Latest news with #FrancescoPesole
Mint
22-05-2025
- Business
- Mint
Pound holds near three-year high on trade optimism
LONDON, May 22 (Reuters) - The British pound dipped slightly against the dollar but remained close to its highest level since 2022 reached the day before as hot inflation and improving relations with Europe and the U.S. continued to support the currency. The pound was last down 0.1% against the dollar at $1.3399, having touched a high of $1.3468 on Wednesday, its strongest level in over three years. Britain has recently looked to improve relations with the U.S. and the European Union, becoming the first nation to sign a deal with the U.S. after President Trump's reciprocal tariffs, and agreeing its biggest reset of trade and defence ties with the EU since Brexit this week. "The trade deals are generally good news for the pound," said ING FX strategist Francesco Pesole. "We still think the pound is in a pretty good position." Sterling was up 0.1% against at 84.2 pence per euro . A downturn in business activity for British firms eased this month, the S&P Global UK Composite Purchasing Managers' Index (PMI) showed on Thursday, as businesses grew a little cheerier about the outlook, including fewer worries about the impact of higher U.S. tariffs. The British currency has also been supported this week by hot inflation data, which might lower the prospect of rates cuts from the Bank of England. The BoE's chief economist Huw Pill said this week that a quarterly pace of cuts was "too rapid" given still strong wage pressures on inflation. "There's a bit of dissent building at the Bank of England," ING's Pesole noted. The British central bank lowered interest rates by a quarter point to 4.25% on May 8 in a three-way split vote, with two members of the Monetary Policy Committee favouring a bigger cut, and two - including Pill - preferring a hold. (Reporting by Samuel Indyk, editing by Ed Osmond)
Al Etihad
19-05-2025
- Business
- Al Etihad
Dollar falls after US credit downgrade, trade tensions weigh
19 May 2025 16:25 TOKYO (Reuters)The US dollar fell against a range of currencies on Monday, slipping to a ten-day low versus the safe-haven yen as markets digested a surprise downgrade of the US government's credit rating while trade tensions also brought the mood cut the United States' top sovereign credit rating by one notch on Friday, the last of the major ratings agencies to downgrade the country, citing concerns about its growing $36 trillion debt news saw the dollar lose ground against its major rivals following four straight winning weeks when it was boosted by rising optimism for US trade deals and then a thaw in relations with China that eased fears of a global recession."It looks like the dollar is facing a new round of short building after Friday's downgrade by Moody's. S&P500 futures down -1.2% and Treasuries are under pressure: it's a textbook 'sell America' session in markets," said Francesco Pesole, FX strategist at greenback slipped as much as 0.7% to 144.665 yen - its lowest level since the first time since May 8 on Monday, meanwhile the euro was 0.73% higher at $ added 0.79% to $1.33850 versus the weaker dollar, rising to its highest level since April 30 as Britain agreed the most significant reset of defence and trade ties with the European Union since Brexit on Monday.S&P 500 futures were off 1.1%, on track to underperform European equities with the STOXX 600 last down 0.6%, while U.S 10-year treasuries rose 11.5bps to 4.5545%.China on Monday called on the United States to take responsible policy measures to maintain the stability of the international financial and economic system and safeguard the interests of follows US Treasury Secretary Scott Bessent saying in television interviews on Sunday that President Donald Trump will impose tariffs at the rate he threatened last month on trading partners that do not negotiate in "good faith."However, a Financial Times report that the United States had begun serious trade talks with the European Union, breaking a long deadlock, offered some hope for additional deals after Washington inked a framework agreement with Britain earlier this has previously said he has potential deals with India, Japan and South Korea as well, although talks with Tokyo seem to be stumbling over car the market, "there's a lot of complacency about the ability to pull off deals," said Ray Attrill, head of FX strategy at National Australia Bank."Confidence that the US economy is going to weather this is very much open to question."Elsewhere, Trump cleared a hurdle towards passing a sweeping tax cut bill that would add an estimated $3 trillion to $5 trillion to the nation's debt over the next decade, after winning approval from a key congressional dollar declined 0.41% to 0.833390 Swiss franc, another safe-haven currency. Australia's dollar was up 0.66% to $0.64460 following three days of declines ahead of Tuesday's Reserve Bank of Australia policy announcement, with a quarter-point cut widely expected. Stock Markets Continue full coverage
Wall Street Journal
16-05-2025
- Business
- Wall Street Journal
Dollar Faces Further Falls as Correlation to Risk Shifts
1336 GMT – The breakdown in the positive correlation between risk aversion and the dollar could lead to further weakness for the currency, Neuberger Berman analysts say. U.S. investors might no longer see the dollar as a safe haven currency or unhedged dollar exposures as a source of diversification, they say. Investors are therefore evaluating whether to partially or fully hedge their exposure to the dollar, they say. Any level of hedging puts downward pressure on the dollar as investors sell dollars and buy currencies of their domicile. 'Non-U.S. investors will have to factor the efficacy of hedging their USD exposure relative to costs and implementation.' The DXY dollar index falls 0.1% to 100.763. ( 0821 GMT – The euro could extend its current gains against the dollar slightly as speculators continue to bet against the U.S. currency, ING analyst Francesco Pesole says in a note. Markets and consensus forecasts seen to be aligning for two further interest-rate cuts by the European Central Bank this year, he says. However, the risks remain skewed towards a weaker dollar. 'We still see $1.120 as a good short-term anchor for the euro, although the bias seems to be for testing $1.130 rather than $1.110 in the short term on the back of lingering dollar strategic selling.' The euro rises 0.2% to $1.1208. (
Zawya
16-05-2025
- Business
- Zawya
US dollar set for fourth straight weekly rise against euro and yen
The dollar was heading for a fourth straight weekly rise against the yen and the euro but remained significantly below its level from before April 2, when U.S. President Donald Trump announced aggressive tariffs on imports. A U.S.-China trade truce propelled the dollar higher on Monday, though the euphoria soon fizzled out as it dropped on Tuesday and Thursday after U.S. data. The greenback was little changed on Friday after retreating earlier in the session on declining U.S. Treasury yields as weak economic data prompted investors to raise bets of interest rate cuts by the U.S. Federal Reserve. "The dollar short-term rates relationship has loosened in the past two months, but the market's bearish U.S. dollar tendency means further dovish repricing could prove to be the catalyst for fresh dollar short building," said Francesco Pesole, rates strategist at ING. Markets are now indicating 59 basis points (bps) worth of Fed easing by December following Thursday's data, up from 49 bps previously. They have also priced in a 40% chance of a 25 bps rate cut by July. The benchmark 10-year U.S. Treasury yield dropped 5 bps to 4.41%. The two-year yield fell 3.5 bps to 3.94%. The euro rose 0.15% to $1.1205 but was on track to end the week 0.38% lower. On April 1, it closed at $1.0793. The single currency ranked among the best performers in March after Germany announced massive investments, and again in April, when the U.S. tariff announcement triggered a brief but sharp selloff in U.S. assets, casting doubt on the dollar's safe-haven status. U.S. equity funds attracted the first inflows in five weeks in the week to Wednesday, Bank of America Global Research said. Against a basket of currencies, the dollar fell 0.05% to 100.73, although it was on track for a 0.3% weekly gain, supported by a sharp 1.3% rise on Monday. Market focus could now shift to U.S. fiscal policy, as concerns about extreme tariffs temporarily subside, with negotiations set to continue with China and Europe. "The U.S. cannot close its very large current account deficit unless it closes its fiscal deficit too," said George Saravelos, head of forex research at Deutsche Bank, which the U.S. appears unwilling to do. Republicans hold a narrow 220-213 House majority, and will need to stay united to pass fiscal measures that Democrats are criticising as hurting social programmes. The greenback dropped 0.12% versus the yen to 145.48 on Friday and was set for a weekly rise of 0.10%, after last week's downbeat GDP data in Japan and dovish remarks from a Bank of Japan policymaker. It was at 149.71 on April 1. Investors also had their eye on potential talks between Tokyo and Washington next week, during which the two sides could discuss the topic of foreign exchange. Most of the action in the foreign exchange market in Asian trading came from the dollar's moves against the South Korean won, where it fell sharply for a second straight day on news that Washington and Seoul discussed the dollar/won market earlier this month. The moves were reminiscent of a similar episode in the Taiwan dollar earlier this month. The dollar last traded 0.10% lower at 1,391 won.
CNBC
16-05-2025
- Business
- CNBC
Dollar drops with U.S. yields after data, set for fourth weekly rise vs euro
The dollar fell in tandem with U.S. Treasury yields on Friday after downside surprises on U.S. economic data this week cemented bets of more Federal Reserve rate cuts this year. The greenback was on track for its fourth consecutive weekly gain versus the euro, recovering from the sharp decline that followed "Liberation Day" on April 2, when President Donald Trump announced aggressive trade duties. A U.S.-China trade truce propelled the dollar higher on Monday, though the euphoria soon fizzled out as the U.S. currency dropped on Tuesday and Thursday after economic data. "The dollar short-term rates relationship has loosened in the past two months, but the market's bearish U.S. dollar tendency means further dovish repricing could prove to be the catalyst for fresh dollar short building," said Francesco Pesole, rate strategist at ING, flagging that pricing for a Federal Reserve cut before September remains below 50%. Markets are now indicating 59 basis points worth of Fed easing by December following Thursday's data, up from 49 bps previously. They also price in a 40% chance of a 25 bps rate cut by July. The benchmark 10-year U.S. Treasury yield extended its 7 bps drop and was down 5 bps in London trading at 4.41%. The two-year yield fell 3.5 bps to 3.94%. The euro rose 0.2% to $1.1209 and was on track to end the week down 0.34%. The single currency ranked among the best performers in March after Germany announced massive investments, and again in April, after "Liberation Day," when concerns about the dollar's safe-haven status triggered a brief U.S. asset selloff. The greenback was about to snap a three-week rising streak versus the yen. It dropped 0.45% and was on track for a weekly fall of 0.15%, after last week's downbeat GDP data in Japan and dovish remarks from a Bank of Japan policymaker. "U.S. investors may wish to consider adding European and Japanese equities and bonds with lower or zero hedging, even though it would mean giving up some income from interest-rate differentials," said Jeff Blazek, co-CIO multi-asset strategies at Neuberger Berman. "There is potential for another 3-5% of (dollar) weakening against the euro and yen this year," he added. Investors also had their eye on potential talks between Tokyo and Washington next week, where Japanese Finance Minister Katsunobu Kato said he would seek to discuss foreign exchange issues with U.S. Treasury Secretary Scott Bessent. Most of the action in the foreign exchange market came from the dollar's moves against the South Korean won, where it fell sharply for a second straight day on news that Washington and Seoul discussed the dollar/won market earlier this month. The moves were reminiscent of a similar episode in the Taiwan dollar earlier this month. The dollar last traded 0.31% lower at 1,391 won. Against a basket of currencies, the dollar fell 0.2% to 100.51, though was on track for a slight weekly gain thanks to its sharp 1.3% rise on Monday. In Australia, the Aussie rose 0.30% to $0.6426, while the New Zealand dollar gained 0.65% to $0.5913.
