Latest news with #economicData
Bloomberg
5 days ago
- Business
- Bloomberg
Treasury Rally Eases As Investors Cautious on Jobs and Outlook
A rally in US Treasuries steadied, with investors cautious ahead of Friday's jobs report and slightly paring bets on interest-rate cuts from the Federal Reserve. On Thursday the two-year yield rose as much as two basis points to 3.89%, trimming a steep decline in the previous session triggered by softer-than-expected US economic data. Traders still fully priced two quarter-point cuts from the Fed this year, but trimmed wagers on a third move.
CNA
5 days ago
- Business
- CNA
Europe waits for ECB cut after US-driven bond rally
LONDON : European markets made a steady start on Thursday ahead of an expected ECB interest rate cut, and after weak U.S. economic numbers had triggered a sharp government bond rally and nudged Wall Street toward bull market territory. With the European Central Bank expected to deliver another quarter point cut in the euro zone's borrowing costs to 2 per cent later, investors are keen to hear what Christine Lagarde and other policymakers think might come next, given the uncertainty over a potential U.S. trade deal. German data already out showed industrial orders unexpectedly rose in April due to strong domestic demand. That helped lift Europe's STOXX 600 index for a third day running as Germany's approval of a tax relief package also lifted sentiment. The euro and regional government bonds barely budged, however, as traders waited on the ECB's move. With euro zone inflation now safely in line with the central bank's 2 per cent target, policymakers have widely telegraphed what would be their eighth cut in the current cycle later. "A cut today is pretty much a done deal," said Oxford Economics' Oliver Rakau, who expected Lagarde to sound even more non-committal than usual in the post rate-decision press conference. The combination of trade talks with the U.S. and robust data coming out of Germany increased the chance that this might even be the last cut, although for now Rakau still expects two more before the end of the year. "A sudden trade deal could shift things along a lot," he said. "They don't want to be wrongfooted and German fiscal stimulus also coming." The currency markets were largely in a holding pattern. The dollar had dropped in the previous session after weak U.S. jobs and services data, putting the focus squarely on non-farm payrolls due on Friday. The yield on the 30-year U.S. Treasury bond fell more than 7 basis points to 4.911 per cent, while the benchmark 10-year yield dropped to 4.385 per cent, having been at a 3-month high of 4.629 per cent just a couple of weeks ago. TRADE TALKS Trump's doubling of tariffs on steel and aluminium imports had also become effective on Wednesday, hitting Canada and Mexico in particular. The same day, his administration sought "best offers" from trading partners to stop other import levies taking effect in July. Japan was sending key trade negotiator Ryosei Akazawa to the U.S. on Thursday for another round of talks. Germany's chancellor, Friedrich Merz, was also in Washington to meet Trump. MSCI's broadest index of Asia-Pacific shares outside Japan had jumped 0.7 per cent overnight, with South Korea's KOSPI touching an 11-month high amid optimism around new President Lee Jae-myung and Hong Kong's Hang Seng up 1 per cent. "There is a degree of complacency in the equity markets in the sense there is an expectation now that there will continue to be resolution and deals being done," said Chris Nicol, Australia equity strategist at Morgan Stanley. "The black and white of the policy is still to be put in stone and the growth and inflation impacts are still relatively uncertain." The dollar index, which measures the greenback against a basket of currencies, rose 0.1 per cent to 98.8, trimming its 0.5 per cent slide on Wednesday. Among the individual moves the dollar was up 0.3 per cent against the yen at 143.34, 0.25 per cent higher against the Swiss franc at 0.82025 francs and virtually unchanged against the euro and sterling at just over $1.14 and $1.35 respectively. Gold pared gains from the previous day, while oil steadied after slipping on a build in U.S. inventories and as Saudi Arabia cut to its July prices for Asian crude buyers. [O/R] Spot gold edged 0.1 per cent lower to $3,374 per ounce. Brent crude ticked up 0.4 per cent to just over $65 a barrel.
Malay Mail
5 days ago
- Business
- Malay Mail
Asian markets edge higher as weak US data lifts rate-cut hopes, eyes on Trump-Xi talks
HONG KONG, June 5 — Asian shares mostly rose Thursday after soft US economic data boosted expectations the Federal Reserve will soon cut interest rates and put the focus on key jobs figures coming at the end of the week. Investors were also keeping track of developments in Donald Trump's trade war and signs of movement on possible talks between the US president and his Chinese counterpart Xi Jinping. Wall Street provided an uninspiring lead as a report by payroll firm ADP showed private-sector jobs rose by 37,000 last month, a sharp slowdown from April's 60,000 and less than a third of what was forecast in a Bloomberg survey. Another survey showed activity in the services sector contracted in May for the first time since June last year. The readings stoked concerns that the world's number one economy was stuttering, with the Fed's closely watched 'Beige Book' study noting that 'economic activity has declined slightly'. It flagged household and business caution caused by slower hiring and heightened uncertainty surrounding Trump's policies. However, the readings ramped up bets on a Fed cut, with markets pricing in two by the end of the year, with the first in September. Eyes are now on the non-farm payrolls release on Friday, which the central bank uses to help shape monetary policy. Still, there is some concern that the US president's tariff blitz will ramp up inflation, which could put pressure on the Fed to keep borrowing costs elevated. Most of Asia rose in early trade, with Hong Kong, Sydney, Singapore, Taipei and Wellington up. Shanghai was flat and Tokyo fell ahead of a closely watched Japanese government bond auction. Seoul rallied more than two percent on continued excitement after the election of a new president ended a six-month power vacuum. The won rose around 0.4 per cent, building on a recent run-up. Jakarta edged higher as Indonesia's government began rolling out a US$1.5 billion (RM6.4 billion) stimulus package after South-east Asia's biggest economy saw its slowest growth in more than three years in the first quarter. The possibility of US rate cuts hit the dollar Wednesday and it struggled to recover in Asia, making small inroads against the yen, pound and euro. Investors are awaiting news of talks between Trump and Xi, with the White House saying they could take place this week. But while tariffs remain a millstone around investors' necks, IG's chief market analyst Chris Beauchamp said traders seemed less concerned than they were after the US president's April 2 'Liberation Day' fireworks. 'With markets still rising, the overall view appears to still be that the US is no longer serious about imposing tariffs at the levels seen in April,' he wrote in a commentary. 'President Trump appears fixated on a call with China's president that might help to move the situation forward, but Beijing remains wary of committing itself to any deal. 'This does leave markets open to another sudden shock, which might replicate some of the volatility seen in April. But that manic period appears to have dissuaded the administration from further major tariff announcements.' — AFP
Bloomberg
5 days ago
- Business
- Bloomberg
Bloomberg Daybreak Asia: Futures Mixed on Fed Rate Cut Hopes
Treasuries rallied as tepid US economic data reinforced expectations for Federal Reserve interest rate cuts this year. The 10-year Treasury yield fell 10 basis points to the lowest level in almost a month. Equity-index futures for Asia were mixed while an index of US-listed Chinese shares rose 2%. We get a read on markets from Willem Sels, Global Chief Investment Officer at HSBC Global Private Banking and Premier Wealth. Plus - economic activity declined slightly in the US in recent weeks, indicating tariffs and elevated uncertainty are rippling across the economy, the Federal Reserve said in its Beige Book survey of regional business contacts. Mentions of tariffs came up 122 times in the Beige Book, compared with 107 in the prior report. Variations of the word "uncertain" appeared 80 times. We look at what it may mean for monetary policy with David Bahnsen, Founder and Chief Investment Officer at the Bahnsen Group.
Reuters
13-05-2025
- Business
- Reuters
No reason for Fed to lower rates, portfolio manager says
Brian Mulberry, client portfolio manager at Zacks Investment Management, said that despite President Donald Trump's continued demands that the U.S. Federal Reserve lower interest rates, the latest economic data does not support such a move.
