growth outlook. Prime Minister Lee Hsien Loong said in 2019 that it should prepare for these consequences and adapt to new global realities. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

WASHINGTON, April 12 (Reuters) - The Biden administration's proposal on Wednesday to sharply cut tailpipe emissions and vehicle pollutants is on a fast track as the future of U.S. auto production could become a presidential campaign issue next year. Under Trump, the EPA reversed that decision and rolled back the Obama standards, a move that would have increased U.S. oil consumption by about 500,000 barrels per day by the 2030s. Biden, a self-proclaimed "car guy," will accelerate the adoption of zero-emission vehicles, the White House said on Wednesday. The EPA rules are also crucial to meeting the administration climate goals. Biden has said he intends to be the Democratic candidate for president in 2024 but has not made a formal announcement.

☆ Global money market funds witness inflows for sixth straight week
▼ + stars: | 2023-04-10 | by ( ) www.reuters.com time to read: +2 min

Funds in the global money market saw purchases worth a net $61.91 billion, that marked a sixth consecutive week of net inflows, data from Refinitiv Lipper showed. Reuters Graphics Reuters GraphicsThe U.S., European and Asian money market funds obtained inflows worth $42.51 billion, $25.62 billion and $280 million, respectively. Reuters GraphicsMeanwhile, global bond funds drew $15.16 billion worth of inflows, the biggest amount since July 2021. Investors purchased $5.26 billion worth of high yield and $1.71 billion worth of target maturity bond funds, but sold $1.15 billion worth of short-term bond funds. Data for 23,935 emerging market funds showed equity and bond funds, both obtained a second weekly inflow, amounting $397 million and $412 million, respectively.

☆ BofA sees 'meaningful risks' of Q2 U.S. economic contraction
▼ + stars: | 2023-04-10 | by ( ) www.reuters.com time to read: 1 min

April 10 (Reuters) - The U.S. economy is at risk of shrinking in the second quarter, BofA Global Research wrote in a client note, following recent economic data that hinted that the Federal Reserve's aggressive interest rate hikes were cooling the economy. "This week's data flow is consistent with our view that the U.S. economy slowed steadily over the course of 1Q 2023," BofA economists wrote in a note dated Friday and emailed Monday. We see meaningful risks of a contraction in GDP in 2Q." BofA pointed to data from April 3 showing U.S. manufacturing activity slumped in March to the lowest level in nearly three years as new orders plunged. Reporting by Reuters markets team; Editing by Mark PorterOur Standards: The Thomson Reuters Trust Principles.

The underlying trend though for the dollar remained tilted to the downside and Wednesday's U.S. private sector jobs numbers affirmed that. The ADP National Employment report showed U.S. private employers hired far fewer workers than expected in March, suggesting a cooling labor market. Private employment increased by 145,000 jobs last month. Economists polled by Reuters had forecast private employment increasing 200,000. Another report on Wednesday also indicated continued economic weakness, this time in the services sector.

☆ Stocks falter as economic worries nag, big rate hike lifts kiwi dollar
▼ + stars: | 2023-04-05 | by ( Dhara Ranasinghe | ) www.reuters.com time to read: +4 min

[1/2] A stock broker looks at his screens at the stock exchange in Frankfurt, Germany, March 16, 2023. REUTERS/Kai Pfaffenbach/File PhotoSummary Graphic: World FX ratesGraphic: Global asset performanceWorld stocks pull back from 7-week highsNZ dollar rallies after big rate hikeLONDON, April 5 (Reuters) - World stock markets stumbled on Wednesday as signs that the economic outlook is weakening spurred caution, while a bigger-than-expected interest-rate hike from New Zealand lifted the kiwi dollar. European stocks fell with the broad STOXX 600 index pulling away from Tuesday's one-month highs (.STOXX). U.S. equity futures dipped , and Japan's Nikkei (.N225) fell 1.6% in its biggest one-day percentage fall since mid-March. Weak U.S. economic data this week has exacerbated recession worries, taking the edge off recent stock market gains.

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