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THE GIST
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Global Philippines Fine Living
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Economy Stocks Bonds Currencies
THE BASICS
Investment Tips Explainers Retirement
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2024 Mid-Year Economi Briefing, economic growth in the Philippines
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June 21, 2024
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Investing with Love: A Mother’s Guide to Putting Money to Work
May 15, 2024
retirement-ss-3
Investor Series: An Introduction to Estate Planning
September 1, 2023
View All Webinars
DOWNLOADS
economy-ss-8
Inflation Update: Weak demand softens shocks
July 4, 2025 DOWNLOAD
948 x 535 px AdobeStock_433552847
Economic Updates
Monthly Economic Update: Fed cuts incoming   
June 30, 2025 DOWNLOAD
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Consensus Pricing
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Archives: Reuters Articles

US long-dated yields dip as investors consolidate positions ahead of long weekend

NEW YORK – US Treasury yields fell on the long end of the curve on Friday as investors, ahead of a long weekend, paused selling government debt and consolidated positions to book profits after Republican Donald Trump’s victory in Tuesday’s presidential election.

The bond market is closed on Monday for Veterans Day.

The benchmark US 10-year yield posted its largest weekly drop since early September. It was last down 2.7 basis points (bps) at 4.316%.

US 30-year yields were down 5.7 bps at 4.486%. On the week, it slid 5.8 bps, its biggest weekly fall since early September as well.

Going into the election, bond investors sold Treasuries, pushing their yields to multi-month highs, as they priced in a Trump victory. His re-emergence suggests more government borrowings due to expected higher fiscal deficits under his administration with lower taxes and higher tariffs.

“It’s definitely very much like the classic ‘buy the rumor, sell the fact’ event,” said Brendan Murphy, head of fixed income, North America, at Insight Investment in Boston, which oversees USD 838.1 billion in assets.

“The market has done a very good job of anticipating the outcome and pricing them in. And then you get position-squaring in the aftermath of it, causing a near-term reversal,” Murphy added.

Treasury yields also fell after the cooler-than-expected one-year inflation print, as indicated in the University of Michigan’s consumer sentiment report for November, analysts said. Year-ahead inflation expectations of 2.6% in November ticked down from October’s reading of 2.7% and were the lowest since December 2020.

The Michigan inflation print has gained more attention from the Fed, with Chair Jerome Powell mentioning it in one of his press conferences.

The Consumer Sentiment Index, however, climbed to 73.0 this month, the highest since April, from 70.5 in October. The result exceeded the median estimate among economists polled by Reuters for a reading of 71.0. I

The Fed on Thursday gave markets a chance to take some profits, when it lowered its fed funds target rate to 4.50%-4.75%, as expected. With inflation coming down and signs of labor market loosening, the central bank eased by an aggressive 50 basis points in September after holding rates at 5.25-5.50% since July 2023.

The US rate futures market has priced in an 85% chance of a another 25-bp easing at next month’s policy meeting, and a 15% probability of a pause in cuts, according to LSEG calculations. For next year, rate futures have implied just two rate reductions of 25 bps each.

Policymakers are preparing for what could be a more complex economic picture after Trump takes office in January.

Kim Rupert, managing director of fixed income at Action Economics in San Francisco, said Treasuries were digesting recent movements and trying to find a course from here.

“The Trump trade has been a big factor,” Rupert said. “The Fed really didn’t tell us much yesterday (Thursday). It wasn’t expected to. So now we’re going to have to hang around these levels to try to figure out the path ahead, but that’s going to require more data.”

Next week, markets will be watching for the October Consumer Price Index report on Wednesday, followed by producer prices on Thursday.

In other maturities, the two-year yield, which typically tracks interest rate expectations, rose 3.8 bps to 4.258%.

The yield curve, meanwhile, flattened on Friday, with the gap between two-year and 10-year yields hitting 4.2 bps late Friday, the lowest in a month. It was at 19.5 bps on Nov. 6, a day after the election.

Investors have been putting on trades that steepen the yield curve, a popular bet when the Fed is in the midst of an easing cycle. Friday’s sharp decline in the curve suggested a bit of position-squaring as well in line with other parts of the bond market.

(Reporting by Alden Bentley and Gertrude Chavez-Dreyfuss; Editing by Frances Kerry and Will Dunham)

After Trump win, investors savor ‘red sweep’ possibilities

NEW YORK – Investors are increasingly factoring what potential Republican control of government could mean for stocks, bonds, and currencies, even as the first feverish market reactions to Donald Trump’s presidential victory begin to settle.

A so-called red sweep scenario, in which Republicans control the White House and both houses of Congress, could clear the way for Trump to implement his economic proposals with a freer hand. Many, such as tax cuts, are seen as being growth-friendly but also driving up inflation risks.

Republicans held a narrow edge on Friday as election officials tallied the final votes that will determine control of the US House of Representatives, though Democrats succeeded in flipping a pair of New York state seats.

“With many of Trump’s policies geared to support stocks, particularly small caps, markets are likely to respond well to a red sweep,” said JJ Kinahan, CEO of IG North America and president of online broker Tastytrade.

Expectations that such policies will be pushed through under Trump to some degree have helped lift corners of the stock market higher, boost the dollar, and weigh on Treasuries, as investors recalibrated their portfolios for stronger growth, looser regulations, and the possibility that inflation worries could keep the Federal Reserve from cutting rates too deeply next year.

One notable move has been in small cap stocks, with the Russell 2000 index up about 8% this week.

While some of those moves have lost steam in recent days, investors are still gaming out how Trump’s policies could affect markets and the economy over the long-term, especially under a red-sweep scenario.

Trump has promised to slash federal regulations that he says limit job creation. He has pledged to keep in place a 2017 tax cut he signed while in office, and Trump’s economic team has discussed a further round of individual and corporate tax cuts beyond those enacted in his first term.

Strategists at Goldman Sachs said their earnings per share estimates for the S&P 500 would rise by about 4% if Trump reduced the statutory domestic corporate tax from 21% to 15%.

Deutsche Bank analysts said they would upgrade their 2025 US growth forecast to 2.5-2.75% from 2.2% in the event of a red sweep. However, they expect to reduce their 2026 growth forecast in anticipation of economic uncertainty associated with an intensifying trade war.

Republican control of government could also provide a longer-term boost for the dollar, which has already risen to its highest level in four months against a basket of its peers following a post-election surge this week.

Strategists at JP Morgan see the euro sinking to USD 1.00-USD 1.02, down about 6% from its current level, if there is a sweep, as opposed to a drop to USD 1.05 in the case of a split Congress.

History may also be on the side of continued strong stock performance if a red sweep comes to pass.

The S&P 500 rose an average of 9.1% in years of such unified control against a 6.7% average annual return for divided government, in which the opposing party holds at least one of the Senate or House of Representatives, according to an analysis by Evercore ISI of data since 1928. The index is up 26% this year and hit 6,000 points for the first time ever on Friday.

To be sure, even with the Republican Congressional majority, some investors believe the narrow margins faced in both the House and Senate may still present challenges to implementing fiscal and regulatory changes.

“We may not get everything that has been promised. The discussion on the campaign trail is always very different than the legislation that gets passed,” said Paul Nolte, senior wealth advisor and market strategist for Murphy & Sylvest. “I think a lot of that is already in the pricing for stocks today.”

(Reporting by Saqib Iqbal Ahmed; Additional reporting by Chuck Mikolajczak; Editing by Ira Iosebashvili and Marguerita Choy)

 

Southeast Asia prepares for factories fleeing Trump tariffs on China

BANGKOK – Companies have been moving factories from China to Southeast Asia, anticipating Donald Trump would slap high tariffs on Beijing if he regained the White House, a move set to accelerate with his election win, industrial park developers in the region say.

Trump, who won a resounding victory on Tuesday, has threatened 60% tariffs on goods coming into the US from China, much higher than the levies of 7.5% to 25% he imposed in his first term, a major risk for the world’s second-largest economy.

Southeast Asia – with auto and electronics factories from Thailand to Vietnam and Malaysia – will likely benefit at China’s expense, said two executives, two business groups, a lawyer and an analyst in the region.

Developers of industrial parks are adding Chinese speakers and preparing land tracts for factories, a sign of how Trump, who takes office in January, could reshuffle global supply chains.

As Trump geared up his campaign to retake the presidency earlier this year, calls from Chinese customers flooded WHA Group, one of Thailand’s largest industrial estate developers, said CEO Jareeporn Jarukornsakul.

“There was (already) a relocation to Southeast Asia, but this round is going to be more intense,” she said, referring to Trump’s 2017-2021 first term.

WHA is expanding its sales force and adding Chinese speakers to teams overseeing maintenance and administration of industrial parks spanning more than 12,000 hectares (30,000 acres) in Thailand and Vietnam, Jareeporn said.

Of the 90 factories that have opened this year in industrial parks run across Southeast Asia by Thailand’s Amata Corp, some two-thirds have been companies relocating facilities from China, said Vikrom Kromadit, the developer’s founder and chairman.

TRUMP ‘NEEDS SOME FRIENDS’

Trump will be a “big punch” to China, potentially doubling the number of firms looking to move from there into Amata’s 150 square km (60 square miles) of industrial estates in four Southeast Asian countries, Vikrom said.

Construction begins this month on an Amata industrial park in Laos, where China has built a high-speed rail line connecting Kunming in southwestern China to the Laotian capital Vientiane, he said.

Thailand, a regional automobile manufacturing hub, has drawn over USD 1.4 billion in investment from Chinese automakers into its fast-expanding electric vehicle industry.

“We want a lot of investment from China so we can sell to America,” said Thai Commerce Minister Pichai Naripthaphan.

“I believe this will happen,” told reporters on Thursday. “The Americans love us, the Chinese love us – we don’t have to choose sides.”

Malaysia, hoping to draw over USD 100 billion in new investments to its semiconductor sector, could benefit from a realignment of supply chains, said leaders of two business groups.

“This shift could provide Malaysia with new opportunities to capture a larger share of exports to the United States and other key markets,” said Soh Thian Lai, president of the Federation of Malaysian Manufacturers.

But risks persist, particularly with some indications that Trump may consider tariffs on imports from countries across the region, said Leif Schneider, head of international law firm Luther in Vietnam.

Vietnam, a major exporter to the US with USD 90 billion bilateral trade surplus between January and September, is bracing for volatility under Trump.

“Trump will have to choose – you can be anti-China, but you’ll need to have some friends in Southeast Asia,” said WHA’s Jareeporn. “He is a negotiator, so we will negotiate.”

(Reporting by Devjyot Ghoshal and Chayut Setboonsarng in BANGKOK, Additional reporting by Ashley Tang in KUALA LUMPUR, and Francesco Guarascio and Phuong Nguyen in HANOI)

 

US recap: Dollar slides as Fed delivers rate cut

US recap: Dollar slides as Fed delivers rate cut

The dollar fell on Thursday, holding on to broad earlier losses after the Fed cut rates by 25 basis points to 4.50-4.75%, as expected, while noting that inflation is somewhat elevated.

Federal Reserve Chair Jerome Powell said risks were balanced and will adjust policy meeting by meeting. He added that some downside risks to the economy have diminished, that recent data has been strong and that policy is still restrictive.

The dollar index pulled back from a four-month high and erased half of Wednesday’s post-election surge as long positions were trimmed before the Fed decision.

CNN reported that US President-elect Donald Trump is likely to allow Powell to serve the remainder of his term as the Federal Reserve chair, citing a senior adviser to Trump.

Other central bank policy moves on Thursday were as expected. The Bank of England cut 25bps to 4.75%, Sweden’s Riksbank cut 50bsp to 2.75% and Norway Norges bank left rates unchanged at 4.5%.

The pound gained after BoE Governor Andrew Bailey said future reductions were likely to be gradual as it predicted the British government’s first budget would lead to higher inflation and economic growth.

China will continue to implement a supportive monetary policy, according to the central bank.

The euro rose though lagged most other peers amid concerns about regional growth, security, and a fractured political coalition in Germany.

The European economy would suffer if Donald Trump enacted his pledges on tariffs and trade barriers, and this could impact European Central Bank policy, Greek Central Bank chief Yannis Stournaras said.

German opposition parties and business groups on Thursday urged Chancellor Olaf Scholz to trigger a new election quickly after his rocky three-way coalition collapsed.

The Aussie dollar led G10 gainers amid surging metal prices.

Treasury yields were down 4 to 7 basis points across tenors. The 2s-10s curve fell about 4 basis points to +12.0bp.

The S&P 500 rose 0.60% amid gains in tech and consumer shares.

WTI oil was up 0.9% as President-elect Trump’s policies are weighed and helped by a favorable risk tone.

Gold rose 1.27% amid share gains and a weaker dollar.

Copper soared 4.47% as investors took another look at the impact of Donald Trump’s US election victory and hoped for more stimulus from China.

Heading toward the close: EUR/USD +0.67%, USD/JPY -1.18%, GBP/USD +0.83%, AUD/USD +1.69%, DXY -0.73%, EUR/JPY -0.47%, GBP/JPY -0.32%, AUD/JPY +0.50%.

(Editing by Burton Frierson; reporting by Robert Fullem)

Gold holds firm after US Fed rate cut, softer dollar

Gold holds firm after US Fed rate cut, softer dollar

Gold prices rose more than 1% on Thursday, helped by a retreat in the US dollar, while the Federal Reserve cut interest rates by a quarter of a percentage point as widely expected.

Spot gold was up 1.2% at USD 2,691.36 per ounce as of 2:22 p.m. EST (1919 GMT), after dropping to a three-week low on Wednesday. US gold futures settled 1.1% higher at USD 2,705.80.

At the end of a two-day policy meeting, the US central bank lowered the benchmark overnight interest rate to the 4.50%-4.75% range, with policymakers taking note of a job market that has “generally eased”.

Lower US interest rates put pressure on the dollar and bond yields, increasing the appeal of non-yielding bullion.

“Gold remains in a strong bull market and no event this week, from the election to today’s Fed decision, is likely to change that,” said Tai Wong, an independent metals trader.

“Unless Powell leans towards a pause today, gold is likely to take back yesterday’s knee-jerk losses,” Wong added.

The dollar index was down 0.6% against its rivals after rising to a four-month high after Republican former President Donald Trump’s win in Tuesday’s presidential election.

Traders are currently pricing in another 25 basis point cut by the Fed in December, according to LSEG data.

Investors now look forward to comments from Fed Chair Jerome Powell’s press conference due at 2:30 p.m. ET for more cues on monetary policy path.

With Trump’s impending return to power, “any future rate reductions could well be more difficult to achieve due to concerns that higher prices and stickier inflation force central banks to keep policy restrictive for longer than they would like,” independent analyst Michael Hewson wrote in a note.

Elsewhere, spot silver rose 1.8% to USD 31.71 per ounce, platinum gained 0.6% to USD 992.65 and palladium shed 1.3% to USD 1,021.25.

(Reporting by Brijesh Patel, Sherin Elizabeth Varghese, and Anjana Anil in Bengaluru; Editing by Paul Simao, Susan Fenton, Vijay Kishore, and Mohammed Safi Shamsi)

 

Oil rises 1% as investors digest US election fallout

Oil rises 1% as investors digest US election fallout

NEW YORK – Oil prices rose nearly 1% on Thursday as the market weighed how President-elect Donald Trump’s policies would affect supplies and as drillers cut output while bracing for Hurricane Rafael.

A strong dollar and lower crude imports in China limited gains.

On Wednesday, the election of Republican former President Trump initially triggered a sell-off that pushed oil down more than USD 2 as the dollar rallied. Crude prices later pared losses to settle down by less than 1%.

On Thursday, Brent crude oil futures settled up 71 cents, or 0.95%, at USD 75.63 a barrel. US West Texas Intermediate (WTI) crude rose 67 cents, or 0.93%, to USD 72.36.

Prices gained support on expectations that Trump’s incoming administration may tighten sanctions on Iran and Venezuela, said Andrew Lipow, president of Lipow Oil Associates, adding that this could take oil supply off the market.

“The market is now looking into what Donald Trump’s policies might be and the market is reacting to that prospect,” said Lipow.

In his first term, Trump put in place harsher sanctions on Iranian and Venezuelan oil. Those measures were briefly rolled back by the Biden administration but later reinstated.

Also supporting prices, the US Federal Reserve
cut interest rates
by a quarter of a percentage point at the close of its policy meeting on Thursday. Interest rate cuts typically boost economic activity and energy demand.

Actual, supply cuts also lent support. In the US Gulf Coast, over 22%, or 391,214 barrels per day, of crude oil production was shut in response to Hurricane Rafael, the US Bureau of Safety and Environmental Enforcement said.

The dollar index eased nearly 1% but remained near a two-week high after surging following Trump’s victory. A strong dollar makes oil more expensive for other currency holders and tends to weigh on prices.

Downward pressure also came from data showing crude oil imports in China fell 9% in October, the sixth consecutive month showing a year-on-year decline, as well as from a rise in US crude inventories.

(Reporting by Nicole Jao in New York and Alex Lawler in London; Additional reporting by Colleen Howe and Gabrielle Ng; Editing by David Goodman, David Gregorio and Leslie Adler)

 

‘Risk on’ as Powell signals Fed still on easing track

‘Risk on’ as Powell signals Fed still on easing track

Asian markets on Friday round off a monumental week on the front foot after Federal Reserve Chair Jerome Powell on Thursday expressed confidence in the US economy and that inflation will continue to cool, signaling further interest rate cuts ahead.

In his press conference after the Fed cut rates by 25 basis points as expected, Powell said the economy could perform better next year than previously thought, and that inflation remains on a path back to the 2% target.

This added fuel to the US equity rally already underway following Donald Trump’s thumping victory in the US presidential election on Tuesday, pushing the three main US indices to new all-time highs.

The equity rally was also aided by lower Treasury yields and a weaker dollar – the 10-year yield fell 10 basis points for its biggest one-day fall in three months, and the dollar shed 0.7%.

Asian stocks ex-Japan go into Friday’s session up almost 2% on the week, which would be the biggest rise in five weeks. Over the month of October though, outflows rose sharply.

Japan’s Nikkei is up 3.5%, on course for its best week in six. Many analysts are increasingly bullish on Japanese stocks, citing attractive valuations and an assumption that the yen stays weak.

The outlook for Asian stocks in a Trump world more broadly, however, is mixed.

On the one hand stronger demand and a buoyant Wall Street are positive forces for emerging Asia. But on the other, a stronger dollar and higher US bond yields could tighten financial conditions and encourage capital outflows from some countries.

Chinese stocks, in particular, are vulnerable. But as SocGen analysts note, the threat of punishing tariffs from Washington could accelerate more forceful policy responses from Beijing, which may end up supporting local stocks.

Meanwhile, attention in Asia turns to China as investors await a readout from the National People’s Congress Standing Committee meeting which concludes on Friday. Any stimulus surprise from the meeting will likely help lift market sentiment in China stocks.

The yuan on Thursday bounced back a bit from the three-month low struck the previous day. The yuan’s fall on the spot market of around 1% on Wednesday, an immediate reaction to Trump’s election win, was its biggest decline since February 2020.

Investors will also cast an eye to Chinese inflation data on Saturday. Strong exports data on Thursday offered encouraging signs that growth may be recovering, but imports fell short of forecasts, suggesting domestic demand remains weak.

The annual rate of consumer inflation is expected to have held steady at 0.4% in October, according to a Reuters poll, while producer price deflation is seen easing only a little to -2.5% from -2.8%.

Here are key developments that could provide more direction to markets on Friday:

– Taiwan trade (October)

– Japan household spending (September)

– China NPC Standing Committee readout

(Reporting by Jamie McGeever; Editing by Deepa Babington)

 

Politics can still shock the dollar: McGeever

Politics can still shock the dollar: McGeever

ORLANDO – Politics is often a major driver of exchange rates in emerging economies where elections, leaders and government policies can play a big role in shaping trade and investment flows. That’s not often the case for major currencies in markets with much deeper investment flows and liquidity – like the US dollar.

But the greenback’s explosive rally following the US presidential election shows that politics still matter for the dollar – a lot. Or more accurately, the dollar is still highly sensitive to political shocks.

The dollar surged nearly 2% against a basket of major currencies early on Wednesday, following Republican Donald Trump’s thumping win over Democrat Kamala Harris in Tuesday’s election.

This marked the dollar’s biggest one-day rise in more than eight years, since June 24, 2016, to be precise. That was the day after another historic, political drama played out: the “Brexit” referendum in the UK, when Britons dumbfounded pollsters and voted to leave the European Union.

Sterling’s 8% plunge on that day – by far its biggest decline against the dollar since the era of free-floating exchange rates began over 50 years ago – lifted the dollar index by 2%.

Trump’s victory was far less shocking than the Brexit vote, and financial markets had been pricing it in for weeks. But the dollar’s sharp reaction suggests that the margin of victory, and the likelihood that Republicans would take control of both houses of Congress, caught markets off guard.

Steven Englander, head of G10 FX strategy at Standard Chartered, reckoned a potential for “clean sweep” combined with the polarized nature of politics today help explain the dollar’s outsized move.

“So much in politics is ‘same old, same old’, but when you get a real surprise the market reaction can be dramatic,” he noted.

MOMENTUM

The dollar rarely fluctuates anywhere close to 2% in one day because vast flows are required to move such a heavily traded asset that much. The greenback is on one side of almost 90% of all foreign exchange trades, and the global FX market’s average daily turnover is USD 7.5 trillion.

The dollar has racked up daily gains of around 1.5% since 2016, but they were mostly clustered in the highly volatile days of March 2020 at the onset of the pandemic or in September 2022 when US interest rates were close to reaching their 40-year peak.

Declines of that magnitude have also been rare. They occurred either around the pandemic or when soft inflation data was released in November 2022.

But the 2024 US presidential election, like Brexit, is a reminder that political shocks can still have an instant impact on the world’s more liquid currencies, including the most widely used and liquid of all.

The bigger question may be: Do such extreme moves have long-term effects? And the answer is, they can.

Sterling has never regained its pre-June 2016 heights. It is still down 10% against the dollar and down 25% on a trade-weighted basis, meaning Britain has effectively suffered a permanent loss of global purchasing power.

Of course, the likelihood of the dollar embarking on a near-decade-long global rally is slim. Far too many domestic and global variables would have to align for that to happen.

But investors do appear to be pricing in expectations that the new administration’s fiscal and monetary policy will push inflation, bond yields, and the dollar higher.

Mizuho’s FX strategy team says the dollar has potentially another 4% of upside before it eclipses its gains in 2016 after Trump won the presidency then.

Barclays analysts agree that the dollar has more room to strengthen “either a little or a lot … depending on whether the Republicans manage a sweep”. They believe the latter scenario could push the euro down to USD 1.03 in the near term.

It’s impossible to predict exactly what will happen, but investors are being reminded now that even in such a liquid market, political shocks can still move the dollar.

(The opinions expressed here are those of the author, a columnist for Reuters.)

(By Jamie McGeever; Editing by Cynthia Osterman)

 

Oil settles lower as US dollar surges, investors take stock of Trump victory

Oil settles lower as US dollar surges, investors take stock of Trump victory

HOUSTON – Oil prices settled lower on Wednesday as investors weighed a strong US dollar against the potential that US President-elect Donald Trump’s foreign-policy plans could squeeze global oil supply.

Brent crude oil futures settled down 61 cents, or 0.81%, at USD 74.92 per barrel. US West Texas Intermediate (WTI) crude settled down 30 cents or 0.42%, to USD 71.69.

Trump’s election triggered a large sell-off that pushed oil prices down by more than USD 2 per barrel during early trade as the US dollar rallied, currently at its highest level since September 2022.

A stronger dollar makes greenback-denominated commodities such as oil more expensive for holders of other currencies and tends to weigh on prices.

“All the excitement and initial selling enthusiasm has since waned, and I think there is more upside rather than downside in the short term,” said Phil Flynn, senior analyst at Price Futures Group, noting that investors on Wednesday looked more at the short-term supply, demand outlook.

“There was an over-reaction to the election results, and that a Trump victory could have caused the US industry to sort of drill itself into oblivion and cause a glut,” said John Kilduff, partner at Again Capital in New York.

“But cooler heads have prevailed and this market has a lot of problems on its hands,” he added, citing the war in the Middle East as a supportive factor because it could weigh on supply.

Trump’s reelection could also mean the renewal of sanctions on Iran and Venezuela, removing barrels from the market, which would be bullish, UBS analyst Giovanni Staunovo said.

Iran is an OPEC member with production of around 3.2 million barrels per day, or 3% of global output.

However, a crackdown on Iran may be more difficult as the country has become adept at evading sanctions, Alex Hodes, oil analyst at brokerage firm StoneX, said in a note.

Trump’s support for Israeli Prime Minister Benjamin Netanyahu could heighten instability in the Middle East, according to Andrew Lipow, president of Lipow Oil Associates.

That could boost oil prices as investors price in a potential disruption to global oil supplies. Trump is expected to continue arming Israel.

But setting aside the US election and geopolitical uncertainties, persistent trends in oil markets are likely to shape the outlook ahead, Mukesh Sahdev, global head of commodity markets, oil at Rystad Energy, said in a note.

OPEC+ still pulls the strings, refinery margins battle weaker demand, and higher supply and oil trade flows continue to battle inefficiencies, according to Sahdev.

US crude oil, gasoline, and distillate inventories rose last week, the US Energy Information Administration said.

Crude inventories climbed by 2.1 million barrels to 427.7 million barrels in the week ending Nov. 1, the EIA said, compared with analysts’ expectations in a Reuters poll for a 1.1-million-barrel rise.

(Reporting by Georgina McCartney in Houston, Arunima Kumar in Bengaluru, Katya Golubkova in Tokyo, and Emily Chow in Singapore; additional reporting by Alex Lawler in London; Editing by Louise Heavens, Alexander Smith, David Evans, David Gregorio, Rod Nickel, and Leslie Adler)

 

Gold hastens retreat as dollar rallies on Trump victory

Gold hastens retreat as dollar rallies on Trump victory

Gold prices slid to a three-week low on Wednesday, as investors piled into the US dollar after Republican Donald Trump was elected US president.

Market participants were also looking ahead to the Federal Reserve’s interest-rate decision on Thursday for further clues on the bank’s easing cycle that had helped gold’s stunning rally to successive record highs this year.

Spot gold was down 2.8% at USD 2,667.19 per ounce, as of 2:07 p.m. ET (1907 GMT), after hitting a three-week low of USD 2,652.19. The metal was on track to post its biggest daily loss in five months.

US gold futures settled 2.7% lower at USD 2,676.30.

“A clear presidential victory when the market has been pricing in a contested result, removal of an element of risk, Trump trades include the dollar’s strengthening this morning and the combination of the two has brought gold lower,” said StoneX analyst Rhona O’Connell.

Trump recaptured the White House by securing more than the 270 Electoral College votes needed to win the presidency, Edison Research projected.

Investors said Trump’s presidency will bolster the dollar, causing the Federal Reserve to pause its easing cycle if inflation takes off after expected new tariffs.

The dollar index hit a four-month high, making bullion more expensive for overseas buyers.

The risk of rising inflation could slow the pace of US rate cuts as tariffs roll out, said Ole Hansen, head of commodity strategy at Saxo Bank.

“The (Federal Open Market Committee) will likely still cut on Thursday but the subsequent language will be studied closely for signs of a pause.”

Investors widely expect the Fed to announce a quarter-point rate cut after 50-bps reduction in September.

Commodities from oil and gas to metals and grains dropped as the dollar rallied.

Spot silver fell 4.4% to USD 31.24 per ounce. Platinum shed 0.8% to USD 991.60 and palladium was down 3.4% at USD 1,039.43. All three metals hit their lowest levels in three weeks.

(Reporting by Anjana Anil, Sherin Varghese, and Anushree Mukherjee in Bengaluru; Editing by Veronica Brown, Sharon Singleton, Shilpi Majumdar, and Rod Nickel)

 

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