Dollar steadies as U.S. coronavirus cases rise before long holiday By Reuters



© Reuters. A U.S. Dollar banknote

By Stanley White

TOKYO (Reuters) – The dollar was hemmed into a narrow range on Friday, supported by safe-haven flows as a resurgence of the coronavirus in the United States discouraged some investors from taking on excessive risk.

The yuan held steady after data showing a strong rebound in China’s services sector, as investors avoided big positions due to worries about diplomatic friction between Washington and Beijing over civil liberties in Hong Kong.

The U.S. economy added more jobs than expected in June, data showed on Thursday, but reaction in the currency market has been muted because another spike in coronavirus infections threatens to once again put the breaks on economic activity.

“New infections in the United States have been on an uptrend since June,” said Junichi Ishikawa, senior foreign exchange strategist at IG Securities.

“The market is leaning more toward buying the dollar, particularly against emerging market currencies, because the dollar is considered the safest asset around.”

Against the euro (), the dollar traded at $1.1243 on Friday in Asia.

The dollar held steady at 0.9460 Swiss franc after three straight days of gains.

The British pound traded hands at $1.2465 and stood at 90.20 pence per euro ().

The dollar was little changed at 107.57 yen .

A wave of coronavirus infections has prompted the halting of or back-pedalling on plans to reopen economic activity in several U.S. states after months of strict lockdowns.

Officials are also taking steps to curtail activity during the extended Independence Day holiday weekend starting on Friday.

Trading in other Asian currencies on Friday was subdued before the U.S. holiday, but analysts say sentiment favours more gains in the dollar as investors turn cautious.

Relations between the United States and China are also in focus.

The U.S. Senate unanimously approved legislation on Thursday to penalise banks doing business with Chinese officials who implement Beijing’s new national security law for Hong Kong, raising the chances of further friction between the world’s two- largest economies.

The traded at 7.0665, little moved after data showed China’s services sector expanded in June at the fastest rate in more than a decade.

The Australian dollar held steady at $0.6921 after data confirmed retail sales rebounded by a record in May.

Across the Tasman Sea, the New Zealand dollar traded at $0.6514.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Fed’s gloomy outlook steadies dollar slide, for now By Reuters



© Reuters. A U.S. Dollar banknote

By Tom Westbrook

SINGAPORE (Reuters) – The dollar steadied against riskier currencies and the safe-haven yen hit a one-month high on Thursday, as the U.S. Federal Reserve’s dour economic outlook spooked investors.

The moves arrested the greenback’s initial slide after the Fed’s policy stance, projecting rates near zero for years, was even more accommodative than expected.

The Australian dollar retreated from an overnight 11-month high and fell as much as half a percent to $0.6966. The New Zealand dollar gave up a four-and-a-half month high and fell 0.3% to $0.6516.

The yen rose marginally to 106.90, its highest since mid May. Though the euro – which hit a three month peak overnight – held firm, pointing to the possibility of more downside to come for the dollar once the dust settles.

The single currency () last bought $1.1382.

Fed policymakers projected the U.S. economy to shrink 6.5% this year and the unemployment rate to be 9.3% at year’s end.

“It is a long road,” Fed Chair Jerome Powell said via video link on Wednesday.

“We can use our tools to support the labour market and the economy, and we can use them until we fully recover,” he said.

That was a gloomier view than many in the market have gravitated towards in recent days and sent investors out of stocks, away from riskier currencies and in to bonds and the dollar.

“That’s been the follow-through, and it’s played into a broad rebound in the dollar,” said Rodrigo Catril, FX analyst at National Australia Bank (OTC:) in Sydney.

“But the takeaway is the Fed remains fully committed to its ultra easy monetary polices,” he said. “That should be supportive for risk assets, and on a structural basis we still think the U.S. dollar is embarking on a cyclical downturn.”

Neither Powell nor the Fed’s statement brooked any suggestion that the central bank’s massive liquidity injections would be waning any time soon, with the statement promising bond buying to continue “at least at the current pace”.

Powell also said the question remains open as to whether the Fed will use yield curve controls, reinforcing expectations that it is gearing up to do so and pressing benchmark 10-year yields back down under 0.8%.

Against a basket of currencies () the dollar was steady at 96.050, just above a three-month low hit on Tuesday. Sterling held at $1.2738, just above its 200-day moving average.

Markets are looking ahead to U.S. jobless claims data due at 1230 GMT. A slight slowdown in jobless claims is expected, though some traders might be primed for a positive surprise after Friday’s payrolls report showed a completely unexpected easing in the jobless rate.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Dollar steadies after slide as greenback funding stays tight By Reuters


© Reuters. Saudi riyal, yuan, Turkish lira, pound, U.S. dollar, euro and Jordanian dinar banknotes are seen in this illustration

By Tom Westbrook

SINGAPORE (Reuters) – The dollar halted its decline and gains in riskier currencies petered out on Wednesday as fresh rises in coronavirus cases kept markets on edge and the greenback funding market tight.

Foreign exchange markets were in consolidation as the prospect of a huge U.S. stimulus package bolstered Asian stock markets although gains in riskier currencies were tempered.

The safe-haven dollar, which had pulled back from recent peaks, was now steady against the euro () at $1.0789, and fell only marginally against the yen to 111.11 yen per dollar.

Currencies that fell the hardest last week hung on to overnight gains. The pound was steady at $1.1759, the Australian dollar was 0.2% weaker at $0.5941 after running as far as $0.5990 in early trade.

The U.S Federal Reserve’s offer of unlimited bond-buying, on top of opening discount dollar funding lines to central banks around the globe, has supported risk sentiment for the past day along with hopes for a huge U.S. fiscal stimulus package.

The Jones posted its biggest one-day gain since 1933 overnight and Asian markets kept the rally going on Wednesday. [MKTS/GLOB]

But nerves and still-elevated demand for greenbacks in cash capped further gains in currencies like the , euro and pound.

“It’s a nice rebound and we can probably run with it through the Asian session, but whether this mood can hold 24 hours from now, I’m not convinced,” said Westpac FX analyst Sean Callow.

“The overall (virus) picture is still very grim and almost certainly going to get worse.”

Spain reported its sharpest increase in cases overnight. India announced a 21-day lockdown of its 1.3 billion population.

The World Health Organization said that New York could become the next epicenter of the pandemic.

Within funding markets, signs of stress remain as businesses and investors drive enormous demand for dollars to cover liabilities and as a shelter from a maelstrom that has hit nearly every asset class.

Cross-currency basis swap spreads, which reflect the cost of borrowing dollars abroad have relaxed for the euro but remain elevated for the yen and Australian dollar , for example.

“There’s a lot of reasons to believe that we’re not out of the woods yet,” said Chris Weston, head of research at Melbourne brokerage Pepperstone.

“People still feel that the downside risk is far more prevalent…this is a traders’ market, we’re going to get levels where people look to fade this again.”

The New Zealand dollar fell 0.5% to $0.5800, while the Korean won handed back a small fraction of Tuesday’s 3% gain.

Graphic: World FX rates in 2020 https://graphics.reuters.com/GLOBAL-CURRENCIES-PERFORMANCE/0100301V041/index.html

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Oil steadies above $56 as supply constraints counter virus fears By Reuters


© Reuters. FILE PHOTO: Pump jacks operate at sunset in Midland

By Alex Lawler

LONDON (Reuters) – Oil steadied above $56 a barrel on Tuesday after two days of declines as OPEC output cuts and Libyan supply losses balanced concerns about the spread of the coronavirus and its impact on oil demand.

Crude fell almost 4% on Monday, with other commodities also reporting losses while U.S. and European equities suffered their steepest declines since mid-2016 on concern the coronavirus outbreak could turn into a pandemic.

rose 5 cents to $56.35 a barrel by 1338 GMT. U.S. West Texas Intermediate crude was up 16 cents at $51.59.

“Risk appetite appears to be growing again on the markets,” said Commerzbank (DE:) analyst Eugen Weinberg. He added that the virus and resulting impact on demand is not expected to disappear anytime soon.

South Korea aims to test more than 200,000 members of a church at the centre of a surge in coronavirus cases. The virus is also spreading in Europe and the Middle East. [nL3N2AP0BC]

Concern about the demand impact from the virus has pushed Brent down by almost $10 a barrel this year despite the shutdown of most of Libya’s output and a supply pact between the Organization of the Petroleum Exporting Countries (OPEC) and allies.

Prices received further support as lawmakers based in areas of eastern Libya on Monday said that they would not participate for now in peace talks.

“Libyan peace talks appear to have taken a further blow with both sides announcing the end of their participation, pointing to lost crude volumes from the country carrying on for now,” JBC Energy analysts said in a report.

However, oil could come under more pressure from the latest U.S. supply reports.

Crude inventories are expected to rise for a fifth week running. The first of this week’s two supply reports, from the American Petroleum Institute (API), is due at 2130 GMT.

Potential support for prices could also come from OPEC and allies including Russia, which are considering whether to curb output further. However, scepticism is growing about the chance of further action.

“Doubts are emerging about the willingness of OPEC+ to extend and expand the necessary production cuts,” said Commerzbank’s Weinberg. The producers are due to meet in Vienna over March 5-6 to decide policy.

Saudi Arabia’s energy minister on Tuesday said OPEC+ should not be complacent about the coronavirus. But Russia, key to any deal, has yet to announce its position on further curbs.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Oil steadies on bargain-hunting; virus fears cap gains


TOKYO (Reuters) – Oil steadied on Tuesday as investors sought bargains after crude benchmarks slumped almost 4% in the previous session, although concerns about the coronavirus spreading out of China denting major economies and curbing fuel demand capped gains.

FILE PHOTO: Pump jacks operate at sunset in Midland, Texas, U.S., February 11, 2019. REUTERS/Nick Oxford/File Photo

Brent crude rose 19 cents, or 0.3%, to $56.49 a barrel by 0436 GMT, after slipping 3.8% on Monday, the largest single-day price fall since Feb. 3.

U.S. crude futures gained 17 cents, or 0.3%, to $51.60, recovering from a 3.7% drop in the previous session.

“Because we’ve seen a very significant fall in case of West Texas, from above $60 to touch below $50 (over the past six weeks), I think oil has largely reflected a lot of risk, unlike other markets,” Michael McCarthy, chief market strategist at CMC Markets, told Reuters over the phone.

Crude markets are also close to an important technical support level between $49.50 and $50 for WTI and between $54.50 and $55 for Brent, McCarthy said.

“For this week, key factors are coronavirus, inventory data and the technical picture,” he said.

Demand concerns savaged prices for oil and a whole swathe of commodities on Monday, while both U.S. and European equities suffered their steepest losses since mid-2016.

Asian share markets were trying to stabilise on Tuesday after a wave of early selling petered out and Wall Street futures managed a solid bounce. [MKTS/GLOB]

In the United States, crude oil inventories were seen building for a fifth straight week, while refined products likely fell, a preliminary Reuters poll on the expectations for the week ended on Feb. 21 showed on Monday.

Countries around the world are stepping up efforts to prevent a pandemic of the flu-like SARS-CoV-2 virus originating from China late last year that has now infected more than 80,000 people, 10 times more than the SARS coronavirus of 2002/2003.

“Fears that the rapidly-spreading coronavirus outside of China could lead to a bigger-than-anticipated impact on global economy and oil demand will likely keep weighing on market sentiment,” Satoru Yoshida, a commodity analyst with Rakuten Securities said.

Saudi Aramco expects the coronavirus impact on oil demand to be short-lived, however, and for consumption to rise in the second half of the year, Chief Executive Amin Nasser told Reuters on Monday.

Reporting by Yuka Obayashi; Editing by Tom Hogue



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Yen steadies on virus anxiety, euro hit by weak growth outlook By Reuters


© Reuters. Illustration photo of a Japan Yen note

By Stanley White

TOKYO (Reuters) – The Japanese yen held onto gains against the dollar on Friday, as fresh doubts about the scale of the coronavirus outbreak supported demand for safe-haven currencies.

The nursed losses as the flu-like virus, which emerged late last year in China’s central Hubei province, slammed the brakes on consumer spending and manufacturing.

The euro languished at multi-year lows versus the dollar and the Swiss franc as investors grow more pessimistic about the outlook in the euro zone before the release of gross domestic product data later on Friday.

In contrast, the pound rode a wave of optimism into Asia on Friday due to hopes that a British cabinet reshuffle will lead to more expansionary fiscal policy to support growth.

Officials in Hubei stunned financial markets on Thursday by announcing a sharp increase in new infections and deaths from the coronavirus, reflecting the adoption of a new method to diagnose the illness.

Uncertainty about the real extent of the epidemic is likely to discourage investors from taking on excessive risk until there is sufficient evidence that its spread has slowed.

“There is a return of risk aversion, so yen and other safe-haven assets have risen, but reaction so far has been temporary and limited,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities in Tokyo.

“The change of reporting standards in China is a concern. There is a fear that China is still hiding something.”

The yen held steady at 109.81 per dollar in Asia on Friday, following a 0.25% gain the previous session.

In the onshore market, the yuan slipped 0.09% to 6.9841 per dollar, while its offshore counterpart eased slightly to 6.9860, following a 0.2% decline on Thursday.

Hubei officials on Friday reported 4,823 new cases and 116 new deaths as of Feb. 13, but investors were still reeling after the province reported 14,840 new cases and a record daily increase in deaths on Thursday, using new diagnostic methods to reclassify a backlog of cases.

China’s economy will grow at its slowest rate since the financial crisis in the current quarter, according to a Reuters poll of economists who said the downturn will be short-lived if the outbreak is contained.

The coronavirus was first detected in Hubei’s capital Wuhan, a nerve centre in the global supply chain. It has so far claimed more than 1,300 lives in China and spread to 24 other countries.

The euro () fell 0.1% to $1.0827, the lowest since April 2017, as investors braced for the release of GDP data from Germany and the euro zone later on Friday.

The single currency () was quoted at 1.0618 Swiss francs, close to the lowest since August 2015. The euro () eased slightly to 83.06 pence, close to the weakest since December.

Sentiment for the euro worsened after data earlier this weak showing a plunge in euro zone manufacturing output reinforced expectations that monetary policy will remain accommodative.

The pound was little changed at $1.3046 following a 0.64% gain on Thursday due to expectations that British Prime Minister Boris Johnson’s appointment of a new finance minister will lead to more fiscal spending to help Britain weather its transition away from the European Union.





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U.S. business spending on equipment appears soft; housing steadies By Reuters


© Reuters. FILE PHOTO: Engines assembled as they make their way through the assembly line at the General Motors (GM) manufacturing plant in Spring Hill

By Lucia Mutikani

WASHINGTON (Reuters) – New orders for key U.S.-made capital goods barely rose in November and shipments fell, suggesting business investment will probably remain a drag on economic growth in the fourth quarter.

The White House’s 17-month-old trade war with China has hurt business confidence, undermining capital expenditure. Despite a recent easing of tensions, regional manufacturing surveys showed business confidence remaining subdued in December.

Even if business confidence were to improve in early 2020, a surge in capital expenditure is unlikely. Boeing (N:) announced last week it would suspend production of its best-selling 737 MAX jetliner in January as fallout from two fatal crashes of the now-grounded aircraft drags into 2020. Boeing on Monday ousted Chief Executive Dennis Muilenburg.

“We expect industrial momentum will remain muted in 2020 amid an environment of sluggish global growth, persistent trade policy uncertainty and subdued corporate profitability,” said Oren Klachkin, lead U.S. economist at Oxford Economics in New York. “Boeing’s decision to halt production of the 737 MAX will present a continuing drag on orders.”

The Commerce Department said orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, edged up 0.1% last month as a surge in demand for electrical equipment, appliances and components was partially offset by a drop in machinery orders.

These so-called core capital goods orders rose by an unrevised 1.1% in October. Economists polled by Reuters had forecast core capital goods orders gaining 0.2% in November.

Core capital goods orders rose 0.7% on a year-on-year basis in November.

The dollar held near a two-week high against a basket of currencies, while U.S. Treasury prices slipped. Stocks on Wall Street were trading higher, with Boeing shares surging following Muilenburg’s ousting.

SHIPMENTS DROP

Shipments of core capital goods dropped 0.3% last month. Core capital goods shipments are used to calculate equipment spending in the government’s gross domestic product measurement. Core capital goods shipments rose by a downwardly revised 0.7% in October. They were previously reported to have jumped 0.8%.

Economists said the weak core capital goods shipments posed a downside risk to fourth-quarter GDP growth estimates, which range from as low as a 1.5% annualized rate to as high as a 2.3% pace. The economy grew 2.1% in the third quarter.

While manufacturing is struggling, the housing market is steadily rising, driven by the Federal Reserve’s three interest rate cuts this year. In a second report on Monday, the Commerce Department said new home sales rebounded 1.3% to a seasonally adjusted annual rate of 719,000 units last month, lifted by gains in activity in the Northeast and West regions.

October’s sales pace was, however, revised down to 710,000 units from the previously reported 733,000 units. New home sales are volatile on a month-to-month basis because they are drawn from a small sample of houses selected from building permits. Sales jumped 16.9% from a year ago.

“We expect housing activity to remain supported with now-lower mortgage rates and a Fed on hold, but do not expect a further substantial pick-up in activity into 2020,” said Veronica Clark, an economist at Citigroup (NYSE:) in New York.

Business investment has contracted for two straight quarters, with weak spending on equipment and nonresidential structures such as gas and oil well drilling contributing to the decline that has pushed manufacturing into recession.

Boeing’s biggest assembly-line halt in more than 20 years is expected to disrupt supply chains, further depressing manufacturing, which accounts for 11% of the economy. Economists estimated the suspension of the 737 MAX aircraft production could cut first-quarter 2020 gross domestic product growth by at least half a percentage point.

Last month, overall orders for durable goods, items ranging from toasters to aircraft that are meant to last three years or more, tumbled 2.0% after gaining 0.2% in the prior month.

Durable goods orders were held down by a 72.7% plunge in demand for defense aircraft orders and parts last month. Economists expect a rebound after the U.S. Congress passed a huge defense spending bill last week.

“The big, bipartisan defense bill that passed Congress last week ensures defense spending will be robust next year, however,” said Chris Low, chief economist at FHN Financial in New York. “It’s not a recipe for gangbusters growth, but capital spending should no longer detract from growth next year.”

Orders for transportation equipment dropped 5.9% after edging up 0.1% in October. Motor vehicles and parts orders increased 1.9% in November as the end of a strike at General Motors (N:) boosted auto production. Orders for non-defense aircraft and parts fell 1.8% last month.

Overall shipments of durable goods nudged up 0.1% in November, reversing October’s 0.1% drop. Durable goods inventories increased 0.4% last month. They have risen in 16 of the last 17 months. Unfilled durable goods orders fell 0.4% in November after being unchanged in October.



Dollar steadies as investors brace for key risk events By Reuters



By Tom Westbrook

SINGAPORE (Reuters) – The dollar and yen held the safe-haven high ground on Tuesday, with investors on edge ahead of a looming tariff deadline, the UK election and upcoming central bank meetings in Europe and the United States.

Front of mind is whether Washington will go ahead with a fresh round of tariffs on Sunday, or whether a deal with China can be reached before then.

White House economic adviser Larry Kudlow said on Friday that the Dec. 15 deadline is still in place, but Bloomberg reported Agriculture Secretary Sonny Perdue saying the tariffs are unlikely to take effect.

“There’s risks both ways,” said Westpac FX analyst Imre Speizer.

“Trade’s still the flip-floppy factor, but I think markets are still reasonably upbeat about risk-seeking. All these little movements are only smoke and noise and don’t really tell you what’s going on. Cautiously positive would be the overall mood.”

Against the Japanese yen and the euro () the greenback found support after last week’s declines, steadying at 108.56 yen and $1.1064 per euro. Against a basket of currencies, () the dollar last traded at 97.644.

The Australian and New Zealand dollars were marginally stronger at $0.6824 and $0.6548 , respectively.

The U.S. dollar’s recovery after weakness last week has been supported by a surge in hiring in November.

That has investors almost certain that the U.S. Federal Reserve will hold rates steady on Wednesday, which has increased investors’ focus on finding a trade-war truce.

China said on Monday it hoped to make a trade deal with the United States as soon as possible, though gave no new details or insight into talks’ progress.

“Market risk is becoming binary,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney. “A deal could see further pro-growth trading, new tariffs could see sentiment collapse in a heap.”

Elsewhere, the European Central Bank is likewise expected to keep interest rates steady, while the pound’s fate is in the hands of voters at Thursday’s British election.

Sterling sat at $1.3144, just below a seven-month high hit last week, as polls pointed to a Conservative victory decisive enough to secure a parliamentary majority.

A YouGov poll due at 2200 GMT will offer the latest guide.

“If the UK bookies’ prices are a reasonable guide to market expectations for Thursday’s election, it is hard to see much more upside for GBP on the outcome,” said Adam Cole, chief currency strategist at RBC Capital Markets.

“Despite the confidence with which markets predict a Conservative victory, there are still several major uncertainties,” he added, pointing to unpredictable turnout and polling showing a sizeable chunk of undecided voters.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Dollar steadies after 3 days of losses as trade deal hopes dim By Reuters


© Reuters. A man displays US dollar notes after withdrawing cash from a bank in Harare

By Saikat Chatterjee

LONDON (Reuters) – The dollar stabilized against a broad basket of other currencies on Tuesday after three consecutive days of losses as investors waited for the release of the minutes of the U.S. central bank meeting at end-October when policymakers had cut interest rates.

Global macro hedge funds had ramped up their dollar selling for a third week according to latest weekly positioning data and some market watchers say hawkish policy minutes could trigger a dollar rebound.

The greenback has hit a trough since late last week as hopes for a preliminary trade deal between the United States and China evaporated.

Expectations had grown that Washington and Beijing would sign a so-called “phase one” deal this month to scale back their 16-month-long trade war but those hopes received a setback on Monday after CNBC reported China is pessimistic about agreeing to a deal, which suggests a resolution to perhaps the biggest risk to the global economy remains elusive.

“Trade headlines is dominating sentiment but in terms of the key event risk, the release of the Fed minutes will be a big one for market participants,” said Morten Lund, a senior FX strategist at Nordea.

Against a basket of its rivals (), the greenback was broadly steady at 97.84 after weakening more than 0.6% in the last three sessions. It had hit a one-month high of 98.45 on Nov. 13.

Elsewhere in the currency market, the Australian dollar fell 0.16% to $0.6799 and declined 0.26% to 73.82 yen ().

Australia’s central bank “agreed a case could be made” for another cut in the 0.75% cash rate at its November meeting given unwelcome weakness in wages growth and inflation, minutes published on Tuesday showed.

Sterling held firm around $1.2950 with the pound buoyed by polls pointing to a victory by the ruling Conservatives in upcoming elections.

In the onshore market, the yuan fell to a two-week low of 7.0295 per dollar.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Oil steadies as fall in U.S. inventories offsets weak economic data


LONDON (Reuters) – Oil steadied on Wednesday, following several days of declines, after industry data showed a surprise drop in U.S. crude inventories, although gains were capped as weak economic readings in the United States depressed global markets.

FILE PHOTO: A pumpjack is seen at the Sinopec-operated Shengli oil field in Dongying, Shandong province, China January 12, 2017. REUTERS/Chen Aizhu/File Photo

Brent crude futures, an international benchmark for oil prices, were down 6 cents at $58.83 a barrel at 1307 GMT. U.S. West Texas Intermediate (WTI) crude futures rose 6 cents to $53.68 a barrel.

Front-month WTI prices settled down for a sixth straight session on Tuesday, their longest losing streak this year, after U.S. manufacturing activity dropped to a 10-year low as U.S.-China trade tensions weighed on exports.

(GRAPHIC – U.S. manufacturing: here)

However, prices found some support from American Petroleum Institute (API) data which showed U.S. crude stocks fell last week by 5.9 million barrels, against expectations for an increase of 1.6 million barrels. [API/S]

“It seems to be a fight between two opposing forces; On the bullish side another draw in U.S. inventories, on the bearish side concerns on weaker economic data, and currently ebbing tensions in the oil market,” said Giovanni Staunovo, an oil analyst at UBS.

“I still hold a constructive outlook short term,” he added.

The Energy Information Administration’s (EIA) weekly oil inventories report is due at 1030 EDT (1430 GMT). [EIA/S]

“Even if the EIA were to confirm the API crude oil number this afternoon, the momentum off a single number can easily fade as the economy is front and center for global markets right now,” said Harry Tchilinguirian, global oil strategist at BNP Paribas.

Russian President Vladimir Putin said Russia would continue to be a responsible player in the alliance between OPEC and non-OPEC oil-producing nations, known as OPEC+.

Speaking at an energy forum in Moscow attended by the Saudi and Iranian energy ministers, Putin said it was important to use all available tools to balance the energy markets.

Iran’s Oil Minister Bijan Zanganeh said he expected a slight surplus on the oil supply side next year.

The United Arab Emirates’ Minister of Energy and Industry Suhail al-Mazrouei said OPEC and its allies were monitoring global oil markets, and that conformity levels were the same as previously announced at the last OPEC+ joint ministerial monitoring committee meeting.

(GRAPHIC – OPEC Production: here)

Meanwhile, Ecuador, one of the smallest members of the Organization of the Petroleum Exporting Countries, said it would leave the 14-nation bloc from Jan. 1 due to fiscal problems. Ecuador will be the second country to withdraw from OPEC in the last year after the departure of Qatar.

Additional reporting by Florence Tan and Roslan Khasawneh in Singapore; Editing by Mark Potter and Susan Fenton



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