2024-01-22 05:17

Copyrighted Image by: Reuters. Investing.com-- Most Asian currencies moved little on Monday, while the dollar ticked lower before a slew of key economic cues due this week, with the Japanese yen firming from near two-month lows in anticipation of a Bank of Japan meeting. Concerns over China also kept sentiment towards Asian markets largely muted, after the People’s Bank of China held its benchmark loan prime rate at record lows earlier in the session. The central bank has limited headroom to loosen policy further, as it struggles to strike a balance between supporting an economic recovery and preventing more yuan weakness. The yuan moved little in onshore trade, while the offshore yuan crossed the 7.2 level to the dollar. The dollar was hit with some profit-taking after a strong start to the year, with the outlook for the greenback looking robust as traders began pricing in a greater possibility of higher-for-longer U.S. interest rates. This notion weighed on most Asian currencies over the past few weeks. Japanese yen rises, BOJ set to maintain ultra-dovish policy The yen was among the worst-hit by expectations of high U.S. rates, but saw some strength on Monday, rising 0.2% from its weakest levels since late-November. Focus was chiefly on the conclusion of a BOJ meeting on Tuesday, where the central bank is widely expected to maintain negative interest rates and its yield curve control mechanisms. Analysts expect little changes to the BOJ’s stance, especially amid increased uncertainty over the Japanese economy after a devastating earthquake at the beginning of the year. Softening inflation and sluggish wage growth is also expected to put little pressure on the BOJ to consider tightening policy. Beyond the BOJ meeting, focus this week is also on Tokyo consumer inflation for January, which is expected to reflect any inflationary impacts from the new year earthquake. Broader Asian currencies were muted as they nursed losses from a weak start to the year. The Australian dollar steadied after sinking to a two-month low, while the South Korean won lost 0.2% and remained in sight of a near three-month low. South Korean GDP data for the fourth quarter is also due this Thursday. The Singapore dollar steadied near two-month lows ahead of key inflation data later this week. The Indian rupee moved little, with local markets closed for a special holiday to mark the inauguration of a controversial temple in North India. But traders remained on edge over any potential communal violence rising from the inauguration, given that the topic is a major point of contention for Hindu-Muslim relations. Dollar edges lower before GDP, inflation data The dollar index and dollar index futures both fell 0.1% in Asian trade, retreating further from recent one-month highs amid profit-taking. The CME Fedwatch tool showed that markets were now pricing in a greater chance for no changes to U.S. interest rates in March- a drastic reversal from earlier expectations for a cut. Such a scenario bodes well for the dollar. Focus this week is on more cues from the world’s largest economy, particularly on fourth-quarter GDP which is expected to show cooling growth. More cues on inflation are also due this week with PCE price index data- which is the Fed’s preferred inflation gauge- due this Friday. Any signs of sticky inflation give the bank more impetus to keep rates higher for longer. The Fed is widely expected to keep rates steady when it meets next week. Upgrade your investing with our groundbreaking, AI-powered InvestingPro+ stock picks. Use coupon INVSPRO2024 to avail a limited time discount on our Pro and Pro+ subscription plans. Click here to know more, and don't forget to use the discount code when checking out! https://www.investing.com/news/forex-news/asia-fx-muted-before-more-economic-cues-yen-firms-with-boj-on-tap-3279108

2024-01-22 02:47

Copyrighted Image by: Reuters. NEW YORK - Gold prices saw a marginal increase today, with spot gold trading at $2,030.87 per ounce. The uptick in the precious metal's value coincided with a slight decrease in the dollar index of 0.1%, which often inversely correlates with gold prices. The modest rise in gold prices follows a period of decline over the past week, which analysts attribute to statements from Federal Reserve officials. These officials have emphasized the importance of additional inflation data before deciding on future interest rate adjustments. The market's anticipation of a rate cut by the Fed in March has since diminished, with the likelihood now standing at 55%. In a broader economic context, consumer sentiment has notably improved, hitting its highest mark since mid-2021. This surge in optimism among consumers could potentially influence spending and investment behaviors, which in turn might impact gold markets and other financial sectors. Investors often turn to gold as a hedge against inflation and currency devaluation, making the Federal Reserve's interest rate decisions a crucial factor for the precious metal's performance. As the market continues to digest the Fed's cautious stance on monetary policy, gold futures have also experienced a rise, reflecting investors' ongoing interest in the asset as a safe haven. With the current economic indicators and the Fed's forthcoming policy decisions, market participants will be closely monitoring the impact on gold prices in the weeks to come. https://www.investing.com/news/commodities-news/gold-prices-edge-up-as-dollar-softens-93CH-3279062

2024-01-22 01:48

Copyrighted Image by: Reuters Investing.com -- Oil prices settled higher Monday, starting the week on the front foot after Ukraine reportedly attack a key export terminal in Russia, adding fresh concerns about supply disruptions at time when Middle East tension remain front and center. By 14:30 ET (19.30 GMT), the U.S. crude futures settled 2.4% to $75.19 a barrel and the Brent contract settled 1.9% at $80.06 a barrel. Fresh supply disruptions provide support Ukraine allegedly carried out a drone attack on a major Russian fuel export terminal over the weekend. Russian energy company Novatek said it had been forced to suspend some operations at the site due to a fire, Reuters reported. The suspension of operations at Russian export terminal added to ongoing concerns about supply disruptions as conflict in the oil-rich Middle East - amid the ongoing war between Israel and Hamas -- has widened. The Yemen-based Houthi militants continue to threaten shopping into the Gulf of Aden, a crucial artery for shipping between Europe and Asia, while Iran and Pakistan are now in violent conflict. Weather conditions weigh on US output The cold snap that swept through some regions of the U.S. has hampered oil domestic oil production, with North Dakota oil output estimated to decline by 250,000 to 300,000 barrels per day. North Dakota, which produced about average of 1 million barrels of oil per day in 2022, is the third largest crude-producer in the U.S. Still, the oil demand outlook remains in questions amid ongoing concerns about slowing global growth keeping a lid on oil consumption. Demand concerns remain prominent However, gains have been limited by concerns over a near-term slowdown in demand, with signs of a sluggish economic recovery in China being a major point of contention. The world’s largest oil importer saw underwhelming growth in the fourth quarter. European growth is also difficult to find, while severe cold weather across the U.S. caused more disruptions and also limited travel in large parts of the country, pointing to weaker demand in the world’s largest fuel consumer. This notion was also exacerbated by a string of weekly builds in U.S. oil product inventories. Upgrade your decision-making with InvestingPro+! Using discount code “INVEST2024” receive an additional 10% off the InvestingPro+ yearly subscription. Click here and don't forget the discount code. https://www.investing.com/news/commodities-news/oil-prices-hitch-ride-on-fresh-supply-concerns-to-settle-higher-3279055

2024-01-22 01:48

Copyrighted Image by: Reuters Investing.com-- Oil prices fell in Asian trade on Monday, reversing some of last week’s gains amid persistent concerns that crude demand will slow in the coming months, while anticipation of several key economic events also kept markets on edge. Severe cold weather across the U.S. caused more disruptions and also limited travel in large parts of the country, pointing to weaker demand in the world’s largest fuel consumer. This notion was also exacerbated by a string of weekly builds in U.S. oil product inventories. Concerns over a near-term slowdown in demand have stymied any major gains in oil prices this year, with signs of a sluggish economic recovery in China being a major point of contention. The world’s largest oil importer saw underwhelming growth in the fourth quarter. Demand fears saw traders largely look past potential disruptions in Russian fuel exports. Energy firm Novatek said it had suspended some operations at a major Baltic Sea fuel export terminal after an alleged Ukrainian drone attack, Reuters reported. Brent oil futures expiring in March fell 0.5% to $78.21 a barrel, while West Texas Intermediate crude futures fell 0.3% to $73.04 a barrel by 20:10 ET (01:10 GMT). While both contracts clocked mild gains last week, they were largely muted so far in 2024 after falling over 10% each in 2023. Crude prices had taken little support from fears of supply disruptions in the Middle East, even as the Israel-Hamas war escalated and appeared to be spilling over into other parts of the region. But the conflict had so far had no tangible impact on oil supplies from the region. Oil markets are expected to remain well-supplied in the first half of 2024, amid record-high U.S. output and limited production cuts from the Organization of Petroleum Exporting Countries. Central banks, key economic readings awaited Traders were now waiting on several major central bank meetings and economic readings over the coming weeks for more cues. The Bank of Japan is set to meet on Tuesday and is widely expected to maintain its ultra-dovish policy. But analysts warned of any potential hawkish surprises from the BOJ, especially any changes to its yield curve control policies. The European Central Bank is set to meet later this week and is likely to reiterate its higher-for-longer outlook for interest rates, which bodes poorly for economic activity in the bloc. The euro zone is already grappling with a recession in its biggest economies, amid dwindling economic growth. Fourth-quarter U.S. gross domestic product data is also on tap later this week, and will be closely watched for cues on the world’s largest fuel consumer. Strength in the U.S. economy gives the Federal Reserve more headroom to keep interest rates higher for longer- a scenario that is expected to weigh on economic activity and oil demand in 2024. The Federal Reserve is set to meet next week, and is expected to keep interest rates on hold. Upgrade your investing with our groundbreaking, AI-powered InvestingPro+ stock picks. Use coupon INVSPRO2024 to avail a limited time discount on our Pro and Pro+ subscription plans. Click here to know more, and don't forget to use the discount code when checking out! https://www.investing.com/news/commodities-news/oil-prices-edge-lower-as-demand-concerns-persist-more-economic-cues-awaited-3279055

2024-01-21 23:15

Copyrighted Image by: Reuters. The cryptocurrency Bitcoin is facing a challenging period as it strives to maintain stability above the critical $40,000 support level. After a surge in value following the approval of a Bitcoin exchange-traded fund (ETF), the digital currency has seen its gains diminish, with its price currently standing at $41,743. This represents a slight decrease on the day and a more significant drop over the past week. Investors and market spectators are paying close attention to Bitcoin's performance, particularly as it hovers near this pivotal price point. The initial enthusiasm that emerged with the ETF launch has not had a lasting effect on Bitcoin's valuation, contrary to what some market participants might have expected. Despite the present bearish trends, some analysts remain hopeful about Bitcoin's future, especially with the approaching halving event in April. Historically, such events have led to bullish market sentiment, and there is anticipation to see if the upcoming halving will catalyze another upward trajectory for the cryptocurrency. The market's focus now shifts from the short-lived ETF excitement to the potential impact of the halving. This event, which occurs approximately every four years, reduces the reward for mining new blocks of Bitcoin by half, effectively limiting the supply and potentially increasing the price if demand remains constant. The long-term growth prospects for Bitcoin continue to be a topic of debate among analysts. While some are optimistic, citing the scarcity induced by the halving as a positive price driver, others remain cautious due to the volatile nature of the cryptocurrency market. As Bitcoin approaches this critical juncture, its ability to hold above the $40k support level is seen as a key indicator of its near-term trajectory. https://www.investing.com/news/cryptocurrency-news/bitcoin-struggles-to-hold-40k-support-level-after-etfinduced-rally-fades-93CH-3279038

2024-01-21 23:06

Copyrighted Image by: Reuters LONDON - The leading smart contract platform Ethereum is currently grappling with significant scalability issues, as highlighted by Crypto Rand, a respected voice in the cryptocurrency community. Ethereum's high transaction fees, which can average close to $5, are posing a substantial barrier to the broader adoption and efficiency of decentralized applications (dApps). In stark contrast, Layer 2 solutions such as Optimism are emerging as viable alternatives by offering significantly lower transaction costs, sometimes even below $0.01. These solutions are designed to enhance the Ethereum network by providing faster processing times and reduced fees, all while ensuring compatibility with the existing Ethereum ecosystem. Despite the hurdles presented by higher fees, Ethereum continues to hold its ground as the preeminent platform for smart contracts. Its sustained position is largely attributed to the strong network effect it has cultivated over time and the vibrant community of developers dedicated to its growth and improvement. Layer 2 platforms like Optimism are not just complementary technologies but are increasingly seen as critical for the evolution of Ethereum. They are poised to play a pivotal role in resolving the scalability challenges, enabling Ethereum to maintain its leadership in the space by aligning cost and performance with user expectations and the demands of an expanding dApp marketplace. https://www.investing.com/news/cryptocurrency-news/ethereum-faces-scalability-hurdles-as-high-fees-challenge-dapp-adoption-93CH-3279037