ForexLive Asia-Pacific FX news wrap: US Treasuries yield falls, USD falls

• Bessent said his policy priority will be to deliver on Trump’s various tax-cut pledges
• UBS target US$2,900 gold year-end 2025 – preferred hedge against geopolitical tensions
• Bank of England Dhingra and Lombardelli speaking on Monday
• People’s Bank of China shift to the MLF as the main policy tool – drain today facilitates
• European Central Bank speakers Monday include Lane, Makhlouf
• PBOC net drain 550bn via MLF. Rate unchanged at 2%
• Still waiting on any People’s Bank of China Medium-term Lending Facility (MLF) announcemnt
• PBoC may cut RRR, buy government bonds in December.
• Axios: Israeli, US officials state Israel and Lebanon on the cusp of a ceasefire agreement
• PBOC sets USD/ CNY reference rate today at 7.1918 (vs. estimate at 7.2257): 25 November
• Republican Senators warn Canada, Britain, Germany, France: Help ICC, we crush your economy
• Goldman Sachs on 2025: When the Fed cuts, bond market where investors should want to be
• ICYMI – Financial markets have become more susceptible to liquidity shortages (BIS report)
• ICYMI – Cboe to launch cash-settled Bitcoin ETF options from next week
• US futures trade open for the new week – equity indexes up, bonds up
• FX gaps remain in early Tokyo trade
• Reserve Bank of New Zealand rate cut expected on Wednesday 27 November – preview
• New Zealand Q3 retail sales -0.1% q/q (expected -0.5%)
• Weekend – Trump nominated Scott Bessent to serve as Treasury Department secretary
• Reserve Bank of New Zealand (RBNZ) Shadow Board recommend a 50bp cash rate cut this week
• Trade ideas thread – Monday, 25 November, insightful charts, technical analysis, ideas
• Monday morning open levels – indicative forex prices – 25 November 2024
• Newsquawk Week Ahead: US PCE, FOMC Minutes, RBNZ rate decision, EZ HICP, and Aussie CPI
• Weekly Market Outlook (25-29 November)
• ECB Villeroy says falling inflation allows the Bank to lower interest rates
• Fed: U.S. government fiscal sustainability tops the list of financial system risks
• Forexlive Americas FX news wrap 22 Nov: US PMI data better than Europe. USD moves higher.

The
headline to this wrap is the six-word summary of the moves across
markets to open the week. The news catalyst was the weekend
announcement of Trump’s pick to head the US Treasury, ex-Soros
executive Scott Bessent. The announcement has seen USTs rise sharply
(futures gapped higher) and the US dollar fall sharply (really early
Asia trade, hours before Tokyo became active, saw the USD gap lower).
The US bond market move is a clear sign of stabilisation after a sell-off lasting around two months.

USD/JPY
has been a notable loser, dropping as low as briefly under 153.60.
Its back above 154.00 as I update.

EUR,
AUD, NZD GBP, CAD, CHF too – all gained. There have been various
degrees of retracement (not a lot for EUR/USD, a little more for
AUD/USD, for example).

Looking
at some local developments, New Zealand Q3 retail sales showed
another fall, at -0.1% q/q. This, however, was nowhere close to as bad
as the Q2 fall of -1.2% and also not as bad as the -0.5% expected.
The Reserve Bank of New Zealand meet this week (Wednesday 27th)
and a 50bp rate cut appears locked in. There have been some thoughts
of a 75bp rate cut but ‘not as bad as it could have been’ results
for unemployment and retail sales have sapped some of these
expectations. NZD/USD traded mainly in line with the broader US
dollar moves today.

The
People’s Bank of China injected 900 billion yuan into the banking system today via one-year policy, medium-term lending facility (MLF), loans. The rate was left unchanged at 2%. The 900bn yuan injection,
however, did not cover the 1,450bn yuan maturing this month.

Gold
has been slammed lower, with lows circa 2661 USD. Bitcoin remains shy of
$100K.

This article was written by Eamonn Sheridan at www.forexlive.com.