2025-12-02 02:51

MUMBAI, Dec 2 (Reuters) - The Indian rupee fell to a record low on Tuesday, extending losses sparked by the absence of a trade deal between India and the United States, which has dented trade and portfolio inflows. The currency touched 89.9475 against the U.S. dollar before ending at 89.87, down nearly 0.4% on the day and logging its fifth consecutive daily fall. Sign up here. Shortly after the local spot market closed, the rupee weakened to 90 per U.S. dollar on the inter-bank order matching system before trimming losses. The South Asian currency has stayed under pressure despite strong economic growth in India in the quarter through September, underscoring the strains on the country’s external sector. Analysts expect the rupee to face more weakness but say the Reserve Bank of India’s market interventions, like Tuesday’s, should help keep volatility in check. "Since the current stance of (INR) weakness continues, we have been advising exporters to just sell (USD) on cash/spot basis and keep minimum hedges," said Anil Bhansali, head of treasury at Finrex Treasury Advisors. "Importers have been advised to buy all dips (on USD/INR)," he added. The splintered behaviour has also manifested in market activity as importers rush to lap up dollars while exporters hesitate, adding pressure on the rupee. In November, importers booked forward hedges worth nearly $31 billion, up 11% compared to the average between 2020-24 while exporter activity declined about 5% to about $21 billion compared to the same benchmark. Dollar-rupee forward premiums also surged on Tuesday, reflecting the rising cost of hedging against rupee weakness as the currency nears the 90 per U.S. dollar mark. The 1-month forward premium rose to over 19 paisa, the highest since May while the 1-year implied yield climbed 7 basis points to 2.33%. Elsewhere, global FX markets were largely subdued with Asian currencies and the dollar index hovering sideways as investors held on to wagers that the U.S. Federal Reserve will cut rates this month. https://www.reuters.com/world/india/rupee-may-extend-losses-despite-rbis-move-hold-line-90-2025-12-02/

2025-12-02 01:35

TOKYO, Dec 2 (Reuters) - Japanese Finance Minister Satsuki Katayama said on Tuesday she sees no gap between the government and the Bank of Japan on their assessment of the economy, after the central bank chief voiced confidence in the outlook and hinted at a rate hike. "We believe there is no discrepancy between the BOJ's and government's view that the Japanese economy is recovering modestly, so we don't see this as a problem," Katayama said at a regular press conference, when asked about BOJ Governor Kazuo Ueda's comments on Monday. Sign up here. Ueda said on Monday the BOJ would consider the pros and cons of raising interest rates at its next policy meeting in December, offering the strongest hint so far that a hike may materialise this month. Katayama said she expects the BOJ to continue working closely with the government and conduct monetary policy to achieve a 2% inflation target, accompanied by wage increases. "At this point, given those expectations, I have nothing further to add," she said. "Looking ahead, we need to monitor whether price increases will persist, as well as developments in U.S. trade policy. In addition, given the various fluctuations in global financial and capital markets, we must closely watch corporate trends." https://www.reuters.com/world/asia-pacific/japan-finance-minister-says-no-divergence-with-boj-economic-assessment-2025-12-02/

2025-12-02 00:44

SYDNEY, Dec 2 (Reuters) - Australia's government spending jumped in the third quarter to add to a long-awaited rebound in business investment, setting the stage for a solid economic performance. Data on Tuesday from the Australian Bureau of Statistics showed government spending added 0.4 percentage points to gross domestic product (GDP) in the September quarter, after barely contributing in the previous quarter. Sign up here. That, coupled with solid business investment, suggested risks to economic growth are to the upside last quarter. The ABS also said on Tuesday net exports would subtract 0.1 percentage point from GDP, in line with expectations. A Reuters poll showed the economy likely expanded 0.7% in the quarter, the fastest pace since the fourth quarter of 2022. That leaves the annual rate at 2.2%, above the Reserve Bank of Australia's estimate of trend growth at 2%. The GDP data is due on Wednesday. The stronger economic performance is one reason that inflation re-accelerated in the third quarter, which dashed all hopes for any more policy easing from the RBA after three rate cuts this year. Adam Boyton, head of Australian Economics at ANZ, dropped his call for one more rate cut from the RBA next year given the recent inflation pressures and now sees the central bank on an extended hold. "Signs of ongoing inflation pressures in the monthly CPI, GDP growth running around the RBA’s estimate of potential and the RBA’s view that the labour market is tight all suggest the RBA’s Board is likely to be cautious about further easing," said Boyton. Swaps imply the RBA will remain on hold until the second half of next year, with a 70% probability of a rate hike at the end of 2026. Separate released on Tuesday showed the total value of housing stock in Australia jumped to a record high of A$12 trillion ($7.85 trillion) last quarter, boosting household wealth and underpinning consumer spending. Home prices have leapfrogged almost 8% this year to new record highs as policymakers worry financial conditions might not be restrictive enough to keep inflation in check. ($1 = 1.5295 Australian dollars) https://www.reuters.com/world/asia-pacific/australia-q3-current-account-deficit-widens-drags-gdp-2025-12-02/

2025-12-02 00:41

Trump says potential Fed chair is present as he introduces Kevin Hassett BOJ December rate hike bets intact Euro zone inflation ticks up, pointing to steady ECB rates Bitcoin rebounds after sharp selloff NEW YORK, Dec 2 (Reuters) - The dollar regained ground against the yen on Tuesday, recovering from Monday's selloff, even as expectations for a December rate hike by the Bank of Japan lingered, while the euro edged up after data showed euro zone inflation was slightly hotter than expected. The U.S. currency came under pressure late in the session after U.S. President Donald Trump said a potential Federal Reserve chair was present as he introduced White House economic adviser Kevin Hassett at a White House meeting. Sign up here. Earlier in the day, Trump said he would be announcing his choice to succeed Jerome Powell as head of the Federal Reserve early next year. Hassett would be viewed by many investors as a dovish pick to replace Powell, and as such his nomination could weigh on the dollar. The greenback was 0.2% higher against the yen at 155.845, after hitting a two-week low on Monday, following a sale of 10-year Japanese government bonds that drew the strongest demand since September. "We’re basically back to where we started before (Bank of Japan Governor Kazuo) Ueda’s remarks yesterday, which is maybe a bit perplexing considering that swaps still price about an 80% chance of a Dec hike," said Michael Brown, senior research strategist at Pepperstone. Stocks, bonds, cryptocurrencies and the dollar all tumbled on Monday after Ueda said the Japanese central bank would consider the "pros and cons" of raising interest rates at its next policy meeting, sending Japanese two-year yields above 1% for the first time since 2008 and prompting a spillover into global bond markets. "To me, it speaks to everything still being very much USD-driven, with the pressure on the buck seen yesterday amid increasing expectations that Hassett will get the Fed Chair gig having given way to slightly more rational conditions today, as participants refocus on what remains a solid U.S. growth outlook, even with a 25-basis-point Fed cut next week very much on the cards," Brown said. "It still seems that, in the absence of an obvious narrative, the greenback goes back to being the ‘cleanest dirty shirt’ and finds some healthy demand," he said. Data on Monday showed weaker-than-expected manufacturing in the U.S., heaping pressure on the Federal Reserve to cut interest rates this month. Fed funds futures are pricing an 87% probability of a 25-basis-point cut at the Fed's next meeting on December 10, compared with a 63% chance a month ago, according to the CME Group's FedWatch tool. INFLATION WATCH The euro was 0.1% higher at $1.1624 after data showed inflation in the 20 nations sharing the euro accelerated to 2.2% last month from 2.1% in October, a small rise that is unlikely to be too concerning for the European Central Bank. Inflation in the euro zone is practically at the ECB's 2% target, ECB policymaker Joachim Nagel said in an interview published on Tuesday. "This (inflation data) comes at a time where some had claimed we could yet see another cut from the ECB, although the likeliness is that their easing cycle is over," said Joshua Mahony, chief market analyst at Scope Markets. Sterling was about flat on the day at $1.3211 , having touched its highest level in a month on Monday. The Bank of England cut the amount of capital it estimates lenders need to hold, in a bid to boost lending and stimulate the economy. It was the first reduction to bank capital requirements since the financial crisis. Leading cryptocurrency bitcoin rose 7% to $92,321, pulling away from the 10-day low touched in the previous session. https://www.reuters.com/world/asia-pacific/dollar-defensive-pmi-data-boosts-case-rate-cut-2025-12-02/

2025-12-02 00:30

NEW DELHI, Dec 2 (Reuters) - India's power output fell for a second month in November as temperate weather and a slowdown in industrial activity kept electricity demand tepid, government data showed. Total electricity generation in November fell about 1% year-on-year to 134.26 billion kilowatt-hours (kWh), Reuters calculations based on daily data from federal grid regulator Grid-India showed, following a 6% annual drop in October. Sign up here. India's manufacturing sector lost some momentum in November with growth decelerating to the slowest pace in nine months as steep U.S. tariffs took a heavy toll on demand. This also marked the first time power demand had fallen in the month of November in at least five years. Demand generally picks up in the latter part of the year as industrial and agricultural activity recovers after monsoon season, analysts said. "The early onset of winter has reduced cooling requirements, while previously, weak summer conditions and an early monsoon had already suppressed demand," said Ankit Jain, vice president of corporate ratings at ratings agency ICRA. "These seasonal variations highlight the strong correlation between temperature patterns and electricity consumption, impacting both short-term demand forecasts and generation planning." Reflecting the slowdown in demand, ICRA has trimmed its full-year power demand growth forecast for India sharply to 1.5%–2.0%, from 4.0%–4.5% previously. The country's coal-fired electricity generation in November fell 5.8% from a year earlier as overall power demand declined. Coal-fired generation, which typically accounts for about 75% of India's electricity output, has fallen on an annual basis in seven out of 11 months this year, the most since 2020, Grid-India data showed. The sustained growth in renewable energy has also reduced India's reliance on coal for electricity generation. India's renewable energy output surged to 18.55 billion kWh in November, up 24% from a year earlier. India added a record 25.4 gigawatts of new solar and wind capacity in the first seven months of 2025, and plans to increase non-fossil-fuel power capacity to 500 GW by 2030. https://www.reuters.com/sustainability/boards-policy-regulation/indias-november-power-output-falls-weak-cooling-demand-slower-industrial-2025-12-02/

2025-12-02 00:14

Crypto-linked stocks fall after bitcoin drops below $85k Synopsys jumps after Nvidia invests $2 billion US manufacturing slump deepens in November Indexes off: Dow 0.90%, S&P 500 0.53%, Nasdaq 0.38% NEW YORK, Dec 1 (Reuters) - U.S. stocks closed modestly lower on Monday, weighed down by a jump in Treasury yields and economic data that showed tariffs remained a drag on the manufacturing sector, as investors looked toward the Federal Reserve's policy announcement next week. The Institute for Supply Management's survey showed U.S. manufacturing contracted for a ninth straight month in November, as factories dealt with slumping orders and higher prices as the effect from tariffs lingered. Sign up here. Markets have largely priced in a rate cut from the Fed at the conclusion of its two-day policy meeting on December 10. They are pricing in an 85.4% chance of a 25 basis-point cut, according to CME's FedWatch Tool , opens new tab. "The market actually is still obviously earnings-driven, we went through earnings season, but now it's the Fed," said Joe Saluzzi, partner, co-founder and head of Equity Market Structure Research and co-head of Equity Trading at Themis Trading in Chatham, New Jersey. "I see no reason why the uptrend doesn't continue, at least, not as quickly, but maybe more of a grind up to the end of the year." The Dow Jones Industrial Average (.DJI) , opens new tab fell 427.09 points, or 0.90%, to 47,289.33, the S&P 500 (.SPX) , opens new tab lost 36.46 points, or 0.53%, to 6,812.63 and the Nasdaq Composite (.IXIC) , opens new tab lost 89.76 points, or 0.38%, to 23,275.92. While many policymakers have struck a cautious tone, dovish signals from a few key voting members in recent weeks, along with reports that White House economic adviser Kevin Hassett is a leading contender to succeed Fed Chair Jerome Powell, have heightened expectations for further monetary easing in the months ahead. Powell was scheduled to speak after the market close but was unlikely to address monetary policy due to the proximity to the central bank's policy meeting. "I guess they'll look for hints of anything that he could say, but it looks like it's a done deal," said Saluzzi. Investors are also waiting for a delayed September report on the Personal Consumption Expenditures Price Index, the Fed's preferred inflation gauge, due on Friday. Despite expectations for a cut, U.S. Treasury yields were higher on Monday following weakness in Japanese and European government bonds in the wake of comments from Bank of Japan Governor Kazuo Ueda, who signaled that conditions were aligning for a possible rate hike. Bond yields move inversely to prices. The rise in yields weighed on S&P 500 sectors such as real estate (.SPLRCR) , opens new tab and utilities (.SPLRCU) , opens new tab, which are seen by many investors as bond proxies. Coinbase (COIN.O) , opens new tab, which ended down 4.8%, and U.S.-listed shares of Bitfarms , off 5.7%, were among the crypto stocks that showed significant weakness, as bitcoin stumbled nearly 6% and at one point dropped below $85,000. The crypto market has lost more than $1 trillion in value since hitting a record of around $4.3 trillion, according to CoinGecko. Strategy (MSTR.O) , opens new tab, the world's largest holder of the cryptocurrency, ended 3.3% lower after tumbling as much as 12%. It cut its earnings forecast for 2025, citing a weak run in bitcoin. Big-box retailers were in focus on Cyber Monday, with shoppers expected to spend $14.2 billion online, according to Adobe Analytics. Shares of Walmart (WMT.N) , opens new tab and Target (TGT.N) , opens new tab advanced 0.9% and 0.8%, respectively. The S&P 500 retail index (.SPXRT) , opens new tab edged up 0.2%. Synopsys (SNPS.O) , opens new tab shares closed 4.9% higher after AI chip leader Nvidia (NVDA.O) , opens new tab said it had invested $2 billion in the semiconductor design software provider. Declining issues outnumbered advancers by a 1.86-to-1 ratio on the NYSE and by a 2.33-to-1 ratio on the Nasdaq. The S&P 500 posted 17 new 52-week highs and one new low, while the Nasdaq Composite recorded 76 new highs and 78 new lows. Volume on U.S. exchanges was 15.64 billion shares, compared with the 18.64 billion average for the full session over the last 20 trading days. https://www.reuters.com/business/wall-st-futures-drop-caution-ahead-data-powells-remarks-2025-12-01/