2025-08-18 06:21

LONDON, Aug 18 (Reuters) - News that Chinese battery giant Contemporary Amperex Technology (CATL) (300750.SZ) , opens new tab has suspended operations at its giant Jianxiawo mine has lit a fire under the lithium market. The CME lithium carbonate contract has surged by 27% since the start of August, breaking a long-running downtrend, with the bull momentum sweeping through the shares of listed producers. Sign up here. The market reaction is not irrational. Jianxiawo is China's largest lithium mine and even CATL's anticipated three-month suspension will make a significant dent in a massively over-supplied market. Nor is it the only Chinese producer in the lithium hub of Yichun facing heightened bureaucratic scrutiny. But the price surge looks over-exuberant. Any underlying market signal has been swamped by speculative excess on China's Guangzhou Futures Exchange. Guangzhou only started trading lithium carbonate futures in July 2023 but has muscled out the Wuxi Stainless Steel Exchange as China's primary price reference point for the battery metal. Wuxi was a problematic indicator of China's physical lithium market and Guangzhou is now also battling to contain a speculative frenzy. Guangzhou's lithium contract notched up turnover of nearly 24 million lots in July, far exceeding the previous monthly record, while open interest climbed to an all-time high of 699,164 lots. Trading activity in the options contract mushroomed from 2.9 million lots in June to 8.6 million last month. The exchange's volume figures denote both buy and sell transactions but, even allowing for this double-count, July's turnover was many multiples the size of a global market that is growing fast but still only amounts to around 1.6 million tons each year. The Guangzhou exchange implemented position limits, specifically targeting non-exchange members, at the end of July after the September contract had traded limit-up on two consecutive days. The measures seemed to be damping down the speculative heat until CATL made its announcement on August 11, at which stage the bull flames erupted again with the lithium price again going limit-up over the next two days. While some market participants, particularly industrial players, may have been aware of CATL's licence problems, the price volatility in itself has acted as a magnet for local speculators chasing the next big thing. Such crowd surges are commonplace in the Chinese commodities futures landscape and have the same effect as a giant momentum fund feeding on a fast-moving market. Last month's price action on the Guangzhou lithium contract was "a masterclass in sentiment-driven volatility," according to Paul Lusty, Head of Battery Raw Materials at price assessment agency Fastmarkets. Fastmarkets' view is that "beneath the surface demand remains tepid, inventories high and buyers cautious, underscoring a disconnect between price action and market reality." How much has actually changed in the wake of CATL's confirmation it needs to reapply for its expired mining licence? Chinese speculators are betting that it is symptomatic of a change in government policy. Beijing has taken aim at what it calls "disorderly price competition" with state media amplifying the attack on involution, a now-popular reference to competition so fierce it becomes self-destructive. Lithium is not the only market to have interpreted this as presaging a broader clamp-down on chronic excess capacity in China's industrial base. There have been equally exuberant rallies in steel, coal and polysilicon, a building-block for the over-heating solar panel sector. Whether this is really a new dawn for the bombed-out lithium price remains to be seen. The focus of the market, particularly in China, will be on whether CATL gets its new mining licence and what happens to the other producers clustered in Yichun. All of them are under scrutiny for possible discrepancies between their licensed mining rights and actual extraction rates, according to consultancy Project Blue. In a market that has been weighed down by excess production capacity, any sign of producer restraint, whether voluntary or involuntary, is a price positive. However, just how positive is going to depend on the Chinese speculators massing in the Guangzhou lithium market. The exchange's lithium futures contract has already recorded over 12 million trades so far in August. The speculative froth is still there. The opinions expressed here are those of the author, a columnist for Reuters. https://www.reuters.com/markets/commodities/lithiums-rally-is-super-charged-with-speculative-spice-2025-08-18/

2025-08-18 06:07

Aug 18 (Reuters) - Amsterdam-based cryptocurrency service provider Amdax plans to launch a bitcoin treasury company called AMBTS (Amsterdam Bitcoin Treasury Strategy) on the Dutch stock exchange, Amdax said on Monday. WHY IT'S IMPORTANT: Sign up here. Amdax's plans highlight the growing appeal of bitcoin, which has hit record highs this month. KEY QUOTE: "With now over 10% of bitcoin supply held by corporations, governments and institutions, we think the time is right to establish a bitcoin treasury company with the aim to obtain a listing on Euronext Amsterdam, as one of the leading exchanges in Europe," said Amdax CEO Lucas Wensing. BY THE NUMBERS: Bitcoin has risen nearly 32% so far in 2025, reaching record highs, on the back of regulatory victories for the sector following President Donald Trump's return to the White House. Trump has called himself the "crypto president" and his family has made a series of forays into the sector over the past year. Amdax and AMBTS plan to raise capital from a number of private investors in an initial financing round, and the long-term ambition of AMBTS is to own at minimum 1% of all bitcoin over time. https://www.reuters.com/business/dutch-crypto-firm-amdax-aims-launch-bitcoin-treasury-company-euronext-2025-08-18/

2025-08-18 05:48

Q2 GDP growth at 2.8% y/y vs forecast of 2.5% 2025 growth forecast narrowed to 1.8% to 2.3% from 1.3% to 2.3% Growth to slow in second half due to U.S. tariffs BANGKOK, Aug 18 (Reuters) - Thailand's economy expanded faster than expected in the second quarter on strong export growth ahead of U.S. tariffs taking full effect, but momentum is likely to slow over the rest of the year, the state planning agency said on Monday. Southeast Asia's second-largest economy grew 2.8% in the April-June quarter from a year earlier, the National Economic and Social Development Council said , opens new tab, beating a Reuters poll forecast of 2.5%, but still below the 3.2% annual increase in the first three months. Sign up here. The economy grew 3% annually in the first half, and the council adjusted its full-year forecast to 1.8% to 2.3%, from an earlier estimate of 1.3% to 2.3%. "Exports and manufacturing improved, along with clarity over reciprocal tariffs, so the Thai economy should expand more than our projections in May," the council's head, Danucha Pichayanan, told a news conference. The U.S. tariff on Thai imports has been set at 19%, in line with , opens new tab regional peers. "Growth should be good in the remainder (of the year), but will be lower than the previous two quarters," Danucha added. Last year's annual growth of 2.5% lagged other countries in the region. The council raised its 2025 export growth forecast to 5.5% from 1.8%, after a 15% year-on-year rise in the first half, driven by shippers racing to beat U.S. tariffs. However, exports are expected to taper in the second half. The United States was Thailand's biggest export market last year, accounting for 18.3% of total shipments, with a value of $55 billion, but there are still uncertainties relating to tariffs on transshipments , opens new tab via Thailand from third countries. Kobsidthi Silpachai, head of Capital Markets Research at Kasikornbank, said he predicts a final growth rate of just 1.5% for 2025. "Growth is seen to decelerate markedly post the sugar high of exports front loading," he said, adding that waning tourist numbers and household debt would also weigh heavily on the economy. The NESDC on Monday also lowered its forecast for foreign tourist arrivals this year by 10% to 33 million. On Friday, parliament passed the government's 3.78 trillion baht ($116.6 billion) budget bill for the 2026 fiscal year starting on October 1, which is expected to boost economic activity. The central bank last week also cut its key interest rate , opens new tab by a quarter point to a near three-year low of 1.50%, with more easing expected later this year. ($1 = 32.42 baht) https://www.reuters.com/world/asia-pacific/thailands-q2-growth-beats-forecast-faces-slowdown-h2-tariffs-2025-08-18/

2025-08-18 05:47

MUMBAI, Aug 18 (Reuters) - The Indian rupee rose on Monday, with traders pointing to upbeat risk appetite after Prime Minister Modi announced sweeping tax cuts and on fading risks following the Trump-Putin meeting. The rupee was quoting at 87.3925 to the U.S. dollar at 11.10 a.m. IST, up from 87.55 on Thursday. Sign up here. India's financial markets were shut for a local holiday on Friday. "The (dollar/rupee) pair feels heavier, with sellers more active. The thing is that now it's difficult to see a big up move here and that has probably allowed a pick up in offers," a currency trader at a bank said. "I am keeping 87.20 - the 21-day moving average - on the radar for the downside." Prime Minister Narendra Modi’s planned tax cuts have been a key boost for the rupee and prompted a rally in Indian equities. The measures could help revive foreign portfolio flows, which have been negative of late amid concerns over higher U.S. tariffs on Indian goods, traders said. Those worries have likely waned a bit after the Trump–Putin meeting in Alaska on Friday, where the U.S. president said no additional sanctions would be imposed on Russia for now. Analysts noted that the signal could be considered a modest positive for the rupee, considering how India has been singled out by Trump for its oil purchases from Russia. The rupee’s near-term trajectory is seen hinging on U.S. trade policy towards India, with Trump’s additional 25% tariffs scheduled to take effect next Wednesday. Hopes of averting the tariffs dimmed after Washington cancelled a planned August 25–29 visit by trade negotiators to New Delhi. https://www.reuters.com/world/india/rupee-climbs-tax-cuts-boost-fading-risks-2025-08-18/

2025-08-18 05:43

Investors still eyeing September Fed cut Zelenskiy flies to Washington on Monday to meet Trump Focus on Fed's Jackson Hole symposium for rate clues SINGAPORE, Aug 18 (Reuters) - The dollar steadied on Monday ahead of a key meeting between U.S. President Donald Trump and his Ukrainian counterpart Volodymyr Zelenskiy, while investors also looked ahead to the Federal Reserve's Jackson Hole symposium for more policy clues. Currency moves were largely subdued in the Asia session, though the dollar halted its fall from last week as traders further pared bets on a jumbo Fed cut next month. Sign up here. The euro was little changed at $1.1704, while sterling edged up 0.1% to $1.3563. Against a basket of currencies, the dollar stabilised at 97.85, after losing 0.4% last week. Markets are now pricing in an 84% chance the Fed would ease rates by a quarter point next month, down from 98% last week, after a raft of data including a jump in U.S. wholesale prices last month and a solid increase in July's retail sales figures dimmed the prospect of an oversized 50-basis-point cut. "While the data don't all point in the same direction, the U.S. economy looks to be in okay shape in the third quarter," said Bill Adams, chief economist at Comerica Bank. "The Fed is likely to cut interest rates by year-end, either in September, when markets now price in a cut, or a few months later, when Comerica forecasts a cut." The main event for investors on Monday is a meeting between Trump and Zelenskiy, who will be joined by some European leaders, as Washington presses Ukraine to accept a quick peace deal to end Europe's deadliest war in 80 years. Trump is leaning on Zelenskiy to strike an agreement after he met Kremlin chief Vladimir Putin in Alaska and emerged more aligned with Moscow on seeking a peace deal instead of a ceasefire first. Also key for markets this week will be 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. "I think (Powell) will also talk about the current economic conditions in the U.S., and that will be more policy relevant, that will be more interesting to markets," said Joseph Capurso, head of international and sustainable economics at Commonwealth Bank of Australia. "Given market pricing is very high for a rate cut in September, I think the risk is that Powell is hawkish, or is perceived to be hawkish, if he gives a balanced view of the U.S. economy." In other currencies, the dollar rose 0.14% against the yen to 147.37 , after falling roughly 0.4% last week. Japan's government on Friday brushed aside rare and explicit comments from U.S. Treasury Secretary Scott Bessent who said the Bank of Japan was "behind the curve" on policy, which appeared to be aimed at pressuring the country's central bank into raising interest rates. The Australian dollar was up 0.17% at $0.6519, while the New Zealand dollar rose 0.25% to $0.5940, after falling 0.5% last week. In cryptocurrencies, bitcoin halted its towering rally and eased from a record high. It last traded 1.7% lower at $115,700.39. Ether similarly slid 3% to $4,334.81, after hitting its highest in nearly four years last week. "The widespread adoption by institutional investors of crypto ETFs and the recent rally of ETH due to rapid buying by digital asset treasuries is giving a lot of confidence to the crypto and equities markets," said Leon Yee, chairman of Duane Morris & Selvam. "If you add the Fed rate cut that is bound to happen sometime this year, I think the party will continue," he said, referring to the rally in crypto. https://www.reuters.com/world/middle-east/dollar-braces-busy-week-geopolitics-fed-speak-2025-08-18/

2025-08-18 05:34

Asian stock markets : Nikkei makes new high, EU and Wall St futures edge up Oil market wary as Zelenskiy goes to Washington Dollar on defensive ahead of Fed conference SYDNEY, Aug 18 (Reuters) - Share markets pushed ahead in Asia on Monday ahead of what is likely to be an eventful week for U.S. interest rate policy, while oil prices were subdued as risks to Russian supplies seemed to fade a little. A cautiously risk-on mood saw indices in Japan and Taiwan make record peaks, while Chinese blue chips reached their highest in 10 months. Sign up here. U.S. President Donald Trump now seemed more aligned with Moscow on seeking a peace deal with Ukraine instead of a ceasefire first, after meeting Russian President Vladimir Putin in Alaska on Friday. Trump will meet Ukrainian President Volodymyr Zelenskiy and European leaders later on Monday to discuss the next steps, though actual proposals are vague as yet. The major economic event of the week will be the Kansas City Federal Reserve's August 21-23 Jackson Hole symposium, where Chair Jerome Powell is due to speak on the economic outlook and the central bank's policy framework. "Chair Powell will likely signal that risks to the employment and inflation mandates are coming into balance, setting up the Fed to resume returning policy rate to neutral," said Andrew Hollenhorst, chief economist at Citi Research. "But Powell will stop short of explicitly signalling a September rate cut, awaiting the August jobs and inflation reports," he added. "This would be fairly neutral for markets already fully pricing a September cut." Markets imply around an 85% chance of a quarter-point rate cut at the Fed's meeting on September 17, and are priced for a further easing by December. The prospect of lower borrowing costs globally has underpinned stock markets and Japan's Nikkei (.N225) , opens new tab climbed 0.9% to a fresh record high. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) , opens new tab added 0.5%, having hit a four-year top last week. Chinese blue chips (.CSI300) , opens new tab jumped 1.3%, bringing gains so far this quarter to over 8%. EUROSTOXX 50 futures and DAX futures firmed 0.2%, while FTSE futures gained 0.3%. SOLID EARNINGS S&P 500 futures nudged up 0.1% while Nasdaq futures added 0.2%, with both near all-time highs. Valuations have been underpinned by a solid earnings season as S&P 500 EPS grew 11% on the year and 58% of companies raised their full-year guidance. "Earnings results have continued to be exceptional for the mega-cap tech companies," noted analysts at Goldman Sachs. "While Nvidia has yet to report, the Magnificent 7 apparently grew EPS by 26% year/year in 2Q, a 12% beat relative to consensus expectation coming into earnings season." This week's results will provide some colour on the health of consumer spending with Home Depot, Target, Lowe's and Walmart all reporting. In bond markets, the chance of Fed easing is keeping down short-term Treasury yields while the longer end is pressured by the risk of stagflation and giant budget deficits, leading to the steepest yield curve since 2021. European bonds also have been pressured by the prospect of increased borrowing to fund defence spending, pushing German long-term yields to 14-year highs. Wagers on more Fed easing have weighed on the dollar, which dropped 0.4% against a basket of currencies last week to last stand at 97.851 . The dollar was a fraction firmer on the yen at 147.41 , while the euro held at $1.1704 after adding 0.5% last week. The dollar has fared better against its New Zealand counterpart as the country's central bank is widely expected to cut rates to 3.0% on Wednesday. In commodity markets, gold bounced 0.5% to $3,343 an ounce after losing 1.9% last week. Oil prices struggled as Trump backed away from threats to place more restrictions on Russian oil exports. Brent dropped 0.1% to $65.78 a barrel, while U.S. crude steadied at $62.73 per barrel. https://www.reuters.com/world/china/global-markets-wrapup-3pix-2025-08-18/