2026-01-29 10:47

LONDON, Jan 29 (Reuters) - The Bank of England is considering expanding the range of assets that could be accepted as collateral in tokenised form, Sasha Mills, the central bank's Executive Director of Financial Market Infrastructure said on Thursday. The BoE last year consulted on plans to start permitting tokenised assets - blockchain-based versions of financial assets - as eligible collateral. Sign up here. “Some thought is needed on traditional assets that are not already acceptable as regulatory collateral, but which the industry would like to see tokenized and then used as collateral,” Mills said at City & Financial Global’s London Tokenisation Summit. Earlier this week, the European Central Bank confirmed that it would permit banks to use tokenised assets as collateral in Eurosystem credit operations from March 2026. The ECB also said it was looking at how assets that are currently ineligible in securities settlement systems could become eligible in a tokenised form. Despite significant industry hype, to date there are only a handful of live tokenisation projects and limited take-up by major banks and investors. Most pilots have remained in test environments and trading volumes are still negligible. Supporters say tokenisation and the technology behind it will cut costs and speed up settlement times. https://www.reuters.com/world/uk/boe-is-open-accepting-more-tokenised-assets-collateral-mills-says-2026-01-29/

2026-01-29 10:41

Jan 29 (Reuters) - The pound hovered near multi‑year highs against the dollar on Thursday, with U.S. policy uncertainty keeping the greenback on the back foot as markets looked ahead to next week’s Bank of England decision and to developments on the UK political front. The decision to keep Bank Rate unchanged this month may be less hotly debated given recent news of the strongest private sector since April 2024 alongside unexpectedly and further from the MPC's 2% target, according to economists polled by Reuters. Sign up here. The greenback edged down against a basket of currencies as uncertainty over U.S. economic policies and geopolitical moves weighed on sentiment. Sterling was roughly unchanged at $1.3802 , after hitting $1.36645 early this week, its highest since September 2021. Matthew Ryan, head of market strategy at global financial services firm Ebury, noted that in the last few days “domestic news in the UK, namely expectations for Bank of England rates and the brewing civil war within the Labour Party,” has been completely overshadowed by headlines elsewhere. British Labour Party politician Andy Burnham was on Sunday blocked from , with lawmakers on the left of the party accusing Prime Minister Keir Starmer and his allies of a political move to keep out a potential leadership rival. Labour is trailing in opinion polls to Nigel Farage's right-wing populist Reform UK ahead of bellwether local elections in May. The pound lost 0.05% against the euro to 86.60 pence. “UK politics may well take its toll on sterling again over the coming months,” said Chris Turner head of forex strategy at ING, mentioning a UK by-election on 26 February. There looks to be no upside for Starmer from a by-election in the pipeline in the Greater Manchester constituency of Gorton and Denton, as the Labour Party could lose a seat it won with a big majority in 2024. “Sterling is also vulnerable to any further bond market pressure emanating from Japan or the U.S. In short, we think sterling is near the top of multi-quarter ranges,” ING's Turner added. https://www.reuters.com/world/uk/sterling-close-multi-year-highs-vs-dollar-focus-shifts-boe-politics-2026-01-29/

2026-01-29 10:38

MUMBAI, Jan 29 (Reuters) - The Indian rupee is likely to gradually weaken to 93–94 to the U.S. dollar this year as capital inflows dwindle, highlighting the need for major measures to attract foreign funding, a senior official at DBS Bank India said. The currency slipped to a record low of 91.9850 on Thursday. A fall to 93 would mark a 1% additional decline, while 94 would imply a roughly 2% drop. Sign up here. "Rupee is likely to witness well-anchored depreciation towards 93–94," said Ashhish Vaidya, managing director & treasurer - global financial markets. "The RBI would be comfortable with year-on-year depreciation of 3–4% to reflect the impact of the trade deficit and the inflation differential, especially in the absence of capital flows." Capital outflows pressured the rupee through 2025 and continue to shape its outlook. The currency is already down 2.3% this month, adding to a near 5% decline last year. Foreign investors have withdrawn roughly $4 billion from local equities in January, with bankers noting that external commercial borrowing and net foreign direct investment inflows also remain subdued. As a result, bankers say attention is increasingly turning to other measures to support inflows. "The Reserve Bank of India will need to consider structural measures like an FCNR discount window to incentivise medium‑term inflows, to substitute for the lack of capital inflows," Vaidya said. Reintroducing a Foreign Currency Non-Resident window would allow banks to raise foreign currency deposits from non-resident Indians. The RBI last used this measure in 2013 during the "taper tantrum", when the rupee plunged as foreign investors withdrew capital after the Federal Reserve hinted it could reduce quantitative easing. The FCNR scheme helped bring in $25-$30 billion of inflows and alleviate pressure on the currency at the time. A trade limbo with the United States has compounded challenges to capital inflows, reinforcing foreign investor caution. The rupee has weakened nearly 5% since August, when the U.S. imposed tariffs on Indian exports. "A U.S.–India trade deal could assist in rooting out the negativity priced into rupee, though over the medium term, we would need growth capital to return to provide stability to the rupee," Vaidya said. Vaidya reckons that debt investments are also unlikely to revive in the current environment where global yields are inching higher and the rupee is under pressure. He expects conditions to improve only in the second half of the year, when U.S. rate cuts, combined with relatively higher domestic yields and a more stable currency, could restore the appeal of carry trades. (This story has been refiled to correct a typo in the DBS executive's name to 'Ashhish Vaidya,' not 'Ashishh Vaidya,' in paragraph 3) https://www.reuters.com/world/india/dbs-india-treasurer-sees-rupee-weakening-9394-flags-need-inflow-measures-2026-01-29/

2026-01-29 10:01

Policy rate on hold as expected Riksbank repeats forecast for unchanged rates ahead Says uncertainty has increased STOCKHOLM, Jan 29 (Reuters) - Sweden's central bank kept its key interest rate at 1.75% on Thursday as widely expected and repeated its forecast that no change was likely for the rest of the year. The central bank has been enjoying a rare "Goldilocks" moment where the economy is growing and inflation is close to the 2% target. Sign up here. The Riksbank's main scenario is that the current benign conditions will continue and that the policy rate will be unchanged "for some time to come." Nevertheless the outlook is finely balanced. Geopolitical tensions are running high, growth could disappoint and inflation undershoot. But if the global picture brightens, GDP growth may accelerate. "The uncertainty regarding the outlook for inflation and economic activity has increased," the Riksbank said in a statement. "The Riksbank is vigilant with regard to developments and is prepared to adjust monetary policy if the outlook changes." The Riksbank has cut rates eight times since spring 2024, most recently in September last year, in an effort to get wary consumers to start spending. The economy has started to pick up and the government expects GDP growth of around 3.0% this year after 1.0% in 2025. After being elevated through most of 2025, however, inflation is expected to cool, dropping well below the central bank's 2% target. Analysts' main scenario is for no change in the policy rate until early 2027, when they expect a hike. However, another rate cut has not been completely ruled out. "There are some tentative signs that the Riksbank ... is starting to see risks that inflation is becoming too low," Nordea economist Torbjorn Isaksson said in a note. "We expect the Riksbank to stay on hold at 1.75% in 2026, with risks clearly tilted to a rate cut." Capital Economics said the Riksbank would hike the policy rate in December this year. The central bank will announce its next policy decision on March 19. https://www.reuters.com/business/finance/swedish-central-bank-keeps-rates-hold-175-sees-no-change-ahead-2026-01-29/

2026-01-29 09:54

SINGAPORE, Jan 29 (Reuters) - MSCI (MSCI.N) , opens new tab is a powerhouse within the $139 trillion asset management industry and its decisions are hugely consequential for countries around the world - as Indonesian investors learned this week to their cost. The Jakarta Composite Index plunged by as much as 16.7% in the past two days, after an MSCI warning that a possible downgrade to frontier market status from emerging markets triggered a wave of capital flight. The index recovered later in Thursday's trading session, but still closed down 1.1% to log a second consecutive day of decline. Sign up here. WHAT IS MSCI? Formerly known as Morgan Stanley Capital International, the company's index products are one of the biggest and most important reference points for stock markets around the world. It does no investing of its own, but decisions on which countries and companies to include in its flagship Emerging Markets Index , opens new tab, which tracks some $10 trillion of stocks, can carry enormous weight with global investors. Index compilers, including FTSE Russell and S&P Global, have reshaped the global investment landscape as exchange-traded funds around the world have grown in popularity - and clout. For active fund managers and index trackers alike, MSCI's decisions on which countries and companies to include or exclude can force automatic rebalancing of portfolios and billions of dollars of capital flows. WHAT DID MSCI DO TO INDONESIA AND WHY DID THE MARKET FALL? MSCI said in a statement that clients flagged problems around market data that obscured what proportion of Indonesian companies' shares could be freely traded and how the exchange categorised stock owners. The index provider said its clients pointed to opaque shareholding structures and coordinated trading behaviour by market investors undermined "proper price formation". MSCI has given Indonesia until May to show signs of progress, at which point it will reassess its status. That could result in a lower weighting for Indonesia in its emerging market benchmark, or even a downgrade to frontier market status. It was that threat which caught investors by surprise, and triggered a stampede towards the exits. WHAT HAPPENS IF INDONESIA GETS KICKED OUT OF THE EMERGING MARKET CATEGORY? Upgrades and downgrades by MSCI have had enormous implications for countries and markets in the past and are likely to weigh on Indonesian markets for a while. Goldman Sachs estimates that foreign investor outflow could reach $7.8 billion if Indonesia is downgraded to frontier market, a scenario the investment bank and some investors deem unlikely. Indonesia accounts for about 1% weighting in the MSCI emerging markets, which is dominated by China, Taiwan and India. Whether MSCI's move spurs other index providers remains to be seen. FTSE Russell said it was monitoring the situation closely. WHAT DOES INDONESIA SAY - AND WHAT HAPPENS NEXT? Index reclassification consultations typically take months or years to be made effective, but foreign investors do not have much incentive to hang around when they know that a wave of money is due to roll in - or out. That puts the ball back into the Indonesian government's court. Indonesian financial authorities said on Thursday that the government accepted the index compiler's views as "good input". They added that their communications with MSCI had been positive and they were awaiting a response to proposed measures, which include doubling the free float requirement on listed firms to 15%. The government has shown a willingness to punish foreign firms for downgrading its markets in the past. It penalised JPMorgan Chase & Co in 2015 after the investment bank's research arm recommended a smaller exposure to the country's bonds, and again in 2017 when it issued a similar rating on its stocks. https://www.reuters.com/world/asia-pacific/what-is-msci-what-has-it-done-indonesias-stock-market-2026-01-29/

2026-01-29 08:01

Market awaits possible takeover offer from Rio Tinto Glencore aims to increase copper output through new and restarted mines Cobalt output also declines LONDON, Jan 29 (Reuters) - Glencore's (GLEN.L) , opens new tab copper production declined by 11% in 2025, though higher copper grades and recoveries at several mines boosted output in the second half, the company said on Thursday. At 851,600 metric tons, the year's production was at the lower end of an earlier forecast of 850,000-to-875,000 metric tons. Sign up here. The market awaits a possible takeover offer from rival Rio Tinto (RIO.AX) , opens new tab, (RIO.L) , opens new tab for Glencore that is expected to be announced by February 5. The price of copper, needed for the global shift to lower carbon energy, AI, and defence, has hit record levels as traders anticipate tightening supply. LOWER GRADES AND TIGHTER SUPPLY Glencore's copper guidance for this year is between 810,000 tons and 870,000 tons, in part because of lower ore grades and water constraints at Chilean mine Collahuasi, which it co-owns with Anglo American (AAL.L) , opens new tab. This range is in line with its December forecast that had a midpoint of 840,000 tons, down from 930,000 previously. Glencore aims to lift annual copper output to 1.6 million tons by 2035 through a mixture of new and restarted mines. However, if talks with Rio Tinto progress toward creating the world's largest mining group, valued above $200 billion, the company's long-term outlook could shift. Glencore also produces cobalt, another critical mineral for the energy transition, in the Democratic Republic of Congo, which accounts for more than 70% of global mined production. It said it produced 36,100 tons of cobalt last year, down 5% on 2024. The central African country in October launched a system of export quotas. Glencore expects to export 22,800 tons this year. The miner and trader said it expects its full-year marketing earnings before interest and tax at the mid-point of its $2.3 billion to $3.5 billion range. Its 2025 steelmaking coal production increased to 32.5 million tons from 19.9 million tons. Glencore produced 98 million tons of thermal coal in 2025, down from 99.6 million tons in 2024, maintaining its position as one of the world's largest producers and exporters of the fuel. https://www.reuters.com/business/glencore-reports-11-drop-2025-copper-output-2026-01-29/