2025-11-11 15:19
Asia leads with $16.5 bln inflows, all regions post net inflows EM ex-China stocks see strongest inflow since December 2023 NEW YORK, Nov 11 (Reuters) - A pick-up in flows into stocks led the way as non-resident investors added $26.9 billion to their emerging markets' equities and debt portfolios in October, data from a banking trade group showed. The inflow last month marks an uptick on the $21.1 billion in September and compares to a $5 billion net outflow in October 2024 according to the Institute of International Finance. Sign up here. The overall $12.9 billion net inflow to emerging market stocks was the highest since July, and the $9.4 billion that went into equities outside China the strongest since December 2023. "The most striking shift in October was the recovery of EM equity allocations," Jonathan Fortun, senior economist at the IIF wrote in the report, noting that regional breadth also improved, with developing economies in Asia, Latin America and Europe all enjoying stronger inflows. "Still, behind the headline recovery, key fault lines remain visible," Fortun added. The $14.4 billion inflows into emerging debt was the weakest since April. Net flows to China nearly canceled out in October with a $3.5 billion inflow to stocks more than offsetting a $3 billion outflow from debt, the data showed. Sovereign issuance slowed in October after a very strong third quarter according to the report, with investment grade favored widely while the lower-rated issuers are mostly absent. "Investor demand remains concentrated in credits with deep secondary markets, liquid benchmarks, and transparent macro frameworks," said Fortun. "High nominal and real yields remain central to demand for EM debt, especially in local currency markets, where carry continues to accrue at a historically fast pace." Overall flows picked up, fueled by expectations of a second-consecutive U.S. Federal Reserve rate cut late in October. After cutting rates last month, the Fed cast doubts on further monetary policy easing this year, but another 25 basis point cut is priced in for the December - even if policy makers are divided on it. All regions posted net inflows last month, with Asia leading handily with $16.5 billion. Europe, Latin America and Africa and the Middle east saw inflows between $3.8 billion and $3 billion. https://www.reuters.com/world/asia-pacific/stocks-shine-foreigners-add-27-bln-em-portfolios-october-says-iif-2025-11-11/
2025-11-11 14:20
ORLANDO, Florida, Nov 11 (Reuters) - The yen's fall against the U.S. dollar is raising the specter of Japanese intervention to slow or reverse the slide. While imminent action is unlikely, investors should remain on high alert. The Japanese currency is already below levels that prompted Tokyo to intervene to support it in the recent past, and is now hovering close to the 155 per dollar level that many Japanese companies say is a pain threshold. Last year's record low near 162 per dollar isn't all that far away either. Sign up here. Tokyo's first yen-buying intervention in over a decade came in September and October of 2022 when it spent around $60 billion boosting the currency, first after dollar/yen rose above 145 and then again as it approached 152. The Ministry of Finance also spent some $36 billion in July last year buying yen as the dollar pushed multi-decade highs near 162 yen. Does that mean intervention is imminent? Not necessarily. That's primarily because of the fundamentals putting pressure on Japan's currency. The yen's current swoon partly reflects the stabilization of the U.S. dollar since mid-year and recent appreciation as traders bet that the Federal Reserve is cooling on interest rate cuts. Domestic policy is also playing a role. The yen's drop has accelerated in the past month on expectations that the new Japanese government could be preparing a fiscal stimulus package worth close to $100 billion, while the Bank of Japan's rate-hiking cycle seems to have stalled. These dynamics were brought into sharp focus on Monday by new Prime Minister Sanae Takaichi. She sketched out plans to allow for more flexible spending in the years ahead, essentially watering down Japan's commitment to fiscal consolidation, and renewed calls for the BOJ to go slow with any tightening. Little wonder the yen is falling. Given how these fundamentals are stacked up against the currency, Japan's Ministry of Finance is unlikely to sanction yen-buying intervention, as it would likely be ineffective. What's more, it's unclear if Japan would get buy-in from Washington, no matter how much the Trump administration would probably like the dollar to weaken. CORPORATE PAIN THRESHOLD That said, the close correlation between dollar/yen and U.S.-Japanese bond yield spreads has completely broken down, suggesting the yen may be unusually weak. Analysts at Mizuho say current spreads are consistent with dollar/yen below 145.00. Meanwhile, Finance Minister Satsuki Katayama said last week the government continues to monitor "one-sided and rapid movements" in the yen with a "high level of urgency." And Takaichi's nod on Monday to more accommodative fiscal and monetary policies pushed the dollar back up to within touching distance of 155.00 yen. That's potentially a key level. A survey carried out last year by Nikkei Research for Reuters showed that it was a pain point for around half of the 229 companies that responded. None of the firms in the survey saw a dollar/yen rate above 160.00 as favorable. So the yen is in recent intervention territory. WEAK YEN IS STOKING INFLATION Inflation dynamics are worth considering too. Although BOJ officials see business and consumer inflation expectations settling around 2%, actual inflation is still around 3%. The yen is already historically weak, so one wonders how much more currency weakness authorities are willing to accept. Economists at Mizuho estimate that a 1% depreciation in the yen increases core inflation by around 0.05%. So a move in dollar/yen to 160.00, perhaps the peak in Tokyo's tolerance, from 147.00 early last month, would therefore increase inflation by around 0.4 percentage points. That's meaningful. Right now, though, analysts are reasonably confident nothing is imminent. The yen's slide hasn't been excessively rapid and Japanese policymakers' 'verbal' intervention hasn't yet reached the most serious alert levels. What will change that calculus? Deutsche Bank analysts reckon a quick dollar burst above 157.00 yen might do it. They say a 10-yen move in a month is a decent intervention trigger - so far, the dollar is in a fairly normal 6-7 yen move territory. Analysts at Goldman Sachs are more sanguine. They say the yen isn't particularly weak right now, although that would change if the dollar were to spike to 161-162 in short order. History suggests Tokyo is likely to intervene if market conditions - speculators' positioning, flows, and the speed of the yen's move - give it a chance of succeeding. The stars may not be aligned right now. But they could be soon. (The opinions expressed here are those of the author, a columnist for Reuters) Enjoying this column? Check out Reuters Open Interest (ROI), your essential source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn , opens new tab and X , opens new tab. https://www.reuters.com/markets/currencies/yen-intervention-warnings-flash-amber-2025-11-11/
2025-11-11 13:48
SAO PAULO, Nov 11 - Brazil's inflation slowed more than expected in October, following a rebound in September, data from statistics agency IBGE showed on Tuesday, fueling expectations of an interest rate cut early next year. Consumer prices in Latin America's largest economy rose 0.09% in October, down from a 0.48% increase the previous month, as residential electricity prices fell, IBGE said. Economists at a Reuters poll expected a 0.16% expansion. Sign up here. Over the 12 months through October, prices rose 4.68%, also decelerating from 5.17% the previous month, and below the 4.75% increase expected by in the poll. Brazil's central bank, which targets a 3% inflation plus or minus a margin of 1.5 percentage points, kept the benchmark Selic rate steady last week for the third straight time at a near 20-year high. Capital Economics analysts said in a note that the larger-than-expected fall in inflation, together with pronounced signs of economic weakness, could prompt the central bank to cut interest rates in January, while ruling out the possibility of a December cut. In the minutes of its latest monetary policy decision released earlier on Tuesday, the central bank said that the recent economic developments have reinforced its view that the current 15% rate is adequate to bring inflation back to target. "The minutes to last week's meeting, while less hawkish than those from the preceding meeting, gave no sign that a cut is imminent," Capital Economics' analysts added. Daycoval analysts said that the October data does not alter their expectation that interest rates will remain unchanged through the end of the year. https://www.reuters.com/world/americas/brazils-inflation-slows-october-paves-way-early-2026-rate-cut-2025-11-11/
2025-11-11 12:47
FTSE 100 up 0.8%, FTSE 250 rises 0.5% AstraZeneca hits record high UK unemployment rises to 5%, highest in four years Vodafone shares climb after strong German performance Nov 11 (Reuters) - London's export-focused FTSE 100 rose to a new intraday record peak on Tuesday, buoyed by a weakening pound after economic data revealed rising unemployment and slowing wage growth, while drugmaker AstraZeneca climbed to an all-time high. The blue-chip FTSE 100 index (.FTSE) , opens new tab rose 0.8% by 1210 GMT, building on its record close posted in the previous session. Sign up here. Meanwhile, the mid-cap FTSE 250 (.FTMC) , opens new tab gained 0.5%. AstraZeneca rose 1.7% to surpass its September 2024 peak and solidify the company's position as the UK's largest listed stock by market value, driven by momentum from last week's forecast-beating quarterly results. Meanwhile, the UK labour market showed clear signs of cooling, with unemployment increasing to 5%, the highest in four years, while wage growth continued to slow. These figures have bolstered expectations for a Bank of England rate cut in December. "There's more slack building in the labour market – and perhaps more so than assumed by the MPC in its November projections; and two, pay momentum continues to slow. Both should be encouraging for the MPC," said Deutsche Bank's chief economist Sanjay Raja. The pound fell against the dollar and British government bonds rallied as the figures aligned with the central bank's insistence on seeing clearer signs of easing inflation before proceeding with another rate cut. In the market, media stocks (.FTNMX403010) , opens new tab gained 2.7% with advertising and marketing firm 4imprint Group (FOUR.L) , opens new tab surging 17%, after it raised full-year profit and revenue forecast. Vodafone (VOD.L) , opens new tab reached a two-year high, climbing 5.5%, after a strong performance in Germany helped the company to raise its annual profit forecast and lift dividends for the first time in eight years. Scientific tools maker Oxford Instruments (OXIG.L) , opens new tab surged 12.7%, on track for its biggest single-day gain in nearly four years, on improved order momentum. On the downside, food supplier Hilton Food (HFG.L) , opens new tab slumped 22.5% to the lowest since 2015 after it said that profit growth is likely to be challenging in the next financial year. https://www.reuters.com/business/media-telecom/ftse-100-hits-record-high-job-market-data-weakens-pound-astrazeneca-shines-2025-11-11/
2025-11-11 12:45
Nov 11 (Reuters) - India's Tata Power (TTPW.NS) , opens new tab plans to set up 10 gigawatts of solar wafers and ingots manufacturing plant, the company's chief executive Praveer Sinha said on a post-earnings call on Tuesday. Sign up here. https://www.reuters.com/sustainability/climate-energy/indias-tata-power-plans-set-up-10-gw-solar-wafers-ingots-making-plant-2025-11-11/
2025-11-11 12:18
India's cotton imports seen rising to 4.5 million bales Due to duty exemption and drop in local production Cotton output seen falling to a 17-year low on crop damage MUMBAI, Nov 11 (Reuters) - India's cotton imports are forecast to climb 9.8% in the new season to a record high, driven by New Delhi's move to allow duty-free overseas purchases and a drop in local output to a 17-year low, industry officials told Reuters. Higher imports by the world's second-largest cotton producer are expected to support global prices , which are trading near six-month lows. Sign up here. India's cotton imports could rise to 4.5 million bales in the 2025/26 marketing year, which began on October 1, with nearly 3 million expected to arrive in the December quarter, Atul Ganatra, president of the Cotton Association of India (CAI), told Reuters. India's imports reached a record 4.1 million bales last year from the U.S., Brazil, Australia and Africa. DUTY EXEMPTION, WEAK OUTPUT "Cotton is a lot cheaper overseas right now compared to local prices, so textile mills are rushing to import it before the end of December," Ganatra said. New Delhi has extended an exemption for cotton imports from an 11% duty until December 31. Apart from the exemption, concerns over domestic supply following crop damage are prompting textile mills to turn to higher-quality imported cotton, said a New Delhi-based trader with a global trade house. Western states Maharashtra and Gujarat, along with southern states Andhra Pradesh and Telangana, received heavy, untimely rainfall in October, damaging cotton crops ready for harvest. Together, these states account for over 70% of India's total cotton production. India's cotton production in 2025/26 is projected to decline 2.4% from the previous year to 30.5 million bales, the lowest since 2008/09, the CAI estimates. Some traders are forecasting a steeper decline towards 28 million bales. The textile industry is one of the largest employers in India, directly employing over 45 million people. The CAI forecasts demand cotton consumption will drop 4.5% to 30 million bales in 2025/26 amid sluggish export demand. "Demand from the U.S. has fallen after they slapped on hefty tariffs, forcing many textile units in southern India to scale back their operations," Ganatra said. The U.S., which takes nearly 29% of India's $38 billion annual textile exports, doubled tariffs on imports from India to as high as 50%, effective August. (1 Indian bale = 170 kg) https://www.reuters.com/world/china/indias-cotton-imports-hit-record-high-duty-exemption-low-output-2025-11-11/
