2025-11-24 23:04

Yuan gains on dollar contrast with Trump's first term Steady rise suggests policy intent, analysts say Goldman expects yuan to strengthen to 7 per dollar by year-end Nov 25 (Reuters) - The yuan has shrugged off a trade war, slow growth, rock-bottom interest rates and a slump in foreign investment, to head for its sharpest annual gain since the pandemic year of 2020. The steady appreciation of the tightly-managed currency has reignited speculation that Beijing is renewing its campaign to drive the yuan's global use, analysts say. Sign up here. The People's Bank of China (PBOC), which manages the currency within a fixed trading band, did not comment when asked about the yuan's management this year or the strategy behind its strength. Yet for market participants, the nature of gains on the dollar are telling. Where in 2018, the yuan was a shock-absorber for U.S. trade restrictions and fell about 5%, in 2025 it is nearly 3% stronger. That has happened because, for months, it has been guided higher almost every morning by the PBOC's midpoint settings, while at the same time frequent state banks' dollar buying has capped volatility and steadied its grind higher. "It's staying stronger than expected despite escalating U.S. trade actions," said Kelvin Lam, senior China+ economist at Pantheon Macroeconomics. "From a strategic optics point of view, China appears keen to project the image of a stable yuan to build international credibility, reminiscent of 1998 when the yuan refused to join the wave of competitive devaluations during the Asian Financial Crisis and cemented its status as a regional anchor." Stronger-than-expected daily fixings by the PBOC since last November have gained attention in light of weak economic fundamentals. Benchmark interest rates are well below dollar counterparts. Growth has been held back by anaemic consumption and the capital account showed a $281 billion deficit over 10 months to end October. At the same time, China's economic blueprint appears to harden its ambitions for the currency. Having long promised to "prudently promote" yuan internationalisation, the 15th five-year plan published in October drops the word "prudently". "Showcasing a strong and stable yuan amid a volatile market environment tends to be a good case for China to promote yuan internationalisation," said Kiyong Seong, lead Asia macro strategist at Societe Generale. SEVEN AND BEYOND The strongest hand behind the yuan has been the central bank, which has encouraged investment bank analysts to expect gains and greater adoption to continue. "For both economic and non-economic reasons, we believe yuan internationalisation has become a policy priority for the Chinese government and is likely to accelerate meaningfully in the coming years," analysts at Goldman Sachs said in a note. Goldman analysts said the authorities' comfort with its strength has them expecting it to hit 7 per dollar by year-end and keep rising to 6.85 in a year's time. The yuan traded at 7.1068 per dollar on Monday. The PBOC has been fixing the midpoint, which allows the spot rate to fluctuate a maximum 2% on either side, firmer than market projections since last November. The average gap between the official midpoint and Reuters' market-based estimates stood at 327 pips since April, while yuan adoption has been gaining momentum. Since the last survey in 2022, this year's Bank for International Settlements figures show a near 60% increase in the daily turnover in the dollar yuan pair to $781 billion, which is a little over 8% of total daily currency trade. STORE OF VALUE The other part of the picture has been steadiness, thanks to what several separate market sources describe as the constant appearance of state banks selling yuan onshore and offshore. This has kept three-month realised volatility for USD/CNY hovering near decade lows. Analysts say it encourages exporters to gradually sell down some of the roughly $1 trillion pile of dollars on deposit, chipping away at a long-standing risk to yuan stability. Commercial banks purchased a net $17.7 billion of foreign exchange from clients in October, data shows, a sixth straight month of surplus and suggesting an increase in dollar selling. To be sure, the signal is complicated by volatile export receipts, and, in any case, yuan strength has been uneven. The yuan has fallen 7.7% this year against the euro and is down 3% against a basket of trading partners' currencies (.CFSCNYI) , opens new tab. Most market participants also say internationalisation at scale won't happen until China loosens its control over the flow of capital across its borders - an unlikely move in the near term. Still, the price and momentum have caught markets' attention. "The government's inclination to keep the yuan value stable while allowing gradual appreciation should gain trust in the yuan as a store of value," said Shuang Ding, chief economist for Greater China and North Asia at Standard Chartered. "This intention appears to be supported by China's trade competitiveness and the authorities' proven record of managing capital flow volatility." https://www.reuters.com/world/asia-pacific/global-ambitions-behind-yuans-steady-rise-2025-11-24/

2025-11-24 22:56

Fed divided on December rate cut, recent comments favor reduction Fed still will not have data delayed by the shutdown available January decision more uncertain, based on upcoming information WASHINGTON, Nov 24 (Reuters) - The job market is weak enough to warrant another quarter-point rate cut in December, though action beyond that depends on an upcoming flood of data delayed by the government shutdown, Fed Governor Christopher Waller said on Monday. Since the last Fed meeting, "most of the private sector and anecdotal data that we've gotten is that nothing has really changed. The labor market is soft. It's continuing to weaken," with inflation expected to ease, Waller said on Fox Business' Mornings with Maria. Sign up here. While that makes a December cut appropriate, "January could be a little trickier, because we're going to get a flood of data that's released. If it is kind of consistent with what we've seen, then you can make the case for January. But if it suddenly shows a rebound in inflation or jobs or the economy's taking off, then it might give concern" about more cuts, Waller said. Fed officials are divided over whether to cut rates again at the December meeting, though recent comments from top policymakers - including New York Fed President John Williams on Friday - have shifted market expectations strongly in favor of another quarter-point reduction at their December 9-10 meeting. According to CME Group's FedWatch tool, the futures-market-implied probability of a quarter point reduction to a range of 3.50% to 3.75% is now about 83%, roughly double what it had been a week ago. The Fed will remain information-constrained at that session, with government statistical agencies still digging through the backlog of work from the 43-day shutdown that ended November 14. The Bureau of Labor Statistics already has said it will not release a jobs or consumer inflation report for October, while the reports for November will not become public until after the Fed meets. In the absence of those keystone data releases, officials are relying more heavily on information from private providers and on their own contacts in businesses and households around the country. Much of that information is compiled into a compendium known as the Beige Book that is released two weeks prior to each Fed meeting, with the next version due out on Wednesday. "The labor market is still weak and ... we're getting no evidence telling me it's rebounding," Waller said. He downplayed the recently released September jobs report, showing the economy added a more-than-expected 119,000 jobs that month, as likely to be revised lower. The September report also showed the unemployment rate rose to 4.4% from 4.3% the month before. One other policymaker joined Waller in voicing that concern on Monday. San Francisco Fed President Mary Daly, who had been on the fence over whether to support a third consecutive rate cut next month, told the Wall Street Journal she now backs a reduction. “On the labor market, I don’t feel as confident we can get ahead of it,” she said in an interview Monday. “It’s vulnerable enough now that the risk is it’ll have a nonlinear change.” Daly, who does not have a vote on policy this year but like all Fed policymakers has a voice at the debate during meetings, now views an inflation surge as a lower risk. By the time of the next meeting on January 27-28, however, Waller, Daly and their colleagues should be able to better gauge which of two views of the economy are starting to materialize - the one where inflation stays persistent with a risk of moving higher, a possibility that has led several regional reserve bank presidents to oppose further rate cuts, or the one where job growth remains weak and the unemployment rate increases, the outcome Waller finds most concerning. Fed officials at the upcoming meeting will issue new economic projections that could reset expectations for any rate reductions next year. Policymakers were divided on the outlook in September, with the median official seeing only one further rate hike in 2026. Investors currently anticipate two to three cuts next year, according to data from the CME Group's FedWatch. By the next meeting, the Fed should have in hand official estimates for jobs, the unemployment rate, and inflation through December. "You may see a more of a meeting-by-meeting approach once you get to January," Waller said. "But I still don't think the labor market is going to turn around in the next six to eight weeks." https://www.reuters.com/business/feds-waller-december-cut-is-appropriate-action-january-more-uncertain-given-2025-11-24/

2025-11-24 22:51

Co warns of one-month output shortfall on Kalgoorlie disruption Finished goods output at Malaysian facility to be affected Canaccord Genuity cuts revenue forecast for December quarter Nov 25 (Reuters) - Lynas Rare Earths (LYC.AX) , opens new tab warned on Tuesday of a one-month production shortfall this quarter due to significant power supply disruptions at its Kalgoorlie processing facility in Western Australia. The production shortfall could be a potential setback for the world's largest rare earths producer outside China as it tries to ramp up output amid a growing push from countries to reduce their reliance on China. Sign up here. Lynas said its Kalgoorlie facility faced a substantial rise in power supply disruptions in 2025, with outages in November resulting in a significant loss in mixed rare earth carbonate (MREC) production. The company expects the disruptions to impact production of finished goods at its Malaysian facility this quarter. MREC produced in Kalgoorlie is processed at Lynas Malaysia's , opens new tab advanced materials plant in the industrial town of Gebeng. "Lynas is working constructively with the WA government and Western Power to identify causes of recent outages and options to improve power availability to the Lynas plant," the company said. "Whilst these are being progressed on an urgent basis, even on a best-case scenario, they will not be in place in time to improve this quarter's forecast production." Lynas recorded total rare earth oxide output of 3,993 metric tons and neodymium and praseodymium (NdPr) output of 2,003 tons for the September quarter. It reported sales revenue of A$200.2 million ($129.19 million) for the quarter. Analysts at Canaccord Genuity cut their NdPr production forecast for the December quarter to 1.8 kilotons (kt) from 2.7 kt previously expected. Revenue expectations were lowered to A$220 million from A$280 million. Shares of Lynas closed 0.1% lower at A$15.02 after falling more than 2% earlier in the session. The broader benchmark index (.AXJO) , opens new tab edged 0.1% higher. ($1 = 1.5497 Australian dollars) https://www.reuters.com/business/energy/australias-lynas-warns-production-shortfall-kalgoorlie-after-power-disruptions-2025-11-24/

2025-11-24 22:25

NEW YORK, Nov 24 (Reuters) - Making sense of the forces driving global markets By Alden Bentley, Editor in Charge, Americas Finance and Markets Sign up here. Jamie is enjoying some well-deserved time off, but the Reuters markets team will still keep you up to date on what animated markets today: primarily strengthened confidence about a December Federal Reserve cut. I'd love to hear from you so please feel free to reach out at [email protected] , opens new tab Today's Key Market Moves Today's Key Reads Wall Street rallies on tech rebound, rising rate cut bets Stocks jump, US yields dip as Fed rate cut bets rise Wall Street slump could secure Fed rate cut Deutsche Bank sees S&P 500 rising to 8,000 by end of 2026 Record US Black Friday crowds to find fewer bargains amid high prices Reanimated about December Fed cut Investors paraded back into U.S. stocks after last week's bull market reset, emboldened by the latest remarks by influential Federal Reserve officials. Fed Governor Christopher Waller on Monday told Fox Business that available data indicate labor conditions are weak enough to justify a quarter-point cut when the Federal Open Market Committee meets in two weeks, reinforcing dovish comments by New York Fed President John Williams that helped reverse last week's selloff on Friday. Rate futures markets place the odds of a quarter-point cut on December 10 at 67%, up from less than even last week. The Magnificent Seven mega caps were all in recovery mode, overriding concerns that rattled sentiment about excessive valuations and debt financing of the artificial intelligence spending spree. More delayed data trickles out on Tuesday with the Producer Prices Index and Retail Sales from September that did not get released during the government shutdown. Given the Thanksgiving holiday on Thursday, early stock and bond closes on Friday, and the proximity of December book closings, large swings either way should not come as a surprise. Black Friday's shopping deals will provide the first inkling of how retailers at least will fare going into year-end. Market action was not broadly risk-on, however, with safe-haven gold and Treasuries also gaining, along with crude oil. The dollar index , (.DXY) , opens new tab meanwhile slipped, although the greenback was solid against the beleaguered yen, after Takuji Aida, an adviser to Prime Minister Sanae Takaichi, said on Sunday that Japan can actively intervene in the currency market. What could move markets tomorrow? Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. Trading Day is also sent by email every weekday morning. Think your friend or colleague should know about us? Forward this newsletter to them. They can also sign up here. https://www.reuters.com/world/china/global-markets-trading-day-2025-11-24/

2025-11-24 22:11

Nov 24 (Reuters) - The U.S. Federal Energy Regulatory Commission, or FERC, said on Monday it has granted a five-year extension to complete construction of Sempra's (SRE.N) , opens new tab Cameron LNG export facility in Louisiana and place it into service. In October, Cameron LNG had filed an extension request for five years (until March 16, 2033) to complete construction and place the facility into service. Sign up here. Cameron LNG is majority-owned by Sempra Infrastructure and has helped the U.S. to become the world's leading exporter of superchilled gas since 2023. The LNG sector in the U.S. has seen a pick-up in commercial activity after President Donald Trump lifted a moratorium on new export permits soon after coming into office in January. https://www.reuters.com/business/energy/ferc-grants-five-year-extension-sempras-cameron-lng-project-louisiana-2025-11-24/

2025-11-24 21:47

BOGOTA, Nov 24 (Reuters) - Colombian state-run energy company Ecopetrol (ECO.CN) , opens new tab on Monday warned that natural gas supply to the country's northern and central regions could be at risk due to an ongoing roadblock at its Guajira field. The roadblock, which kicked off three weeks ago, could cause Ecopetrol to halt production at the site, which puts out 70 million cubic feet of gas per day, the firm said in a statement issued with subsidiary Hocol. Sign up here. Ecopetrol said that the situation has recently escalated, "putting at risk the physical integrity of the 26 workers who remain on-site." The Carrapinapule community, behind the roadblocks, is making demands directed at the state, Ecopetrol said, including on potable water, education and school transport. Colombia is facing a deficit in natural gas production, causing it to boost imports of the fuel to meet domestic demand. Commercialized production of natural gas fell more than 10% in September year-over-year to 814 million cubic feet per day, according to the national hydrocarbons agency. https://www.reuters.com/business/energy/colombias-ecopetrol-warns-possible-natural-gas-shortage-community-roadblocks-2025-11-24/