2024-11-13 05:57

Bitcoin surges to new all-time peak Yen drops below 155 per dollar Euro falls to one-year low Dollar index hits highest since November 2023 NEW YORK, Nov 13 (Reuters) - The U.S. dollar advanced to one-year high against major currencies on Wednesday powered by so-called Trump trades and after U.S. inflation for October came in as expected, suggesting the Federal Reserve will continue lowering interest rates. The greenback hit its highest level since November 2023, buoyed by Donald Trump's victory in last week's U.S. presidential election, which sparked expectations of potentially inflationary tariffs and other measures by his incoming administration. Trump's Republican Party will also control both houses of Congress when he takes office in January, Edison Research projected on Wednesday, enabling him to push an agenda of cutting taxes and shrinking the federal government. The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, rose 0.43% to 106.44 after reaching as high as 106.53. "I'm not sure the inflation data pushed things around too much since it was pretty much in line with expectations," said Brad Bechtel, global head of FX at Jefferies. "I think it's just continuation of the Trump trade kind of mindset ... leading to strengthen the dollar on a broad basis but also kind of a flushing of some of the EM [emerging market] long positions." Labor Department data on Wednesday showed the U.S. consumer price index rose 0.2% for the fourth straight month, in line with economists' expectations, amid higher costs for shelter such as rents. In the 12 months through October, the CPI advanced 2.6%. U.S. Treasury yields fell following the inflation data, with the 2-year note yield, which typically moves in step with interest rate expectations, dropping 6.5 basis points to 4.279%. "So certainly there was a lot of concern going into the number as it's just one of the new bricks in this kind of wall of worry; so there's a little bit of a relief rally and yields are lower," said Marvin Loh, senior global market strategist at State Street in Boston. "It just shows how on edge the market is based on the Fed, based on inflation, and certainly based on this nebulous Trump trade. The dollar seems to be one of the cleanest, easiest ways of playing the Trump trade as well as bitcoin, it seems." Bitcoin surged past the $90,000 level for the first time, powered by euphoria from Trump's election victory and expectations that his administration will be beneficial to cryptocurrencies. Bitcoin gained 2.75% to $90,734.00. Ethereum declined 3.11% to $3,178.60. Japan's wholesale inflation accelerated in October at the fastest annual pace in more than a year, complicating the Bank of Japan's decision on how soon to raise interest rates. The yen broke through 155 per dollar, the Japanese currency's weakest level since late July. It was last at 155.46 yen per dollar. The euro continued its descent amid expectations of potential Trump tariffs. Political uncertainty in Germany, the bloc's biggest economy, has also weighed on the currency following the collapse of Chancellor Olaf Scholz's governing coalition last week and with snap elections set for Feb. 23. The euro was down 0.51% at $1.0569. It had dropped to as low as $1.055575, its lowest level since November 2023. The dollar was flat at 7.243 versus the offshore Chinese yuan. Against the Swiss franc , the dollar strengthened 0.43% to 0.885. Sign up here. https://www.reuters.com/markets/currencies/dollar-holds-firm-ahead-us-inflation-bitcoin-targets-fresh-highs-2024-11-13/

2024-11-13 05:39

MUMBAI, Nov 13 (Reuters) - The Indian rupee was hovering near its all-time low on Wednesday, wedged between weakness in local equities and dollar sales by state-run banks. The rupee was at 84.4050 as of 10:45 a.m. IST, nearly unchanged from its close at 84.3925 in the previous session. The currency declined to a record low of 84.4125 on Tuesday. Most Asian currencies rose, with the Chinese yuan up 0.1% aided by firmer-than-expected official guidance by the Chinese central bank. The dollar index was hovering just shy of the 106-handle after hitting an over six-month high boosted by a rise in U.S. bond yields as investors continued to price in U.S. President-elect Donald Trump's policies of lower taxes and trade tariffs. The rupee has slumped to record lows for the last five trading sessions, pressured by a rally in the dollar index and persistent outflows from local equities. India equity markets "have witnessed strong foreign portfolio outflows on high valuation concerns, softening corporate earnings and a portfolio rebalancing push," DBS Bank said in a note. Foreign investors have net sold about $3 billion of Indian stocks over November so far, adding to previous month's $11 billion outflows. Indian equity indexes have fallen over 9% since their peak in late September. While the rupee has remained under pressure for more than a month, routine interventions by the central bank have ensured a gradual decline and kept volatility muted, a senior trader at a foreign bank said. The Indian currency is down 0.4% so far in November, outperforming most regional peers. Investors await U.S. consumer inflation due later in the day to gauge the future path of the Federal Reserve's policy rates. Sign up here. https://www.reuters.com/markets/currencies/rupee-pinned-near-record-low-state-run-banks-dollar-sales-cap-weakness-2024-11-13/

2024-11-13 05:35

A look at the day ahead in European and global markets from Kevin Buckland The wide-ranging market bets on big fiscal spending, lower taxes and higher tariffs under incoming U.S. President Donald Trump - collectively dubbed "Trump trades" - took a breather on Wednesday while traders' focus shifted back to economic data. The dollar has surged and Treasury yields have skyrocketed since last week's election, while market odds for a rate cut at the Fed's next meeting in December have been whittled down to just 62% from 77% a week earlier and 84% a month ago, according to CME Group. Wednesday brings potentially crucial U.S. CPI data that could either bolster or reverse that trend in rate cut expectations, and kicks off a busy few days that include U.S. producer inflation readings and comments from Fed Chair Jay Powell on Thursday, followed by retail sales figures on Friday. Powell last week pledged to stay the course on careful, patient monetary easing, saying the central bank wouldn't try to "guess" Trump's policies or their effect on the economy. Whatever Trump's agenda, it should be easily pushed through Congress, now that Republicans appear to have won a majority of U.S. House seats, marking a government sweep. This week has brought into sharper relief some of the contradictions across the various Trump trades, which at times work at cross-purposes. Gold prices have set consecutive record highs this year, partly on bets for higher inflation and government borrowing under Trump, but its momentum has been stymied by the strong dollar. The U.S. currency stands near a one-year peak against the euro and a multi-month high against the yen, buoyed mainly by the leap in U.S. yields. But surging borrowing costs tend to make equity investors antsy, and are a particular weight on high-flying tech shares and other growth stocks. As markets analyst Kyle Rodda from Capital.com put it, eventually "higher risk-free rates strangle valuations". Many of the biggest Asian equity benchmarks are down close to 1% or more, including Japan's Nikkei, South Korea's Kospi and Australia's share index. Hong Kong's Hang Seng is off 0.6% but was down twice that earlier in the session. Wall Street futures point to additional weakness after Tuesday's pullback, and pan-European STOXX 50 futures are also lower. The European calendar is fairly light, with financial firms ABN Amro and Allianz headlining corporate earnings announcements. The Bank of England's Catherine Mann speaks on a panel today, and may draw attention after sterling's sharp sell-off on Tuesday. But the bulk of central bank speak will come from the Fed again, with regional heads Alberto Musalem, Lorie Logan and Jeffrey Schmid taking to the podium at separate events throughout the day. Key developments that could influence markets on Wednesday: -US CPI (Oct) -Dallas, St Louis, Kansas City Fed chiefs speak at separate events -BoE's Mann speaks Sign up here. https://www.reuters.com/markets/europe/global-markets-view-europe-2024-11-13/

2024-11-13 05:12

CATL aims to develop and manage green energy grids for mines, cities, and data centers CATL plans to launch micro-grid pilot at copper mine in DRC in 2025 CATL to launch off-the-shelf EV platform to reduce costs for automakers NINGDE, China, Nov 13 (Reuters) - Robin Zeng, the billionaire founder of CATL (300750.SZ) , opens new tab, aims to reinvent the world’s largest battery maker as a green-energy provider and to slash the cost of developing electric vehicles, upending the economics of the industry that has powered its growth. Zeng told Reuters in an interview that he expects the business of developing and managing "zero carbon" electric grids could be "ten times" larger than supplying electric-vehicle batteries, a market CATL now leads with a 37% global share. CATL, he said, aims to build independent energy systems big enough to power a massive data center or even a city. In a separate strategic move, CATL plans to offer an off-the-shelf electric-car platform with a long-range battery integrated into a chassis. Customers could then launch their own customized EVs by designing only the interior and exterior. The goal, Zeng said, is to sharply cut EV development costs - to millions of dollars from billions - and open the industry to new competitors. Zeng’s initiatives aim to unlock new growth for his 25-year-old enterprise, which got its first big break selling lithium-ion batteries for Apple’s (AAPL.O) , opens new tab iPod before pivoting to EVs in 2011 with a BMW (BMWG.DE) , opens new tab supply deal. CATL sold $40 billion worth of EV batteries last year, up from $33 billion a year earlier. Hitting Zeng’s goal for electric grids of tenfold revenue growth would put the battery maker on par with state oil giants Sinopec and PetroChina (601857.SS) , opens new tab, China’s largest companies. CATL’s strategic pivots into electric grids and EV platforms have not been previously reported. In an exclusive interview with Reuters on Nov. 7 outside CATL’s headquarters in the southern Chinese city of Ningde, Zeng also discussed the battery giant’s readiness to invest in the United States if President-elect Donald Trump opens the door; the path to profit for its European factories; and why the industry’s fixation on so-called solid-state batteries as the next big breakthrough is misplaced. A GIANT 'GREEN GRID' MARKET CATL’s energy-storage business grew 33% last year, outpacing its EV-battery business. But Zeng sees a much bigger opportunity for CATL by supplying green-grid systems including solar and wind power, dedicated storage and a smart system to draw power from parked EVs. China has the world's highest EV-adoption rates; EVs and hybrids have accounted for more than half of all new cars sold there in recent months. CATL, Zeng said, can build a zero-emissions grid big enough to power a massive mining complex or a city. The firm aims to go well beyond energy-storage and into power generation, Zeng said. "That's huge compared to EVs," he said. The grids, and CATL management systems, could serve AI companies scrambling to secure green energy for data centers. CATL would partner with providers of solar panels and wind turbines, Zeng said. "A lot of the data-center companies are asking me, 'Hey, Robin, can you really do it 100% green?'" he said, noting they are often "giant" firms. "They have money, but they don't have the technology." CATL plans a pilot project in the Democratic Republic of the Congo with CMOC Group (603993.SS) , opens new tab, the Chinese mining company in which it holds a stake. The company is also working with Hainan, an island province off China's southern coast, on a larger, longer-term project that would combine energy storage with solar and offshore wind turbines. OFF-THE-SHELF EV PLATFORM CATL supplies batteries for more than a third of electric or hybrid vehicles globally. Now Zeng is pushing a new automotive offering - an EV chassis engineered by CATL with a battery capable of running more than 800 km (497 miles) on a single charge. The battery is integrated into the chassis in a way that protects it from damage in accidents, Zeng said. That project, code-named "panshi", or "bedrock" in Chinese, has not been formally announced but CATL has started marketing the platform to customers. Reuters reporters saw a demonstration version of the EV platform at CATL's headquarters on display for customers and staff. Zeng said the project could slash the cost of developing a new EV from billions of dollars to just $10 million. That could make a niche EV firm profitable by selling just 10,000 cars a year, Zeng said. This would open the industry to new EV players in economies without established automakers, he said. CATL has shown the "panshi" technology to Porsche (PSHG_p.DE) , opens new tab for a potential luxury EV and to investors in the United Arab Emirates eager to start a local EV brand, Zeng said. "We are not trying to go into making a car. Never," Zeng said. "But we try to make everything ready for carmakers." CATL could even supply a 3D-printed body for the car, Zeng said. CATL faces competition in the new market for ready-to-make EV platforms, including from Xpeng (9868.HK) , opens new tab and Shanghai-based engineering firm Launch Design. OVERSEAS BATTERY PRODUCTION In Europe, CATL has been working on a plan to build a jointly owned battery factory in Spain with Stellantis (STLAM.MI) , opens new tab. That deal could be finalized in January at the latest, Zeng said. CATL operates a six-year-old factory in Germany, its first in Europe, and is building a new plant in Hungary. Zeng said those plants would be profitable in 2025 and 2026, respectively. The larger Hungarian plant, which will start production next year, will produce 100 gigawatt hours of batteries on a sharply lower cost base than the plant in Germany, Zeng said. The plants are part of a CATL plan to make batteries in Europe for automakers such as BMW, Stellantis and Volkswagen (VOWG_p.DE) , opens new tab. Zeng said CATL's European business is important in part because the region has prioritized the clean-energy transition. But he called the EU decision to impose tariffs of up to 45.3% on Chinese EV imports "stupid thinking." European automakers would be better off partnering with Chinese automakers, as Stellantis has with China’s Leapmotor (9863.HK) , opens new tab, to bring lower-cost EVs or long-range hybrids to market, he said. "In this battle, actually, China is more advanced," Zeng said. "Why not learn from us?" The EU Commission declined to comment. LITHIUM MINING AND THE FUTURE OF BATTERIES Zeng said he stopped production at a huge CATL lithium hub in the southern Chinese province of Jiangxi in September because the price of lithium carbonate fell, achieving his aim. He started the project in 2022 when prices were soaring. CATL's intervention was intended to "reduce the cost dramatically," he said. CATL has faced criticism in China from competitors and others who say its size gives it power over pricing of battery minerals or the ability to muscle out competitors. Zeng said CATL was not aiming to drive rival miners out of business by pushing down lithium prices and recognized the need for a profitable supply chain. "As the big player in batteries, we want to maintain, or try our best to maintain oxygen for everyone," Zeng said. The reasoning for the production suspension has not been reported. CATL said it was making "adjustments" to production when it first announced the move in September. CATL's Yichun plant had also faced higher costs because of its reliance on a hard type of lithium ore, analysts have said. Zeng also downplayed the potential of solid-state batteries as the next game-changing technology. CATL has more than 20,000 staff in research, including 1,000 dedicated to solid-state batteries, which have been touted for years as a lighter, more powerful alternative to the current generation of EV batteries. Zeng expects CATL to start a limited rollout of the technology in 2027. China's government has also provided more than $830 million to fund research on solid-state batteries industry-wide. But Zeng sees sodium-ion batteries as a better bet, potentially replacing up to half of the market for lithium-iron phosphate batteries that CATL now dominates. Unlike other battery materials, sodium is cheap and abundant, and the chemistry has the potential to reduce fire risks in EVs, experts have said. CATL offers a sodium-ion battery that is paired with lithium-ion batteries for use in EVs. Sign up here. https://www.reuters.com/business/autos-transportation/chinese-giant-catl-pushes-beyond-batteries-into-power-grids-ev-platforms-2024-11-13/

2024-11-13 05:00

US CPI increased as expected in October Dollar advances near 7-month peak Bullion at a near two-month low Nov 13 (Reuters) - Gold prices extended losses for the fourth straight session on Wednesday, weighed down by a stronger dollar and elevated bond yields on news that October U.S. consumer prices increased as expected. The Labor Department also reported slower progress toward low inflation since mid-year, which could result in fewer interest rate cuts from the Federal Reserve next year. Spot gold was down 0.7% at $2,580.39 per ounce by 01:49 p.m. ET (1849 GMT), after hitting a near two-month low earlier in the session. U.S. gold futures settled 0.8% lower at $2,586.50 per ounce. The dollar (.DXY) , opens new tab advanced near a seven-month high against major currencies, while benchmark U.S. 10-year yield climbed. US/] "The CPI increased but met expectations, leading to a mixed impact on gold prices. Markets have increased their bets on a potential 25 basis points interest rate cut in December," Zain Vawda, market analyst at MarketPulse by OANDA, said. Traders are pricing in an 82% chance of a Fed rate cut in December, up from around 58% before the data, according to CME FedWatch tool. However, investors believe Trump's presidency might cause the Fed to pause its easing cycle if inflation takes off after expected new tariffs. "In the short term, there is potential for gold prices to slightly recover to around $2,650 per ounce, but they may decline again afterward," Vawda added. Looking ahead, the U.S. Producer Price Index (PPI) and weekly jobless claims are due on Thursday, with retail sales data on Friday. Remarks from Fed Chair Jerome Powell and other central bank officials are also on the radar. "Gold bulls' next upside price objective is to produce a close above solid resistance at $2,700. Bears' next near-term downside price objective is pushing futures prices below solid technical support $2,500," Jim Wyckoff, a senior market analyst at Kitco Metals, said in a note. Spot silver fell 0.5% to $30.55 per ounce. Platinum slipped 0.9% to $938.60 per ounce, while palladium dropped 1.3% to $932.10 per ounce. Sign up here. https://www.reuters.com/markets/commodities/gold-drifts-higher-traders-eye-us-inflation-print-2024-11-13/

2024-11-13 04:39

Prices hit 2-wk low on Tuesday after OPEC's lower demand forecast Saudi crown prince, Russia's Putin talk 'close coordination' within OPEC+ Dollar advances near 7-month peak after US inflation data NEW YORK, Nov 13 (Reuters) - Oil prices rebounded on Wednesday, settling higher on short-covering a day after they fell near a two-week low on OPEC's reduced demand forecast, but crude's gains were limited as the dollar hit a seven-month high. Brent crude futures settled up 39 cents, or 0.54%, to $72.28 a barrel. U.S. West Texas Intermediate crude (WTI) futures gained 31 cents, or 0.46%, to $68.43. On Tuesday, the benchmarks closed at their lowest level in nearly two weeks after the Organization of the Petroleum Exporting Countries lowered its global oil demand growth forecasts for 2024 and 2025, citing weak demand in China, India, and other regions. It was the producer group's fourth straight downward revision for 2024. "The forecast is no doubt bearish and the market is still digesting it," said Bob Yawger, director of energy futures at Mizuho, adding the market bounced back as some speculative investors tried to recoup losses. Both U.S. and global oil production are set to rise to slightly larger record highs this year than prior forecasts, the U.S. Energy Information Administration said on Wednesday. U.S. oil output is now expected to average 13.23 million barrels per day (bpd) this year and global production is set to reach 102.6 million bpd. The International Energy Agency, which has a much lower demand growth forecast than OPEC's, is set to publish its updated estimate on Thursday. Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman have underscored the importance of continuing a "close coordination" within OPEC+ during a phone call on Wednesday, also providing some support. On the supply side, markets could still face disruption from Iran or further conflict between Iran and Israel. "If this war continues, Israel is eventually going to attack Iranian oil assets," said Clay Seigle, an independent political risk strategist. This could be limited to Iran's refineries, but Israeli planners may be more ambitious and go for production and export facilities," he said. Trump's expected pick for secretary of state, Senator Marco Rubio, could be bullish for prices as his hawkish view on Iran could see sanctions enforced, potentially removing 1.3 million bpd from global supply, said Panmure Liberum's Ashley Kelty. Iran's oil minister said Tehran had made plans to sustain oil production and exports and was ready for possible oil curbs by the U.S., the ministry's news website Shana reported. Limiting oil price gains, the dollar advanced to near a seven-month high against major currencies after data showed U.S. inflation for October increased in line with expectations, suggesting the Federal Reserve will keep cutting rates. A stronger greenback makes dollar-denominated oil more expensive for holders of other currencies, which can reduce demand. The American Petroleum Institute's weekly inventory data, due at 4:30 p.m. EST (2130 GMT) was also in focus, with analysts polled by Reuters expecting a 100,000-barrel rise in crude stocks last week. Government data is due on Thursday at 11 a.m. Both reports are delayed a day due to Monday's Veterans Day holiday. Sign up here. https://www.reuters.com/business/energy/oil-trims-losses-tight-near-term-supply-2024-11-13/