2025-09-01 05:26
US dollar index hits 5-week low ahead of US data Robust figures could challenge current Fed rate cut expectations Trade policy and Fed independence still in focus Yuan underpinned by central bank fixings, Chinese stock rally Sept 1 (Reuters) - The dollar hit a 5-week low on Monday as investors looked ahead to a raft of U.S. labour market data this week that could affect expectations for the Federal Reserve's monetary easing path. Traders were also assessing Friday's U.S. inflation figures and a court ruling that most of Donald Trump's tariffs are illegal, as well as the U.S. president's ongoing tussle with the Fed over his attempt to fire Governor Lisa Cook. Sign up here. Money markets have recently priced an around 90% chance of a 25-basis-point Fed rate cut in September and around 100 bps of easing by autumn 2026, according to the CME FedWatch tool. Against a basket of currencies, the dollar eased 0.22% to 97.64 , after hitting 97.552, its lowest level since July 28. It clocked a monthly decline of 2.2% on Friday. Investors will be focussed on Friday's U.S. nonfarm payrolls report, which will be preceded by data on job openings and private payrolls. Analysts said the U.S. economy is no longer outperforming as it did for much of the past decade, justifying a weaker dollar, and further signs of a softening labour market are expected to bolster that narrative. "Severe weakness (in economic data) would point to an even more forceful Fed response than market pricing predicts, but if May/June weakness is revealed as a statistical mirage, rate cuts would seem unwarranted given the almost certain prospect of rising inflation over the next year or so," Societe Generale economist Klaus Baader said. Some analysts still see the chance of a 50-bp move by the Fed later this month. The euro was up 0.35% to $1.1724, while sterling edged 0.18% higher to $1.3528. U.S. markets are closed for a holiday on Monday. Political risks are in focus as the French government faces likely defeat in a confidence vote over plans for sweeping budget cuts. Analysts noted that such risks tend to weigh on the currency only when there are clear signs of contagion within the euro area, something that is not evident at the moment. Investors are keeping a close eye on trade policy while the U.S. continues negotiations with key trading partners. "We do not see much market impact from the court ruling," Jefferies economist Mohit Kumar said. "The matter would pass on to the Supreme Court which is likely to rule in favour of Trump." The greenback has also been weighed down by worries over Fed independence, as Trump steps up his campaign to exert more influence over monetary policy. "Fiscal dominance risks should be more clearly apparent in both higher long-end U.S. inflation break-evens and a higher risk discount on the dollar, none of which is materializing yet," George Saravelos, head of forex strategy at Deutsche Bank, said. "Fiscal dominance" refers to a scenario where central banks are pressured to ease monetary policy to help finance large budget deficits. The dollar was flat at 147.00 against the yen after a monthly decline of 2.5% in August. The onshore yuan steadied near Friday's roughly 10-month high and last stood at 7.1326 per dollar. The yuan has drawn support from firm central bank fixings in the onshore market and a buoyant domestic stock market, even as China's economy struggles to mount a solid recovery. China's factory activity in August expanded at the quickest pace in five months on the back of rising new orders, a private-sector survey showed on Monday, contrasting with an official survey released on Sunday that showed factory activity shrinking for the fifth straight month. https://www.reuters.com/world/africa/dollar-hits-lowest-since-end-july-ahead-us-jobs-data-2025-09-01/
2025-09-01 04:49
BEIJING, Sept 1 (Reuters) - A GCL Technology Holdings (3800.HK) , opens new tab official signalled in a call with investors on Sunday that more information on a plan to restructure China's polysilicon industry would be released soon. "We believe that clearer information should come out soon about the reform, and we will have a better grasp of how our future cash flow will go," GCL's Chief Financial Officer Yang Wenzhong said in response to a question about a proposed acquisition fund. He added it was "not 100 percent certain" that reform would happen this year. Sign up here. Yang said GCL may use some of its own cash to support the reform but did not yet know how much, so was being very careful in managing its funds. A previous proposal by GCL to restructure the industry, of which management did not provide further details in the meeting, would see GCL and other top producers buy up and shut down about one-third of the industry's capacity. Expectations are that would increase prices and the higher prices would be passed on to the loss-making solar panel industry downstream. Analysts have said it is unclear where the money would come from in the highly indebted industry, although banks were likely to be one source of financing for the restructuring. Yang also told investors GCL Technology would likely make a profit in August and September. Polysilicon spot prices have risen as Chinese regulators have signalled they would crack down on companies selling at overly low prices. GCL's losses for the first half of 2025, before the anti-price war movement, widened to 1.78 billion yuan ($249.6 million), the company reported on Friday. https://www.reuters.com/sustainability/boards-policy-regulation/chinas-gcl-expects-more-information-soon-polysilicon-restructuring-2025-09-01/
2025-09-01 04:36
Sept 1 (Reuters) - A look at the day ahead in European and global markets from Wayne Cole. It's been a resistant start to September with much of Asia in the red and Wall Street on holiday, leaving S&P 500 futures flat in what is typically a bad month for the market. European share futures have hardly budged, but China's market remains well supported by a tide of liquidity looking for a home in a low-yield world. Sign up here. Chinese blue chips (.CSI300) , opens new tab climbed more than 10% last month, helped in part by talk Beijing was pushing firms to develop a home-grown alternative to Nvidia's (NVDA.O) , opens new tab AI chips. Hong Kong shares of Alibaba (9988.HK) , opens new tab jumped almost 19% in the biggest one-day rise since early 2022 on optimism over its cloud business. There were also reports DeepSeek had opted for Huawei (HWT.UL) chips to train some of its AI models. That may have sparked some profit taking in Japanese chip group Advantest (6857.T) , opens new tab, which dived 9.1%, giving back some of the near-50% gains made in the past three months. AI-focused investor SoftBank Group (9984.T) , opens new tab also dropped 6% and contributed to a 2% loss for the Nikkei (.N225) , opens new tab. Chinese investors might also be encouraged that President Trump is running into legal challenges to his tariff policies. While the levies remain in place pending an assumed appeal to the Supreme Court sometime in October, the ruling could lead trading partners to drag their feet on negotiations with the White House. Indeed, of the trade "deals" supposedly already agreed, few if any have been signed or ratified - more concepts of a plan for a framework of a deal. Talks with Japan have hit a stumbling block over rice, while negotiations with South Korea are bogged down despite the recent leaders' meeting. Markets seem to be assuming the conservative majority on the Supreme Court will find a way for trump to keep the tariffs in place. Were the judges to actually uphold the appeals court ruling, then presumably many of the deals would be defunct and Trump's leverage for new ones greatly diminished. Treasury would also have to repay the more than $100 billion collected, which, since it is likely being spent, will have to be borrowed. Apart from it being a logistical nightmare, the money would go to the importers who paid the tariffs, not the American consumers who paid higher prices. Would the importers roll back any price hikes to pre-tariff levels, or keep them up to fatten margins? And what happens to the $3 trillion or more the taxes were supposed to bring in to cover tax cuts? Who knew trade law could be so much fun? Key developments that could influence markets on Monday: - European PMIs for August, EU unemployment for July - speech by ECB President Christine Lagarde. Appearances by ECB Board members Piero Cipollone and Isabel Schnabel https://www.reuters.com/world/china/global-markets-view-europe-2025-09-01/
2025-09-01 04:14
Metaplanet shares surged 760% in past year Metaplanet plans to sell up to 550 million shares for about $884 million Eric Trump named adviser to Metaplanet in March TOKYO, Sept 1 (Reuters) - Eric Trump is expected to attend a shareholder meeting of Japanese bitcoin treasury company Metaplanet (3350.T) , opens new tab in Tokyo on Monday, as the U.S. president's family expands its crypto ventures internationally. The second son of President Donald Trump was named in March as an adviser to Metaplanet, which holds more than $2 billion in bitcoin, and his attendance would follow an appearance last week at the Bitcoin Asia conference in Hong Kong. Sign up here. Metaplanet stockholders were asked to approve a plan that would sell up to 550 million new shares overseas for 130.3 billion yen ($884.41 million), with the bulk of the proceeds to be spent on buying more bitcoin. Three people who came out of the meeting held in the Shibuya area of central Tokyo said the capital-raising plan was approved, and that Eric Trump was due to speak at a fireside chat at the same venue later in the day. Metaplanet declined to comment on Eric Trump's involvement in the meeting, when Reuters contacted the company before the meeting began. A representative for him did not respond to requests for comment. Donald Trump has promised to be the "crypto president", saying he backs the asset class because it can improve the banking system and increase the dominance of the U.S. dollar. Some of Trump's businesses in areas such as crypto, which have added substantially to his wealth, benefit from U.S. policy shifts under him and have invited criticism. American Bitcoin, a miner of the cryptocurrency founded by Eric Trump and his brother Donald Trump Jr., is aiming to list on the Nasdaq this month. Asher Genoot, CEO of the company that presently holds 80% of American Bitcoin, said Eric Trump would attend the Metaplanet event, which was previously reported by Bloomberg. COSTUMES AND FOOD TRUCKS At the meeting venue, it was a festive scene, with people in costumes lined up at the entrance, food trucks assembled, and a K-Pop band due to perform. Media were not allowed to observe the meeting, which is due to run till late afternoon. Previously a hotel operator, Metaplanet's pivot into crypto has paid off handsomely. Citing Michael Saylor's bitcoin treasury firm Strategy MSTR.O , opens new tab as an inspiration, founder and chief executive Simon Gerovich liquidated most of Metaplanet's hotel assets, already in the doldrums due to the COVID-19 pandemic, and piled into the cryptocurrency. Selling bonds and warrants, Metaplanet has continued to buy bitcoin and is now the seventh-largest holder among public treasuries globally, according to BitcoinTreasuries.net. It announced on Monday it added another 1,009 coins to bring its total hoard to 20,000. Its shares have surged nearly 760% in the past 12 months, compared with a 14% advance in the Topix (.TOPX) , opens new tab. The stock was down 3.9% in Monday afternoon trading in Tokyo. Metaplanet appointed Eric Trump earlier this year to a newly formed board of advisers, calling him a "leading voice and advocate of digital asset adoption worldwide". The company, which trades on the Standard section of the Tokyo Stock Exchange, was previously known as Red Planet Japan and focused on hotel operations. Before that, it was a wholesaler of music CDs. The company's subsidiary, Red Planet Hotels Japan, filed for bankruptcy in May 2024. ($1 = 147.3300 yen) https://www.reuters.com/world/asia-pacific/eric-trump-advised-japanese-bitcoin-firm-metaplanet-vote-capital-raising-plan-2025-09-01/
2025-09-01 03:02
MUMBAI, Sept 1 (Reuters) - The Indian rupee is likely to remain under stress on Monday after falling past the 88-per-dollar barrier last week, with traders saying the move has emboldened speculators to press harder against the currency and keep downside risks alive. The 1-month non-deliverable forward suggests the rupee will open little changed from 88.1950 on Friday, when the currency sank to a record low of 88.3075. Sign up here. The rupee's slip past 88 on Friday surprised most market participants, who had expected the Reserve Bank of India to step in more forcefully following the imposition of additional U.S. tariffs last week. One banker said the RBI may have opted against defending the 88 level too aggressively in the wake of heavy equity outflows and dollar demand from speculators. Another suggested the central bank may have been signalling that it would not defend particular levels at any cost. Nearly $950 million of equity sales by foreign investors on Friday, coupled with heavy importer and speculative dollar demand, plus "macro considerations" may have led the RBI to allow the rupee to drop past 88, a senior treasury official at a mid-sized private sector bank said. With the breach behind it, the risk-reward on the rupee is now decisively skewed to the downside, he said. "The next focus for markets is identifying the level where the RBI signals it will not tolerate further losses." Meanwhile, India’s June-quarter GDP beat forecasts, though traders said the surprise is unlikely to aid the rupee. Madhavi Arora, lead economist at Emkay Global, said the upside reflected exceptionally soft deflators, front-loaded government spending and pre-tariff export frontloading, warning these supports may reverse in coming quarters. ASIA WEAK Most Asian currencies weakened at the beginning of the week, offering little support to the rupee. The focus this week is on a raft of U.S. labour data that will guide expectations for how deep the Federal Reserve cuts rates this year. Investors will parse U.S. job openings and private payrolls before Friday’s critical nonfarm payrolls data. https://www.reuters.com/world/india/rupee-likely-stay-under-pressure-after-breach-critical-88usd-mark-2025-09-01/
2025-09-01 02:35
MUMBAI, Sept 1(Reuters) - The Indian rupee, after falling to a lifetime low last Friday, will likely remain under pressure this week with U.S. tariffs and sluggish portfolio flows piling on the pressure, while government bonds brace for fiscal developments. The rupee hit an all-time low of 88.3075 against the U.S. dollar last Friday, sliding past the 88 mark — a level widely seen as an important technical support and likely to draw heavy intervention from the Reserve Bank of India. Sign up here. The rupee's drop past 88 followed Washington’s imposition of additional tariffs on India, a move expected to hurt portfolio flows, impact growth, and widen India's trade deficit. Foreign outflows from Indian equities have accelerated after the additional U.S. tariffs amid worries over slower earnings for export-oriented sectors and the macro outlook. "Till the uncertainties around US tariffs settle down, it will continue being a rupee-negative event," Dipti Chitale, CEO at Mecklai Financial Services, said. "We feel that Reserve Bank of India will let the rupee depreciate in the interest of maintaining competitiveness in the market." Meanwhile, India's 10-year benchmark 6.33% 2035 bond yield settled at 6.5678% on Friday, up 2 basis points through Friday, after rising 15 bps in the previous week. Traders anticipate the yield will remain in the 6.52% to 6.65% band this week, with major focus on developments in New Delhi's fiscal picture as well as a meeting of the goods and services tax council towards the end of the week. "Monetary policy has already played its role and has limited fire power left, but the fiscal should act now and calm markets," said Niraj Kumar, chief investment officer at Generali Central Life Insurance. Bond market sentiment has weakened on fears of fiscal slippage after Prime Minister Narendra Modi unveiled sweeping goods and services tax reforms on August 15. India plans to slash the levy by October and has proposed a move to a two-rate structure of 5% and 18%, scrapping the 12% and 28% rates in place currently. The GST council will meet on Wednesday and Thursday. Meanwhile, India's economy unexpectedly expanded 7.8% year-on-year in the April-June quarter, picking up from 7.4% in the previous three months. Economists polled by Reuters had forecast growth likely cooled to 6.7%. "Going forward, we could see some slowdown in the second quarter due to spillovers from the tariff impact. For now, our full-year GDP growth estimate for FY26 is retained at 6.3%, with a downward bias," Sakshi Gupta, principal economist at HDFC Bank said. KEY EVENTS: India ** August HSBC manufacturing PMI - September 1, Monday (10:30 a.m.) ** August HSBC services PMI - September 3, Wednesday (10:30 a.m.) U.S. ** August S&P Global manufacturing PMI final - September 2, Tuesday (7:15 p.m. IST) ** August ISM manufacturing PMI - September 2, Tuesday (7:30 p.m. IST) ** July factory orders - September 3, Wednesday (7:30 p.m. IST) ** July international trade - September 4, Thursday (6:00 p.m. IST) ** Initial weekly jobless claims for week to August 25 - September 4, Thursday (6:00 p.m. IST) ** August S&P Global composite PMI final - September 4, Thursday (7:15 p.m. IST) ** August S&P Global services PMI final - September 4, Thursday (7:15 p.m. IST) ** August ISM non-manufacturing PMI - September 4, Thursday (7:30 p.m. IST) ** August non-farm payrolls and unemployment rate - September 5, Friday (6:00 p.m. IST) https://www.reuters.com/world/india/rupee-may-weaken-further-tariffs-outflows-bonds-eye-fiscal-clarity-2025-09-01/
