2025-12-04 05:36

A look at the day ahead in European and global markets from Gregor Stuart Hunter The greenback is getting a reprieve as monetary authorities in Asia's biggest economies signal discomfort with weakness in the U.S. currency, which hit a five-week low this week. Sign up here. The U.S. dollar index has snapped a nine-day losing streak, last rising 0.1%, and precious metals have retreated, with silver cooling off from a record high of $58.98 hit on Wednesday. The Chinese yuan pulled back from the strongest levels against the dollar in more than a year after the central bank set a weaker-than-expected official midpoint for the sixth consecutive session, indicating caution over the renminbi's rapid appreciation. Meanwhile, yields on 30-year Japanese government bonds pulled back from record highs after Japan's chief cabinet secretary said the government is closely watching market moves. Longer-dated bond yields had hit fresh peaks ahead of an expected rate hike from the Bank of Japan later this month. The jawboning came as BOJ Governor Kazuo Ueda tempered expectations over how far the central bank would raise interest rates, saying there was uncertainty over the path ahead due to the difficulty estimating the country's neutral rate. An auction of 30-year JGBs drew the highest demand in more than six years as record yields lured buyers, adding to the sense of relief in Tokyo over investor appetite to hold government debt. The Indian rupee also weakened to a record against the greenback, breaking past the 90 to the dollar mark and adding pressure to the Reserve Bank of India when it meets on Friday and is expected to cut interest rates. Equity markets have had a tepid session, with stocks off 0.1% outside of Japan, where the Nikkei 225 is surging 1.8%, led by a blowout 12.4% gain for Fanuc Corp (6954.T) , opens new tab. The industrial robot maker's shares have surged since they announced a collaboration with Nvidia (NVDA.O) , opens new tab earlier this week. In early European trades, pan-region futures were up 0.6%, German DAX futures rose 0.5% and FTSE futures were up 0.3%. Key developments that could influence markets on Thursday: Economic data: Euro Zone: HCOB Construction PMI for November, Retail Sales for October Germany: HCOB Construction PMI for November France: HCOB Construction PMI for November Italy: HCOB Construction PMI for November U.K.: S&P Global Construction PMI for November Debt auctions: France: 9-year, 15-year and 30-year government debt U.K.: 14-year government debt https://www.reuters.com/world/china/global-markets-view-europe-2025-12-04/

2025-12-04 05:14

Dollar index higher on day but rate cut bets weigh US weekly jobless claims at lowest level in more than three years Yen supported by rate hike expectations Bitcoin takes breather, slips 2% NEW YORK, Dec 4 (Reuters) - The U.S. dollar edged up against a basket of currencies on Thursday but stayed close to the five-week low touched earlier in the session as investors braced for a Federal Reserve rate cut next week. Investors widely expect a rate cut when the Fed meets next week and will be watching for signals on the policy path ahead. Traders are pricing nearly a 90% chance of a quarter-point rate cut next week, LSEG data showed. Sign up here. "Traders are doubling down on bets the Fed will cut rates and stop short of delivering an overtly-hawkish message at next week’s meeting," Karl Schamotta, chief market strategist at Corpay, said. The dollar index , which measures the U.S. currency against six rivals, was up 0.1% at 99.02, on pace to snap a 9-day losing steak. It remained near a five-week low of 98.765 and was down about 9% for the year. The euro was down 0.2% to $1.1649. The European currency remains supported by data on Wednesday, which showed business activity in the euro zone expanded at its fastest pace in 30 months in November. U.S. data on Thursday that showed the number of Americans filing new applications for unemployment benefits dropped to the lowest level in more than three years last week, allaying fears of a sharp deterioration in labor market conditions, did little to sway expectations for a Fed rate cut next week. The dollar also has come under pressure in recent days as investors have also been weighing the prospect of White House economic adviser Kevin Hassett taking over as Fed Chair after Jerome Powell’s term ends in May. Hassett is expected to push for more rate cuts. U.S. President Donald Trump said this week he will unveil his pick to succeed Powell early next year, extending a months-long selection process despite previously claiming he had already decided on a candidate. A move to appoint Hassett could pressure the dollar, analysts have said, with bond investors expressing concerns to the U.S. Treasury that Hassett could aggressively cut rates to align with Trump's preferences, the Financial Times reported. Still, investors remained hesitant to press bearish bets on the dollar. "Stepping in front of the train wouldn’t be wise at this juncture, but current levels of dollar bearishness could be difficult to sustain into early 2026," Corpay's Schamotta said. YEN REBOUND The yen was up 0.2% at 155.015 per dollar, close to its strongest since November 17, on expectations that the Bank of Japan will raise rates when it meets later this month. Three government officials told Reuters that the BOJ is likely to raise rates in December, although what comes after remains uncertain, with markets only fully pricing in one more rate hike next year and around a 50% chance of another. "A still-cautious BOJ, attractive carry for long dollar/yen and persistent topside pressure to JGB yields on potential fiscal expansion is likely to keep the pressure on yen weakness," Chidu Narayanan, head of macro strategy in APAC at Wells Fargo, said. Sterling fell 0.2% to $1.3333, but was not far from its highest point since October 24 as an upward revision of business activity data painted a brighter picture of the economy. Leading cryptocurrency bitcoin took a breather after rising more than 8% over the last two sessions, slipping 1.7% to $92,142. https://www.reuters.com/world/asia-pacific/dollar-weak-with-rate-cut-enthusiasm-intact-euro-7-week-high-2025-12-04/

2025-12-04 04:52

MUMBAI, Dec 4 (Reuters) - The Indian rupee ended above the 90 per dollar level after hitting a record low on Thursday, as dollar sales from multiple foreign banks, likely on account of inflows, helped the currency snap a six-session losing streak. The rupee fell to 90.42 early in the session before reversing course to end up 0.2% at 89.9750. Sign up here. Multiple headwinds, from a wider trade gap to weak investment flows amid stalled trade talks with the U.S., have sapped dollar inflows into the world's fifth-largest economy and made the rupee Asia's worst performing currency. India's central bank will tolerate a weaker currency as inflows dry up, Reuters reported on Thursday, citing people familiar with central bank's thinking. On the day, dollar sales from foreign banks picked up in the latter half, which alongside likely selling interest in the non-deliverable forwards market helped the rupee recover, traders said. Two traders also flagged dollar offers from state-run banks. "Given today's price action, think the confidence on taking long bets (on USD/INR) will diminish heading into the monetary policy decision," a senior trader at a Mumbai-based bank said. The Reserve Bank of India's policy decision, due on Friday, will be keenly watched for the rate action, measures on banking system liquidity and commentary on the rupee's slump. Analysts expect the rupee to continue facing headwinds in the near-term but ING says that the currency could stage a meaningful reversal should the trade talks turn favourable, "making it one of the few high-yielders with upside potential in 2026." Asian currencies were mostly weaker on the day while the dollar index traded near a five-week low after lacklustre U.S. data cemented the case for a Federal Reserve rate cut next week. Odds of a 25 basis point U.S. rate cut are currently at 87%, per CME's FedWatch tool. https://www.reuters.com/world/india/rupee-hits-record-low-forward-premiums-surge-weakening-bias-2025-12-04/

2025-12-04 03:01

MUMBAI, Dec 4 (Reuters) - The Indian rupee is expected to extend its slide on Thursday after breaching the 90-per-dollar mark, a move that traders say has firmed a weak bias and is likely to draw in speculative bets. The 1-month non-deliverable forward indicated the rupee will open in the 90.25-90.35 range versus the U.S. dollar, having settled at 90.19 on Wednesday. Sign up here. Bankers said the fall past the psychologically important 90 handle has further cemented the rupee's bearish bias, a shift that will nudge importers to step up hedging and prompt exporters to hold back in anticipation of better levels. Moreover, with no immediate positive catalysts on the horizon and the central bank signalling a preference for measured rather than heavy-handed intervention in recent days, bankers said speculative accounts will become more confident in wagering against the rupee. Madan Sabnavis, chief economist at Bank of Baroda, noted that a India-U.S. trade deal "is still not on the table", which is a sore point for the rupee. "Hence the importers are rushing in while exporters are holding back," he noted, adding that the RBI "appears to be apparently silent on intervention". "Any mark breached by the rupee which prevails for 2-3 days, becomes the new benchmark", he said. This in a way reinforces expectations of traders that the 90 level may now be sticky. The rupee's slide comes despite a broadly steady dollar index, underscoring that the weakness is being driven by flows. India's widening trade deficit, alongside weak capital flows, has skewed the underlying demand-supply balance for the dollar. This combination, bankers say, has brought the market to a point where routine corporate buying is enough to pile pressure on the rupee if the central bank is not there to absorb the flow. KEY INDICATORS: ** One-month non-deliverable rupee forward at 90.50-90.56; onshore one-month forward premium at 18.5 paise ** Dollar index at 98.96 ** Brent crude futures up 0.4% at $62.9 per barrel ** Ten-year U.S. note yield at 4.08% ** As per NSDL data, foreign investors sold a net $448.7 million worth of Indian shares on December 2 ** NSDL data shows foreign investors bought a net $2.1 million worth of Indian bonds on December 2 https://www.reuters.com/world/india/rupee-likely-extend-slide-90-breach-cements-weak-bias-invites-speculative-bets-2025-12-04/

2025-12-04 02:14

BENGALURU, Dec 4 (Reuters) - The Indian rupee will regain some lost ground against the U.S. dollar over the next three months, according to a Reuters poll of FX strategists, but a reversal in the currency's fortunes hinges upon India and the U.S. agreeing to a trade deal. U.S. President Donald Trump's punitive 50% tariff on Indian goods has soured sentiment among foreign investors, who have sold around $17 billion of Indian equities so far this year, pushing the rupee to record-low levels. Sign up here. Despite the Reserve Bank of India selling dollars in recent weeks and the economy growing at a robust 8.2% in the July-September quarter, the rupee hit a new low of 90.29 per dollar on Wednesday. The currency is down nearly 5% for the year against the greenback. Between foreign investors' reluctance to enter Indian equity markets without a U.S.-India trade deal and the RBI's tight leash on the rupee, the currency is expected to move in a narrow range in the near term. The partially convertible rupee was forecast to rise nearly 1.1% from current levels to 88.91 per dollar by end-February 2026, and then be marginally stronger at 88.83 by end-May, according to the median view of 37 forex analysts polled between December 1-3. "I was expecting some kind of India-U.S. trade deal to happen by November, and that hasn't happened. But still, the base case is that it should happen before the financial year-end, so that itself will boost the sentiment for the rupee," said A. Prasanna, head of fixed income research at ICICI Securities Primary Dealership. "The equity flows have been quite erratic, and FDI flows on a net basis have been weak. We don't see anything that tells us that the capital flows can improve on a sustainable basis...But we don't expect this kind of outright depreciation or one-sided pressure on the currency to continue." The currency was expected to gain nearly 0.3% to trade around 89.65 against the dollar in the coming 12 months, the poll also showed. (Other stories from the December foreign exchange poll) https://www.reuters.com/world/india/indian-rupee-rise-record-lows-us-trade-deal-key-recovery-2025-12-04/

2025-12-04 00:16

LONDON, Dec 4 (Reuters) - Great British Energy, a state-owned energy company, unveiled a five-year strategic plan on Thursday aimed at accelerating the country’s transition to renewable power to help meet its climate targets. Britain is seeking to largely decarbonise its power sector by 2030, a goal that it says will help drive down energy costs and that will also require a huge increase in renewable capacity. Sign up here. GBE was launched last year to invest in and co-develop clean power projects. The government has pledged a total of 8.3 billion pounds ($11.04 billion) over the current Parliament. Under the strategic plan, GBE said it would deliver some 15 gigawatts of clean energy generation and storage capacity by 2030, enough to power around 10 million homes, by using its own investments and partnerships to help mobilise 15 billion pounds of private finance. The company will focus on three priority areas: local community energy, onshore energy development, and offshore wind expansion, and will operate as both developer and equity investor, with returns from the publicly owned assets reinvested into new capacity. “GBE will build a portfolio which is generating income by 2030 and be on a pathway to company-wide profitability,” the strategic plan said. The initiative is expected to directly support over 10,000 jobs, including in regions that are historically reliant on oil and gas, while backing more than 1,000 local community energy projects, GBE said. ($1 = 0.7519 pounds) https://www.reuters.com/sustainability/climate-energy/britains-great-british-energy-unveils-plan-boost-renewable-power-by-2030-2025-12-04/