2025-10-08 05:40

MUMBAI, Oct 8(Reuters) - The Indian rupee lumbered in a tight band on Wednesday, holding above its all-time low even as the U.S. dollar continued to charge higher, with traders pointing to likely central bank intervention to support the local currency. The rupee closed at 88.7975 against the U.S dollar, a whisker away for its all-time low of 88.80 hit last week but little changed on the day. Sign up here. Traders noted that the Reserve Bank of India has repeatedly defended the rupee near 88.80, keeping volatility in check, but persistent dollar demand from importers has kept it pinned near that level. The local unit has remained steady around that mark even as the dollar has risen over 1% this week against its major peers, boosted by weakness in the euro and the Japanese yen due to political developments. The euro was last down nearly 0.4% at $1.1615 while the Japanese yen slipped to 152.90, its weakest level since February. "The real test for USD bears begins this week as FX quant signals deteriorate for both EUR and JPY," analysts at BofA Global Research said in a note. Traders also said that in addition to spot market interventions, the RBI has conducted dollar-rupee buy/sell swaps for October delivery of maturities between January and March 2027, over the last three sessions. Dollar-rupee forward premiums have dropped in response to this, with the 1-year implied yield falling to 2.18%, its lowest since August 29. Investors are now awaiting the minutes of the Federal Reserve's September policy meeting, due later on Wednesday, alongside remarks from a clutch of central bank policymakers. https://www.reuters.com/world/india/soaring-dollar-puts-all-time-low-peril-traders-eye-rbi-defence-2025-10-08/

2025-10-08 05:35

Gold shows no sign of stopping Yen hits lowest since February European shares climb to record S&P 500, Nasdaq hit record closing highs; Dow off NEW YORK, Oct 8 (Reuters) - Major stock indexes rose on Wednesday, with U.S. and European indexes hitting record highs, while gold extended its recent rally above $4,000 an ounce as a prolonged U.S. government shutdown and expectations of further U.S. interest rate cuts drove demand for the safe-haven asset. Gold, traditionally seen as a store of value during times of instability, is up 54% year-to-date after gaining 27% in 2024. Spot gold was last up 1.36% at $4,037.90. U.S. gold futures GCv1 , opens new tab for December delivery settled 1.7% higher at $4,070.5. Silver also climbed to a record high. Sign up here. Shares of gold miners also rose, including U.S.-listed shares of Gold Fields , which ended 3.7% higher. The Japanese yen reached its weakest level since mid-February against the dollar as investors worried about an increase in fiscal spending in Japan, while the euro eased on ongoing political uncertainty in France. On Wall Street, stocks rebounded from Tuesday's declines, with the S&P 500 and Nasdaq registering all-time closing highs and technology shares (.SPLRCT) , opens new tab leading the way higher. Nvidia (NVDA.O) , opens new tab shares ended 2.2% higher. "It comes down to investors have been optimistic since April, and that optimism continues to be expressed in spite of a government shutdown, a slowing employment market or any other red flags that would normally detract investors," said Oliver Pursche, senior vice president and advisor for Wealthspire Advisors in Westport, Connecticut. Investors have been without most U.S. economic data as the federal government remains shut. Minutes released Wednesday from the last Federal Reserve meeting showed a divided committee, in which policymakers were concerned about rising labor market risks but remained wary of inflation. The central bank is widely expected to cut rates by 25 basis points at its October 28-29 meeting, according to the CME Group’s FedWatch Tool. The Dow Jones Industrial Average (.DJI) , opens new tab slipped 1.20 points to 46,601.78, the S&P 500 (.SPX) , opens new tab gained 39.13 points, or 0.58%, to 6,753.72 and the Nasdaq Composite (.IXIC) , opens new tab gained 255.02 points, or 1.12%, to 23,043.38. European shares climbed to record highs, powered by strong gains in French and Spanish stocks. The pan-European STOXX 600 (.STOXX) , opens new tab was up 0.8%, closing at its highest level, while French stocks (.FCHI) , opens new tab jumped 1.1% and Spanish stocks (.IBEX) , opens new tab touched their highest mark since 2007. French caretaker Prime Minister Sebastien Lecornu said a deal could on a 2026 budget despite the country's political crisis. France's fifth prime minister in two years, Lecornu tendered his and his government's resignation on Monday, just hours after announcing the cabinet line-up, making it the shortest-lived administration in modern France. The euro pared losses after Lecornu also said on Wednesday that President Emmanuel Macron could be in a position to nominate a new prime minister in the next 48 hours. The currency was last down 0.33% at $1.1616 and reached $1.1597, the lowest since August 27. In Japan, the surprise election of Sanae Takaichi to lead the country's ruling Liberal Democratic Party on Saturday has dented the yen on expectations of greater government stimulus. Against the yen the dollar was last up 0.53% at 152.7. It earlier reached 152.99, the highest since February 14, and has risen from 147.44 on Friday. U.S. Treasury yields turned positive in afternoon trading after investors showed tepid demand at an auction of 10-year notes. The yield on the benchmark U.S. 10-year Treasury note was up 0.6 basis points to 4.133%. Oil prices rose. Traders expected a lack of progress on a Ukraine peace deal to keep sanctions in place against Moscow. U.S. crude rose 82 cents to settle at $62.55 a barrel and Brent gained 80 cents to settle at $66.25. https://www.reuters.com/world/china/global-markets-wrapup-1-2025-10-08/

2025-10-08 05:32

JAKARTA, Oct 8 (Reuters) - Indonesia's Investment Minister Rosan Roeslani on Wednesday said the government has entered into discussions with China about restructuring the debt of Indonesia's high-speed train company. Construction of the $7.3 billion China-backed high-speed railway began in 2016, and it was meant to start operating in 2019. Sign up here. But the project to connect the capital Jakarta and Bandung in West Java faced problems, including land procurement issues, pandemic-related delays and ballooning costs, which pushed out its launch to 2023. Rosan declined to disclose details of the proposed restructuring being negotiated with the Chinese government. "We want a comprehensive reform, so that after we restructure there will be no more things like the possibility of default and so on in the future," Rosan said. https://www.reuters.com/world/asia-pacific/indonesia-has-entered-talks-with-china-high-speed-train-debt-minister-says-2025-10-08/

2025-10-08 05:10

Tokenized stocks can lack traditional investor rights and protections Regulatory concerns grow over tokenization's impact on market stability Pushback from Wall Street on SEC's potential tokenization exemptions NEW YORK/PARIS, Oct 8 (Reuters) - A race by crypto companies to sell tokens pegged to stocks is raising alarm bells among traditional financial firms and regulatory experts who warn that the fast-growing novel products pose risks to investors and market stability. Buoyed by President Donald Trump's pro-crypto stance and his administration's push for friendly regulations, the crypto industry is rushing to capitalize on a global surge in enthusiasm for the sector. Sign up here. Robinhood (HOOD.O) , opens new tab, Gemini (GEMI.O) , opens new tab and Kraken among others have launched tokenized stocks in Europe, while Coinbase (COIN.O) , opens new tab, Robinhood and startup Dinari are seeking approval to launch similar products in the United States. Nasdaq, meanwhile, last month became the first major exchange to propose offering tokenized shares. The industry says tokenized shares — blockchain-based instruments that track traditional equities — could revolutionize stock markets by allowing shares to be traded 24/7 and settled instantly, boosting liquidity and reducing transaction costs. The combined value of tokenized public stocks geared toward retail investors as of September grew to $412 million, compared with just a few million dollars 12 months ago, according to tokenization tracker RWA.xyz. Although many products are marketed like stocks, they rarely offer the same rights, disclosures and protections as traditional equities. Instead, they more closely resemble riskier derivatives, according to a Reuters review of several products and interviews with a dozen industry executives and legal experts. That increases the hazards for investors, while tokenization more broadly could undermine market integrity and fragment liquidity if left unsupervised, critics say. "You're buying exposures to those shares through creating some sort of synthetic instrument," said Diego Ballon Ossio, a partner at law firm Clifford Chance in London. "A lot of the burden gets shifted on you to understand what exactly it is that you're buying." A few companies have issued their own experimental stock tokens on the blockchain - software that acts as a shared digital ledger - but most tokenized shares are pegged to public companies and issued by third parties like Ondo Global Markets and Dinari. Some tokens are backed 1:1 by underlying stocks, while others provide economic exposure through derivatives. The industry is divided over which regulations apply to stock tokens, and investor rights and protections vary. Often, the products provide no ownership, voting rights or traditional dividends, while creating counterparty risk exposure to the token issuer. For example, there are multiple tokens pegged to Nvidia (NVDA.O) , opens new tab and Tesla (TSLA.O) , opens new tab with a range of structures and terms and conditions. "The fact that different tokenized offerings have different rights and different disclosures ... that's a real big worry," said Gabriel Otte, CEO of Dinari, which offers 1:1 collateralization. Robinhood in June launched trading in tokens pegged to public companies and said it plans to offer tokenized stocks of private companies. To promote the launch, it gave away tokens pegged to OpenAI. Those tokens are derivative contracts backed by Robinhood's ownership of fund units in a special-purpose vehicle that holds OpenAI convertible notes, according to its terms and conditions , opens new tab. The announcement drew pushback from OpenAI, which said it had not blessed the offering. It also prompted scrutiny from Robinhood's European regulator. Johann Kerbrat, general manager of Robinhood Crypto, said the company clearly flags that its tokens are derivatives. "It's just one step forward to be able to have the benefits of no longer having multiple days to settle," he added. While Robinhood is issuing public company tokens on the blockchain, it is not yet settling the trades on the blockchain, a spokesperson said. Gemini declined to comment. CORE INVESTOR PROTECTIONS In Europe, Robinhood, Kraken and others operate under the "MiFID" derivatives rules but some legal experts say that law is insufficient to oversee the novel products. Trump's crypto-friendly chair of the U.S. Securities and Exchange Commission, Paul Atkins, has indicated the agency plans to grant would-be issuers exemptions from securities rules. That plan is facing opposition from powerful Wall Street players including Citadel Securities and the Securities Industry and Financial Markets Association, which say such major structural changes should go through a formal rulemaking process. "Just because a security is represented on blockchain, that doesn't change the core investor protections and other provisions that apply to securities," said Peter Ryan, head of international capital markets at SIFMA. In a July letter to the SEC, Citadel Securities raised concerns , opens new tab that tokenization would siphon liquidity away from public markets. Spokespeople for the SEC declined to comment, while Citadel Securities did not provide comment beyond the letter. A spokesperson for the European Securities and Markets Authority, which helps oversee MiFID, said it was aware of the potential risks of tokenization and was monitoring developments. The World Federation of Exchanges recently urged regulators to crack down on tokenization, citing insufficient investor protections and liquidity fragmentation, although the group told Reuters it supports Nasdaq's proposal because it would treat tokens like traditional stocks. Coinbase is also in talks with the SEC about launching tokenized securities that would similarly grant investors the full legal rights and benefits associated with conventional stocks, according to a source familiar with the matter. Other issuers said they hew closely to traditional securities, anti-money laundering, bankruptcy protections and other rules. Mark Greenberg, Kraken's global head of consumer, said the company offered the "gold standard" including 1:1 collateralization and investor disclosures, while dismissing derivative offerings as "IOUs." "Done right, tokenization enhances investor protections, rather than eroding them," said Ian De Bode, chief strategy officer at Ondo Finance. https://www.reuters.com/sustainability/boards-policy-regulation/crypto-race-tokenize-stocks-raises-investor-protection-flags-2025-10-08/

2025-10-08 04:59

RBNZ cuts benchmark rate by an aggressive 50bps, signals more to come NZ dollar and interest rate swaps tumble post-rate cut RBNZ's larger cut comes as economy struggles despite previous raft of cuts NZ Prime Minister Luxon has supported lower cash rate amid economic challenges RBNZ sees inflation returning to midpoint of target band in 2026 WELLINGTON, Oct 8 (Reuters) - New Zealand's central bank slashed its benchmark rate by an aggressive 50 basis points on Wednesday, surprising some in the markets as policymakers signalled concerns about the frail state of the economy and kept the door open for further easing. The New Zealand dollar and interest rate swaps tumbled in the wake of the move that took the official cash rate to over a three-year low of 2.5%, as investors bet on more stimulus in the coming months to shore up demand and buffer the economy from rising global headwinds. Sign up here. “The Committee reached consensus to reduce the official cash rate by 50 basis points to 2.5 percent,” the Reserve Bank of New Zealand said in its accompanying policy statement. “The Committee remains open to further reductions in the OCR as required for inflation to settle sustainably near the 2% target mid-point in the medium term.” The dovish stance will be a welcome relief for the New Zealand government and the country’s prime minister, Christopher Luxon, whose popularity has taken a sharp hit in recent months as the economic recovery he and his party campaigned on has failed to eventuate. Luxon has said publicly he would like to see the cash rate lower to try and shake off the economic torpor, with business confidence worsening and households in a depressed mood as they fret about the rising cost of living and scarcity of jobs. The Taxpayers' Union-Curia Poll released earlier Wednesday found that the current government would not have enough seats to govern if an election was held today. Finance Minister Nicola Willis said the rate cut is good news for growth, jobs and investment, adding: "We know many New Zealanders are still doing it tough." The RBNZ decision went against 15 of 26 economists surveyed in a Reuters poll who had forecast it would cut the cash rate (NZINTR=ECI) , opens new tab by 25 basis points. However, the larger cut wasn't totally unexpected as the remaining 11 economists had picked a 50-bp reduction and markets were primed for the RBNZ to pull harder on its monetary policy levers to inject impetus to a weakened economy. The New Zealand dollar tumbled to six-month lows, losing 0.90% to $0.5745, while two-year interest rate swaps fell to 2.5251% from 2.6194% before the decision. The market is now fully pricing in a further 25-basis-point cut to 2.25%, and is ascribing a 60% chance of a 2.00% terminal cash rate. “The RBNZ’s decision signals that the likelihood of inflation pressures being weaker than previously anticipated carried more weight than waiting to see how quickly the economy rebounds and what ripple effects come from the current spike in inflation,” ASB chief economist Nick Tuffley said in a note. The central bank has cut rates by 300 basis points since August 2024, and with inflation within its target band of 1% to 3%, policymakers have leeway to lower borrowing costs further. TRUMP POLICIES ADD TO ECONOMIC WOES Wednesday's policy review is Christian Hawkesby’s second-to-last meeting as RBNZ Governor, after the government last month appointed Swedish policymaker Anna Breman to the role starting December 1. A global front-runner in withdrawing pandemic-era stimulus, the RBNZ lifted rates 525 basis points between October 2021 and September 2023 to curb inflation in the most aggressive tightening since the cash rate was introduced in 1999. The punishing borrowing costs, however, slammed the brakes on demand and tipped the economy into recession last year. Since then it has struggled to motor on, contracting , opens new tab by 0.9% in the second quarter in a shock result that fuelled bets of steeper rate cuts. While trading partner growth has been resilient, it is expected to slow in part due to U.S. President Donald Trump's sweeping tariffs and the government’s tight fiscal policy, hurting business confidence and pushing up unemployment. One challenge for the central bank is that inflation is expected to reach 3.0% in the third quarter. However, in its statement on Wednesday, the RBNZ said spare capacity in the economy should see inflation return to near its mid-point in 2026. New Zealand is one of several countries to ease rates as inflation has moved lower, but its sharp reductions to borrowing costs contrast with a more cautious approach by the U.S. Federal Reserve and its counterpart in Australia. The Reserve Bank of Australia held the cash rate steady last week as it flagged inflation concerns. And last month, the Federal Reserve delivered its first rate cut for the year. Zoe Wallis, investment strategist at brokerage Forsyth Barr, is retaining her terminal rate forecast at 2.25% for now. However, she said "there is a chance that further easing beyond that level could be on the cards if inflation proves well contained and the economy fails to fire up convincingly in coming months." (This story has been refiled to restore the dropped word 'Barr' in the brokerage name in paragraph 20) https://www.reuters.com/world/asia-pacific/new-zealand-central-bank-cuts-cash-rate-by-larger-than-expected-50bps-2025-10-08/

2025-10-08 04:52

TOKYO, Oct 8 (Reuters) - The yen's recent sharp falls may prompt the Bank of Japan to raise interest rates as soon as this month, former central bank executive Kazuo Momma said on Wednesday. The yen has tumbled since fiscal and monetary dove Sanae Takaichi's victory in a party leadership race on Saturday, setting her on course to become the nation's next premier and stoking concerns she could pressure the BOJ to delay further rate hikes. Sign up here. Ironically, the increasing yen-bearishness in markets could prompt the BOJ to raise interest rates as soon as its next policy meeting on October 29-30, Momma told Reuters in an interview. While BOJ Governor Kazuo Ueda appears cautious on moving too quickly with rate hikes on concern over the U.S. economic outlook, such views could change if yen falls persist, he said. "The biggest loser from a weak yen is the government" as it pushes up inflation via higher import costs and hurts the ruling party's approval ratings, Momma said, adding that Takaichi may consent to an early rate hike if yen falls accelerate. "The only factor that could prompt the BOJ to push forward its rate-hike timing would be a weak yen," said Momma, who has experience drafting monetary policy and retains close contact with incumbent policymakers. With inflation exceeding its 2% target for well over three years, the BOJ has signaled its readiness to keep raising interest rates, albeit at a slow pace as it assesses the fallout from U.S. tariffs on corporate behaviour. The rate-hike timing will depend on how the BOJ weighs downside risks to the economy, such as from softening U.S. demand, and inflationary risks from a weak yen, Momma said. "The likelihood of an October rate hike has heightened somewhat, although it's more likely the BOJ will wait until December," said Momma, who is currently executive economist at Mizuho Research & Technologies. After ending a decade-long stimulus programme in March, the BOJ raised short-term interest rates to 0.25% in July last year and 0.5% in January this year. In both rate-hike cases, the BOJ moved in the wake of political calls to counter unwelcome yen falls. https://www.reuters.com/world/asia-pacific/yen-falls-may-prod-boj-hike-rates-october-ex-central-bank-executive-says-2025-10-08/