2025-08-27 19:54
Trump's effort to fire Fed governor sets up legal fight Dollar in holding pattern, but Fed independence worries linger French political developments in focus for euro NEW YORK, Aug 27 (Reuters) - The dollar clung to gains against the euro and the yen on Wednesday, paring much of the strength made earlier in the day as investors focused on upcoming U.S. economic data for policy cues, even as worries persist over the Federal Reserve's independence. The euro touched its weakest level since August 6 and was last down 0.09% at $1.1631. Sterling eased up 0.12% to $1.3496, while the dollar slipped against the Swiss franc 0.14%, and was flat versus the Japanese yen at 147.445. Sign up here. In U.S. afternoon trading, the dollar index , which measures the greenback against a basket of currencies, alternated between gains and losses and was last up 0.02% at 98.227. "Traders are largely in a holding pattern as we await key earnings today from Nvidia and core PCE on Friday," said Michael Boutros, senior technical strategist at StoneX. "Its unlikely traders will want to take on any significant new exposure into the monthly cross until we get through these data points." New York Fed President John Williams said on Wednesday it is likely interest rates can fall at some point, but policymakers will need to see what upcoming data indicate about the economy to decide if it is appropriate to make a cut at next month’s meeting. Although the dollar appears to have shaken off the immediate worries over Fed independence that followed U.S. President Donald Trump's attempt on Monday to fire Governor Lisa Cook, the U.S. Treasury yield curve has steepened. Cook's lawyer later said she would file a lawsuit to prevent her ouster, kicking off what could be a protracted legal fight. "I don't think the markets are very concerned about the drama with Ms. Cook and the Fed. They are a little more concerned about what Donald Trump has been saying about wanting lower rates," said Joseph Trevisani, senior analyst, FX Street. "If the Fed starts to move on interest rates, the U.S. economy will pick up strength, and that is going to end up supporting the dollar." Since his return to the White House this year, Trump has relentlessly pressured the central bank to lower interest rates. Money markets are pricing in a 87.2% chance of a 25 basis point rate cut in September, according to the CME's FedWatch tool. Elsewhere, political developments in France are the focus for the euro as Prime Minister Francois Bayrou battles to save his minority government ahead of a September 8 confidence vote over budget cuts. A majority of French people want new parliamentary and presidential elections, opinion polls showed on Wednesday. "There was a lot of concern about European politics, but I think that the some of those concerns have abated. The market is more comfortable with the politics in Europe than anyone expected even six or eight hours ago," said Steven Englander, head of global G10 FX research, Standard Chartered Bank. Investors will next week examine U.S. labour market and business survey data for clues on the future path of Fed policy. Meanwhile, they will be keeping an eye on U.S. personal consumption expenditure data later this week, which if it "comes in as expected, I'm pretty sure the Fed is going to move (on a rate cut)," said Trevisani. French government bonds steadied on Wednesday, a day after the yield on the 10-year benchmark bond climbed to its highest level in five months. Meanwhile, preliminary data released on Wednesday showed that British producer output price inflation rose to a two-year high of 1.9% in June, up from 1.3% in May, adding to signs of inflationary pressures in the economy. https://www.reuters.com/world/middle-east/forex-dollar-clings-gains-with-focus-fed-policy-french-politics-cloud-euro-2025-08-27/
2025-08-27 19:50
SANTIAGO, Aug 27 (Reuters) - Two recent accidents involving autonomous trucks are raising safety concerns, a workers' union at BHP's (BHP.AX) , opens new tab Escondida mine in Chile, the world's largest copper mine, said in a statement on Wednesday. The union, which has often been critical of BHP and has staged strikes as part of contract negotiations, said that on August 25 an autonomous truck collided with shovel machinery and the week before, another truck overturned. Sign up here. It did not report any injuries. Despite that, the head of the Union Patricio Tapia told Reuters that while workers don't operate the vehicles, they perform other tasks in the area like maintaining roads. In a statement, BHP said it has trained more than 4,800 workers in its automation process and has "totally eliminated" having people exposed when material is moved in the open pit. BHP said that one of the incidents involving the autonomous trucks happened in March. "In the other incident, that involved a mechanical shovel with an autonomous truck, there were no exposed people and it is still under internal investigation," the statement said. The company in July said it had fully implemented autonomous operations for 33 trucks and eight drills at the mine's Escondida Norte unit, completing a five-year rollout. "Less than a month since the announcement, the reality is revealing a huge risk to the safety of workers," the statement said. Escondida produced 1.28 million tons of copper last year. https://www.reuters.com/sustainability/chiles-escondida-mine-union-warns-self-driving-truck-accidents-2025-08-27/
2025-08-27 19:49
Nvidia second-quarter results due after closing bell Dollar recovers even as Fed independence worries linger US stocks higher in afternoon trading NEW YORK, Aug 27 (Reuters) - Major stock indexes rose on Wednesday ahead of results from artificial intelligence leader Nvidia(NVDA.O) , opens new tab, while the dollar recovered from the previous session's drop despite ongoing concerns about the U.S. Federal Reserve's independence. A lawyer for Fed Governor Lisa Cook said she would file a lawsuit against U.S. President Donald Trump after he said he would fire her. Trump's statement left some investors worried about the independence of the U.S. central bank. Sign up here. Interest-rate sensitive two-year U.S. Treasury yields fell to an almost four-month low and the yield curve steepened as traders weighed the chance that Trump may be able to make more dovish appointments to the Fed. Even so, the dollar rebounded from its drop in the previous session and was last up 0.36% at 147.93 Japanese yen , while the euro was down 0.48% at $1.1586. The three major U.S. stock indexes were slightly higher, with Nvidia's second-quarter report, due after the closing bell, seen as a test of the AI optimism that has propelled markets over the past couple of years. This year, strong gains for a number of technology-related stocks exposed to AI have helped power major equity indexes to record highs. "Trump has been on the Fed's back since Day One, and this (Cook firing) is just a continuation of that strategy. The market is completely focused, 100%, on Nvidia," said Jake Dollarhide, CEO of Longbow Asset Management in Tulsa, Oklahoma. Investors are wondering whether Nvidia's results will continue to live up to Wall Street's high expectations, he said. "My expectation is today it will." Nvidia's shares were last down 0.1%. The company is expected to report that second-quarter revenue jumped to $46.06 billion, according to LSEG data, and investors will pay close attention to its business in China after the company agreed to pay the U.S. federal government 15% of the sales it made there in exchange for undefined export licenses. Technology shares, including several AI leaders, with investors pointing to some signs of caution emerging in the sector. The Dow Jones Industrial Average (.DJI) , opens new tab rose 190.54 points, or 0.42%, to 45,608.19, the S&P 500 (.SPX) , opens new tab climbed 20.02 points, or 0.31%, to 6,486.06 and the Nasdaq Composite (.IXIC) , opens new tab gained 55.61 points, or 0.26%, to 21,599.98. European stocks rebounded slightly from the previous day's decline, with investors monitoring political risks in France. Concerns over a potential collapse of French Prime Minister Francois Bayrou's government next month sparked a selloff in French assets on Tuesday. MSCI's gauge of stocks across the globe (.MIWD00000PUS) , opens new tab rose 1.64 points, or 0.17%, to 954.36. The pan-European STOXX 600 (.STOXX) , opens new tab index rose 0.1%. Market watchers interpreted Fed Chair Jerome Powell's comments at the Fed's annual Jackson Hole symposium last week as indicating interest rate cuts could be on the way. Fed funds futures traders are pricing in 84% odds of a cut in September, according to the CME Group's FedWatch Tool. But the outlook for U.S. interest rates will still likely depend on labor market strength and inflation trends. The two-year note yield was last at 3.625%, down around five basis points on the day. The benchmark 10-year note yield fell to 4.236%, the lowest since August 14. The yield curve between two-year and 10-year notes Oil and gold prices rose. Oil gained on a larger-than-expected drop in U.S. crude inventories. U.S. crude rose 90 cents to settle at $64.15 a barrel and Brent gained 83 cents to settle at $68.05. Spot gold rose 0.09% to $3,395.33 an ounce. https://www.reuters.com/world/china/global-markets-wrapup-5-2025-08-27/
2025-08-27 19:39
BRASILIA, Aug 27 (Reuters) - Brazil's central bank chief Gabriel Galipolo emphasized on Wednesday the need to keep interest rates at a restrictive level, citing a slow convergence of inflation expectations toward the official target. Speaking at an event in Sao Paulo hosted by vehicle distributor group Fenabrave, Galipolo said policymakers have consistently signaled that the benchmark Selic rate, currently at 15%, should remain unchanged for an extended period. Sign up here. "Expectations and projections from both the central bank and the market (are) still converging slowly toward the inflation target … that is what has required a more restrictive monetary policy," he said. His remarks came after a weekly central bank survey of economists showed a first decline in inflation expectations for 2027, which had been stuck for six months. Inflation expectations for this year and next had already been falling in recent weeks, helped by a stronger local currency amid a global weakening of the U.S. dollar. Even so, market forecasts remain well above the official 3% target, standing at 4.86% for this year, 4.33% for next year and 3.97% in 2027 - a point Galipolo highlighted on Wednesday. The central bank last month held its benchmark Selic rate steady after a 450 basis-point tightening cycle kicked off in September. Galipolo said that even with interest rates at 15%, Brazil's labor market continues to show strong resilience. "And that is probably what is driving, in some cases, stronger demand," he added. https://www.reuters.com/world/americas/brazil-central-bank-chief-flags-still-sluggish-convergence-inflation-2025-08-27/
2025-08-27 19:37
BRASILIA, Aug 27 (Reuters) - Brazil's central bank is not competing with financial or payment institutions through its operation and regulation of the widely used instant payments system Pix, said Renato Gomes, the institution's financial system organization director. In remarks released by the central bank on Wednesday, Gomes said the institution "plays the role of a neutral agent, providing a public digital infrastructure that allows the market to develop more efficiently, inclusively and competitively." Sign up here. Pix is among the Brazilian trade practices under formal investigation by U.S. President Donald Trump's administration in a case opened by the Office of the U.S. Trade Representative (USTR), which views the system as potentially unfair. Launched in late 2020, Pix quickly became Brazil's most used payment method, sharply eroding the share of cash, cards, checks, bank slips and other forms of payment in Latin America's largest economy. By cutting out intermediaries, Pix has squeezed revenue from card networks such as Visa (V.N) , opens new tab and Mastercard (MA.N) , opens new tab, card processors including Cielo, StoneCo (STNE.O) , opens new tab, PagBank (PAGS.N) , opens new tab and Getnet, and banks that once charged more for traditional transfers. Gomes said Pix helped bring 80 million individuals into the financial system until 2023, driving rapid digitalization of the financial and payments industry, which he stressed benefits everyone. "After Pix was implemented, the use of payment cards has continued to grow," he said. According to the director, relying on the private sector to build essential payments infrastructure had failed in Brazil, prompting the central bank to begin this project in 2018 after repeated industry attempts fell short. "The market is good for competition and innovation, but less effective when the goal is to provide a public good through private effort," he noted, emphasizing that the market tends to undersupply interoperability, resulting in concentration, low innovation and high prices. "As the central bank's mandate is to ensure safety, competitiveness and efficiency in payments, and not to profit from Pix, there are no pecuniary interests that could create conflicts," Gomes said. https://www.reuters.com/sustainability/boards-policy-regulation/brazils-central-bank-says-its-pix-system-is-not-threat-payments-companies-2025-08-27/
2025-08-27 19:25
SAO PAULO, Aug 27 (Reuters) - Higher U.S. tariffs on Brazil are expected to reshape global beef trade flows, sparking increased shipments to the U.S. from countries like Mexico and Australia while Brazil seeks alternative markets, analysts said on Wednesday. Brazil is the world's largest beef exporter, with China as its main trading partner. In August, Mexico overtook the U.S. to become its second-largest export destination for the commodity. Sign up here. "It is very likely that countries that can triangulate Brazilian beef will increase their purchases following Mexico's example," Mauricio Nogueira, director of livestock consultancy Athenagro, said in an interview. "If Mexico starts sending beef to the U.S., it will have to buy from someone, it will have to buy from here." Argentina would be another candidate to import and eventually re-export Brazil's beef to the U.S., he added. Nogueira's Athenagro did not change its year-end projection for Brazil's beef exports after Trump's 50% tariffs on the country's products took effect on August 6. His consultancy is projecting a 7.5% increase this year in Brazilian beef exports, to 3.08 million metric tons. Through July, such exports rose more than 13%. Luis Rua, secretary of trade at Brazil's agriculture ministry, said Brazilian beef helps keep Mexican inflation in check. Whether Mexico will re-export supplies from Brazil is unclear. "We send it to Mexico, but we don't know exactly what Mexico will do with the meat," he told Reuters. Economist Thiago de Carvalho confirmed expectations of a shift in global beef flows, with Brazil potentially selling to markets previously served by Australian exporters, for example. Factors such as tight global beef supplies, which the U.S. is facing after its cattle herd hit historical lows, may also direct demand to Brazil, Carvalho added. Japan, which traditionally buys meat from the U.S., may soon open up for Brazilian products, he said. https://www.reuters.com/world/china/us-tariffs-brazil-will-reshape-global-beef-trade-flows-analysts-say-2025-08-27/
