* German parliament approves Merz's historic spending surge. * Central bank meetings this week focus on forward guidance. By Saqib Iqbal Ahmed. The dollar rose against the euro on Tuesday as Germany's parliament approved plans for a massive spending surge on Tuesday and as the Federal Reserve kicked off its March policy meeting that could offer clues to the path of U.S. interest rates.
* Europe stocks, euro rise ahead of German spending vote. * Israel strike on Gaza revives Middle East tensions. * U.S. housing starts, industrial output surprise to the upside. * Trump, Putin to hold call on Ukraine. * Safe-haven flows keep gold above $3,000. By Stephen Culp.
Canada's main stock index was largely unchanged on Tuesday as investors awaited the U.S. Federal Reserve's outlook on interest rate and economic growth amid the trade war. The Toronto Stock Exchange's S&P/TSX composite index was down 0.2% at 24,731.62 points, after two straight sessions of gain. Traders expect the Fed to keep rates unchanged after its two-day meeting ends on Wednesday.
* Single-family housing starts increase 11.4% in February. * Building permits for single-family homes fall 0.2% * Import prices rise 0.4%; January data revised higher. By Lucia Mutikani. U.S. single-family homebuilding rebounded sharply in February amid a thaw in winter weather, but rising construction costs from tariffs and labor shortages threaten the recovery.
U.S. manufacturing production increased more than expected in February, boosted by a surge in motor vehicle output, but tariffs are casting a shadow on the nascent factory recovery. Factory output jumped 0.9% last month after an upwardly revised 0.1% gain in January, the Federal Reserve said on Tuesday. Production at factories increased 0.7% on a year-on-year basis in February.
U.S. manufacturing production increased more than expected in February, boosted by a surge in motor vehicle output, but tariffs are casting a shadow on the nascent factory recovery. Factory output jumped 0.9% last month after an upwardly revised 0.1% gain in January, the Federal Reserve said on Tuesday. Production at factories increased 0.7% on a year-on-year basis in February.
* Chile's economy grows 0.4% q/q, 4.0% y/y in Q4. * Full-year growth exceeds central bank forecasts. * Policymakers expected to keep rates on hold this week.
U.S. stock indexes opened lower on Tuesday as worries about the impact of U.S. tariffs and their impact on economic growth prevailed ahead of a monetary policy decision from the Federal Reserve.
U.S. single-family homebuilding rebounded sharply in February, but rising construction costs from tariffs and labor shortages threaten the recovery. Single-family housing starts, which account for the bulk of homebuilding, surged 11.4% to a seasonally adjusted annual rate of 1.108 million units last month, the Commerce Department's Census Bureau said on Tuesday.
By Jamie McGeever. It's widely believed that the biggest issue with U.S. consumers' balance sheets is indebtedness, but the Federal Reserve's latest financial accounts - and the volatile stock market - suggest that larger risks may be on the other side of the ledger. This seems counterintuitive.
Chile's gross domestic product grew 0.4% in the fourth quarter of 2024 from the previous three-month period, central bank data showed on Tuesday, while economists in a Reuters poll expected a 0.5% expansion. The Andean nation's economy was up 4.0% in the fourth quarter from a year earlier, the central bank added.
Futures tied to Canada's main stock index were flat on Tuesday as investors awaited the U.S. Federal Reserve's outlook on interest rates and economic growth in the backdrop of an ongoing trade war. The S&P/TSX index futures were up 0.04% at 0650 ET . U.S. stock index futures also struggled for direction.
By Mike Dolan. What matters in U.S. and global markets today. By Mike Dolan, Editor-At-Large, Financial Industry and Financial Markets. U.S. stocks stabilised for the second day on Monday, as details of the February U.S. retail sales report calmed some of the worst fears about American consumers. Today, I'll take a look at the Bank of England, one of the big central banks meeting this week.
By Mike Dolan. What matters in U.S. and global markets today By Mike Dolan, Editor-At-Large, Financial Industry and Financial Markets U.S. stocks stabilised for the second day on Monday, as details of the February U.S. retail sales report calmed some of the worst fears about American consumers. Today, I'll take a look at the Bank of England, one of the big central banks meeting this week.
Nicolai Tangen has been appointed to a second term as CEO of Norway's vast sovereign wealth fund, Norges Bank Investment Management, the central bank said on Tuesday. Tangen, 58, who became the fund's CEO in September 2020 for a five-year period, said in November he would seek a new term as chief executive of the sovereign wealth fund as he felt the job was not yet done.
Bond investors are bracing for a U.S. economic downturn, as they pare back risky exposures, while many are extending duration in their fixed-income portfolios, taking in to account a Federal Reserve that is in no rush to resume cutting interest rates. In the run-up to this week's two-day Federal Open Market Committee meeting, investors have been extending duration.
* Futures: Dow down 0.01%, S&P 500 down 0.06%, Nasdaq down 0.2% U.S. stock index futures struggled for direction on Tuesday ahead of the Federal Reserve's upcoming meeting that will be closely monitored for commentary from the central bank on the potential economic ramifications of ongoing tariff disputes.
- Wall Street's ever-shifting outlook on the reduction of the Federal Reserve's balance sheet is once again in flux, with a number of banks and researchers now seeing a good chance the central bank may slow further or pause the effort at this week's policy meeting.
Tumbling stock markets and signs of tightening credit may make the Federal Reserve's job even more difficult this week as U.S. central bank policymakers try to weigh whether consumer spending will suffer as households take stock of the potential blow to their net worth and greater difficulty in obtaining loans.
Tumbling stock markets and signs of tightening credit may make the Federal Reserve's job even more difficult this week as U.S. central bank policymakers try to weigh whether consumer spending will suffer as households take stock of the potential blow to their net worth and greater difficulty in obtaining loans.
* Fed may slow or pause QT as early as this week, a number of analysts now believe. * Main concern involves dynamics around the federal debt ceiling. * 'Various' policymakers had shown openness to a change during discussions at January's meeting. By Michael S. Derby.
Sterling hit a fresh 4-1/2-month high at $1.30 against the dollar on Tuesday on rising expectations the Bank of England will not cut interest rates later in the week, while the pound dropped against the euro, which was buoyed by Germany's spending plans. The pound continued to be driven by developments in Europe and the United States.
The Bank of Japan is likely to keep hiking interest rates gradually as wages are seen rising at a pace that will keep inflation stably around its 2% target, according to recent estimates made by Goldman Sachs (GS). Based on data so far, Japan's wage growth will likely accelerate to 3.0% this year from 2.8% in 2024, Goldman Sachs (GS) said in a report released on Monday.
* Euro hits 5-month peak before Germany's stimulus package vote. * Central banks' meetings this week focus on forward guidance. * Yen slips ahead of Bank of Japan decision. By Stefano Rebaudo.
In a week when major central banks are expected to remain static, caught in a storm of disruptive U.S. policymaking, the Bank of England may be the one with most reason to cut to the chase. Monetary policymakers face a potential double whammy from U.S. President Donald Trump's planned April tariff hikes, as they could hit global growth while also spurring prices.
* Euro holds near 5-month peak before Germany's stimulus package vote. * Central banks' meetings this week focus on forward guidance. * Yen slips ahead of Bank of Japan decision. By Brigid Riley.
The Swiss National Bank greatly reduced its activity in foreign currency markets during 2024, according to data published on Tuesday, as the central bank relied instead on interest rates to steer monetary policy. The SNB bought foreign currency worth 1.2 billion Swiss francs in 2024, its annual report said, with its purchases slowing to a trickle in the fourth quarter.
The Swiss National Bank bought foreign currency worth 1.2 billion Swiss francs in 2024, the central bank said on Tuesday, dramatically reducing its interventions after bringing inflation under control. The figure compared with 132.9 billion Swiss francs of foreign currencies sold by the SNB during 2023 as the bank sought to boost the franc as a shield against imported price rises.
Japan's benchmark 10-year government bond yield rose on Tuesday, reversing course as investors awaited the Bank of Japan's policy decision. The yield was up 0.5 basis point at 1.51%, after slipping 1 bp to 1.495% earlier in the session.
The rising U.S. trade deficit with South Korea is "troubling" to the administration of U.S. President Donald Trump, the acting U.S. ambassador to South Korea, Joseph Yun, said on Tuesday, adding that it has to decrease. South Korea needs to get rid of barriers in the agriculture, digital and service sectors, he said.
Wall Street turned lower and gold surged to record highs on Tuesday as Israeli airstrikes on Gaza revived geopolitical jitters and the U.S. Federal Reserve gathered to discuss monetary policy amid growing economic uncertainty. A vote by Germany's parliament to overhaul government spending sent European stocks higher, however, and German shares to near record highs.
The dollar edged up against the euro on Tuesday as Germany's parliament approved plans for a massive spending surge on Tuesday and as the Federal Reserve kicked off its March policy meeting that could offer clues to the path of U.S. interest rates. The euro was 0.2% lower at $1.0915, after hitting $1.0954 earlier in the session, its highest since October 10.
* Dollar struggles around recent lows ahead of Fed meeting. * Euro holds near 5-month peak before Germany's stimulus package vote. * Central banks' meetings this week focus on forward guidance. By Brigid Riley.
U.S. President Donald Trump nominated Federal Reserve Governor Michelle Bowman to the central bank's top regulatory post as vice chair for supervision where she is expected to oversee an agenda of relaxed rule-writing and bank oversight.
* Bowman is a former community banker and state regulator. * Was a frequent critic of efforts to impose tougher bank rules. * Has served on Fed board since 2018. By Pete Schroeder and Kanishka Singh.
The bank at the centre of Vietnam's biggest financial fraud has received a central bank bailout amounting 5% of the nation's 2024 economic output, which a local white knight hopes to repay in 15 years, documents seen by Reuters show.
U.S. President Donald Trump nominated Federal Reserve Governor Michelle Bowman as vice chair for supervision, he said in a post on social media. A former community banker and frequent critic of overzealous bank regulation, Bowman would replace Michael Barr, who stepped down from the supervision post at the end of February to avert a potential legal dispute with the Trump administration.
Germany's constitutional court threw out new challenges by opposition parties against a plan by the prospective coalition government to push a massive public borrowing initiative through the outgoing parliament, it said on Monday.
By Jamie McGeever. It's widely believed that the biggest issue with U.S. consumers' balance sheets is indebtedness, but the Federal Reserve's latest financial accounts - and the volatile stock market - suggest that larger risks may be on the other side of the ledger. This seems counterintuitive.
In a week when major central banks are expected to remain static, caught in a storm of disruptive U.S. policymaking, the Bank of England may be the one with most reason to cut to the chase. Monetary policymakers face a potential double whammy from U.S. President Donald Trump's planned April tariff hikes, as they could hit global growth while also spurring prices.
* BANK OF CANADA ANNOUNCES PLANNED CHANGES TO ITS CONTINGENT TERM REPO FACILITY Source text: https://www.bankofcanada.ca/2025/03/bank-canada-announces-planned-changes-contingent-term-repo-facility/
* Concerns rise about economic impact of Trump's tariffs. * US retail sales rebound moderately in February. * Euro near 5-month high after Germany agrees fiscal deal. * Yuan firm as Beijing takes steps to bolster consumption. By Saqib Iqbal Ahmed.
* Intel (INTC) up after report new CEO plots overhaul of manufacturing, AI operations. * February retail sales rise 0.2% * New York factory activity tumbles in March. * Indexes up : Dow up 0.91%, S&P 500 up 0.69%, Nasdaq 0.33% By Chuck Mikolajczak.
Argentina's economy is expected to have registered year-on-year growth in the fourth quarter of 2024, ending six consecutive quarters of year-on-year contraction and further lifting it out of recession, a Reuters poll of analysts showed on Monday. The average forecast from 15 local and international analysts showed Argentina's gross domestic product expanding 1.7% in the last three months of 2024.
* Intel (INTC) up after report new CEO plots overhaul of manufacturing, AI operations. * February retail sales rise 0.2% * New York factory activity falls in March. * Indexes: Dow up 0.39%, S&P 500 up 0.06%, Nasdaq down 0.44% By Pranav Kashyap and Johann M Cherian.
U.S. business inventories rebounded in January as declining sales boosted stocks at wholesalers, which could see inventories contributing to economic growth in the first quarter. Inventories increased 2.3% on a year-on-year basis in January. Inventories subtracted from GDP growth in the fourth quarter, restricting economic growth to a 2.3% annualized rate.
* Intel (INTC) up after report new CEO plots overhaul of manufacturing, AI operations. * February retail sales rise 0.2% * New York Fed Manufacturing falls in March. * Indexes up: Dow 0.50%, S&P 500 0.49%, Nasdaq 0.33% By Pranav Kashyap and Johann M Cherian.
U.S. homebuilder sentiment dropped to a seven-month low in March as tariffs on imported materials raised construction costs, a survey showed on Monday. The National Association of Home Builders/Wells Fargo Housing Market Index dropped three points to 39 this month, the lowest level since August.
* Concerns rise about economic impact of Trump's tariffs. * US retail sales rebound moderately in February. * Euro near 5-month high after Germany agrees fiscal deal. * Yuan firm as Beijing takes steps to bolster consumption. By Saqib Iqbal Ahmed.
In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.
Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.
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