Latest news with #USFiscalConcerns
Malay Mail
22-05-2025
- Business
- Malay Mail
Dollar tumbles on fiscal worries as Bitcoin extends record rally, surging past US$110,000
US fiscal concerns hit dollar, yen strengthens Bitcoin reaches record high as investors seek dollar alternatives Republicans divided over Trump's spending and tax-cut bill TOKYO, May 22 — US fiscal concerns and a tepid auction of Treasury bonds slapped the dollar to a two-week low versus the yen today, 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 today, partly as investors sought out alternatives to US assets. Gold also benefitted, reaching an almost two-week top of US$3,325.79 (RM14,160) 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 yesterday 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 today. 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. — Reuters
Reuters
22-05-2025
- Business
- Reuters
US fiscal concerns drive dollar down, to propel rupee higher
MUMBAI, May 22 (Reuters) - The Indian rupee is likely to open higher on Thursday, supported by the strength in Asian peers, with investors shying away from the dollar due to U.S. fiscal concerns. The 1-month non-deliverable forward indicated a open in the 85.55 to 85.58 range, versus 85.6375 in the previous session. The offshore Chinese yuan rose past 7.1950 to the U.S. dollar, the Indonesian rupiah rallied 0.6% and the Malaysian ringgit and the Taiwanese dollar were both up 0.4%. Based on recent price action, it's more likely than not that the rupee will remain rangebound after the open, said a currency trader at a Mumbai-based bank. "I am currently playing the 85.30 to 85.80 band, looking to fade moves on either side.' The Indian rupee has struggled to benefit from the dollar's broader weakness against Asian peers, an outcome that has surprised bankers. The dollar index dipped below 99.50 while Treasury yields climbed and equities sold off — a combination suggesting that American assets were out of favour with investors. The 10-year U.S. Treasury yield jumped nearly 12 basis points on Wednesday to hit 4.60%, while the 30-year climbed past the 5% handle. Soft demand at the 20-year auction triggered a selloff in Treasuries, highlighting investor concerns over the U.S. fiscal outlook. U.S. lawmakers are wrangling over a tax and spending that estimates put the costs $3.8–4.5 trillion over a decade. The U.S. House of Representatives Rules Committee voted to advance President Donald Trump's sweeping tax-cut, setting the stage for a vote on the House floor. "We think that the first pain point (30-year yields > 5%) has been breached and it is another warning from bonds that fiscal deficit is the key focal point (US tariff worries have gone into the backburner)," DBS Bank said in a note. "The other two market markers to watch would be if 10Y breach 5% and / or swap spreads blow out again." KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.68; onshore one-month forward premium at 13.25 paise ** Dollar index down at 99.48 ** Brent crude futures down 0.1% at $64.8 per barrel ** Ten-year U.S. note yield at 4.59% ** As per NSDL data, foreign investors sold a net $1,175 mln worth of Indian shares on May 20 ** NSDL data shows foreign investors bought a net $7.5 mln worth of Indian bonds on May 20
