2024-11-13 17:21

Nov 13 (Reuters) - Bitcoin broke through the $90,000 level on Wednesday, to an all-time high in a rally showing no signs of easing on expectations that Donald Trump as U.S. president will be a boon for cryptocurrencies. The world's biggest cryptocurrency has become one of the most eye-catching movers in the week since the election and on Wednesday touched a record of $93,480 before paring gains. It was last down slightly at $88,185, but has risen 32% since the Nov. 5 election. Smaller peer ether has also risen 37% since Election Day, while dogecoin , an alternative, volatile token promoted by billionaire Trump-ally Elon Musk was up more than 150%. "What you've seen since the election is the market hoping or realizing what that could mean for bitcoin in the medium to long term – a pro-bitcoin administration, Senate and potential legislation that not only gives U.S. citizens the right to self-custody bitcoin but potentially for bitcoin to be a strategic reserve asset for the U.S. Treasury," said Damon Polistina, head of research at Eaglebrook. Regulatory uncertainty has been a major cloud hanging over the sector and a headwind to advisors allocating for their clients to bitcoin, he said. Trump embraced digital assets during his campaign, promising to make the United States the "crypto capital of the planet" and to accumulate a national stockpile of bitcoin. It is unclear how or when that could happen but the possibility drove a speculative surge in crypto mining and trading stocks. Zach Pandl, head of research at Grayscale Investments, said the "election results will open up the ability for large, regulated businesses like banks, custodians and exchanges to engage with public blockchain technology in the way that they haven't in the past." Software company and bitcoin investor MicroStrategy (MSTR.O) , opens new tab announced it had spent about $2 billion buying bitcoin between Oct. 31 and Nov. 10. Shares scaled a record high on Tuesday. Crypto investors see an end to increased scrutiny from the Securities and Exchange Commission under Trump. Trump and his sons announced a new crypto business, World Liberty Financial, in September. "Many people believe that we will inevitably get to bitcoin at $100k," said JJ Kinahan, CEO of IG North America and president of its tastytrade retail brokerage. "I expect bitcoin to continue building momentum, at least until after the inauguration when we find out what the real plans to get there are." Others advised investors against getting caught up in the crypto frenzy. "With bitcoin reaching $90K and hitting a new all-time high, investors should be cautious about the potential volatility ahead," said Georgi Koreli, CEO of Hinkal, a blockchain-based private trading platform. "This doesn't mean that we will not see $95K or even $100K soon, but rather that BTC might pause or slide back to regain its strength." Sign up here. https://www.reuters.com/business/finance/bitcoin-rises-above-90000-trump-euphoria-2024-11-13/

2024-11-13 16:54

President Sheinbaum plans to consolidate three taxes on Pemex 'We have to fix Pemex,' Sheinbaum says Program seeks to cut Pemex inefficiencies and debt, diversify and boost energy resources Pemex debt could be refinanced in the future MEXICO CITY, Nov 13 (Reuters) - Mexico announced on Wednesday a plan to simplify its fiscal regime for state producer Pemex, in an effort to boost the oil producer whose heavy debts have weighed on state coffers. Mexican President Claudia Sheinbaum said in the regular morning press conference that her administration would consolidate the number of taxes Pemex pays the government, merging three existing duties into one. The president said the move was aimed at "transparency" and giving the oil company, formally known as Petroleos Mexicanos (PEMX.UL), more room for investment. The new duty will be set at a general rate of 30%, and a lower 11.63% for non-associated gas, gas that does not come to the surface as a byproduct of oil production but is considered the principal resource, in 2025. "We have to fix Pemex," Sheinbaum said, adding that the program would also seek to cut inefficiencies, diversify its energy sources, and pay down debt while protecting its output levels. During the presentation, state officials laid out plans for Pemex to increase estimated oil reserves, hit a target 5 billion cubic feet of natural gas per day during Sheinbaum's six-year term, maintain its hydrocarbon production at 1.8 million barrels per day, and increase storage capacity for refined products like gasoline and diesel. New Pemex chief Victor Rodriguez said the company would push an austerity drive that seeks to slash some 50 billion pesos ($2.44 billion) in costs. He added Pemex would continue to work to pay down its debts and that he did not expect the company would have to resort to international debt markets to shore up its financing. Despite government efforts to reduce debt, Pemex carries financial debt of nearly $100 billion and service provider debt of about $20 billion. Credit agencies have warned that government budget allocations for Pemex are an important factor they look at when assessing the country's credit rating. Sheinbaum also responded to questions on a Bloomberg report on Tuesday that said the government would allocate $6 billion to Pemex in its 2025 draft budget, saying the figure was not correct and was still being evaluated. The president, who said the cuts would target in part administrative inefficiencies such as the large number of subsidiaries, did not rule out refinancing Pemex debt in the future. As with her mentor and former president, Andres Manuel Lopez Obrador, Sheinbaum has underlined the importance of state energy companies in shoring up the country's energy sovereignty. She has also spoken of the need to transition to more renewable sources. ($1 = 20.5337 Mexican pesos) Sign up here. https://www.reuters.com/business/energy/mexico-simplify-fiscal-regime-state-oil-firm-pemex-2024-11-13/

2024-11-13 16:17

ZURICH, Nov 13 (Reuters) - Switzerland's financial regulator said on Wednesday it would regularly review how it oversees UBS (UBSG.S) , opens new tab as the country's authorities prepare to overhaul regulations to make the banking sector more robust. Laying out its strategic goals for 2025 to 2028, FINMA said it would enhance supervision of institutions it watches and have them develop their governance and risk culture towards higher requirements and clear risk tolerance thresholds. "The supervisory approach for UBS will be reviewed on an ongoing basis and refined as necessary so that the risks associated with its systemic importance can be countered at all times," FINMA said in a statement. It said it had used its supervisory instruments intensively in the past, including on-site inspections, stress tests and stabilisation and resolution planning, but with the enlarged UBS, Switzerland was particularly exposed. "This means that the supervisory authority must be able to intervene quickly and at an early stage," a spokesperson said. "The new instruments we are calling for would further strengthen our supervision of UBS." The Swiss government in April pitched a series of proposals aimed at tightening banking sector regulations following the 2023 collapse of Credit Suisse and its subsequent takeover by its long-time rival UBS. Among the proposals floated were extra powers for FINMA, but authorities have yet to determine how far-reaching the new regulations should be. That process is expected to extend well into next year. The government said it would in the first half of 2025 make an announcement on the supervisory instruments FINMA has as part of the follow-up to those proposals. UBS and Switzerland's three other systemically important banks - Raiffeisen Group, PostFinance and Zuercher Kantonalbank - must be capable of being restructured, wound up, or sold off, without jeopardising Swiss and international financial stability, FINMA said. Last month FINMA said UBS must improve its emergency and recovery plans following its takeover of Credit Suisse to ensure it can be wound down or sold without risking financial stability and taxpayer cash. FINMA has been appealing for stronger powers to oversee banks, including the authority to name and shame banks that breach its rules, as well as issue fines. The government said it would take into account the findings of a parliamentary report into how the Credit Suisse crisis was handled when determining banking regulations, it added. The report is expected to be published in the next few weeks. Sign up here. https://www.reuters.com/business/finance/swiss-financial-watchdog-regularly-review-how-it-oversees-ubs-2024-11-13/

2024-11-13 16:09

NEW YORK Nov 13 (Reuters) - Congress is likely to adopt legislation governing cryptocurrencies during President-elect Donald Trump's administration, Jay Clayton, a former top Wall Street regulator and potential political appointee, said on Wednesday. Clayton also said he favored easing regulatory burdens to encourage companies to go public, remarks foreshadowing broad-based changes in public policy now anticipated by industry, which spent heavily to influence this month's elections. "I think we will see crypto legislation," Clayton told a gathering of securities lawyers in New York. "I think it becomes much easier to have crypto legislation if you're tackling some of these problems that can be tackled at the executive and the administrative level." Under President Joe Biden, regulators have pursued aggressive enforcement actions against crypto companies and have declined to adopt regulations called for by industry. Clayton, who is in contention for a role in Trump's second administration including attorney general, also described sharp differences with the Biden administration's approach to market regulation and legal enforcement. Regulations requiring corporate disclosures of climate transition costs, such as those adopted earlier this year by the Securities and Exchange Commission, are "terrible" since they can dissuade companies from going public. "If you're thinking about entering the public markets and you're seeing that working its way through the system, you're like, 'Really? I gotta gather all this data that has nothing to do with how I run my business?'" Clayton said. Clayton also said recent Supreme Court precedents that have curtailed the executive branch's powers should encourage regulators to review existing litigation and regulations to see if they remain "viable." When asked about any plans to join the Trump administration, Clayton declined to comment on specifics but said: "If asked for a role where I could be effective, I'll say yes." Sign up here. https://www.reuters.com/business/finance/crypto-legislation-likely-coming-under-trump-ex-sec-chief-says-2024-11-13/

2024-11-13 15:25

Trump's tariff plans, fewer US rate cuts could weigh on euro Weaker euro good for exporters, and especially Germany Euro weakness not seen stalling ECB rate cuts LONDON, Nov 14 (Reuters) - The euro has fallen to one-year lows, reviving talk the currency could hit the $1 mark. Donald Trump’s U.S. election win raises the prospect of a hike in tariffs that could deal a fresh blow to the euro zone economy. At around $1.05 , the euro has slumped 6% from more than one-year highs in September when a weakening economic outlook stopped it in its tracks. Euro/dollar is the world’s most actively traded currency pair. Here’s a look at what’s driving the move in the euro and what could be next for the currency. 1. Could the euro hit $1? It’s possible. Parity is just 5% away and the euro has traded below that level before - once in the early 2000s and again for a [USN:L8N2YP20H TEXT:“few months in 2022″], when U.S. interest rates were rising faster than euro zone ones as Europe grappled with the energy price surge that followed the war in Ukraine. For traders, the $1 mark is a key psychological level. So a fall below here could exacerbate negative euro sentiment, leading to a further depreciation. Big banks including JPMorgan and Deutsche Bank reckon a drop to parity could happen, depending on the extent of tariffs. Tax cuts could also fuel U.S. inflation and limit [USN:L4N3ME1E5 TEXT:“Federal Reserve rate cuts”], making the dollar potentially more attractive than the euro. 2. What does it mean for businesses and households? A weak currency typically raises the cost of imports. That can lead to prices of food, energy and raw materials rising, aggravating inflation. Since hitting double digits two years ago, inflation has [USN:L1N3M70EE TEXT:“fallen quickly”] so the hit to prices from currency weakness shouldn’t be a big worry for now. Most economists see inflation back at its 2% target next year after some volatility at the end of 2024. Conversely, a fall in the euro makes exports cheaper - good news for Europe’s automakers, industrials and luxury retailers, for example, and for individuals or investors with overseas incomes. It’s especially positive for Germany. Long-considered Europe’s export engine, the [USN:L8N3MF1RS TEXT:“German economy has suffered”] from a number of headwinds including a weak Chinese economy. 3. Is the euro being singled out? Not necessarily. Many currencies of major U.S. trading partners have been hit hard in the past six weeks by tariff worries. The euro has lost over 4.5%, while the Mexican peso has lost 6% and the Korean won has fallen 5.4%. The euro actually rallied 6% over the course of Trump’s last term, but fell by nearly 6% in the six weeks following the 2016 result, before recovering. And look at Japan’s yen . It’s down almost 10% this year against the dollar; the euro has fallen less than half of that. 4. Is it really that bad? Not everyone has a bearish long-term view of the euro. Many banks see parity as possible, but not necessarily probable. Faster interest rate cuts from the European Central Bank (ECB) than in the United States would be negative for the euro, but on the positive side that easing could also support the currency longer term by boosting the economic growth outlook. The euro zone economy grew 0.4% in the third quarter from the previous three months, [USN:L1N3M60CL TEXT:“faster than forecast”], positive for the euro. The collapse of Germany’s government that potentially [USN:L8N3MF1RS TEXT:“paves the way for growth-boosting spending”] under the next one could also be supportive. “Everyone is gloomy on Europe and we understand the gloominess but we could have some positive surprises,” said Edmond de Rothschild CIO Benjamin Melman, adding he does not see a significant euro downturn from here. 5. What does it mean for the ECB? The ECB is in a better position than the last time the euro weakened sharply - that was in 2022 and inflation was surging so the euro’s drop below $1 added pressure on the central bank to hike rates. Fast forward to today and inflation is trending lower. There are other reasons why a fall to $1 would not be a huge worry for the ECB. The ECB pays more attention to how the euro performs against a basket of the currencies of the euro area’s main trading partners. Viewed this way, it’s not looking so weak. The trade-weighted euro is down less than 1% in the past week and well above levels seen in 2022. Economists also note that the pass-through from currency moves to inflation is relatively small, so euro weakness shouldn’t stall rate cuts for now. Sign up here. https://www.reuters.com/markets/currencies/why-is-euro-falling-could-it-hit-1-2024-11-13/

2024-11-13 13:57

Nov 13 (Reuters) - Minneapolis Federal Reserve Bank President Neel Kashkari said on Wednesday that he is confident inflation is headed down, noting that data released minutes earlier 'confirms' that downward path. Kashkari, in an interview with Bloomberg TV minutes after a government report showed consumer prices rose 2.6% last month, said he does not think inflation is stuck above 2%, pointing to the decline in goods inflation, the slowdown in wage growth, and the expected but slow-moving decline in housing-related inflation as new and lower leases get folded into the data. Sign up here. https://www.reuters.com/markets/us/traders-bet-fed-december-rate-cut-after-inflation-data-2024-11-13/