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CNBC
a day ago
- Business
- CNBC
Dollar steady as U.S.-China talks conclude, UK spending review awaited
The dollar steadied on Wednesday as teams from the U.S. and China concluded trade talks in London, hinting at a thaw in a damaging trade war but offering scant detail, while sterling was firm ahead of a British government spending review. U.S. and Chinese officials approved a framework based on a trade truce reached last month in Geneva that would resolve China's export restrictions on rare earth minerals and magnets, and remove some U.S. export restrictions recently put in place. Chinese Vice Commerce Minister Li Chenggang said that the next step would be to take the agreed framework back to their respective heads of state. "On traditional metrics this would be a 'sell the dollar' moment: good for risk, good for global trade," said James Kniveton, senior corporate FX dealer at Convera. However, since the dollar has not been behaving like a safe-haven asset lately, people might instead continue buying dollars and invest in Wall Street, Kniveton said. Much of the year has been dominated by investor unease over U.S. President Donald Trump's erratic policies. Despite a bounceback in U.S. stocks, the erosion of investor confidence clearly shows in a dollar that is down by over 8% this year. On Wednesday the dollar was 0.1% weaker versus the euro at $1.1438, and rose 0.1% against the yen to 144.93. China's onshore yuan was little changed at 7.1849 per dollar. An index that measures the greenback against six other currencies was flat at 98.993. Still, analysts noted that any newly agreed tariffs would be higher than they were late last year, while the blow that trade uncertainty has had on both economies is yet to be fully reflected in economic data. Commerzbank analysts said no new improvements were achieved in the U.S.-China talks, rather only the tensions that have arisen since the last agreement had been defused. Markets are also awaiting a closely-watched UK spending review, with British finance minister Rachel Reeves set to divvy up more than 2 trillion pounds ($2.7 trillion) of public spending for government departments from 2026 to 2029 and investment plans out to 2030. Sterling was flat at $1.349, while gilt yields, which are among the highest in the developed world, underperformed on Wednesday, adding 7 bps to 4.598%, compared with a 1 bp rise in 10-year Treasuries, which yielded 4.49%. "This week's spending review will highlight the tight fiscal headroom, leaving a bearish taste in rates markets. Until the government moves towards tax increases ..., the room for longer-dated sterling rates to move lower will be limited," analysts at ING said. Later in the day, investors will parse a U.S. consumer inflation report that could potentially determine the trajectory of the Federal Reserve's monetary policy for the rest of 2025. The Fed is expected to hold rates steady next week and a Reuters poll showed that analysts expect the central bank to maintain that stance until September. Analysts at ANZ Bank said consumers are likely to face the impact of tariffs through higher goods prices, which would also keep the Fed cautious as they look for more clarity on how U.S. trade policy is impacting inflation over the coming months. Attention will also be on a $39 billion, 10-year Treasury bond auction that could be a reflection of investor appetite for U.S. debt, as concerns mount regarding an expensive tax and spending bill that is making its rounds in Congress.
Ammon
22-05-2025
- Business
- Ammon
Dollar swoons on fiscal worries, bitcoin extends record rally
Ammon News - U.S. fiscal concerns and a tepid auction of Treasury bonds pushed the dollar to a two-week low versus the yen on Thursday, while the U.S. Congress moved closer to passing President Donald Trump's bill for massive cuts in taxes and spending. The lacklustre 20-year bond sale reinforced the "Sell America" narrative, weighing not just on the dollar but on Wall Street as well, with traders already jittery after Moody's cut the triple-A U.S. credit rating last week. Bitcoin pushed to an all-time high on Thursday, partly as investors sought out alternatives to U.S. assets. Gold also benefited, reaching an almost two-week top of $3,325.79 and putting it within $175 of April's record peak. "Despite falling equities, the U.S. dollar has not seen traditional safe-haven demand, with gold, the euro and the yen instead benefiting," said James Kniveton, a senior corporate FX dealer at Convera. In the process of getting Trump's bill to the Senate, "fiscal restraint could emerge, but market sentiment suggests scepticism," he said. The dollar slipped as much as 0.4% to 143.15 yen , the weakest level since May 7. The euro was last flat at $1.1326, after rising 0.4% on Wednesday for a third straight session. Sterling rose 0.1% to $1.3431. The Swiss franc ticked up 0.1% to 0.8246 per dollar.
CNBC
22-05-2025
- Business
- CNBC
Dollar swoons on fiscal worries, bitcoin extends record rally
U.S. fiscal concerns and a tepid auction of Treasury bonds slapped the dollar to a two-week low versus the yen on Thursday, while President Donald Trump tried to push his sweeping spending and tax-cut bill through Congress. The lackluster 20-year bond sale reinforced the "Sell America" narrative, weighing on not just the dollar but Wall Street as well, with traders already jittery after Moody's cut the U.S. triple-A credit rating last week. Bitcoin pushed to a fresh all-time high on Thursday, partly as investors sought out alternatives to U.S. assets. Gold also benefitted, reaching an almost two-week top of $3,325.79 and putting it within $175 of April's record peak. "Despite falling equities, the U.S. dollar has not seen traditional safe-haven demand, with gold, the euro and the yen instead benefiting," said James Kniveton, a senior corporate FX dealer at Convera. In the process of getting Trump's bill to the Senate, "fiscal restraint could emerge, but market sentiment suggests skepticism," he said. Republicans are still divided over the details of the tax legislation. Hardliners within the party continue to argue the bill does not sufficiently cut spending, House Speaker Mike Johnson said. The bill would add $3 trillion to $5 trillion to the country's debt, according to nonpartisan analysts. The dollar slipped to 143.27 yen early in Asia, the weakest level since May 7. It turned lower despite an early pop of as much as 0.5% after Japanese Finance Minister Katsunobu Kato said he did not talk about foreign-exchange levels in his discussions with U.S. Treasury Secretary Scott Bessent on the sidelines of the Group of Seven meetings in Canada. However, the short-lived response suggests investor suspicions run deep that the White House wants a weaker dollar versus many Asian currencies. South Korea's currency jumped to the strongest level since November 4 on Wednesday at 1,368.90 per dollar after the Korea Economic Daily reported that Washington had demanded that Seoul come up with measures to boost the won. It was trading a touch weaker at 1,377.00 on Thursday. The euro was last flat at $1.1330, after rising 0.4% on Wednesday for a third straight session of gains. Sterling was steady at $1.3426. The Swiss franc ticked up 0.1% to 0.8245 per dollar. Bitcoin was last 1.6% higher at $110,049.82, after earlier reaching a record high of $110,636.58.
Economic Times
22-05-2025
- Business
- Economic Times
Dollar swoons on fiscal worries, bitcoin extends record rally
U.S. fiscal concerns and a tepid auction of Treasury bonds slapped the dollar to a two-week low versus the yen on Thursday, while President Donald Trump tried to push his sweeping spending and tax-cut bill through Congress. ADVERTISEMENT The lacklustre 20-year bond sale reinforced the "Sell America" narrative, weighing on not just the dollar but Wall Street as well, with traders already jittery after Moody's cut the U.S. triple-A credit rating last week. Bitcoin pushed to a fresh all-time high on Thursday, partly as investors sought out alternatives to U.S. assets. Gold also benefitted, reaching an almost two-week top of $3,325.79 and putting it within $175 of April's record peak. "Despite falling equities, the U.S. dollar has not seen traditional safe-haven demand, with gold, the euro and the yen instead benefiting," said James Kniveton, a senior corporate FX dealer at Convera. In the process of getting Trump's bill to the Senate, "fiscal restraint could emerge, but market sentiment suggests scepticism," he said. Republicans are still divided over the details of the tax legislation. Hardliners within the party continue to argue the bill does not sufficiently cut spending, House Speaker Mike Johnson said. ADVERTISEMENT The bill would add $3 trillion to $5 trillion to the country's debt, according to nonpartisan analysts. The dollar slipped to 143.27 yen early in Asia, the weakest level since May 7. ADVERTISEMENT It turned lower despite an early pop of as much as 0.5% after Japanese Finance Minister Katsunobu Kato said he did not talk about foreign-exchange levels in his discussions with U.S. Treasury Secretary Scott Bessent on the sidelines of the Group of Seven meetings in Canada. However, the short-lived response suggests investor suspicions run deep that the White House wants a weaker dollar versus many Asian currencies. ADVERTISEMENT South Korea's currency jumped to the strongest level since November 4 on Wednesday at 1,368.90 per dollar after the Korea Economic Daily reported that Washington had demanded that Seoul come up with measures to boost the won. It was trading a touch weaker at 1,377.00 on Thursday. The euro was last flat at $1.1330, after rising 0.4% on Wednesday for a third straight session of gains. ADVERTISEMENT Sterling was steady at $1.3426. The Swiss franc ticked up 0.1% to 0.8245 per dollar. Bitcoin was last 1.6% higher at $110,049.82, after earlier reaching a record high of $110,636.58. (You can now subscribe to our ETMarkets WhatsApp channel)
New Straits Times
22-05-2025
- Business
- New Straits Times
Dollar swoons on fiscal worries, bitcoin extends record rally
TOKYO: US fiscal concerns and a tepid auction of Treasury bonds slapped the dollar to a two-week low versus the yen on Thursday, while President Donald Trump tried to push his sweeping spending and tax-cut bill through Congress. The lacklustre 20-year bond sale reinforced the "Sell America" narrative, weighing on not just the dollar but Wall Street as well, with traders already jittery after Moody's cut the US triple-A credit rating last week. Bitcoin pushed to a fresh all-time high on Thursday, partly as investors sought out alternatives to US assets. Gold also benefitted, reaching an almost two-week top of US$3,325.79 and putting it within US$175 of April's record peak. "Despite falling equities, the US dollar has not seen traditional safe-haven demand, with gold, the euro and the yen instead benefiting," said James Kniveton, a senior corporate FX dealer at Convera. In the process of getting Trump's bill to the Senate, "fiscal restraint could emerge, but market sentiment suggests scepticism," he said. Republicans are still divided over the details of the tax legislation. Hardliners within the party continue to argue the bill does not sufficiently cut spending, House Speaker Mike Johnson said. The bill would add US$3 trillion to US$5 trillion to the country's debt, according to nonpartisan analysts. The dollar slipped to 143.27 yen early in Asia, the weakest level since May 7. It turned lower despite an early pop of as much as 0.5 per cent after Japanese Finance Minister Katsunobu Kato said he did not talk about foreign-exchange levels in his discussions with US Treasury Secretary Scott Bessent on the sidelines of the Group of Seven meetings in Canada. However, the short-lived response suggests investor suspicions run deep that the White House wants a weaker dollar versus many Asian currencies. South Korea's currency jumped to the strongest level since November 4 on Wednesday at 1,368.90 per dollar after the Korea Economic Daily reported that Washington had demanded that Seoul come up with measures to boost the won. It was trading a touch weaker at 1,377.00 on Thursday. The euro was last flat at US$1.1330, after rising 0.4 per cent on Wednesday for a third straight session of gains. Sterling was steady at US$1.3426. The Swiss franc ticked up 0.1 per cent to 0.8245 per dollar. Bitcoin was last 1.6 per cent higher at US$110,049.82, after earlier reaching a record high of US$110,636.58.
