Longer-dated US Treasury yields rise on jobs openings

NEW YORK, Dec 3 (Reuters) – Longer-dated US Treasury yields rose on Tuesday after labor market data showed an increasing number of unfilled jobs, but demand remained high at the short end as investors seeking safe haven from geopolitical uncertainty in Asia bought Treasuries.

US job openings increased moderately in October while layoffs declined, suggesting the labor market continued to slow in an orderly fashion. Job openings, a measure of labor demand, rose 7.744 million by the last day of October, the Labor Department’s Bureau of Labor Statistics said in its Job Openings and Labor Turnover Survey, or JOLTS report, on Tuesday. Layoffs decreased 169,000 to 1.633 million.

After South Korean President Yoon Suk Yeol on Tuesday declared martial law, the country’s currency tumbled to a two-year low and investors fled to low-risk assets such as Treasuries. The president agreed to lift the martial law decree after parliament rejected it.

The yield on the benchmark US 10-year Treasury note rose 0.5 basis point to 4.199%. The two-year US . Treasury yield, which typically moves in step with interest rate expectations, fell 4.7 basis points to 4.151%.

The part of the US Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes , seen as an indicator of economic expectations, steepened to 4.6 basis points.

Two Federal Reserve policymakers on Tuesday said they believe inflation is heading down to the US central bank’s 2% target and the job market is solid, even as neither gave any clear steer on whether they’ll support another interest rate cut later this month.

Fed Governor Adriana Kugler and San Francisco Fed President Mary Daly did not indicate at public events on Tuesday whether they favor a rate cut at the central bank’s Dec. 17-18 policy meeting, but both said they will be looking closely at the release on Friday of the US employment report for November.

The odds of a 25-bp easing this month were at 72% on Tuesday afternoon, slightly down from 75% late on Monday, according to CME’s FedWatch.

On Monday, Fed Governor Christopher Waller said he was leaning toward another rate cut. Fed Chair Jerome Powell on Wednesday will give what are expected to his last public remarks before the meeting. Wednesday will also see additional job market data with the ADP National Employment Report.

“Yields went up a couple of basis points after the JOLTS report, but markets do not think a higher job creation number changes the Fed’s view as expressed by Governor Waller on Monday“, said Angelo Manolatos, macro strategist at Wells Fargo.

Lou Brien, strategist at DRW Trading in Chicago, also noted the safe haven effect. “There might have been a little bit of a bid in Treasuries, sort of a safety play there, because it looks like people are getting out of South Korean ETFs.”

The breakeven rate on five-year US Treasury Inflation-Protected Securities (TIPS) was last at 2.383% after closing at 2.351% on Tuesday. The 10-year TIPS breakeven rate was last at 2.292%, indicating the market sees inflation averaging about 2.3% a year for the next decade.

(Reporting by Tatiana Bautzer; Editing by Nick Zieminski and Jonathan Oatis)

South Korea’s martial law confusion deepens caution

Dec 4 (Reuters) – A look at the day ahead in Asian markets.

A sudden burst of political chaos in South Korea has put investors in Asia on the defensive, pointing to a cautious market open across the continent on Wednesday despite Wall Street’s resilience the previous day.

South Korea’s President Yoon Suk Yeol declared martial law on Tuesday to thwart “anti-state forces” among his opponents, creating the most serious challenge to the country’s democracy since the 1980s, only to lift it hours later after lawmakers rejected the move and protesters gathered outside parliament.

The initial declaration had an immediate impact on the won, slamming it to a 2-year low against the dollar. At one point, it was down 2% and set for its biggest one-day loss since Nov. 9, 2016, the day after the 2016 US election that swept Donald Trump to power and started the clock ticking on a looming trade war with China.

This cemented the won’s unwanted status as the worst-performing major Asian currency against the dollar this year, bringing its year-to-date losses to nearly 10%. The benchmark Kospi is also one of the worst-performing equity indexes in Asia this year, down nearly 6% year-to-date at Tuesday’s close.

Yoon’s about face, however, appears to have restored a sense of calm. The won is still weaker but reclaimed more than half its losses from earlier on Tuesday. Kospi futures traded on the Eurex exchange are pointing to a fall at the stock market open in Seoul of only around 0.3%.

Elsewhere in Asia, India’s rupee is at a record low, while China’s yuan is at a 13-month low and seemingly poised for a break below 7.30 per dollar, as traders speculate Beijing is allowing it to slide as trade tensions with Washington heat up.

China on Tuesday announced a ban on exports of ‘dual-use items’ related to key minerals gallium, germanium, antimony and superhard materials to the United States. This came 24 hours after the US launched a third crackdown in three years on China’s semiconductor industry, curbing exports to 140 firms.

If volatility in key assets across Asia is spiking, US market volatility right now is pretty subdued. The VIX ‘fear index’ on Tuesday hit its lowest since July, and the MOVE index of implied volatility in US Treasuries has tumbled since the US presidential election to a two-month low.

The Asian calendar on Wednesday sees the release of Australian GDP, Thai inflation, and a raft of purchasing managers index reports for November, including China’s Caixin services PMI.

Australia’s economy is expected to have expanded at a 0.4% pace in the July-September period, twice the rate of the previous quarter, and at a 1.1% year-on-year pace, a marginal uptick from the 1.0% annual growth registered in Q2.

(Reporting by Jamie McGeever; Editing by Bill Berkrot)

Oil steady, traders hopeful on China demand but worried about Fed

HOUSTON – Oil prices were little changed on Monday, as hopes of stronger demand stemming from higher factory activity in China was largely offset by concerns that the US Federal Reserve will not cut interest rates again at its December meeting.

Brent crude futures settled 1 cent lower at USD 71.83 a barrel. US West Texas Intermediate crude rose 10 cents, or 0.15%, to USD 68.10.

A private sector survey showed China’s factory activity expanded in November at the fastest pace in five months, boosting Chinese business optimism just as US President-elect Donald Trump has ramped up trade threats.

Meanwhile, a ceasefire between Israel and Lebanon, which took effect last Wednesday, appeared increasingly fragile. The Israeli military said on Monday it was currently striking “terror” targets in Lebanon amid mutual accusations of ceasefire violations between Israel and the Lebanese armed group Hezbollah.

The Pentagon said that despite some incidents, the ceasefire between Israel and Lebanese armed group Hezbollah was holding.

“Increased geopolitical risks remain. Even though the ceasefire is underway in Israel, it seems evident that there are some misconceptions about the legitimacy of the ceasefire,” said Dennis Kissler, senior vice president of trading at BOK Financial.

Traders also watched developments in Syria, weighing whether recent escalation could widen tensions across the Middle East and affect supply.

Both crude benchmarks fell more than 3% last week, pressured by easing supply concerns from the Israel-Hezbollah conflict and 2025 surplus forecasts, despite expected sustained output cuts.

The Organization of the Petroleum Exporting Countries and its allies, together known as OPEC+, postponed the group’s next meeting to Dec. 5. It will discuss delaying a planned oil output increase scheduled to start in January, OPEC+ sources told Reuters last week.

“Attention will be on the potential delay of the planned production hike, as an indefinite delay could alleviate downward pressure on prices,” said George Pavel, general manager at Naga.com Middle East.

This week’s meeting will decide policy for the early months of 2025.

“Money managers are sitting on the fence … the market is looking for clarity between the implication of the forthcoming Trump administration and OPEC+ supply policy,” said Harry Tchilinguirian at Onyx Capital Group.

Pressuring oil prices, Atlanta Federal Reserve President Raphael Bostic said he has an open mind about whether to cut interest rates again at the Fed’s December meeting, with upcoming data on jobs important in shaping the decision.

Higher interest rates increase the cost of borrowing, which can slow economic activity and dampen demand for oil.

Also pressuring oil, the dollar pushed higher again, after Trump on Saturday threatened 100% tariffs on BRICS member countries unless they commit to not creating a new currency or supporting another currency that could replace the dollar.

A stronger greenback makes dollar-denominated oil more expensive for investors holding other currencies, hurting demand.

(Reporting by Arunima Kumar in Bengaluru, Enes Tunagur in London and Florence Tan, and Gabrielle Ng in Singapore; Editing by Jason Neely, David Goodman, Jonathan Oatis, and David Gregorio)

Tesla leads November’s global market value surge

Tesla’s market capitalization increased by the most among top global companies in November, boosted by expectations the automaker will benefit from CEO Elon Musk’s close ties with US President-elect Donald Trump.

The company’s market value surged 38.1% to USD 1.1 trillion last month on reports that Donald Trump’s transition team plans to relax federal regulations on self-driving cars, potentially simplifying the rollout of autonomous vehicles.

Optimism around holiday shopping helped boost Walmart’s market value by 12.9% to USD 743.5 billion, following the company’s third upward revision of its annual sales and profit forecasts, driven by increased online and in-store purchases of groceries and merchandise.

JPMorgan Chase’s market value rose 12.5% to USD 703 billion, as it was announced that CEO Jamie Dimon will continue leading the bank, and investors are confident that Trump will bring favorable policies for lenders.

Improving retail sales pushed Amazon.com’s market value up 11.5% to USD 2.2 trillion, after it reported higher-than-expected profit growth. Similarly, Visa saw its market value increase by 8.3% to USD 617.5 billion, as resilient consumer spending pushed it to a strong fourth-quarter profit.

Reports that US authorities ordered Taiwan Semiconductor Manufacturing Company 2330.TW to halt shipments of advanced chips to China, a move aimed at curbing exports of critical technologies, helped wipe 5.1% off its market cap, which fell to USD 793.5 billion.

AI bellwether Nvidia’s market value rose by a modest 3.9%, slowing from October’s 9.3% increase as its revenue growth forecast failed to excite investors.

(Reporting By Patturaja Murugaboopathy and Gaurav Dogra in Bengaluru; Editing by Kirsten Donovan)

S&P 500, Nasdaq post record highs as tech-related shares gain

NEW YORK – The Nasdaq and S&P 500 scored record closing highs on Monday, boosted by tech-related shares following the market’s strong November gains, as investors awaited this week’s economic data including the key monthly jobs report on Friday.

The Dow finished lower on the day. Both the Dow and S&P 500 recorded on Friday their biggest monthly percentage gains in a year.

The technology, communication services, and consumer discretionary sectors rose about 1% each on Monday, while the rest of the S&P 500 sectors were lower. Tesla shares advanced 3.5%, with Stifel raising its price target on the stock.

“We’re seeing a market that’s in a seasonably strong period just creep higher,” said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.

“It’s a tough time for people to bail out, but by the same token, I don’t see an explosive finish to the year. There’s just too much uncertainty as to where we’re headed. … No one is quite sure what the plan is economically with the new administration.”

Former US President Donald Trump recaptured the White House in last month’s election and his Republican Party swept both houses of Congress, boosting stocks in November.

The Dow Jones Industrial Average fell 128.65 points, or 0.29%, to 44,782.00. The S&P 500 rose 14.77 points, or 0.24%, to 6,047.15 and the Nasdaq Composite climbed 185.78 points, or 0.97%, to 19,403.95.

Strategists have cited Trump’s potential plans for tax cuts and deregulation as a positive for stocks, but tariffs would be negative.

Investors also digested comments from Federal Reserve Governor Christopher Waller that he was inclined to cut the benchmark interest rate at the Dec. 17-18 meeting as monetary policy remained restrictive.

Investors have been expecting a quarter-point rate cut in December, but recent inflation data has raised worries that progress may have stalled.

The Fed began reducing rates in September by half a point, following that with a quarter-point cut in November.

Earlier on Monday, the Institute for Supply Management reported improved US manufacturing activity in November.

Aside from Friday’s hotly anticipated employment report, investors this week also will see private sector job growth data, the ISM’s services report, and the Labor Department’s weekly jobless claims.

Super Micro Computer surged 28.7% after the artificial intelligence server maker began searching for a new finance chief based on recommendations by a special committee formed to review its accounting practices.

Declining issues outnumbered advancers by a 1.08-to-1 ratio on the NYSE. There were 406 new highs and 64 new lows on the NYSE.

On the Nasdaq, 2,332 stocks rose and 2,060 fell as advancing issues outnumbered decliners by a 1.13-to-1 ratio.

Volume on US exchanges totaled 13.64 billion shares, compared with the 14.74 billion full-session average over the last 20 trading days.

(Reporting by Caroline Valetkevitch; Additional reporting by Shashwat Chauhan and Purvi Agarwal in Bengaluru; Editing by Maju Samuel and Richard Chang)

US yields little changed as Fed’s Waller points to December rate cut

NEW YORK – US Treasury yields were little changed on Monday, after trading higher for most of the session, as Federal Reserve Governor Christopher Waller said he was inclined to cut the benchmark interest rate at the Dec. 17-18 policy meeting.

The yield on the benchmark US 10-year Treasury note, which was up earlier after manufacturing data releases in the morning, pared gains to 4.197%, slightly up on the day, after Waller’s comments. The US two-year yield, which typically moves in step with interest rate expectations, was up 1.2 basis points at 4.182%.

Yields on the long end of the curve slipped, with those on US 30-year bonds down marginally at 4.368%.

“Policy is still restrictive enough that an additional cut at our next meeting will not dramatically change the stance of monetary policy and allow ample scope to later slow the pace of rate cuts, if needed, to maintain progress toward our inflation target,” Waller said in comments at a central bank symposium organized by the American Institute for Economic Research.

Waller compared the Fed’s battle with inflation to a mixed martial arts fighter in that sport’s unique arena. “Let me assure you that submission is inevitable — inflation isn’t getting out of the octagon.”

Ellis Phifer, managing director for fixed income capital markets at Raymond James in Memphis, said Waller’s comments were seen as reassuring. “His comment showed a stronger than usual support for a rate cut, but we still have to see what the jobs data will show later in the week.”

A closely watched part of the US Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes, seen as an economic outlook indicator, flattened slightly to 0.8 bp, compared with 1.4 bps late on Friday.

The overall flattening was earlier driven by the positive US data, which had initially reduced the odds of a 25-bp cut by the Fed later this month. That has since been offset by Waller’s comments.

Following Waller’s remarks, the markets raised the odds of a 25-bp easing this month to 75%, from 66% late on Friday, according to CME’s FedWatch. At the same time, rate futures reduced the chances of a Fed pause to 25% from 34% on Friday.

Earlier on Monday, Treasury yields rose modestly after data showed that the Institute for Supply Management’s manufacturing PMI increased to 48.4 last month from 46.5 in October, above the 47.5 economists polled by Reuters had forecast.

Analysts looking closely at the manufacturing data saw some signs of weakness not evident in headline numbers. Brian Jacobsen, chief economist at Annex Wealth Management in Menomonee Falls, Wisconsin, said the headline improved, but details were disappointing, with 66% of manufacturing GDP contracting in November.

“The most important thing was the unexpected drop at the prices paid by manufacturers; that’s an interesting anecdote that could influence inflation indexes ahead,” said Vail Hartman, analyst on the US Rates Strategy team at BMO Capital Markets.

Meanwhile, this week’s slew of US employment data begins on Tuesday, with job openings in October, followed by the November ADP national employment report on Wednesday. The US nonfarm payrolls report will be out on Friday.

Although the focus is on the short-term FOMC decision, markets are also trying to estimate the longer-term interest rate level.

“We’ve already heard many Fed officials say their estimates of neutral policy this cycle has changed. The destination of policy over the next eighteen months and onward will matter a lot more for Treasuries at the long end of the curve than what happens this month,” said Will Compernolle, macro strategist at FHN Financial, in a research note.

(Reporting by Tatiana Bautzer; additional reporting by Chuck Mikolajczak; editing by Jonathan Oatis)

Buoyant dollar keeps bulls in check

Investors in Asia go into Tuesday’s session with a spring in their step following the upswing in global stocks and risk appetite on Monday, but wary that the buoyant US dollar can extinguish that optimism in a flash.

Also keeping regional sentiment in check will be unease around China’s economic predicament, even though purchasing managers index data over the last 72 hours showed that factory activity in November expanded at the fastest pace in months.

Much of that – the pickup in Chinese manufacturing activity, deepening disquiet about the outlook, and the dollar’s renewed vigor – is tied to US President-elect Donald Trump’s hardline stance on trade and threats of heavy tariffs when he takes office next month.

His social media broadside on Saturday to countries contemplating backing away from the “mighty” US dollar appears to have had an initial effect. Excluding Nov. 6, the day after the US election, the dollar’s 0.6% appreciation on Monday was its biggest rise in six months.

Europe’s economic and political travails, especially in France, are certainly at play, while the yen is drawing support from bets that the Bank of Japan could raise interest rates later this month.

But the dollar’s independent strength cannot be ignored, and bullish sentiment toward emerging markets is rarely sustained for long when the dollar is on the march.

Nor can China’s weakness be ignored. Some analysts say the positive PMI surprises are due to a ramp up in production before tariffs from Washington are levied, and China’s underlying economic health remains fragile.

China’s bond market would appear to back up that assertion. The 10-year yield on Monday fell below 2% for the first time, while the 30-year yield is now below its Japanese equivalent for the first time in at least 20 years.

Still, investors will draw comfort from the S&P 500 and Nasdaq’s rise to fresh peaks on Monday, and US Federal Reserve Governor Christopher Waller saying he is leaning toward a rate cut later this month.

Remarkably, after Monday’s spike the S&P 500 has registered more than 50 record highs this year. But will that be enough to lift Asian markets on Tuesday?

Asia’s calendar on Tuesday is light, with South Korean inflation the only major economic indicator on tap. It is one of several CPI releases this week following Indonesia’s on Monday and ahead of the latest snapshots from the Philippines, Taiwan and Thailand later in the week.

Economists polled by Reuters expect South Korea’s annual rate of headline inflation in November to accelerate to 1.7% from a three-and-a-half-year low of 1.30% in October. That would mark the biggest jump since August last year.

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

– South Korea consumer inflation (November)

– Bank of Thailand governor Sethaput Suthiwartnarueput speaks

– Thailand’s finance minister Pichai Chunhavajira speaks

(Reporting by Jamie McGeever; Editing by Bill Berkrot)

US bonds extend rally in holiday shortened session

NEW YORK – US Treasury yields dropped amid thin trading during the holiday-shortened market session on Friday, extending a weekly bond rally spurred by optimism about the new US Treasury secretary and some respite from inflation concerns.

Benchmark 10-year yields dipped to an over one-month low, while two- and thirty-year yields hit their lowest in over three weeks, partly because of holiday-week effects after Thanksgiving on Thursday as well as month-end investor flows.

“Month-end positioning is likely to be playing a role, particularly going into the long US Thanksgiving weekend, which is likely to have led to some increased demand for Treasuries,” said David Page, head of macroeconomic research at AXA Investment Managers.

The move lower in yields, which decline when prices rise, indicated further unwinding of the trades linked to Donald Trump’s win in the US presidential election, which had put downward pressure on bonds in previous weeks because of expectations for higher deficits and inflation during a second Trump presidency.

This week’s rally began after Trump named Scott Bessent as Treasury secretary last Friday and gained momentum after a string of well-received Treasury auctions as well as inflation data in line with estimates.

“The nomination of Bessent as US Treasury secretary … has eased fiscal concerns,” said Diana Iovanel, senior markets economist at Capital Economics.

For Michael Ashley Schulman, partner and chief investment officer at Running Point Capital Advisors, Trump’s selection of Bessent suggested “economic rationality, potentially tempering fears of inflationary policies, possibly with a measured implementation of tariffs.”

Benchmark 10-year yields were last seen at 4.176%, their lowest since Oct. 25. Two-year yields, which more closely reflect monetary policy expectations, stood at 4.163%, their lowest since Nov. 5.

“It’s been a one-way slide lower in yield since the Asia reopen, though light flows have magnified the moves to a degree,” analysts at Citi wrote in a note early on Friday.

Since the beginning of November, 10-year yields have declined by about 10 basis points while two-year yields were roughly unchanged by the end of the month. Further out, 30-year yields have declined by about 11 basis points since the beginning of November to 4.366% on Friday.

The closely watched curve comparing two- and 10-year yields was last at 1.7 basis points, flatter than on Thursday – meaning the premium of long-term yields over shorter-ones was smaller.

That part of the curve inverted earlier this week for the first time in over a month, with two-year yields briefly higher than the 10-year. A curve inversion is a bond market signal of a possible economic contraction in the future.

US stock and bond markets were open for a half-day on Friday. The sustainability of this week’s decline in yields might become clearer once the new month starts next week.

For Page at AXA Investment Managers the weeks ahead will continue to be volatile as speculation mounts over the next US administration’s policies.

“Bonds look expensive to us at these yields,” he said.

(Reporting by Davide Barbuscia; editing by Jonathan Oatis and Diane Craft)

Global equity funds draw ninth weekly inflow in a row

Global investors stepped up purchases in equity funds in the week ended Nov. 27, encouraged by prospects of robust US growth under the Trump administration and boosted by cooling treasury yields.

Investors pumped a substantial USD 12.19 billion into global equity funds, a jump of 32% compared with about USD 9.24 billion worth of net acquisitions in the week before, LSEG Lipper data showed. It marked the ninth consecutive weekly inflow.

On Friday, global shares were on track for their best month since May, driven by optimism about strong US growth and the artificial intelligence investment boom, despite concerns over political turmoil and economic slowdown in Europe.

Last week, US President-elect Donald Trump’s appointment of fiscal hawk Scott Bessent as US Treasury Secretary raised market expectations of controlled debt levels in his second term, leading to a drop in Treasury yields.

Investors picked a significant USD 12.78 billion worth of US equity funds, extending net purchases into a fourth successive week. However, they withdrew USD 1.17 billion and USD 267 million out of Asian and European funds, respectively.

The financial sector witnessed robust demand as it drew USD 2.65 billion in net purchases, the fifth weekly inflow in a row. Investors also snapped up consumer discretionary, tech, and industrials sector funds totaling a hefty USD 1.01 billion, USD 807 million, and USD 778 million, respectively.

Global bond funds witnessed inflows for the 49th successive week. Investors poured USD 8.82 billion into these funds.

Corporate bond funds received a net USD 2.16 billion, the biggest weekly inflow in four weeks. Government bond funds and loan participation funds also witnessed notable purchases, totaling a net USD 1.9 billion and USD 1.34 billion, respectively.

At the same time, investors ditched USD 12.87 billion worth of money market funds in a second straight week of net sales.

The gold and precious metals funds gained a net USD 538 million, marking a 14th weekly inflow in 16 weeks.

Data covering 29,635 emerging market funds indicated that equity funds were out of favor for a fifth consecutive week with about USD 4.3 billion in net sales. Investors also divested bond funds to the tune of 2.58 billion, logging a sixth weekly net sales.

(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Gareth Jones)

Dollar faces crunch week for US rates, yen holds gains

SYDNEY – The dollar started in a cautious mood on Monday in what is shaping up to be a critical week for the prospect of US rate cuts, while the yen’s recent rebound was underpinned by wagers on rising rates at home.

Over the weekend, Bank of Japan Governor Kazuo Ueda said the next interest rate hikes are “nearing in the sense that economic data are on track,” following figures showing Tokyo inflation picked up in October.

Markets now imply a 56% chance the BOJ will hike by a quarter point to 0.5% at its policy meeting on Dec. 18-19.

Barclays economist Christian Keller said data on labor earnings this week should show a further pickup and all the signs were pointing to another strong “shunto” wage round in February.

“The wage and inflation picture continues to support further rate hikes, though whether the BOJ moves in December or January remains a close call,” he added.

The risk of an early hike was enough to keep the dollar pinned at 149.60 yen JPY=EBS, having shed 3.3% last week in its worst run since July. Support lies around 149.40/47 and 147.35.

The euro held at USD 1.0555, after bouncing 1.5% last week and away from a one-year trough of USD 1.0425. That left the dollar index flat at 105.790 =USD, having closed out November with a gain of 1.8% even after last week’s setback.

“Given the continued resilience of the US economy and a worsening outlook elsewhere, we don’t think this is the start of a deeper setback for the dollar,” said Jonas Goltermann, deputy chief markets economist at Capital Economics.

“But the bar for a further shift in expected interest rates in favor of the US in the near term is quite high,” he added. “A period of consolidation into year-end looks to us like the most likely scenario, although the risks remain skewed in favor of the dollar over the course of 2025.”

Key to the outlook for rates will be the November payrolls report due Friday where median forecasts favor a rise of 195,000 following October’s weather and strike-hit report, which could also be revised given a low response rate for that survey.

The jobless rate is seen edging up to 4.2%, from 4.1%, which should keep the Federal Reserve on course to cut by 25 basis points on Dec. 18.

Markets imply a 65% chance of such an easing, though they also only have two more cuts priced in for all of 2025.

A host of Fed officials are due to speak this week, including Fed Chair Jerome Powell on Wednesday, while other data include surveys of manufacturing and services.

The European Central Bank is also seen cutting rates this month, with markets implying a 27% chance it might even ease by 50 basis points on Dec. 12.

Political uncertainty is another drag for the single currency as investors wait to see if France’s government can survive the week intact.

France’s far-right National Rally leaders said on Sunday that the government had rebuffed its calls for more budget concessions, raising the chances of a no-confidence vote in the coming days that could topple Prime Minister Michel Barnier.

The threat of an ever-wider budget deficit saw French yields match those in Greece while the spread over German yields reached the highest since 2012.

(Reporting by Wayne Cole; Editing by Sam Holmes)

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