2024-01-11 10:32

MUMBAI, Jan 11 (Reuters) - The Indian rupee ended little changed against the dollar on Thursday, ahead of the key U.S. inflation data that could potentially help investors reassess the outlook for interest rates in the world's largest economy. The rupee was at 83.0275 to the dollar compared with 83.0250 in the previous session. The rupee had, in intraday trades, risen to a near one-month high of 82.9350 on dollar sales by certain foreign banks pertaining to custodial and positional flows, traders said. "Despite the dollar inflows, the rupee needs to close convincingly above 83 to confirm a change in trend," said Jigar Trivedi, senior research analyst - currencies and commodities at Reliance Securities. The role of the Reserve Bank of India (RBI) will be important in terms of how these flows are managed, Trivedi added. U.S. inflation data, due later in the day, is expected to show headline consumer prices rose 0.2% month-on-month in December and 3.2% for the 12-month period. The core measure is likely to have increased 0.3%. On a year-on-year basis, core prices are estimated to have increased by 3.8%, compared to a 4% rise in November, providing more evidence of easing inflation. Investors have priced in a total of 140 basis points of rate cuts by the U.S. Federal Reserve in 2024, nearly double what the central bank indicated in its dot plot in December. However, a few economists reckon investors' expectations may be a tad optimistic. While we may not see a big jump in the dollar on a consensus inflation print, the combination of "only modest core inflation declines and lingering labour tightness will prompt the Fed to push back on rate cuts more forcefully," ING Bank said in a note. A narrative that Fed rate cuts before May are unlikely needs to take over before dollar bears can be discouraged, ING said. https://www.reuters.com/markets/currencies/rupee-holds-near-83dollar-crucial-us-inflation-data-focus-2024-01-11/

2024-01-11 10:14

Jan 11 (Reuters) - Russia's finance ministry said on Thursday it would switch to foreign currency sales from purchases in the coming weeks after December oil and gas revenues were lower than expected. The finance ministry's currency interventions are carried out by the central bank. In August 2023, the central bank deferred foreign currency purchases until the new year as it stopped them to avoid aggravating pressure on the rouble, which tumbled past 100 to the dollar in August and October. The ministry was selling Chinese yuan for the first half of 2023 as Western sanctions over Russia's actions in Ukraine hit energy revenues. It reverted to purchases in August as commodity prices rose and energy revenues recovered. Under its budget rule, Russia sells foreign currency from its National Wealth Fund (NWF) to make up for any shortfall in revenue from oil and gas exports, or makes purchases in the event of a surplus. The ministry said its sales of foreign currencies and gold for the period from Jan. 15 to Feb. 6 would amount to the equivalent of 69.1 billion roubles ($778.2 million), or 4.1 billion roubles ($46.2 million) per day. Russia's December energy revenues were 199.9 billion roubles lower than the ministry had expected, it said. In January, Russia expects additional energy revenues for the budget of 130.8 billion roubles. In the previous period, between Dec. 7 and Jan. 12, the ministry had planned to buy foreign currency worth 244.8 billion roubles. This year, the central bank's mirroring of finance ministry operations, including the deferred foreign currency purchases from August to December, is being adjusted by the volume of NWF funds spent on financing the government's budget deficit for 2023 and supporting companies. Taking that NWF spending into account, the central bank will ultimately make net sales of foreign currency, which should support the rouble, analysts say. According to a central bank statement in late December, overall operations are set to be adjusted by separate daily yuan sales worth 12.6 billion roubles until the end of January. Daily sales equivalent to 11.8 billion roubles are envisaged from February to June 28. December's energy revenue shortfall and the ministry's switch to sales mean the central bank should sell the equivalent of 16.7 billion roubles a day in the second half of January. ($1 = 88.7975 roubles) https://www.reuters.com/markets/currencies/russias-finance-ministry-switches-fx-sales-energy-revenues-drop-2024-01-11/

2024-01-11 06:56

U.S. CPI rose more than expected Fed's Mester sees March rate cut as unlikely Silver hits lowest in nearly two months Jan 11 (Reuters) - Gold eased on Thursday to a one-month low as the dollar ticked higher after hotter-than-expected inflation data, while hawkish remarks from Federal Reserve officials fuelled worries that higher interest rates could stay unchanged beyond March. Spot gold was down 0.1% at $2,024.99 per ounce, as of 2:30 p.m. ET (1930 GMT), after rising as much as 0.8% before the data. U.S. gold futures settled 0.4% lower at $2019.20. The dollar index (.DXY) extended gains after data showed U.S. consumer prices rose more than expected in December, which could delay a much anticipated U.S. rate cut in March. Cleveland Fed President Loretta Mester said it would likely be too soon for the central bank to cut its policy rate in March, while Richmond Fed chief Tom Barkin said gains on inflation have been too narrowly focused on goods. "We got a little ahead of ourselves," said Phillip Streible, chief market strategist at Blue Line Futures in Chicago, adding that the hawkish comments call into question the timing and number of rate cuts that the market anticipates this year. Traders see a 67% probability of a rate cut in March, according to the CME Fedwatch tool, compared with about a 71% chance seen before the report. Higher rates dim the appeal of gold, which pays no interest. "There has been a lot of hype behind bitcoin, so people tend to rotate out of different asset classes and that could also be behind some degree of the selling," Streible added. Attention will turn to the U.S. producer price index (PPI) due on Friday. "Gold is just grudgingly lower and (the market) hopes PPI will show softer results tomorrow," said Tai Wong, a New York-based independent metals analyst. Silver fell 0.7% to $22.71 per ounce, its lowest since Nov. 14. Platinum lost 0.5% to a one-month low of $914.85, and palladium fell 0.9% to $989.36. https://www.reuters.com/markets/commodities/gold-climbs-softer-dollar-us-inflation-test-looms-2024-01-11/

2024-01-11 06:40

DUBAI, Jan 11 (Reuters) - Oman unveiled late on Wednesday a sustainable finance framework to help the Gulf country reduce its reliance on fossil fuels and attract environmental, social and governance (ESG) investors. Under the initiative, the Sultanate plans to issue financial instruments like green, social and sustainability bonds as well as loans and sukuk - bonds that comply with Islamic law - whose proceeds will be used to fund and re-finance renewable energy projects. As power supply and fossil-fuel reserves come under pressure form population growth and rapid industrial development, "Oman appreciates the potential of renewable energy technologies," the country's finance ministry said in the report detailing out the framework. Oman's vision 2040, an economic development plan launched in 2021, envisions the country cutting oil's share of gross domestic product (GDP) to 16% in 2030 and 8.4% in 2040, down from 39% in 2017. https://www.reuters.com/sustainability/sustainable-finance-reporting/oman-unveils-sustainable-finance-framework-green-push-2024-01-11/

2024-01-11 06:19

Major U.S. stock indexes end mostly flat Data: U.S. consumer prices rise more than expected in Dec Bitcoin rises after first US bitcoin ETF approvals NEW YORK, Jan 11 (Reuters) - Global stock indexes were flat to lower on Thursday as data showed U.S. consumer price inflation came in above economists' expectations in December, raising some doubts that the Federal Reserve will cut rates as soon as some traders expect. Bitcoin rose to a two-year high as several exchange-traded funds (ETFs) tied to the spot price of the cryptocurrency began trading. U.S. Treasury yields slid, while the dollar was down on the day against the euro and the yen but off lows reached before the U.S. CPI report. The day's data showed headline CPI rose 0.3% last month, for an annual gain of 3.4%. That was expected to be 0.2% and 3.2%, respectively. "This is not pernicious, it's not a bad number... This is not a signal of a resurgence of inflation. All it's saying is that inflation has come down," said Thierry Wizman, global FX and interest rate strategists in Macquarie, New York. "So, bottom line, this is not dangerous, the Fed will still be easing," Wizman said, adding that a rate cut will not happen in March, as many expected, but will start later in the year. Traders have been pricing in aggressive expectations for rate cuts this year, with the Fed seen as possibly beginning to cut rates in March. The Dow Jones Industrial Average (.DJI) rose 15.29 points, or 0.04%, to 37,711.02, the S&P 500 (.SPX) lost 3.21 points, or 0.07%, to 4,780.24 and the Nasdaq Composite (.IXIC) added 0.54 points, or 0%, to 14,970.19. The benchmark S&P 500 rose early in the session and briefly surpassed its record closing high from January 2022. Also, Microsoft (MSFT.O) briefly overtook Apple (AAPL.O) as the world's most valuable company for the first time since 2021. The pan-European STOXX 600 index (.STOXX) lost 0.77% and MSCI's gauge of stocks across the globe (.MIWD00000PUS) shed 0.06%. The dollar index was last down 0.05% on the day at 102.29. It had traded at around 102.20 before the data was released. The euro gained 0.09% on the day to $1.09820. The greenback gained dipped 0.20% to 145.48 yen , after earlier reaching 146.10, the highest since Dec. 11. The benchmark 10-year yield was last down 4.9 basis points (bps) at 3.980% . BITCOIN BOOST Bitcoin reached $49,051, the highest since December 2021, and was last up 1.80% at $46,800. The U.S. Securities and Exchange Commission late on Wednesday gave the green light to offer ETFs linked to bitcoin. Crypto stocks like Coinbase (COIN.O) were down on Thursday. Investor focus will soon turn to U.S. earnings season, with banking giants including JPMorgan Chase (JPM.N) and Wells Fargo (WFC.N) due to report earnings on Friday. Oil futures and gold prices advanced. Brent futures rose 61 cents, or 0.8%, to settle at $77.41 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 65 cents, or 0.9%, to settle at $72.02. Spot gold added 0.1% to $2,024.69 an ounce. https://www.reuters.com/markets/global-markets-wrapup-1-2024-01-11/

2024-01-11 06:17

NEW YORK, Jan 11 (Reuters) - The dollar was down on the day against the euro and the yen on Thursday but off lows reached before data showed that U.S. consumer price inflation came in above economists' expectations in December, raising some doubts that the Federal Reserve will cut rates as soon as traders expect. Bitcoin also surged to a two-year high as several exchange-traded funds (ETFs) tied to the spot price of the cryptocurrency began trading. The headline U.S. Consumer Price Index (CPI) rose 0.3% last month, for an annual gain of 3.4%, against expectations of 0.2% and 3.2%, respectively. The cost of shelter, which includes rents, hotel and motel stays as well as school housing, accounted for more than half of the increase in the CPI. “The details of the report will give dovish Fed officials pause," said Adam Button, chief currency analyst at ForexLive in Toronto. Traders are pricing in aggressive expectations for rate cuts this year, with the Fed seen as beginning to cut rates in March. But “today's CPI report suggests that the Fed's initial rate cut may be later than the market is hoping for," said Quincy Krosby, chief global strategist at LPL Financial in Charlotte, North Carolina. The dollar index fell to a five-month low in December as traders priced in the likelihood that the U.S. central bank will ease monetary conditions as the U.S. economy weakens and inflation moves back closer to the Fed's 2% annual target. "The question everyone is struggling with is what kind of inflation regime we are in - are we still in a 2010s era of low growth, low inflation and we’re still just working through the end of the pandemic adjustment and then we’re back into that?" Button said. "Obviously that's what the market’s been betting on for the last two months. And I think it's ultimately right, but getting there might not be as quick as anyone would like,” he added. Cleveland Fed President Loretta Mester said on Thursday that the latest CPI figures means that it would likely be too soon for the central bank to cut its policy rate in March. Richmond Fed President Thomas Barkin also said that the data did little to clarify the path of inflation. The dollar index was last down 0.05% on the day at 102.29. It had traded at around 102.20 before the data was released. The euro gained 0.09% on the day to $1.09820. The greenback gained dipped 0.20% to 145.48 yen , after earlier reaching 146.10, the highest since Dec. 11. Sterling rose 0.17% to $1.27630 and got as high as $1.27880, the highest since Dec. 28. In cryptocurrencies, Bitcoin reached $49,051, the highest since December 2021, and was last up 1.80% at $46,800. The U.S. Securities and Exchange Commission on Wednesday gave the green light to offer ETFs linked to bitcoin. https://www.reuters.com/markets/currencies/yen-lags-while-dollar-waits-us-cpi-2024-01-11/