2025-08-26 06:00

Japan could invest in chips, antibiotics, rare earths in US, Lutnick says Japan's Akazawa to visit U.S. to seal investment returns split, source says Tokyo wants Trump orders to cut tariffs on Japanese goods soon TOKYO, Aug 26 (Reuters) - The United States will make an announcement this week on Japan's $550 billion investment in the U.S., Commerce Secretary Howard Lutnick said, with a top Japanese trade envoy planning to visit Washington to formalise the package. "The Japanese agreement, which we're going to announce later this week, that's $550 billion at the hand of Donald Trump," Lutnick told the Ingraham Angle show on Fox News on Monday night. Sign up here. The Japanese funds could be used for the manufacturing of products such as semiconductors, antibiotics or rare earths in the U.S., Lutnick added. Tokyo's top trade negotiator Ryosei Akazawa plans to visit the U.S. this week to craft a written confirmation on the financial details of the package, such as the split of investment returns between the U.S. and Japan, a government source close to the negotiations told Reuters. Washington and Tokyo agreed in July to set a reduced 15% tariff on imports from Japan in exchange for a $550 billion package of U.S.-bound investment through government-backed loans and guarantees, but details of its contents remain obscure. While Trump has touted the package as "our money to invest" and said the U.S. would retain 90% of the profits earned, Japanese officials have stressed that the investments will be determined based on whether they will also benefit Japan. SoftBank Group's (9984.T) , opens new tab $2 billion investment in Intel (INTC.O) , opens new tab announced last week was not part of the package at the moment, a Japanese government source has said. Akazawa, speaking at a regular Tuesday briefing, said his next U.S. trip was not decided and declined to comment on Lutnick's remarks. Tokyo will keep pressing Washington to implement the deal to cut U.S. tariffs on Japanese goods soon, he added. The U.S. has urged Japan to have a written agreement on the investment plans, but Japan would prefer to keep the deal less legally-binding, the Nikkei business daily reported earlier on Tuesday. The lack of a clear document on the trade agreement had created confusion in Tokyo about tariff rates until Lutnick and U.S. Treasury Secretary Scott Bessent clarified earlier this month that Japanese goods were exempt from overlapping levies and an earlier presidential order would be amended. Lutnick and Bessent also promised, during Akazawa's previous visit on August 7, that Trump would issue another order to lower tariffs on Japanese cars to 15% from 27.5%, but did not specify when. Japanese Prime Minister Shigeru Ishiba has said Tokyo did not seek a written trade agreement with Washington because it wanted a swift resolution and to ensure Trump's tariffs on key Japanese exports such as autos were lowered quickly. Ishiba's support rate has surged in recent polls thanks in part to the trade deal, even after his ruling coalition lost its majority in an upper house election last month. https://www.reuters.com/business/lutnick-says-update-japans-550-billion-us-investment-coming-this-week-2025-08-26/

2025-08-26 05:45

BEIJING, Aug 26 (Reuters) - China will tighten its carbon trading market by introducing absolute emissions caps in some industries for the first time starting by 2027, the cabinet said on Monday evening. The caps will be implemented first in industries with relatively stable carbon emissions by 2027, according to a statement by the State Council and Central Committee of the Communist Party. By 2030, China's nationwide carbon market or emissions trading scheme (ETS) will be basically established. Sign up here. "Policymakers are now actively tightening the system," said Xuewan Chen, senior research analyst at LSEG. The national carbon market, which would replace the current system of eight pilot markets launched in 2021, would have absolute emissions caps and a combination of free and paid carbon emissions allowances (CEAs), the statement said. Currently, CEAs are based on carbon intensity benchmarks that are reduced over time, rather than absolute emissions caps. Firms are granted a quota of free CEAs and if actual emissions exceed a company's quota during a given compliance period, it must buy more allowances from the market to cover the gap. If its emissions are lower, it can sell its surplus CEAs. "The (cabinet) document provides much-needed transparency for the development timeline for China's carbon markets," said Mai Duong, Asia-Pacific carbon markets analyst with Veyt, adding it showed China considered carbon markets "the key tool" in meeting its decarbonisation goals. The ETS will expand by 2027 to basically cover major carbon emitting industries, the statement said, without detailing the specific industries. Analysts have said chemicals, petrochemicals, papermaking and domestic aviation would be among those included in China's scheme. The regulation also broadens market participation to banks and financial institutions, which will help increase liquidity, Duong said. In September last year China said it would broaden the carbon market beyond the power sector to include steel, cement and aluminium - which would cover about 60% of the country's greenhouse gas emissions. But analysts said the large amount of free allowances means that the market has so far had little effect on China's carbon emissions. "It is positive that China now has a clear timeline for the full scope expansion – but whether this will deliver significant effectiveness in reducing the country’s giant emissions remains to be seen," Duong said. https://www.reuters.com/sustainability/climate-energy/chinas-carbon-market-introduce-absolute-emissions-caps-2027-2025-08-26/

2025-08-26 05:43

Focus on US PCE data due on Friday SPDR Gold Trust holdings rose 0.2% on Monday Aug 26 (Reuters) - Gold touched a two-week high on Tuesday, as the dollar slipped after U.S. President Donald Trump said he was removing Federal Reserve Governor Lisa Cook, a move that undermines confidence in U.S. assets and the central bank's independence. Spot gold gained 0.2% to $3,374.49 per ounce, as of 0644 GMT, after hitting its highest level since August 11 earlier in the session. Sign up here. U.S. gold futures for December delivery rose 0.1% to $3,421.50. "Trump has put traders a little bit on edge once again with his comments about Cook, which has resulted in gold picking up additional safe-haven flows today," KCM Trade chief market analyst Tim Waterer said. "There is a sense that Trump may be reshaping the Fed into a more dovish-leaning body, and any resulting dollar depreciation or move lower in yields would likely suit gold." The U.S. dollar index (.DXY) , opens new tab fell 0.2% against its rivals, making gold less expensive to overseas buyers. Trump on Monday took the unprecedented action of firing Cook, the first African-American woman to serve as a Fed governor, over claims of mortgage borrowing impropriety. On Friday, Fed Chair Jerome Powell signalled a possible rate cut at the Fed's meeting next month, saying that risks to the job market were rising but inflation remained a threat, and that a decision wasn't set in stone. Non-yielding gold tends to appreciate in a low-interest-rate environment, which reduces the opportunity cost of holding bullion. Focus now shifts to the Personal Consumption Expenditures Price Index, the Fed's preferred inflation gauge, for more cues on U.S. rate-cut path. The report is due on Friday. SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, said its holdings rose 0.18% to 958.49 metric tons on Monday from 956.77 tons on Friday. Elsewhere, spot silver rose 0.4% to $38.71 per ounce, platinum eased 0.2% to $1,340.10 and palladium climbed 0.7% to $1,093.95. https://www.reuters.com/world/india/gold-hits-2-week-high-dollar-dips-after-trump-fires-feds-cook-2025-08-26/

2025-08-26 05:29

Trump fires Fed governor Lisa Cook, impacts dollar and Treasuries Trump's actions raise concerns over Fed's independence Market uncertainty rises over Fed policy and potential rate cut Major brokerages predict 25-basis-point Fed rate cut in September TOKYO, Aug 26 (Reuters) - The dollar and longer-dated U.S. Treasuries slid on Tuesday after President Donald Trump announced he was firing a Federal Reserve governor, an unprecedented move that further undermines confidence in the Fed's independence and U.S. assets. The U.S. currency fell against the euro after Trump said he was removing Lisa Cook from her position on the Fed's board of directors, citing allegations of improprieties in obtaining mortgage loans and escalating the president's battle against the central bank. Sign up here. Stock markets in Asia followed declines on Wall Street as the news muddied the outlook for Fed policy and stoked uncertainty over prospects for a rate cut next month. Gold touched a two-week high and U.S. equity futures fell, as Trump also renewed tariff threats on trade partners. "All of this, tariffs included, is just another reason the U.S. can't be trusted," said Bart Wakabayashi, the Tokyo Branch Manager of State Street. "There's no credibility. That's the basis of the U.S. being the safest investment in the world. If you're a responsible investor, it gives you pause." The euro added 0.1% to $1.1631. The yen was flat at 147.82 per dollar after earlier jumping more than 0.5%. The dollar index , which tracks the greenback against a basket of currencies, retreated 0.1% after a 0.7% gain on Monday. The yield on the benchmark U.S. 10-year Treasury note rose 3.1 basis points (bps) to 4.306%. The yield on the 30-year bond rose 4.7 bps to 4.936%. The two-year Treasury yield, which typically moves in step with interest rate expectations for the Fed, fell 1.3 bps to 3.717%. Trump has regularly threatened to dismiss Fed Chair Jerome Powell, and earlier this month he fired a top Labor Department official after accusing her, without evidence, of manipulating jobs data that had disappointed him. "I have determined that there is sufficient cause to remove you from your position," the president said in a letter to Cook posted on his Truth Social platform, claiming there was enough evidence that Cook had made false statements on mortgage applications. Trump, who lacks the legal authority to fire the Fed chair except "for cause", has backed away from that threat as Powell gets closer to the expiration of his term as Fed chief next May. Cook's exit from the central bank could speed up the president's reshaping of the Fed and the rate-setting Federal Open Market Committee (FOMC). Her term had been due to end in 2038. "The move is another example of concerns over Fed independence weighing on the dollar and has implications for the potential makeup of the FOMC going forward," said OCBC currency strategist Christopher Wong. "That adds to rate cut prospects and a softer dollar outlook." MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) , opens new tab was down 0.5%, after U.S. stocks ended the previous session with mild losses. Japan's Nikkei (.N225) , opens new tab index sank 0.9%. Futures markets pointed to a nervous day ahead for Europe and the U.S. Euro Stoxx 50 futures were down 0.53%, German DAX futures were down 0.45% and FTSE futures fell 0.35%. The U.S. S&P 500 e-minis slid 0.07%. Major brokerages, including Barclays, BNP Paribas and Deutsche Bank, now expect a 25-basis-point Fed rate cut in September. Fed funds futures traders are pricing in 83% odds of a September cut, according to the CME Group's FedWatch Tool. Data for August due before the Fed's September 16-17 meeting could still sway policy. The U.S. personal consumption prices reading, due on Friday, is considered the Fed's preferred inflation gauge. Hotter-than-expected U.S. producer price data last month raised some questions over the certainty of a cut. Extending months of turmoil over on-again, off-again tariff policies, Trump also threatened "subsequent additional" import duties on countries with digital taxes. U.S. crude dipped 0.5% to $64.48 a barrel. Gold rose 0.2% to $3,373.32 per ounce after touching $3,386.27, the highest since August 11. https://www.reuters.com/world/china/global-markets-global-markets-2025-08-26/

2025-08-26 05:13

BANGKOK, Aug 26 (Reuters) - Thailand is hoping to meet its rice export target of 7.5 million metric tons this year by seeking more deals in markets where demand is strong, commerce ministry official said on Tuesday. Rice shipments dropped by 25% year-on-year to 4.3 million metric tons in the first seven months of 2025, but those to key markets such as the United States and China still increased over the period, Arada Fuangtong, head of the foreign trade department, told a press conference. Sign up here. "There's still some hope, even if it seems dim. We'll try our best," she said, adding that efforts were underway to focus on markets including China, the Middle East, and Japan. Rice exports to the United States rose 4.3% year-on-year in the January-July period and full-year volumes are expected to be close to last year's level of about 800,000 metric tons, despite tariffs, she said. The decline in rice shipments has been driven by increased global rice production, particularly after the resumption of rice exports from India, Arada said. Major rice importers like Indonesia and the Philippines have also cut their purchases, she added. Adding to the pressure is the strength of the baht , she said, as the currency has gained about 5.8% against the dollar so far this year. "What worries us the most is the decline in the (rice export) value. Even though the volumes dropped sharply, the stronger baht made the value fall even further," Arada said. Thailand, the world's second-largest exporter of the grain after India last year, recorded a 35.4% annual fall in the value of rice exports to 86.4 billion baht ($2.67 billion) over the January-July period. ($1 = 32.4200 baht) https://www.reuters.com/markets/commodities/thailand-aims-meet-this-years-rice-export-target-by-focusing-strong-markets-2025-08-26/

2025-08-26 05:09

MUMBAI, Aug 26 (Reuters) - The rupee slipped on Tuesday after Washington confirmed it will impose an extra 25% levy on Indian imports, clouding the outlook for Asia's third-largest economy. The rupee dropped to 87.80 against the dollar, a three-week trough and within striking distance of its lifetime low of 87.95. Sign up here. The currency opened weaker and has struggled since, after the U.S. Department of Homeland Security on Monday outlined the procedure to implement the additional tariff on Indian goods starting August 27. The notice reiterated that the action was in response to India's indirect support for Russia's military incursion into Ukraine. "Markets were clinging to hopes of a compromise. With that off the table, the rupee's decline was inevitable," a currency trader at a private sector bank said. Indian goods currently face 25% U.S. duties, among the highest tariff rates imposed by Washington on any major trading partner. Indian equities declined on the day. The currency and equities are both reacting to the tariff news, and the key to watch now is whether the Reserve Bank of India (RBI) steps in at these levels, said Anil Bhansali, head of treasury at Finrex Treasury Advisors. India's foreign exchange reserves remain comfortable at $695 billion, he noted. The RBI will be keen to avoid disorderly moves on a day of heightened sensitivity, especially with the rupee near to lifetime lows. The RBI has a well-established habit of stepping in to curb excess volatility. The local unit is facing selling pressure, despite the dollar index's decline after U.S. President Donald Trump said he fired Federal Reserve Governor Lisa Cook over alleged mortgage fraud. Cook's removal comes amid the president's regular threats to fire Fed Chair Jerome Powell. https://www.reuters.com/world/india/pressure-builds-rupee-us-confirms-punitive-tariffs-indian-goods-2025-08-26/