2025-04-11 15:29
Risk-sensitive rand advances after turbulent week Currency at mercy of trade war and local politics JOHANNESBURG, April 11 (Reuters) - The South African rand gained ground against a weaker dollar on Friday, but analysts said it remained susceptible to twists in the global trade war and the risk that South Africa's coalition government might split. At 1507 GMT the rand was trading at 19.2050 against the dollar , about 1.3% stronger than Thursday's closing level. Sign up here. It has been highly volatile this week, falling to a record low against the dollar on Wednesday before staging a sharp relief rally after U.S. President Donald Trump announced a 90-day pause in higher tariff rates on dozens of trading partners including South Africa. China increased its tariffs on U.S. imports to 125% on Friday, raising the stakes in a confrontation between the world's two largest economies that threatens to upend global supply chains. The dollar was last trading about 0.5% weaker against a basket of currencies, helping currencies such as the rand to recover. Analysts said the rand would also continue to move on news about the future of South Africa's generally business-friendly Government of National Unity. The two biggest parties in the coalition, the African National Congress and the pro-business Democratic Alliance, clashed over the budget last week, with the DA voting against it in parliament and challenging it in court. Isaac Matshego, an economist at Nedbank, said markets were worried about the direction of economic policy if the coalition collapses. "A shift towards more populist policies if the ANC partners with the leftist parties in a new GNU would hurt confidence and put the rand under renewed pressure," he said. The ANC and DA are due to meet on Saturday to discuss the budget impasse. On the Johannesburg Stock Exchange, the blue-chip Top 40 index (.JTOPI) , opens new tab closed up about 0.45%, after a 4.5% rally on Thursday. The benchmark 2030 government bond was weaker, as the yield rose 6.5 basis points to 9.305%. https://www.reuters.com/markets/currencies/south-african-rand-recovers-against-weaker-dollar-risks-remain-2025-04-11/
2025-04-11 15:15
WASHINGTON, April 11 (Reuters) - The International Monetary Fund said on Friday it had reached a staff-level agreement with Honduras that would result in the disbursement of around $155 million should the board approve the review in June. The IMF agreement followed a review of its Extended Credit Facility and Extended Fund Facility with the Central American nation. Sign up here. https://www.reuters.com/world/americas/imf-staff-level-agreement-with-honduras-set-unlock-around-155-million-2025-04-11/
2025-04-11 14:34
April 11 (Reuters) - Traders on Friday continued to pull back from bets on aggressive Federal Reserve interest-rate cuts this year, as the closely-followed University of Michigan surveys of consumer sentiment showed confidence and inflation expectations deteriorating further in late March and early April. Prices of interest-rate futures continue to reflect expectations that the U.S. central bank will start reducing its policy rate in June, though with less certainty than earlier, with the market-indicated probability around 75%, versus more than 80% earlier in the day. Traders see the Fed delivering three rate cuts in total over the course of the year, pulling back from bets on a fourth rate cut. Sign up here. https://www.reuters.com/markets/wealth/traders-lighten-bets-fed-rate-cuts-still-eye-june-start-2025-04-11/
2025-04-11 14:31
India, US negotiators holding talks for bilateral trade deal Vice President JD Vance to visit India soon, says source India won't allow re-routing of goods to US, says source NEW DELHI, April 11 (Reuters) - India and the U.S. have finalised terms of reference for talks over the first part of a bilateral trade deal, an Indian trade official said on Friday, adding it was possible that a "win-win" deal could take shape in the next 90 days. U.S. President Donald Trump on Wednesday announced a 90-day pause on most tariff hikes for major trading partners including India, while raising levies on China, providing temporary relief for Indian exporters. Sign up here. India and the U.S. agreed in February to work on the first phase of a trade deal to be concluded late this year, with a view to reaching bilateral trade worth $500 billion by 2030. "We are far ahead in trade talks with the U.S. compared to other countries ... there are lots of possibilities in 90 days," said the official, who did not want to be named because of the sensitivity of the issue. Reuters reported on Thursday that India wanted to move quickly to clinch a trade deal following Trump's tariff pause. Trade discussions between the countries will continue virtually and regularly, the official said, adding there could be some delegation-level visits from both sides as part of the talks. U.S. Vice President JD Vance is also expected to visit India soon, the official said. Trump's administration had announced a 26% tariff on Indian goods earlier this month, and New Delhi had said it did not plan to retaliate. Bilateral trade with the U.S., India's largest trading partner, rose to around $129 billion in 2024, with a $45.7 billion surplus in favour of India. India has asked its customs authorities to step up scrutiny of exports and imports of goods to ensure the country is not used as a conduit to re-route goods to the U.S., the official said. India has started operating a global tariff and trade helpdesk to help stakeholders navigate trade issues, the Directorate General of Foreign Trade said in a notice on its website. The helpdesk will look into issues relating to import and export challenges, import surges or dumping, supply chain challenges, and financial issues, among other things, the notice said. Trade analysts have said that, following Trump's huge increase in tariffs on China, some companies could use India to divert exports to the U.S. market. "Neither will India be the source of trade diversion for our products, nor will it become a safe haven for others to divert through India," the official said. "India wants to remain a trusted trading partner. This is the message of Prime Minister Narendra Modi to all government officials and industry." https://www.reuters.com/world/india/india-us-finalise-terms-reference-first-phase-trade-deal-says-india-trade-2025-04-11/
2025-04-11 14:29
BUENOS AIRES, April 11 (Reuters) - Argentine peso futures have weakened sharply in recent days as traders place tentative bets on a faster depreciation of the embattled currency amid uncertainty over the exchange rate regime ahead of a deal with the International Monetary Fund. The April peso future contract has weakened to around 1,180 per dollar from 1,125 on April 9 when the IMF announced that it had reached a staff-level agreement with Argentina over a new $20 billion loan program to help bolster depleted reserves. Sign up here. That's seen traders playing a guessing game on what that might mean for the currency, which is currently held in check by strict capital controls and a so-called crawling peg, which allows it to depreciate at 1% each month currently. Analysts have predicted some sort of devaluation, but there is little consensus. The government has moved to rule out a sharp devaluation, but libertarian President Javier Milei has long wanted to unravel currency controls, in place since 2019. Traders are divided on what might happen with exchange rate policy. Some say there will be devaluation, others rule that out, while some predict the creation of a currency band that would in effect allow the peso to weaken within a certain limit. That uncertainty and the expected board approval for the new loan program on Friday have hit peso futures, though prices did strengthen slightly after a sharp drop on Thursday. "The market remains attentive to the signing of the agreement with the IMF and the definitions regarding the exchange rate," Argentina-based settlement and clearing agency Cohen said in a note. "This context, combined with global contagion, is what has led to a rise in dollar futures contracts." https://www.reuters.com/markets/currencies/argentina-fx-futures-jittery-traders-place-bets-ahead-imf-deal-2025-04-11/
2025-04-11 13:50
April 11 (Reuters) - Federal Reserve Bank of Boston President Susan Collins said Friday that financial markets, which have been under massive pressure, appear to be holding in, in comments made in an interview with Yahoo Finance. “Markets continue to function well,” Collins said in the interview, adding “financial market movements are something to stay focused on” amid a huge range of uncertainty tied to trade policy. Sign up here. Collins' comments to Yahoo come after a speech the official made late Thursday that flagged the uncertain outlook caused by the Trump administration's tariffs, amid expectations the big rise in import taxes imposed by the president will drive up inflation and depress growth for a time. Collins told Yahoo the economy entered the year robustly. Now, uncertainty "clouds the outlook" and in conversations with contacts in her district, Collins said "what I hear is really a pervasive wait-and-see approach as firms consider how to react to an environment that is highly uncertain and with the tariffs quite elevated." Collins downplayed recession risks but did not rule them out. "There are more adverse scenarios that I wouldn't rule out, but my own kind of modal scenario is one of slower growth, not a significant downturn," the official said. https://www.reuters.com/markets/feds-collins-tells-yahoo-finance-that-markets-are-holding-now-2025-04-11/
