2025-08-20 11:12

Riksbank keeps rates unchanged, in line with forecast Bank still sees some probability of a further rate cut this year Riksbank says inflation upturn was based on temporary factors STOCKHOLM, Aug 20 (Reuters) - Sweden's central bank held its key interest rate at 2.00% as expected on Wednesday and said it still sees some probability of a further rate cut this year as it tries to balance above-target inflation with an economy running in low gear. Swedish growth has stalled this year with households hesitant about spending and businesses worried by tariffs and geopolitical uncertainty. At the same time, inflation rose more than expected over the summer. Sign up here. "With inflation at 3.0% and the inflation target at 2.0%, we need to be vigilant," Governor Erik Thedeen told reporters at a news conference. "That's why the board decided on an unchanged policy rate of 2.0%. There is some possibility of a rate cut during the remainder of the year." In June, the Riksbank said there was a roughly 50% chance of a cut in the second half of the year and Thedeen said the outlook remained the same. "We forecast that the Riksbank will cut the policy rate at the next meeting in September," economists at Swedbank said in a research note. The Riksbank's next rate decision is September 23. Analysts in a Reuters poll had been unanimous in expecting no change. UNCERTAINTY The Riksbank is one among many central banks trying to navigate a safe path through a geopolitical landscape in flux and a finely balanced outlook for inflation and growth. It expects price pressures to ease in the months ahead as technical factors and seasonal prices for items like holidays normalise, but rate-setters remain wary that inflation could still prove sticky. "We continue to judge further rate cuts as unlikely, though not entirely off the table," DNB Carnegie said. A cut would be "contingent on a deterioration in the Swedish economic outlook alongside a convincing decline in inflation. Neither of these scenarios is part of our baseline," the DNB Carnegie note said. A downgrade to flash second quarter GDP figures - which showed 0.1% growth on the quarter - or a soft inflation number for August could tip the balance toward a cut. Final GDP numbers are due on August 29 with August inflation due on September 4. https://www.reuters.com/business/finance/swedish-central-bank-keeps-key-rate-hold-could-still-cut-this-year-2025-08-20/

2025-08-20 10:56

European shares pare early decline Eyes on Jackson Hole symposium, Powell's speech Minutes of Fed's July meeting due on Wednesday Trump's growing influence over tech sector raises concerns SINGAPORE, Aug 20 (Reuters) - European shares steadied on Wednesday, as a tech-led selloff on Wall Street that has rippled through equity markets eased, while currency and rates traders honed in on a key meeting of central bankers later this week. The pan-European STOXX 600 index (.STOXX) , opens new tab was nearly flat after declining by as much as 0.4% earlier in the day, pressured by weakness in tech and defence sector stocks. Sign up here. That early weakness followed a fall in Asian markets, where tech-heavy indexes were the biggest losers after the NASDAQ composite index (.IXIC) , opens new tab dropped nearly 1.5% on Tuesday. Futures on the tech-heavy NASDAQ were just 0.2% lower on Wednesday, however, suggesting a calmer open ahead. While there was no major trigger for the selloff in tech stocks, analysts pointed to a confluence of factors, including concerns over high valuations, a general risk-off mood and U.S. President Donald Trump's growing influence over the sector. "I think we were priced for perfection in the U.S. and there was a quite a lot of complacency in markets, so some summer volatility should have been expected," said Ben Laidler, head of equity strategy at BRADESCO BBI. Trump's influence on the U.S. tech-sector has also been in focus for investors. U.S. Commerce Secretary Howard Lutnick is looking into the government taking equity stakes in Intel as well as other chip companies, two sources told Reuters. While the individual developments may be brushed aside by markets, they fall into the broader bucket of concerns over the institutional framework in the United States, Laidler said. The potential move comes on the back of other unusual deals Washington has recently struck with U.S. companies, including allowing AI chip giant Nvidia (NVDA.O) , opens new tab to sell its H20 chips to China in exchange for the U.S. government receiving 15% of the revenue from those sales. In commodities, Brent crude futures were last up 1.1% at $66.55 a barrel as investors awaited the next steps in talks to end Russia's war on Ukraine, with uncertainty over whether oil sanctions might be eased or tightened. While a meeting between Trump, Ukrainian President Volodymyr Zelenskiy and a group of European allies concluded without much fanfare, Trump said the United States would help guarantee Ukraine's security in any deal to end Russia's war there. "The U.S. is not categorically underwriting anything, any security for Ukraine, even if they're open to provide some, because we don't know the conditions under which they will. So there's quite a bit of risk left out there," said Vishnu Varathan, head of macro research for Asia ex-Japan at Mizuho. Elsewhere, Sweden's central bank kept its key interest rate on hold as expected on Wednesday, while the Reserve Bank of New Zealand cut policy rates to a three-year low and signalled further easing, sending the kiwi down by over 1%. AWAITING JACKSON HOLE The focus is now on the Kansas City Federal Reserve's August 21-23 Jackson Hole symposium, where Fed Chair Jerome Powell is due to speak on the economic outlook and the central bank's policy framework on Friday. Powell's remarks on the near-term outlook for rates will be keenly watched as traders are almost fully pricing in a rate cut next month. The minutes of the Fed's July policy meeting are due later on Wednesday, but are unlikely to spur meaningful market reactions as they pre-date weak U.S. labour market data that spurred a firming of rate cut expectations. The dollar was steady against the euro at $1.1646. Sterling was flat at $1.3498 after rising slightly in immediate reaction to data that showed UK inflation its highest in 18 months in July. The fact this was not even worse meant under-fire British government bonds rallied on the news, with the benchmark 10-year gilt yield down 5 basis points at 4.69%. The 10-year Treasury yield was marginally lower at 4.29%. "We expect the dollar to depreciate largely because US economic performance no longer supports the currency’s high valuation, and we think the softening labor market is providing late-summer support to that view," analysts at Goldman Sachs said in a note. Elsewhere, spot gold rose 0.3% to $3,326.89 an ounce. https://www.reuters.com/world/china/global-markets-wrapup-4-2025-08-20/

2025-08-20 10:52

Data shows area burned since Monday almost equals 2024 total Heatwave declared over, humidity forecast to rise Castile and Leon leader says emergency teams stabilising fires GONDULFES, Spain, Aug 19 (Reuters) - Wildfires raging in northern and western Spain have burned through nearly the same area in the past 24 hours as in all of last year, although the end of a 16-day heatwave and expected rainfall have fanned hopes that an end may be in sight. The fires have spread over the regions of Extremadura, Galicia, and Castile and Leon, forcing authorities to suspend rail services and cut access to roads in the area, as well as blocking a 50 km (30 mile) stretch of the popular Camino de Santiago pilgrimage trail. Sign up here. Data on Tuesday from the European Forest Fire Information System showed the fires have burned vegetation on 38,000 hectares (94,000 acres) since Monday, just below 42,000 hectares during the whole of 2024. However, the national weather agency, which on Monday declared the end of one of the longest heatwaves in the past five decades, now expects temperatures to fall and humidity to rise. "The evolution is favourable, the teams are stabilising the fires," Castile and Leon regional leader Alfonso Fernandez Manueco told reporters. The region, Spain's largest, is one of the worst hit by the blazes. "If weather trends continue, we will be better tomorrow than today and better the day after tomorrow," Manueco said. The weather agency said adverse conditions would remain in southern Spain, including in part of Extremadura. So far this year, an estimated 382,600 hectares have burned in Spain - an area equivalent to the size of the island of Mallorca - according to the EFFIS. It is the largest area in records that go back to 2006 and more than four times the 2006-2024 average. Visiting the fires in Extremadura, Prime Minister Pedro Sanchez said the government would declare many of the affected areas as emergency zones, which in practice means they will be eligible to receive aid for reconstruction. Blaming the fires on the effects of climate change, he also said he would propose a plan next month to turn climate emergency policies into permanent state policies. He gave no details, but the authorities have been focusing on fire prevention and response planning. "We're seeing the climate emergency accelerate and worsen significantly, particularly in the Iberian Peninsula, each year," he said. Opposition leaders have said his proposal is a way to divert attention from his government's poor handling of the fires. Most of Southern Europe is experiencing one of its worst wildfire seasons in two decades. The Spanish army has deployed 3,400 troops and 50 aircraft to help firefighters, while Czech Republic, Finland, France, Germany, Netherlands and Slovakia have sent hundreds of firefighters, vehicles and aircraft. The Interior Ministry said that since June, 32 people have been arrested and 93 were under investigation for suspected arson. https://www.reuters.com/sustainability/climate-energy/huge-wildfires-stabilising-spain-cooler-forecast-fuels-hope-worst-is-over-2025-08-19/

2025-08-20 10:41

LONDON, Aug 20 (Reuters) - What matters in U.S. and global markets today By Mike Dolan , opens new tab, Editor-At-Large, Finance and Markets Sign up here. In markets, the trigger for sudden confidence swoons is often elusive, particularly when looking at periodic rotations out of high-flying U.S. tech stocks. And most signs suggest this week's tech retreat may be more about re-positioning than investors receiving some lightning bolt of news.Tuesday's tech shakeout led to a 1.5% plunge in the Nasdaq index even as the blue chip Dow Jones Industrials Average hit a record intraday high. But the tech slump dragged the S&P 500 down 0.6%, and U.S. equity futures showed little sign of a bounce early on Wednesday. * Reasons for the sudden tech angst tended to be gathered after the event, with some pointing to comments late last week from OpenAI boss Sam Altman on inevitable bubbles in the sector and others pointing to different research papers fretting variously about both the limited returns on blistering AI spending to date and also its growing jobs destruction. The jitters also come ahead of next week's earnings report from chip behemoth Nvidia, some concern about the wider implications of the U.S. government's proposed stake in ailing chip giant Intel and caution ahead of the Federal Reserve's annual Jackson Hole conference this week. * Even though Fed concerns were cited across markets on Tuesday, there was little shift in Fed futures pricing during the day - and they still show just over an 80% chance of a rate cut next month. With Fed meeting minutes due later today and 20-year bonds under the hammer too, Treasury yields were flat and the dollar firmer. An unexpected pick-up in housing starts in July was reported on Tuesday but this was offset by a drop in building permits to five-year lows. * Tech-heavy stock indexes overseas were hit by Wall Street's wobble, with Japan's Nikkei losing 1.5% and South Korea's Kospi down 0.7%. Lifted on Tuesday by Ukraine deal hopes, European stocks were flatter today, with euro inflation coming in bang on forecast and a hotter-than-expected UK inflation reading downplayed due to seasonal airfare skews. Chinese stocks outperformed, with the Shanghai main index rallying to 10-year highs, as investors rotated stock holdings and hoped for more government stimulus. Be sure to check out today's column, which looks at a particular dilemma facing the Fed: should it ease to offset weakness in the housing market if that means spurring the blistering AI infrastructure boom? Today's Market Minute * U.S. and European military planners have begun exploring post-conflict security guarantees for Ukraine, U.S. officials and sources told Reuters on Tuesday, following President Donald Trump's pledge to help protect the country under any deal to end Russia's war. * Alongside a massive build-up in conventional military firepower, China has embarked on a rapid and sustained increase in the size and capability of its nuclear forces, according to the U.S. military and arms control experts. * British inflation hit its highest in 18 months in July when it increased to 3.8% from 3.6% in June, official data showed on Wednesday, once again leaving the country with the biggest price growth problem amongst the world's big rich economies. * A glaring mismatch between benchmark oil prices and expectations of a looming supply overhang has created an imbalance that could end badly for traders, writes ROI energy columnist Ron Bousso. * Trump has faced little opposition in his drive to rip up the global economic rule book. The only exception has been "the market". But now even investors are holding their fire, claims ROI markets columnist Jamie McGeever, enabling more risk to build up in the financial system. Chart of the day Americans are deeply concerned over the prospect that advances in artificial intelligence could put swaths of the country out of work permanently, according to a new Reuters/Ipsos poll. The six-day poll, which concluded on Monday, showed 71% of respondents said they were concerned that AI will be "putting too many people out of work permanently." Today's events to watch * Federal Reserve meeting minutes released (2:00 PM EDT); Board Governor Christopher Waller and Atlanta Fed President Raphael Bostic speak * U.S. corporate earnings: Target, Nordson, TJX, Lowe's, Estee Lauder, Progressive, Analog Devices * U.S. Treasury sells $16 billion of 20-year bonds Want to receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here. You can find ROI on the Reuters website , opens new tab, and you can follow us on LinkedIn , opens new tab and X. , opens new tab Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. https://www.reuters.com/business/finance/global-markets-view-usa-2025-08-20/

2025-08-20 10:32

Aug 20 (Reuters) - Futures tracking Canada's main stock index were flat on Wednesday, as investors await the U.S. Federal Reserve's annual symposium later this week for clues on the monetary policy path. The futures on the S&P/TSX index (.SXFcv1) , opens new tab were down 0.02% as of 06:05 a.m. ET (1005 GMT), while futures tracking Wall Street's benchmark S&P 500 fell 0.1%. Sign up here. Investors avoided outsized bets as they looked ahead to remarks from Fed chair Jerome Powell at the Jackson Hole symposium on Friday that could potentially sway market expectations for future interest rate cuts. Later on Wednesday, expectations for U.S. policy easing will also be tested by the release of minutes from the Fed's last policy meeting, where two officials dissented from the majority "hold" verdict - the first such split since 1993. According to the CME Group's FedWatch tool, traders are pricing in at least two rate cuts by the end of 2025. Ahead of the Fed minutes, gold prices ticked up but hovered near three-week lows. Copper prices remained steady. Oil prices gained over 1% after report of a drop in U.S. crude inventories. Canada's new housing price index, due at 08:30 a.m. ET, is the only noteworthy indicator in a data-light day. In corporate news, High Arctic Energy Services (HWO.TO) , opens new tab on Tuesday announced the resignation of Mike Maguire as CEO. The S&P/TSX composite index (.GSPTSE) , opens new tab fell on Tuesday, dragged by significant declines for technology and mining shares. Tuesday's losses, however, were contained by a cooler domestic inflation report. The data firmed expectations for a Bank of Canada rate cut at the October meeting, with the odds reaching about 60%. FOR CANADIAN MARKETS NEWS, CLICK ON CODES: TSX market report Canadian dollar and bonds report CA/ Reuters global stocks poll for Canada , Canadian markets directory ($1 = 1.3878 Canadian dollars) https://www.reuters.com/markets/europe/tsx-futures-subdued-investors-await-jackson-hole-conference-2025-08-20/

2025-08-20 10:28

MUMBAI, Aug 20 (Reuters) - The Indian rupee slipped on Wednesday, as corporate hedging and short-term speculators bolstered demand for the greenback, most of which was met by dollar sales by foreign banks. The rupee settled at 87.0650 to the U.S. dollar against its close of 86.9500 on Tuesday when it climbed the most in over a month, boosted by speculation over Russia-Ukraine peace talks. Sign up here. Traders said foreign banks were active sellers of dollars on Wednesday, limiting rupee depreciation despite significant hedging by importers. A rally in local equities and position squaring also helped the Indian currency recover after recent pressure, traders said. Recent weeks have seen the rupee’s direction influenced by news around U.S. tariffs on India, S&P's upgrade of the nation's sovereign credit rating and Prime Minister Narendra Modi's planned tax cuts on goods and services. Foreign portfolio investors turned buyers of Indian assets in the past three sessions after net selling Indian markets in the last few weeks over tariff uncertainties. "FPIs have turned steady buyers in Indian markets, encouraged by hopes that the U.S. may reconsider its plan to impose an additional 25% tariff on Indian exports," said Amit Pabari, managing director at CR Forex. The return of foreign inflows comes even as U.S. Treasury Secretary Scott Bessent on Tuesday accused India of profiteering from its purchases of Russian oil during the war in Ukraine. Other Asian currencies traded mixed on the day, while the dollar index was slightly higher at 98.21 as on 1549 IST. Rupee traders will also tune in to Federal Reserve Chair Jerome Powell’s speech at Jackson Hole, Wyoming, on Friday, which may provide clues on the U.S.'s interest rate trajectory. “A signal that cuts may be delayed could strengthen the dollar, while any indication of looser policy may weigh on it and encourage risk-on sentiment,” Pabari added. https://www.reuters.com/world/india/rupee-edges-lower-dollar-sales-by-foreign-banks-offset-most-greenback-demand-2025-08-20/