2025-10-27 11:51

Percentage of investors long duration falls -J.P. Morgan survey Bond investors believe soft landing in sight Focus on end of quantitative tightening End of QT bullish for Treasuries NEW YORK, Oct 27 (Reuters) - Bond investors are re-examining their holdings of longer-dated Treasuries, with some reducing positions and others even going short relative to their benchmark, as the Federal Reserve prepares to cut interest rates by another quarter percentage point on Wednesday. Many bond investors expect the Fed to continue to adopt a measured pace in cutting interest rates. Portfolio managers tend to favor duration, which entails buying longer-dated debt, when the Fed is easing, as a hedge against further economic weakness. But some investors are backing away from that trade on views a soft landing for the world's largest economy remains within reach. Sign up here. The Federal Open Market Committee, which sets monetary policy, is expected to end its two-day meeting by announcing it will lower the benchmark overnight rate by 25 basis points to a range of 3.75%–4.00%, which would be its second easing this year. In September, the FOMC ended a nine-month pause, cutting rates by a quarter of a point as signs of a weakening labor market emerged. Investors will also closely parse remarks from Fed Chair Jerome Powell for signals about when the central bank might conclude its balance sheet reduction program, known as quantitative tightening (QT). Powell recently signaled that the end of QT is approaching — fueling speculation that the Fed could either announce its conclusion at this week's meeting or outline a roadmap for winding it down. This should be bullish for Treasuries because it reduces their supply in the market, pushing prices higher and yields lower. An exit from QT also means the Treasury's financing requirements would decline because it no longer needs to borrow as much to cover the Fed's redemptions. Under QT, Treasury's borrowings effectively increase. The Fed shrinks its balance sheet by letting the bonds it holds mature. The Treasury redeems the debt and pays the U.S. central bank by subtracting the required amount from the cash balance it keeps on deposit at the Fed. In order to replace the cash it paid the Fed, the Treasury needs to sell new securities. "It's another tailwind for fixed income such as Treasuries," said Neil Sutherland, portfolio manager at Schroders. "At the margin, it merits going long bonds but since yields have come down, valuations are not quite as compelling as they were three to four months ago. It does suggest that fixed income remains well supported." PULLBACK FROM DURATION? When the Fed enters a rate-cutting cycle, investors typically extend duration, anywhere from U.S. five-year to 30-year Treasuries. In periods of easing, shorter-dated yields fall, so investors reach further out the curve to lock in higher long-term rates before they decline further. As such, longer-dated debt has historically outperformed shorter-duration Treasuries during Fed easing. "Dealers are telling me that I should extend duration and buy as long as I possibly can because we're going into recession and everything's going to break down," said Byron Anderson, head of fixed income at Laffer Tengler Investments in Scottsdale, Arizona. "But I'm just on the other side of that argument, pushing short, being protective, buying T-bills, and just waiting. I'm not buying the idea that we're going into economic disaster. I know things are bad for big parts of the consumer base and I get that the job market has stagnated, but it hasn't fallen off a cliff." Overall, there has been a retreat from long-duration positioning. JP Morgan's latest Treasury Client Survey showed that the percentage of investors that are long duration relative to their benchmark fell as of October 20, while those with shorter duration increased. The survey of all its clients showed the fewest outright longs since August 25, the bank said. Brendan Murphy, head of fixed income, North America at Insight Investment in Boston, said the firm is still overweight duration overall, "but probably a bit less overweight than we were earlier in the year." He added that "rates have rallied a fair amount and so we've reduced duration a little bit." That overweight, he added, is concentrated in the "intermediate part of the curve and probably the five-year is where the preference is." Tony Rodriguez, global head of fixed income strategy at Nuveen in Minneapolis, believes in going slightly above neutral duration in bond portfolios, or adding a little bit more risk with the focus as well on the front and intermediate sector. The positioning reflects steady fundamentals and a solid technical picture in the bond market, Rodriguez said. "We think the economy will do a little better next year than this year," the Nuveen strategist said. "You will begin to see a little progress on inflation. It's going to be slow, but that will cause the Fed to be less aggressive with cuts." https://www.reuters.com/business/finance/countdown-fed-cut-bond-investors-scale-back-longer-dated-treasuries-2025-10-27/

2025-10-27 11:38

Oct 27 (Reuters) - Albemarle (ALB.N) , opens new tab said on Monday it will sell a 51% stake in its refining catalyst solutions business, Ketjen, to private equity firm KPS Capital Partners, and divest its 50% interest in the Eurecat joint venture to France's Axens SA, in deals worth about $660 million. Albemarle, one of the world's largest lithium producers, said it would use the proceeds for debt reduction and general corporate purposes as part of its efforts to boost financial flexibility and refocus on its core lithium and bromine units. Sign up here. The sale marks Albemarle's latest move to streamline its portfolio amid a downturn in lithium prices that has pressured earnings and cash flow this year. Once the transactions are closed, expected to be in the first half of 2026, Albemarle said it would retain a 49% minority stake in Ketjen and full ownership of its Performance Catalyst Solutions business, including the PCS plant in Pasadena, Texas. KPS, which manages more than $19 billion in assets, said it will leverage its manufacturing experience to grow Ketjen's global refining catalyst operations and drive profitability. https://www.reuters.com/business/albemarle-divest-ketjen-control-eurecat-stake-660-mln-deal-2025-10-27/

2025-10-27 11:36

TOKYO, Oct 27 (Reuters) - Japan's new finance minister, Satsuki Katayama, said on Monday her meeting with U.S. Treasury Secretary Scott Bessent did not directly touch upon the Bank of Japan's monetary policy. "I believe the Treasury Secretary held talks with Bank of Japan Governor (Kazuo) Ueda at the IMF meetings" earlier this month, Kataya told reporters after her first face-to-face meeting with Bessent in Tokyo. Sign up here. https://www.reuters.com/world/asia-pacific/japan-us-did-not-directly-discuss-boj-policy-finmin-katayama-says-2025-10-27/

2025-10-27 11:24

Oct 27 (Reuters) - Sterling was set to snap a three-session losing streak against the euro on Monday, as investors paused ahead of a week crowded with central bank policy decisions. Last week’s UK inflation data prompted markets to increase bets on Bank of England rate cuts, while 2-year gilt yields dropped by 7.5 basis points, before rising by 2 bps on Thursday and Friday. They were roughly unchanged at 3.80% on Monday. Sign up here. Traders have priced in a 67% chance of a BoE rate cut by year-end from less than 50% before last week's inflation data, while fully pricing in two reductions by June 2026. The euro dropped 0.14% to 87.22 pence after hitting 87.47 pence on Friday, its highest since October 6. Friday's euro zone purchasing managers' surveys strengthened expectations that the European Central Bank will keep its deposit facility rate at 2% into 2027 , with markets pricing out the chance of a rate cut in 2026. However, some economists' base case is for the BoE to keep policy on hold until its February meeting, which would likely see a partial unwinding of the recent rate differential moves that have pushed sterling lower. “Fiscal events remain the dominant factor for the pound in the medium term and we stand by our view that the bar for a positive outcome for sterling is not particularly high,” Barclays’ strategists said in a research note, noting that the BoE's Monetary Policy Committee is split between hawks and doves. There is a high probability the committee will be almost evenly divided when it votes on interest rates in November. Most investors have priced in that British finance minister Rachel Reeves will raise tens of billions of pounds in taxes in her budget on November 26 to stay on track to meet her fiscal targets and avoid a loss of confidence in the bond market. The pound was up 0.20% to $1.3345 , snapping a five-session losing streak. The greenback was mixed, coming off a six-day rally against the yen and a three-day losing streak versus the euro. https://www.reuters.com/world/uk/sterling-snaps-three-day-falling-streak-against-euro-up-vs-dollar-2025-10-27/

2025-10-27 11:22

President Paul Biya, 92, wins eighth term Crowds block roads and burn tyres in Douala Opposition's Tchiroma says two shot dead near his home YAOUNDE, Oct 27 (Reuters) - Cameroon's President Paul Biya, the world's oldest serving ruler, secured an eighth term in office on Monday, election results showed, triggering clashes between security forces and opposition supporters who say the vote was rigged. Backers of opposition candidate Issa Tchiroma Bakary, armed with sticks and stones, blocked off roads with debris and burning tyres in the central African country's commercial capital Douala. Sign up here. Police fired tear gas at crowds who wore masks or tried to cover their faces with clothing. In other parts of the city, streets that normally buzzed with motorbikes were deserted. Biya - aged 92, with a new mandate that could keep him in power until he is almost 100 - said the people had once again placed their trust in his leadership and expressed sorrow for the violence in a statement posted on social media platform X. "My first thoughts are with all those who have unnecessarily lost their lives, as well with their families, as a result of the post-election violence," Biya said. The government has rejected opposition accusations of irregularities. TYRES BURN IN DOUALA Official results published on Monday showed Biya winning the October 12 vote by a comfortable margin of 53.66% against 35.19% for opposition leader Tchiroma. Tchiroma claimed victory last week and said he would not accept any other outcome. Protests erupted in several towns after early, partial results suggested Biya was on track for victory. The government urged people to wait for the results. Over the weekend, four people died in clashes in Douala, the opposition said. "We expect unrest to escalate as Cameroonians widely reject the official result, and we cannot see the Biya government lasting much longer," said Francois Conradie, lead political economist at Oxford Economics. Tchiroma said on Facebook that shots fired at civilians outside his home in the northern city of Garoua killed two people on Monday. Reuters could not independently confirm his account or who had fired the shots. "We all know that the majority of Cameroon's people voted for Issa Tchiroma Bakary," said one protester in Douala. "It is inadmissible that President Paul Biya won in certain war zones." Riot police roamed on patrol and businesses stayed closed. "Biya now has a notably shaky mandate given many of his own citizens don’t believe he won the election," Murithi Mutiga, Africa Program Director at the International Crisis Group, told Reuters. "We call on Biya to urgently initiate a national mediation to prevent further escalation," Mutiga added. ALLY TO RIVAL Biya took office in 1982 and has held a tight grip on power ever since, doing away with the presidential term limit in 2008 and winning reelection by comfortable margins. Cameroon's elderly president is no anomaly in the region, where some of the world's youngest populations are governed by leaders over 80. Togo's president is 86. Ivory Coast's president, who is expected to win last week's election, is 83. The opposition says voters in Cameroon are clamouring for change after more than four decades of Biya's rule, during which economic development in the oil- and cocoa-producing nation has stagnated. Even Biya's daughter Brenda published a now-deleted TikTok video urging voters not to choose her father. Tchiroma, in his 70s, is a former government spokesperson and employment minister who broke ranks with Biya earlier this year. His transformation from ally to opposition figurehead and challenger is one of the most striking political shifts in Cameroon's recent history. His campaign drew large crowds and endorsements from a coalition of opposition parties and civic groups. https://www.reuters.com/world/africa/cameroons-biya-wins-re-election-official-results-show-2025-10-27/

2025-10-27 11:16

Gold expected to average $3,400/oz in 2025, $4,275/oz in 2026 Silver expected to average $38.45/oz in 2025, $50/oz in 2026 Individual forecasts , Oct 27 (Reuters) - Gold's winning streak is seen extending into next year, with analysts forecasting an annual average price above $4,000 per ounce for the first time as economic and geopolitical turmoil keep the metal's safe-haven allure intact, a Reuters poll showed. The poll of 39 analysts and traders returned a median forecast of $3,400 per troy ounce of gold for 2025, up from $3,220 in July. They expect prices to average $4,275 in 2026, up sharply from $3,400 three months prior.COMMODS-GOLD Sign up here. Gold has hit successive record highs and hurdled the $4,000/oz mark to gain 54% so far this year, leaving the metal on track for its strongest annual performance since the 1979 oil crisis. Prices have averaged $3,281 so far this year. "Gold's performance in 2025 reflects more than the strength of a rally. It marks an acceptance of a new reality. The market is no longer responding to short-term shocks but to a deeper loss of confidence in policymakers, currencies, and the financial system itself," said David Russell at GoldCore. Gold, a traditional hedge during times of uncertainty, has gained on broader geopolitical concerns, trade turmoil and a swing away from dollar dominance, with central bank purchases and inflows into exchange-traded funds underpinning its rise. Expectations of U.S. interest rate cuts have also supported the non-yielding metal. While analysts foresee continued gains for gold into 2026, they expect the pace to moderate. Persistent uncertainty is likely to sustain support for the rally, with central banks anticipated to continue buying gold for reserve diversification and investors increasingly treating the metal as a core portfolio asset rather than a speculative investment, analysts say. "While jewellery demand may remain price-constrained, the official sector's strategic purchases, together with retail and institutional investment flows, are likely to be the dominant drivers," said Nitesh Shah, commodities strategist at WisdomTree. SILVER OUTLOOK REMAINS BULLISH Analysts also lifted silver price forecasts, now expecting the white metal to average $38.45 in 2025 and $50 in 2026, compared to $34.52 and $38 forecast in July's poll. COMMODS-SILVER Silver, both a safe-haven asset and industrial metal, has gained 65% this year and notched an all-time high of $54.47. Supply deficits and robust demand from sectors such as solar technology, electric vehicles, and AI data centres underpin its outlook. "Silver continues to see structural supply deficits and this is expected to continue in 2026. Silver is also uniquely positioned as a 'higher beta' play on a bullish metals market, benefiting both from its traditional role as a monetary hedge (like gold) and its crucial industrial applications," said Zain Vawda, analyst at MarketPulse by OANDA. Analysts say robust investment demand will remain a key driver of silver's price gains, as investors seek a cheaper alternative to gold. https://www.reuters.com/business/finance/annual-2026-gold-price-forecast-tops-4000oz-first-time-2025-10-27/