2024-02-08 03:59

Copyrighted Image by: Reuters. Investing.com-- Most Asian currencies advanced slightly on Thursday as the dollar and Treasury yields pulled further away from recent peaks, although persistent signs of deflation in China kept sentiment subdued. Markets were now awaiting more cues on U.S. interest rates after largely dialing back expectations for early rate cuts by the Federal Reserve, following a string of robust economic readings and hawkish comments from Fed officials. This trend largely curbed a rally in the dollar, with the greenback pulling back further from a three-month high hit earlier this week. U.S. Treasury yields also retreated from recent highs. The dollar index and dollar index futures fell 0.1% each in Asian trade, extending sharp overnight declines. U.S. inflation data for January, due next week, is now in focus for more cues on the path of interest rates. Most Asian currencies crept higher. The Australian dollar was among the better performers for the day, rising 0.1% and extending gains from earlier this week after the Reserve Bank of Australia warned that it could still hike interest rates in the face of sticky inflation. The Indian rupee firmed 0.1%, moving further away from near record-low levels as traders awaited a Reserve Bank of India meeting later in the day. The RBI is widely expected to keep rates on hold, while its forecasts on inflation and economic growth will be in close focus. The Japanese yen fell 0.1% and remained in sight of a two-month low, amid persistent uncertainty over when the Bank of Japan will begin scaling back its ultra-loose policy. The South Korean won and Singapore dollar moved little. The Thai baht slid 0.5% after a Bank of Thailand official said that the bank stood ready to cut interest rates if private consumption slowed further in the country. Any major gains in Asian units were largely held back by concerns over higher-for-longer U.S. interest rates, as a chorus of Fed officials warned this week that the bank was not considering any monetary loosening in the near-term. Signs of persistent economic weakness in China also dented sentiment towards the region, as Asia’s largest economy continued to grapple with disinflation. Yuan weak as Chinese inflation data underwhelms The Chinese yuan moved little on Thursday, amid continued support from the People’s Bank of China, which was seen intervening in currency markets earlier this month. But the offshore yuan weakened past the 7.2 level against the dollar, and remained close to a 2-1/2 month low. Official data showed consumer inflation grew less than expected in January, while producer inflation contracted for a sixteenth consecutive month. The consumer price index also clocked its worst monthly decline since late-2009, indicating that discretionary spending in the country remained largely subdued amid worsening economic conditions. However, analysts at ING said January’s inflation data marked a bottom for the current deflation cycle, and that inflation was likely to pick up in the coming months. Demand was also likely to be supported in February by the upcoming Lunar New Year holiday. Chinese markets will be closed for a week starting from this Friday. https://www.investing.com/news/forex-news/asia-fx-gains-some-ground-as-dollar-retreats-china-weakness-persists-3296634

2024-02-08 02:12

Copyrighted Image by: Reuters. Investing.com -- Oil prices surged to settle higher on Thursday as Israel rejected an Hamas proposed ceasefire, reigniting fears that of widening of the conflict in the Middle East just as the U.S. continued to its retaliatory strikes and Houthi rebels launched fresh attacks in the Red Sea. At 14:30 ET (19:30 GMT), the Brent oil futures expiring in April ticked up 3.2% to $76.22 a barrel, while West Texas Intermediate crude futures rose 3.4% to $81.87 per barrel. Middle East tensions renew as Gaza ceasefire Israel's Prime Minister Benjamin Netanyahu rejected a ceasefire deal proposed by Hamas, saying that talks with the latter were "nog going anywhere." The remarks dealt a blow to hopes of a ceasefire in Gaza and stoked concerns that the ongoing violence in the Middle is set to continue, keeping the risk of crude supply disruptions front and center. Still, bigger gains in oil prices were held back by weak economic signals from top importer China, as well as mixed cues from U.S. inventory data. Weak China inflation, mixed US inventories brushed aside Chinese consumer inflation grew less than expected in January, official data showed on Thursday, while producer inflation remained in contraction for a 16th consecutive month. The readings pointed to sustained economic weakness in the world’s largest oil importer, and factored into concerns over sluggish oil demand in the coming months. China has remained a key pain point for oil markets, as a post-COVID economic recovery in the country largely failed to materialize over the past year. U.S. inventory data also provided middling signals on supply and demand. While gasoline and distillate inventories saw modest draws in the week to February 2, overall U.S. inventories grew much more than expected as production recovered from a cold snap through January. While record-high U.S. production has also served as a pain point for oil prices, the Energy Information Administration forecast a reduction in output through 2024, and that production will only retake record highs in early-2025. The forecast offered some support to oil prices this week. But gains in crude were largely held back by a strong dollar, as markets began steadily pricing out the chances of early interest rate cuts by the Federal Reserve this year. The central bank is now only expected to begin cutting rates by June 2024, with a chorus of Fed officials this week downplaying bets on early cuts. Recent signs of resilience in the U.S. economy are also expected to give the Fed more headroom to keep rates higher for longer. https://www.investing.com/news/commodities-news/oil-prices-rise-after-gaza-ceasefire-rejection-weak-china-data-limits-gains-3296564

2024-02-07 05:45

Copyrighted Image by: Reuters. Investing.com-- Gold prices moved little on Wednesday but saw some relief as the dollar eased from three-month highs, although waning bets on early U.S. interest rate cuts kept the outlook for the yellow metal uncertain. Bullion prices were battered by bets on higher-for-longer interest rates, especially following a slew of strong U.S. economic readings and hawkish comments from Federal Reserve officials. The dollar and U.S. Treasury yields had surged on these signals. While the dollar fell slightly from three-month highs on Wednesday, the greenback was still sitting on strong gains so far in 2024. A higher outlook for U.S. interest rates bodes poorly for gold, given that high rates increase the opportunity cost of investing in bullion. This trade had limited any major upside in gold over the past two years. Spot gold steadied at $2,035.12 an ounce, while gold futures expiring in April were flat at $2,050.95 an ounce by 00:25 ET (05:25 GMT). Gold rangebound amid dearth of cues, but stays above key support level Markets were now awaiting more cues on the U.S. economy to guide price movements in gold. U.S. inflation data for January, due next week, is expected to offer some direction. While analysts had forecast that increasing anxiety over interest rates would spur more near-term losses in gold, the yellow metal still traded well above the $2,000 an ounce support, which analysts said could be tested this week. Still, with markets beginning to steadily price out interest rate cuts in March and May, the outlook for gold remains uncertain. Safe haven demand for the yellow metal may also be diminished by a potential ceasefire between Israel and Hamas. Gold is expected to benefit from an eventual reduction in interest rates. But an increasing number of signs suggest that such a scenario will play out later, rather than earlier in 2024. Copper edges lower before more China cues Among industrial metals, copper prices fell slightly on Wednesday in anticipation of more economic cues from top importer China. Copper futures expiring in March fell 0.2% to $3.7772 a pound. The red metal was nursing steep losses over the past week following a string of underwhelming purchasing managers index readings from China. Inflation data for January, due on Thursday, is expected to offer more cues on the world’s largest copper importer. Concerns over slowing Chinese demand have been a key weight on copper prices, especially as a post-COVID economic rebound largely failed to materialize. https://www.investing.com/news/commodities-news/gold-prices-rangebound-as-rate-cut-fears-persist-3294774

2024-02-07 04:54

Copyrighted Image by: Reuters. Investing.com-- Most Asian currencies kept to a tight range on Wednesday, steadying after recent losses as the dollar retreated from recent three-month peaks, although the prospect of higher-for-longer U.S. rates still kept traders on edge. Regional currencies were nursing steep losses over the past three sessions, after a string of robust U.S. economic readings and hawkish comments from Federal Reserve officials saw traders largely price out bets on early rate cuts by the central bank. This trend spurred sharp gains in the dollar, with the greenback hovering just below its strongest levels since early-November. The dollar index and dollar index futures both fell about 0.1% in Asian trade. With markets now pricing out rate cuts in March and May, Asian units are likely to see more pressure in the coming weeks while the dollar is set to remain strong. Higher U.S. rates diminish the appeal of risk-heavy, high-yielding assets. U.S. inflation data for January, due next week, is set to offer more cues on the path of interest rates. Among Asian currencies, the Australian dollar was somewhat of an outlier, rising 0.1% and extending strong gains from the prior session after the Reserve Bank of Australia warned it could still hike rates further in the face of sticky inflation. The Japanese yen steadied after hitting a 1-½ month low earlier this week, amid continued uncertainty over the Bank of Japan’s plans to begin tightening policy. The Chinese yuan moved little, and also largely lagged its regional peers as concerns over China’s economic health persisted. While Chinese authorities announced a slew of measures to support local stock markets this week, they did little to address a sluggish economic recovery in the country. Chinese inflation data for January is due on Thursday, and is expected to provide little support to the yuan. The data also comes before the week-long Lunar New Year holiday. Most other Asian units kept to a tight range. The Singapore dollar and South Korean won both rose 0.1% after seeing some losses this week. Indian rupee firms ahead of RBI, Reuters poll sees some strength The Indian rupee rose 0.1% and managed to just break below the 83 level against the dollar. Focus was squarely on a Reserve Bank of India meeting this Thursday, where the central bank is expected to keep interest rates unchanged. But the RBI’s outlook on inflation and economic growth will be in close focus. A Reuters poll showed analysts expect the rupee to see some strength this year, amid continued support from the RBI. But the Indian currency remains close to record lows, having seen little strength despite stellar growth in the Indian economy over the past two years. https://www.investing.com/news/forex-news/asia-fx-steadies-as-dollar-dips-from-3mth-high-rate-fears-persist-3294743

2024-02-07 01:36

Copyrighted Image by: Reuters. Investing.com-- Oil prices settled higher, as fading hopes of a Gaza ceasefire agreement cooled concerns about potential supply disruptions in the Middle East, but gains were stifled by a larger than expected build in U.S. crude inventories. At 14:30 ET, Crude Oil WTI Futures futures settled up 0.8% to $73.86 per barrel. Gaza ceasefire dashed after Netanyahu rejects Hamas ceasefire deal Israel's Prime Minister Benjamin Netanyahu rejected a ceasefire deal proposed by Hamas, dashing hopes of a ceasefire deal that keeps the risk that the conflict could broaden in the oil-rich Middle East region and potentially disrupt crude supplies. Netanyahu said the demands proposed by Hamas were "delusional," and said there was a lack of commitment to negotiate from Hamas. The remarks come a day after U.S. Secretary of State Antony Blinken said that an agreement was still possible. US inventories jump much more than expected U.S. oil inventories jumped by roughly 5.5M barrels in the week ended Feb. 2, well above expectations for an increase of about only 1.7M barrels. Gasoline inventories, one of the products that crude is refined into, fell by roughly 3.2M barrels against expectations for a build of 140,000 barrels while distillate stockpiles fell by 3.2M barrels, compared to expectations for a drop of 1M barrels. The mixed petroleum report comes as U.S. oil output growth is forecast to slow, the EIA said Tuesday, after cutting its forecast for 2024 domestic production to 120,000 barrels per day to 170,000 bpd. https://www.investing.com/news/commodities-news/oil-prices-rise-with-gaza-ceasefire-us-production-in-focus-3294607

2024-02-06 22:11

Copyrighted Image by: Reuters Investing.com -- U.S. crude stockpiles increased by less than expected last week, the API reported Tuesday, boosting sentiment on crude following expectations for a slowing domestic output. Crude Oil WTI Futures, the U.S. benchmark, traded at $73.47 a barrel following the report after settling up 0.7% at $73.31 a barrel. U.S. crude inventories rose by about 674,000 barrels for the week ended Feb. 2, compared with a draw of about 2.5M barrels reported by the API for the previous week. Economists were expecting an increase of about 2.1M barrels. U.S. production has been recovering following a weather-related dip in January, but will likely slow from record levels in 2024, the Energy Information Agency said Tuesday as it cut its forecast for domestic oil output by 120,000 barrels per day to 170,000 bpd. The API data also showed that both gasoline inventories rose by about 3.7M, but distillate stockpiles fell by 3.7M barrels. The official government inventory report due Wednesday is expected to show weekly U.S. crude supplies decreased by about 2.1M barrels last week. https://www.investing.com/news/commodities-news/oil-inventories-rise-by-674000-barrels-last-week-api-3294533