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Dollar pares gains on soft U.S. inflation data
  + stars: | 2024-01-12 | by ( ) www.cnbc.com   time to read: +3 min
The dollar index pared gains on Friday after U.S. producer prices unexpectedly fell in December, raising expectations of an early U.S. rate cut. That led traders to add to bets for a rate cut in the coming months. Fed funds futures now imply a 79% chance of a March rate cut, up from 73% on Thursday, according to the CME Group's FedWatch Tool. Traders maintained their view that a March rate cut is likely even after consumer price inflation data on Thursday came in above economists' expectations. The dollar index was last up 0.19% at 102.40.
Persons: Steve Englander, Englander, Martin Luther King Jr, Sterling, bitcoin Organizations: U.S, British, Global, Research, Standard Chartered Bank, Branch, Traders, U.S . Securities, Exchange Commission, Wednesday Locations: Yichang, Hubei province, U.S, Yemen, America, Zealand, Iran, Red, Gaza
Wholesale prices unexpectedly declined in December, providing a positive signal for inflation, the Labor Department reported Friday. Excluding food, energy and trade services, PPI also was up 0.2%, in line with the estimate. For the full year, the final demand measure less food, energy and trade services rose 2.5% for all of 2023 after being up 4.7% in 2022. Markets initially reacted positively to the PPI release but turned lower through morning trading. PPI measures the prices that producers pay for goods and services, while CPI gauges what consumers pay in the marketplace.
Persons: Dow Jones, Kurt Rankin, Jamie Dimon Organizations: Labor Department, PPI, PNC, Diesel, Traders, Federal, Market, JPMorgan Locations: U.S
The consumer price index increased 0.3% for the month, higher than the 0.2% estimate at a time when most economists and policymakers see inflationary pressures easing. Excluding volatile food and energy prices, the so-called core CPI also rose 0.3% for the month and 3.9% from a year ago, compared with respective estimates of 0.3% and 3.8%. On annual basis, shelter costs increased 6.2%, or about two-thirds of the rise in inflation. Food prices increased 0.2% in December, the same as in November. "Certainly, as long as shelter inflation remains stubbornly elevated, the Fed will keep pushing back at the idea of imminent rate cuts."
Persons: Dow Jones, Seema Shah Organizations: Labor Department, Energy, of Labor Statistics, Federal Reserve, Fed, Asset Management Locations: U.S
"The market seems to have gotten excited that the Fed's going to have to do more than what the Fed thinks in terms of rate cuts now. watch nowThere is certainly a wide gap between what the Fed has indicated in terms of rate cuts and what the market is expecting. It probably means that right now, the market needs to give back some of the rate cuts that they priced in." Fed Governor Michelle Bowman said this week that while she expects rate hikes could be done, she doesn't see the case yet for cuts. Still, Brusuelas thinks the market is too aggressive in pricing in six rate cuts.
Persons: Frederic J, Brown, Dow Jones, Jack McIntyre, McIntyre, they've, Michelle Bowman, Lorie Logan, Logan, Joseph Brusuelas, Brusuelas, Richard Clarida, … There's, Clarida Organizations: AFP, Getty, Federal, Brandywine Global Investment Management, Traders, Dallas, RSM Locations: Rosemead , California
European markets dipped for a second straight session on Wednesday, as last year's rally continues to stutter. The Stoxx 600 index provisionally closed 0.17% lower, with sectors trading in mixed territory. Mining stocks remained one of the week's worst performers, down 1.07%, while media stocks rose 0.75%. Asia-Pacific markets mostly turned lower overnight, although Japan stocks extended gains after notching a 33-year high in the previous session. In recent weeks, traders have boosted their bets on a Federal Reserve pivot, bracing for rate cuts as soon as March.
Organizations: Federal Reserve, Group Locations: Asia, Pacific, Japan, U.S
Dollar gains before inflation data, bitcoin slips
  + stars: | 2024-01-09 | by ( ) www.cnbc.com   time to read: +3 min
The dollar rose against the euro and yen on Tuesday as traders awaited inflation data on Thursday for clues on when the Federal Reserve is likely to cut rates. But Fed expectations are likely to continue to drive dollar moves. The release on Thursday of the consumer price inflation report for December will be the main piece of economic data this week. If the data confirms that inflation is continuing to moderate it could boost expectations for a March rate cut, though if it comes in above expectations it could also reverse some of that pricing. The U.S. dollar index , which measures the greenback against a basket of six currencies, was last up 0.33% at 102.55.
Persons: Bipan Rai, Kamal Sharma, steepening, Sharma Organizations: Federal Reserve, Securities and Exchange, CIBC Capital Markets, Bank of America, Fed, U.S, Bank of Japan, Investment Locations: North American, Toronto, U.S, Asia, Bitcoin
Dollar falls as traders focus on data for Fed policy clues
  + stars: | 2024-01-08 | by ( ) www.cnbc.com   time to read: +2 min
The greenback initially bounced on Friday after data showed that U.S. employers hired 216,000 workers in December, above economists' expectations in a Reuters poll, while average hourly earnings rose 0.4%, which was also above expectations. The U.S. currency then dropped, however, as investors focused on some underlying factors in the jobs report that showed less strength. It declined further after a separate report showed the U.S. services sector slowed considerably in December, with a measure of employment dropping to the lowest level in nearly 3-1/2 years. The release on Thursday of the consumer price inflation report for December will be the main piece of economic data this week. Fed funds futures traders are pricing in rate cuts beginning in March, though the odds of a move that soon have fallen.
Persons: Helen, Raphael Bostic Organizations: Federal Reserve, greenback, Monex USA, New York Fed, Traders, Atlanta Fed Locations: U.S, Washington
December's jobs report showed employers added 216,000 positions for the month while the unemployment rate held at 3.7%. Economists surveyed by Dow Jones had been looking for payrolls to increase 170,000 and the unemployment rate to nudge higher to 3.8%. That increase in the "real" unemployment rate came as the household survey, used to calculate the unemployment rate, showed a decline in job holders of 683,000 as the ranks of those working multiple jobs increased by 222,000. Major averages meandered through the day as markets reacted to a lower than expected reading from the ISM services gauge. The report showed that inflationary pressures, despite receding elsewhere, are still prevalent in the labor market.
Persons: downwardly, Dow Jones, Andrew Patterson Organizations: Labor Department, meandered, Treasury, Leisure, Federal Reserve, CME, Vanguard Locations: U.S
Rallies in the stock and bond markets could be undone by the very thing that seems to be underpinning the moves higher. The Fed relies on an amorphous group of indicators collectively known as "financial conditions" to help judge the state of play on policy. True to form, a Chicago Fed baromete r is showing financial conditions at their easiest since early February 2023. But I think they don't want to be premature, because they also know there's a risk of the economy restarting with the loosening of financial conditions. "That does not necessarily support the 'happy days are here again' everything-rally that we're currently seeing in the market."
Persons: Jerome Powell, Roger Ferguson, Powell, Jay Powell, Peter Boockvar, they're, Ferguson, Wharton, Jeremy Siegel, we're Organizations: Federal Reserve, Treasury, Dow Jones, Bleakley Financial, Chicago Fed, Committee, Traders, Fed, Group, CNBC
If this year's early Santa Claus rally is any indication, investors may be getting too optimistic about the prospects of a rate cut early next year, according to Wolfe Research. The Dow Jones Industrial Average and S & P 500 hit fresh year-to-date closing highs on Friday. .SPX YTD mountain S & P 500 YTD chart Investors have been sending stocks flying on the back of expectations that the Federal Reserve will adopt more dovish policy next year. Senyek's base line scenario for 2024 sees these factors bringing the S & P 500 to 4,250 by year-end 2024, implying about an 8% drop. His bull case takes the S & P 500 up to 4,995 for a 9% gain, while his bear case calls stocks to plunge 22% to 3,565.
Persons: Santa Claus, Chris Senyek, Senyek Organizations: Wolfe Research, Dow Jones Industrial, Federal Reserve, Traders, pharma Locations: Santa, U.S
The New York Stock Exchange (NYSE) in New York City, U.S., February 24, 2022. "Presently, the markets price in around a 125bp (basis points) cut from the Fed next year," Ipek Ozkardeskaya, senior market analyst at Swissquote Bank, said in a note. Investors will also parse data on U.S. services sector activity from S&P Global and the Institute for Supply Management on Tuesday. ET, Dow e-minis were down 115 points, or 0.32%, S&P 500 e-minis were down 20 points, or 0.44%, and Nasdaq 100 e-minis were down 103 points, or 0.65%. Reporting by Amruta Khandekar and Shristi Achar A; Editing by Pooja DesaiOur Standards: The Thomson Reuters Trust Principles.
Persons: Caitlin Ochs, Ozkardeskaya, Amruta Khandekar, Pooja Desai Organizations: New York Stock Exchange, REUTERS, Dow, Nasdaq, Federal Reserve, Fed, Swissquote Bank, Labor Department, P Global, Institute for Supply Management, Nvidia, Dow e, CVS, PDD Holdings, Baidu, Thomson Locations: New York City, U.S
The New York Stock Exchange (NYSE) in New York City, U.S., February 24, 2022. Pressuring equities on Monday were higher U.S. Treasury yields, which made returns on stocks less attractive. However, some analysts have cautioned that markets have been too quick to price in lower interest rates. The S&P index recorded eight new 52-week highs and no new lows, while the Nasdaq recorded 46 new highs and 17 new lows. Reporting by Amruta Khandekar and Shristi Achar A; Editing by Anil D'Silva and Pooja DesaiOur Standards: The Thomson Reuters Trust Principles.
Persons: Caitlin Ochs, Jerome Powell, It's, Sam Stovall, Stovall, Santa Claus, advancers, Amruta Khandekar, Anil D'Silva, Pooja Desai Organizations: New York Stock Exchange, REUTERS, Companies Alaska Air, Hawaiian Holdings, Dow, Nasdaq, Federal Reserve, Treasury, Nvidia, Apple, Traders, Research, Alaska Air Group, Dow Jones, Marathon, NYSE, Thomson Locations: New York City, U.S, New York, Santa, Israel, Red
Treasury yields are flat ahead of Powell comments
  + stars: | 2023-12-01 | by ( Sophie Kiderlin | In | ) www.cnbc.com   time to read: +2 min
The 10-year Treasury yield was last at 4.322% after declining by around 2 basis points. Powell could throw some cold water on that notion, maintaining that the central bank had to remain vigilant against inflation. Investors digested inflation data released Thursday in form of the personal consumption expenditures price index for October, which was in line with expectations. The central bank is set to meet later this month for the last time in 2023. Markets are pricing in an over 98% chance of interest rates being left unchanged then, according to CME Group's FedWatch tool.
Persons: Jerome Powell, Powell Organizations: Treasury, Federal, Spelman College, Fed
Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., October 27, 2023. Market participants now await policy comments from Powell at two separate discussions scheduled for 11 a.m. After recent conflicting remarks from other policymakers, investors are concerned that Powell could push back against the rate cut narrative. Other officials, including Fed Governors Lisa Cook and Chicago Fed President Austan Goolsbee are also scheduled to speak during the day. Reporting by Shristi Achar A and Amruta Khandekar in Bengaluru; Editing by Shinjini GanguliOur Standards: The Thomson Reuters Trust Principles.
Persons: Brendan McDermid, Powell, Jerome Powell's, Dow Jones, underscoring, Sophie Lund, Yates, Hargreaves Lansdown, Lisa Cook, Austan Goolsbee, Alibaba, Morgan Stanley, danuglipron, Paula Oyibo, Shristi Achar, Shinjini Organizations: New York Stock Exchange, REUTERS, Dow, Nasdaq, Federal, Chicago Fed, P Global, ISM, Dow e, Pfizer, Marvell Technology, Automation, Thomson Locations: New York City, U.S, Bengaluru
All eyes are now on the personal consumption expenditure (PCE) index- the Fed's preferred inflation gauge- for October, due at 8:30 a.m. ET, which is expected to show inflation eased in the previous month. The PCE index is expected to rise 0.1% on a monthly basis in October, moderating from a 0.4% increase in September. Data cloud company Snowflake (SNOW.N) added 8.2% after it forecast fourth-quarter product revenue above Street estimates on artificial intelligence driven demand. Reporting by Shristi Achar A and Amruta Khandekar in Bengaluru; Editing by Shinjini GanguliOur Standards: The Thomson Reuters Trust Principles.
Persons: Caitlin Ochs, Russ Mould, AJ Bell, Jefferies, Shristi Achar, Shinjini Organizations: New York Stock Exchange, REUTERS, Dow, Nasdaq, Wall, Federal Reserve, Dow e, Ford Motor, Inc, Thomson Locations: New York City, U.S, Chicago, Bengaluru
Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., November 17, 2023. Wall Street indexes ended marginally higher on Tuesday after Fed Governor Christopher Waller, deemed a hawk, hinted at lower interest rates in the months ahead if inflation continued to ease. Other similar positive comments sent Treasury yields tumbling, with the yield on the benchmark 10-year note last at an over two-month low of 4.2840%. Fed Governor Michelle Bowman on Tuesday alluded to the possibility of another rate hike. Reporting by Shristi Achar A and Amruta Khandekar in Bengaluru; Editing by Shinjini GanguliOur Standards: The Thomson Reuters Trust Principles.
Persons: Brendan McDermid, Christopher Waller, Governor Bowman, Charalampos Pissouros, Michelle Bowman, Thomas Barkin, Shristi Achar, Shinjini Organizations: New York Stock Exchange, REUTERS, General Motors, Dow, Nasdaq, Treasury, Federal Reserve, XM, Nvidia, Richmond Fed, Dow e, CrowdStrike Holdings, Thomson Locations: New York City, U.S, Bengaluru
The U.S. economy is "back to normal" for the first time in two decades, but the market is getting ahead of the likely pace of interest rate cuts, according to IBM Vice Chairman Gary Cohn. The central bank in September paused its historically aggressive monetary tightening cycle with the Fed funds rate target range at 5.25-5.5%, up from just 0.25-0.5% in March 2022. "You don't want to be early to leave when you're the last one to come to the party. "The economy will clearly turn down before the Fed had starts to cut interest rates, so I strongly believe that for the first half of '24, we will see no rate activity in the Fed. Maybe [in the third quarter], we'll start hearing rumblings of some forward guidance of lower rates."
Persons: Gary Cohn, Cohn —, Donald Trump, Cohn, CNBC's Dan Murphy Organizations: IBM, Federal Reserve, National Economic, Abu, Abu Dhabi Finance, Fed Locations: U.S, Abu Dhabi
"In a different cycle, when inflation hadn't spiked so much, I think the Fed would have been cutting rates already. "If the real fed funds rate continues to go higher as I expect it will, then you'd want to offset that through rate cuts. And the amount of rate cuts I think they're going to have to do is a relatively large amount." "I think there's a real risk of a hard landing if the Fed doesn't start cutting rates pretty soon," the head of Pershing Square Capital Management added. However, even some of the historically more dovish Fed officials aren't showing their hands on when they think cuts will come.
Persons: Valerie Plesch, Kathy Jones, Charles Schwab, Christopher Waller, Michelle Bowman, Waller, Bowman, Joseph LaVorgna, Donald Trump, Chris Marangi, Bill Ackman, Ackman, David Rubenstein, Raphael Bostic, Thomas Barkin Organizations: Eccles Federal, Bloomberg, Getty, Federal Reserve, Fed, Nikko Securities America, National Economic Council, CME Group, Stocks, Gabelli, Market, Pershing, Capital Management, Atlanta Federal Reserve, Richmond Locations: Washington , DC, Atlanta
The SEC has long rejected spot bitcoin ETF applications on the grounds they do meet its investor protection requirements. Industry hopes that position would shift surged in June when BlackRock (BLK.N), which has an almost unbroken record of SEC ETF approvals, filed for a spot bitcoin ETF. The only prospective issuer to disclose proposed investor fees so far is Ark Investment, which last week announced its spot bitcoin ETF would charge a fee of 0.8%. To be sure, issuers hoping to launch spot bitcoin ETFs have a more bullish outlook than those sticking to the sidelines. Magoon hopes the buzz surrounding a spot bitcoin ETF will draw more assets to Amplify's BLOK ETF.
Persons: Marco Bello, it's, Dave Mazza, Gary Gensler, Michael Sapir, ProShares, Sapir, Roxanna Islam, Aisha Hunt, Kelley, Christian Magoon, Roundhill, Mazza, Magoon, Tom Staudt, Staudt, Suzanne McGee, Michelle Price, Deepa Babington Organizations: REUTERS, Roundhill Investments, SEC, Industry, BlackRock, Ark Investment, Amplify's, Ark Investments, Thomson Locations: Miami Beach , Florida, U.S, BlackRock, Invesco, Amplify's BLOK
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 20, 2023. Multiple Fed policy voting members are scheduled to speak during the day, including Board Governors Christopher Waller and Michelle Bowman. Murphy & Sylvest's Nolte said investors were "digesting very, very strong gains for the month of November," referring to the declines. Declining issues outnumbered advancers for a 1.92-to-1 ratio on the NYSE and for a 1.63-to-1 ratio on the Nasdaq. Reporting by Shristi Achar A and Amruta Khandekar in Bengaluru; Editing by Shinjini GanguliOur Standards: The Thomson Reuters Trust Principles.
Persons: Brendan McDermid, Paul Nolte, Sylvest, Governors Christopher Waller, Michelle Bowman, Murphy, Sylvest's Nolte, advancers, Shristi Achar, Shinjini Organizations: New York Stock Exchange, REUTERS, billings Boeing, RBC, Nasdaq, Federal Reserve, Murphy, Governors, Reuters, Dow Jones, Micron Technology, RBC Capital Markets, PDD Holdings, NYSE, Thomson Locations: New York City, U.S, billings, Bengaluru
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 20, 2023. The rebound in equities in November has brought the S&P 500 (.SPX) within a very close range of its 2023 intra-day high. Multiple policy voting members are scheduled to speak during the day, including Board Governors Christopher Waller and Michelle Bowman. ET, Dow e-minis were up 14 points, or 0.04%, S&P 500 e-minis were down 1.75 points, or 0.04%, and Nasdaq 100 e-minis were down 16.25 points, or 0.1%. Boeing added 1.7% after RBC Capital Markets upgraded the aerospace company to "outperform" from "sector perform" and set a street-high price target.
Persons: Brendan McDermid, Governors Christopher Waller, Michelle Bowman, Susannah Streeter, Hargreaves Lansdown, Jefferies, Shristi Achar, Shinjini Organizations: New York Stock Exchange, REUTERS, Dow, Nasdaq, Federal Reserve, Governors, Dow e, Hargreaves, Conference, Boeing, RBC Capital Markets, Thomson Locations: New York City, U.S, United States, Bengaluru
The dollar index , which measures the currency against six major peers, slipped 0.1% to 103.37 and was headed for a monthly loss of more than 3%, its worst performance since November 2022. The market is also eyeing a rate decision from the Reserve Bank of New Zealand and Chinese purchasing managers' index (PMI) data. In other currencies, the euro was little changed against the dollar at $1.0937 . Against the yen, the dollar fell 0.4% to 148.885 yen . The dollar extended losses after data showed U.S. new home sales fell more than expected in October, dropping 5.6% to a seasonally-adjusted annual rate of 679,000 units.
Persons: ECB's Lagarde, Helen, Christine Lagarde's, Gertrude Chavez, Dreyfuss, Samuel Indyk, Rae Wee, Toby Chopra, Mark Potter, Paul Simao Organizations: U.S, Federal Reserve, Monex USA, Fed, European Central Bank, Bank of England, Reserve Bank of New, Australian, greenback, New, Thomson Locations: U.S, Washington, OPEC, Australia, Reserve Bank of New Zealand, New Zealand, China, New York, London, Singapore
Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., October 27, 2023. The rebound in equities in November has brought the S&P 500 (.SPX) close to its highest intra-day level this year. "We are headed for a mixed session today...maybe something like profit taking at the beginning and then just a leveling off."U.S. The S&P 500 retail sector (.SPXRT), housing Amazon, rose 0.5%. The S&P index recorded 7 new 52-week highs and no new lows, while the Nasdaq recorded 34 new highs and 18 new lows.
Persons: Brendan McDermid, Elliott, Peter Cardillo, Jerome Powell, advancers, Shristi Achar, Saumyadeb Chakrabarty Organizations: New York Stock Exchange, REUTERS, Dow, Nasdaq, Federal Reserve, Spartan Capital Securities, Walmart, Reuters, Fed, Dow Jones, Crown, Elliott Investment Management, GE HealthCare, UBS, NYSE, Thomson Locations: New York City, U.S, Bengaluru
With U.S. markets closed on Thursday for the Thanksgiving holiday and due for a shorter Black Friday trading session, currencies are trading narrowly as liquidity is expected to remain thin. The bank will "then begin its first rate hike in Q2 2024 if wage growth continues to accelerate next year". The nationwide core consumer price index (CPI), which excludes volatile fresh food costs, rose 2.9% year-on-year in October, government data showed on Friday, against 3.0% expected by economists in a Reuters poll. Separate data showed German business morale improved for a third straight month in November. Sterling rose for a second consecutive day, up 0.2% to $1.2559, after data showed on Thursday that British companies returned to growth in November, fuelling hopes Britain will avoid a recession.
Persons: Marcos Brindicci, Jefferies, Mohit Kumar, Sterling, Ankur Banerjee, Joice Alves, Jan Harvey, David Evans Organizations: REUTERS, Bank of Japan, U.S, Federal, Fed, European Central Bank, Bank of England, ING, Thomson Locations: Buenos Aires, Argentina, SINGAPORE, Germany, Singapore, London
Dollar defensive as markets weigh US rates outlook
  + stars: | 2023-11-24 | by ( Ankur Banerjee | ) www.reuters.com   time to read: +3 min
A woman counts U.S. dollar bills at her home in Buenos Aires, Argentina August 28, 2018. The dollar index , which measures the U.S. currency with six peers, eased 0.029% to 103.73, staying close to the two-and-a-half month low of 103.17 it touched earlier this week. The Australian dollar rose 0.14% to $0.657, while the kiwi rose 0.07% to $0.605. The yield on the 30-year Treasury bond rose 2.8 basis points to 4.576%. Reporting by Ankur Banerjee in Singapore; Editing by Jacqueline WongOur Standards: The Thomson Reuters Trust Principles.
Persons: Marcos Brindicci, Sterling, Cash Treasuries, Ankur Banerjee, Jacqueline Wong Organizations: REUTERS, Rights, U.S, Federal, Fed, Bank of Japan, ING, Treasury, Thomson Locations: Buenos Aires, Argentina, Rights SINGAPORE, Germany, Asia, Singapore
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