DOLLAR MIXED
Safe-haven bonds were better bid, with 10-year Treasury yields down almost 2 basis points at 4.326 per cent.
Major currencies were mixed as the dollar index nudged up to 97.071. The euro held at US$1.1771, just off last week’s top of US$1.1830, while the dollar was a fraction firmer at ¥144.76.
The dollar has been undermined by investor concerns about Trump’s often chaotic tariff policy and what that might do to economic growth and inflation.
The same worries have kept the Federal Reserve from cutting rates, and minutes of its last meeting should offer more colour on when the majority of members might resume easing.
It is a relatively quiet week for Fed speakers with only two district presidents on the docket, while economic data is also sparse.
The Reserve Bank of Australia is widely expected to cut its rates by a quarter point to 3.60 per cent at a meeting on Tuesday, the third easing this cycle, and markets imply an eventual destination for rates of 2.85 per cent or 3.10 per cent.
New Zealand’s central bank meets on Wednesday and is likely to hold rates at 3.25 per cent, having already slashed by 225 basis points over the past year.
In commodity markets, gold slipped 0.3 per cent to US$3,324 an ounce, though it did gain almost 2 per cent last week as the dollar fell.
Oil prices slid anew after the Organization of the Petroleum Exporting Countries (OPEC) and their allies, a group known as OPEC+, agreed on Saturday to raise production by a larger-than-expected 548,000 barrels per day in August.
The group also warned that it could hike by a similar amount in September, leaving analysts with the impression it was trying to squeeze lower margin producers and particularly those pulling oil from US shale.
“We see OPEC+ targeting Brent oil futures around US$60 to US$65 per barrel as a result,” said Vivek Dhar, an analyst at CBA.
“This would challenge the economics of US shale oil supply growth and prevent non-OPEC+ supply growth from taking market share in coming years.”
Brent dropped 52 cents to US$67.78 a barrel, while US crude fell US$1.01 to US$65.99 per barrel.
https://www.channelnewsasia.com/business/trump-tariffs-us-asia-markets-stocks-trade-agreements-oil-5223706
