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Business Recorder
6 days ago
- Business
- Business Recorder
Dollar advances after US jobs data
NEW YORK: The US dollar rose against major currencies including the yen, euro and Swiss franc on Thursday after data showed that the US economy created more jobs than analysts estimated, signaling the Federal Reserve might take longer to cut interest rates. The dollar strengthened 0.70% to 144.705 versus the Japanese yen and was up 0.40% to 0.79510 against the Swiss franc. The US currency is on track to notch a second consecutive session of gains against both safe-haven currencies. The euro was 0.26% weaker at $1.1769. It is on track for the second straight day of losses. US Labor Department data on Thursday showed that nonfarm payrolls increased by 147,000 jobs in June. Economists polled by Reuters had forecast a rise of 110,000. The report was published a day early because of the July 4 US Independence Day holiday. 'It will be very difficult for the Fed to cut rates in this environment, with the labor market so strong,' said Axel Merk, president and chief investment officer at Merk Hard Currency Fund in California. 'The argument that Jerome Powell has made for the Fed to stay on the sidelines continues to hold.' The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.27% to 97.01, on track for two straight sessions of gains, although it is still near multi-year lows. The rise in the dollar following the data was accompanied by an increase in US Treasury yields. The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 9.1 basis points to 3.88%. The yield on benchmark US 10-year notes rose 4.1 basis points to 4.344%. Wall Street stock indexes including Dow Jones Industrial Average, the benchmark S&P 500 and the Nasdaq Composite were all up on the session. Republicans in the US House of Representatives advanced President Donald Trump's massive tax-cut and spending bill toward a final yes-or-no vote early on Thursday. The US has lifted restrictions on exports to China for chip design software developers and ethane producers, a sign of easing trade tensions between the countries. The dollar strengthened 0.06% to 7.164 versus the offshore Chinese yuan. The British pound rose after losing ground in the previous session following a selloff in gilts. British Prime Minister Keir Starmer's office backed finance minister Rachel Reeves, easing concerns over her future. The pound strengthened 0.15% to $1.3656.
Nikkei Asia
7 days ago
- Business
- Nikkei Asia
Dollar advances on stronger-than-expected US jobs data
NEW YORK (Reuters) -- The U.S. dollar rose against major currencies including the yen, euro and Swiss franc on Thursday after data showed that the U.S. economy created more jobs than analysts estimated, signaling the Federal Reserve might take longer to cut interest rates. The dollar strengthened 0.70% to 144.705 versus the Japanese yen and was up 0.40% to 0.79510 against the Swiss franc. The U.S. currency is on track to notch a second consecutive session of gains against both safe-haven currencies. The euro was 0.26% weaker at $1.1769. It is on track for the second straight day of losses. U.S. Labor Department data on Thursday showed that nonfarm payrolls increased by 147,000 jobs in June. Economists polled by Reuters had forecast a rise of 110,000. The report was published a day early because of the July 4 U.S. Independence Day holiday. "It will be very difficult for the Fed to cut rates in this environment, with the labor market so strong," said Axel Merk, president and chief investment officer at Merk Hard Currency Fund in California. "The argument that Jerome Powell has made for the Fed to stay on the sidelines continues to hold." The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.27% to 97.01, on track for two straight sessions of gains, although it is still near multi-year lows. The rise in the dollar following the data was accompanied by an increase in U.S. Treasury yields. The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 9.1 basis points to 3.88%. The yield on benchmark U.S. 10-year notes rose 4.1 basis points to 4.344%. Wall Street stock indexes including Dow Jones Industrial Average, the benchmark S&P 500 and the Nasdaq Composite were all up on the session. Republicans in the U.S. House of Representatives advanced President Donald Trump's massive tax-cut and spending bill toward a final yes-or-no vote early on Thursday. The U.S. has lifted restrictions on exports to China for chip design software developers and ethane producers, a sign of easing trade tensions between the countries. The dollar strengthened 0.06% to 7.164 versus the offshore Chinese yuan. The British pound rose after losing ground in the previous session following a selloff in gilts. British Prime Minister Keir Starmer's office backed finance minister Rachel Reeves, easing concerns over her future. The pound strengthened 0.15% to $1.3656.
Zawya
7 days ago
- Business
- Zawya
Dollar advances after stronger than expected US jobs data
The U.S. dollar rose against major currencies including the yen, euro and Swiss franc on Thursday after data showed that the U.S. economy created more jobs than analysts estimated, signaling the Federal Reserve might take longer to cut interest rates. The dollar strengthened 0.70% to 144.705 versus the Japanese yen and was up 0.40% to 0.79510 against the Swiss franc. The U.S. currency is on track to notch a second consecutive session of gains against both safe-haven currencies. The euro was 0.26% weaker at $1.1769. It is on track for the second straight day of losses. U.S. Labor Department data on Thursday showed that nonfarm payrolls increased by 147,000 jobs in June. Economists polled by Reuters had forecast a rise of 110,000. The report was published a day early because of the July 4 U.S. Independence Day holiday. "It will be very difficult for the Fed to cut rates in this environment, with the labor market so strong," said Axel Merk, president and chief investment officer at Merk Hard Currency Fund in California. "The argument that Jerome Powell has made for the Fed to stay on the sidelines continues to hold." The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.27% to 97.01, on track for two straight sessions of gains, although it is still near multi-year lows. The rise in the dollar following the data was accompanied by an increase in U.S. Treasury yields. The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 9.1 basis points to 3.88%. The yield on benchmark U.S. 10-year notes rose 4.1 basis points to 4.344%. Wall Street stock indexes including Dow Jones Industrial Average, the benchmark S&P 500 and the Nasdaq Composite were all up on the session. Republicans in the U.S. House of Representatives advanced President Donald Trump's massive tax-cut and spending bill toward a final yes-or-no vote early on Thursday. The U.S. has lifted restrictions on exports to China for chip design software developers and ethane producers, a sign of easing trade tensions between the countries. The dollar strengthened 0.06% to 7.164 versus the offshore Chinese yuan. The British pound rose after losing ground in the previous session following a selloff in gilts. British Prime Minister Keir Starmer's office backed finance minister Rachel Reeves, easing concerns over her future. The pound strengthened 0.15% to $1.3656. (Reporting by Chibuike Oguh in New York. Editing by Alex Richardson and Mark Potter)
Yahoo
27-05-2025
- Business
- Yahoo
How Trump's big bill is shaking the bond market
House Republicans' domestic agenda bill doesn't have a topline cost estimate yet and faces the likelihood of major rewrites in the Senate, but it's already sending shockwaves through global financial markets. U.S. bonds have sold off in response to the House passage of the bill, which is likely to add trillions to a U.S. national deficit that has hovered around 120 percent of gross domestic product (GDP) since the pandemic. Both the 30-year and the 20-year U.S. Treasuries were trading on a yield above 5.1 percent on Thursday morning. For the 30-year, that's the highest level since 2007. The benchmark 10-year note was up above 4.6 percent, the highest level since February. Those high yields for U.S. bonds mean that investors want a bigger return for their public investments, which seem like less of a sure thing in the face of massive, deficit-expanding tax cuts. Preliminary estimates from the Congressional Budget Office (CBO) suggest the GOP bill could add $2.3 trillion to the deficit over ten years, though that number doesn't include interactions between the various tranches of budget cuts and tax cuts. Bankers and financiers are sounding notes of disappointment at the size of the budget cuts in the Republican bill, which are expected to kick 8.6 million people out of national health insurance programs and 3 million people off of food assistance programs. 'Everybody I've talked to in the financial markets, they're staring at the bill, and they thought it was going to be much more in terms of fiscal restraint, and they're not necessarily seeing it,' Federal Reserve Governor Christopher Waller said in a Thursday interview on Fox Business Network's 'Mornings with Maria' television program. 'Therefore, there's going to be a lot of issuance of Treasuries. And in order for them to buy these things, they want it at a lower price, and therefore, a higher yield,' he said. Investors told The Hill that they weren't all that surprised that the Republican bill would deliver substantial tax cuts, especially for top earners, without proportionate cuts to social services, which are politically unpopular and hard to pull off. The Senate could further walk back the spending cuts delivered by the House, which total roughly $1.5 trillion between the Energy and Commerce, Education, and Agriculture committees. What investors do think is remarkable is the macroeconomic effects of the tariffs, which are splitting up the traditional relationships between bonds, gold and the U.S. dollar. In the context of these larger fractures, the bond market selloff from the GOP bill could be more pronounced, they say. 'It's something I'm watching very closely,' Axel Merk, head of Merk Investments, told The Hill. 'Usually, higher long term yields would mean a stronger dollar and weaker gold, whereas instead we're seeing a weaker dollar and stronger gold.' 'Given the very significant deficits, [the fiscal policy] is something you can't ignore,' he added. The 20-year U.S. Treasury auction this week was another sore spot in the bond market and saw weak demand from investors. The Treasury sold $16 billion of new 20-year bonds at a yield of 5.05 percent – well above the average of the previous auctions at around 4.6 percent. Analysts for Deutsche Bank called the auction 'soft' and said it set off a stock market decline this week. 'The soft 20-year auction was also a trigger for a broader market slump, with the S&P 500 falling from negative 0.2 percent on [Tuesday] to negative 1.61 percent by the close, its worst day in the past month,' Jim Reid and others wrote for Deutsche Bank. Stocks have languished this week, with the Dow Jones Industrial Average and the S&P 500 index down about a percent since Monday Higher interest rates, both in the short term and the long term, make the cost of borrowing money higher — another factor compounding the financial drag from the GOP bill. The Fed has been cutting interest rates off of near-20-year highs prompted by pandemic shutdowns but has paused its cuts since December as economic conditions have wavered. Short term interest rates are now at about 4.3 percent, the highest level since November 2007 Fed Chair Jerome Powell has said that he thinks the days of near-zero interest rates, as was the case during the previous decade, might well be over. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Hill
22-05-2025
- Business
- The Hill
How Trump's big bill is shaking the bond market
House Republicans' domestic agenda bill doesn't have a topline cost estimate yet and faces the likelihood of major rewrites in the Senate, but it's already sending shockwaves through global financial markets. U.S. bonds have sold off in response to the House passage of the bill, which is likely to add trillions to a U.S. national deficit that has hovered around 120 percent of gross domestic product (GDP) since the pandemic. Both the 30-year and the 20-year U.S. Treasuries were trading on a yield above 5.1 percent on Thursday morning. For the 30-year, that's the highest level since 2007. The benchmark 10-year note was up above 4.6 percent, the highest level since February. Those high yields for U.S. bonds mean that investors want a bigger return for their public investments, which seem like less of a sure thing in the face of massive, deficit-expanding tax cuts. Preliminary estimates from the Congressional Budget Office (CBO) suggest the GOP bill could add $2.3 trillion to the deficit over ten years, though that number doesn't include interactions between the various tranches of budget cuts and tax cuts. Bankers and financiers are sounding notes of disappointment at the size of the budget cuts in the Republican bill, which are expected to kick 8.6 million people out of national health insurance programs and 3 million people off of food assistance programs. 'Everybody I've talked to in the financial markets, they're staring at the bill, and they thought it was going to be much more in terms of fiscal restraint, and they're not necessarily seeing it,' Federal Reserve Governor Christopher Waller said in a Thursday interview on Fox Business Network 'Therefore, there's going to be a lot of issuance of Treasuries. And in order for them to buy these things, they want it at a lower price, and therefore, a higher yield,' he said. Investors told The Hill that they weren't all that surprised that the Republican bill would deliver substantial tax cuts, especially for top earners, without proportionate cuts to social services, which are politically unpopular and hard to pull off. The Senate could further walk back the spending cuts delivered by the House, which total roughly $1.5 trillion between the Energy and Commerce, Education, and Agriculture committees. What investors do think is remarkable is the macroeconomic effects of the tariffs, which are splitting up the traditional relationships between bonds, gold and the U.S. dollar. In the context of these larger fractures, the bond market selloff from the GOP bill could be more pronounced, they say. 'It's something I'm watching very closely,' Axel Merk, head of Merk Investments, told The Hill. 'Usually, higher long term yields would mean a stronger dollar and weaker gold, whereas instead we're seeing a weaker dollar and stronger gold.' 'Given the very significant deficits, [the fiscal policy] is something you can't ignore,' he added. The 20-year U.S. Treasury auction this week was another sore spot in the bond market and saw weak demand from investors. The Treasury sold $16 billion of new 20-year bonds at a yield of 5.05 percent – well above the average of the previous auctions at around 4.6 percent. Analysts for Deutsche Bank called the auction 'soft' and said it set off a stock market decline this week. 'The soft 20-year auction was also a trigger for a broader market slump, with the S&P 500 falling from negative 0.2 percent on [Tuesday] to negative 1.61 percent by the close, its worst day in the past month,' Jim Reid and others wrote for Deutsche Bank. Stocks have languished this week, with the Dow Jones Industrial Average and the S&P 500 index down about a percent since Monday Higher interest rates, both in the short term and the long term, make the cost of borrowing money higher — another factor compounding the financial drag from the GOP bill. The Fed has been cutting interest rates off of near-20-year highs prompted by pandemic shutdowns but has paused its cuts since December as economic conditions have wavered. Short term interest rates are now at about 4.3 percent, the highest level since November 2007 Fed Chair Jerome Powell has said that he thinks the days of near-zero interest rates, as was the case during the previous decade, might well be over.
