central bank


Disney lifts Dow, S&P 500 to records while trade tensions cast shadow

NEW YORK, Nov 14 — The Dow Jones Industrial Average and the S&P 500 posted record closing highs yesterday helped by a big jump in Walt Disney shares, but the Nasdaq fell as stocks were kept in check by fresh uncertainty over US-China trade…

Wall St slips on trade worries, Hong Kong unrest

NEW YORK, Nov 13 — Wall Street edged lower today as President Donald Trump’s threat to “substantially” raise tariffs if China did not make a trade deal with the United States as well as escalating tensions in Hong Kong kept investors away…

Fed’s Powell expects ‘sustained expansion’ of US economy

WASHINGTON, Nov 13 — The US economy is likely to continue to grow, but faces continued risks from the global slowdown and trade disputes, which have already dampened expansion, Federal Reserve chief Jerome Powell said today. In the first of…

US consumer prices increase more than expected in October

WASHINGTON, Nov 13 — US consumer prices rebounded more than expected in October and underlying inflation picked up, which together with abating trade tensions and fears of a recession, support the Federal Reserve’s signal for no further interest…

Asian markets hit by trade uncertainty, Hong Kong flares up again

HONG KONG, Nov 13 — Asian markets sank today after Donald Trump failed to give investors enough reassurance over the progress of China trade talks and as violent Hong Kong protests show no sign of letting up. In a much-anticipated speech…

Malaysia’s Q3 GDP growth seen slowing to 4.4%

KUALA LUMPUR: Malaysia’s economic growth likely slowed in the third quarter as sluggish demand at home and abroad began to drag on activity after a solid first half, a Reuters poll showed.

The median forecast from the poll of 14 economists was for growth of 4.4% in July-September compared with a year earlier, slowing from 4.9% in the second quarter and 4.5% expansion in January-March.

Individual forecasts ranged from 4.1% to 4.7%.

Malaysia was the only Southeast Asian nation to report an acceleration in growth in the April-June period from the previous quarter, as the region grappled with softening global demand and the escalating U.S.-China trade war.

But weaker exports and domestic consumption started to drag on Southeast Asia’s third-largest economy in the last few months, according to economic research consultancy Capital Economics.

“The Malaysian economy has outperformed the rest of the region for most of this year but recent data suggest that it is coming to an end,” the firm said in a research note on Friday.

“The latest activity data have been poor… Our GDP Tracker, which is based on this monthly data, points to a fairly sharp slowdown in Q3,” said Capital Economics, which sees Q3 growth at 4.2%.

Malaysia’s exports fell 6.8% in September, the biggest decline in nearly three years and widening from a 0.8% contraction the previous month.

Factory output grew 1.7% in September, performing below expectations for a fourth straight month.

Domestic consumption has also cooled. Wholesale and retail activities grew 5.7% annually in the third quarter, down from 6.1% pace over April-June, according to data from the Malaysian Department of Statistics.

“High frequency indicators like business sentiment, consumer sentiment and motor vehicle sales slowed during the quarter indicating subdued domestic demand,” HSBC said in a note.

Malaysia’s central bank made a preemptive cut to its key interest rate in May in a bid to boost growth, but has since stood pat as it expects private spending to remain resilient and sufficient to offset pressure from weaker exports. – Reuters

Kiwi takes flight as New Zealand’s central bank surprises by standing pat

SINGAPORE, Nov 13 — The New Zealand dollar soared 1 per cent today after the country’s central bank unexpectedly left interest rates on hold, while most other currencies trod water. “It’s flying. Massive surprise,” said Imre Speizer, head…

New Zealand dlr jumps as central bank stuns bears with rate hold

SYDNEY: The New Zealand dollar boasted its biggest daily rise this year on Wednesday after the country’s central bank surprised markets by keeping interest rates steady, wrongfooting bears who had wagered heavily on a cut.

The kiwi dollar jumped 1.1% to $0.6405 as speculators were squeezed out of short positions, which had become a very crowded trade in recent weeks.

The currency now needs to crack chart resistance at the November peak of $0.6466 to extend the rally.

Bears were forced to scramble when the Reserve Bank of New Zealand (RBNZ) skipped a chance to cut rates, staying at 1% when the market had been odds-on for an easing.

The central bank’s next policy meeting is also not until February, too long a time for speculators to stay short.

“Today’s decision shows that the RBNZ is not afraid to stare down financial markets,” said Dominick Stephens, chief economist for New Zealand at Westpac.

“The RBNZ is certainly open to a February cut,” he added. “Our long-held view is that the low-point in the current rate cycle will be 0.75%.”

The market was not so sure, with swap rates surging to imply only a 20% chance of a cut in February.

Yields on two-year government bonds climbed 10 basis points to their highest since August at 1.00% – the sharpest daily rise since mid-2017.

The Kiwi also jumped on its Australian neighbour, with the Aussie diving 1.2% to NZ$1.0678. That kept the Aussie flat on the U.S. dollar at $0.6873.

Domestic Australian data was mixed with wage growth staying disappointingly subdued in the third quarter, while consumer sentiment became a little less gloomy this month.

The annual pace of wage growth slowed to just 2.2%, when analysts had looked for a steady reading of 2.3%.

That was a headache for the conservative government of Prime Minster Scott Morrison which needs much faster growth to meet its pledge of returning the budget to surplus.

It had predicted growth would pick up to 2.5% by the middle of this year, and reach 2.75% for the year to June 2020 and a heady 3.25% the year after.

The Reserve Bank of Australia (RBA) last week abandoned its long-held hope for an acceleration in pay awards, tipping an annual pace of 2.3% right out to end 2021.

“Growth remains dismal and, with the headwinds facing the economy unlikely to abate in the near term, we don’t expect wages growth to accelerate markedly in the near term,” said Sarah Hunter, chief economist for BIS Oxford Economics.

“Given this backdrop, we expect the RBA to cut the cash rate again in early 2020, to 0.5%.”

Australian government bond futures edged up on the data, with the three-year bond contract rising 2 ticks to 99.170. The 10-year contract firmed 1.5 ticks to 98.7250. – Reuters

Battle for Mediobanca: Italy’s richest man takes on seasoned CEO

MILAN, Nov 13 — One comes from a wealthy family, attended Milan’s best schools and has spent all his career engineering mergers at Mediobanca, Italy’s most influential investment bank. The other was raised in an orphanage and was too poor to…

Dollar holds gains as investors cling to trade hopes

SINGAPORE, Nov 13 — The dollar clung to most of its recent gains today after US President Donald Trump said a trade deal with China was “close” but offered no new details on negotiations to send the greenback higher. Hopes for an imminent a…