• The dollar slipped broadly on Wednesday, hurt by a media report that suggested the implementation of a centerpiece corporate tax cut under discussion in U.S. tax reforms plans could be delayed.
The dollar index against a basket of six currencies .DXY dipped 0.1 percent to 94.844 as U.S. Treasury yields continued to decline.
The 10-year Treasury yield US10YT=RR stood within close reach of a three-week low of 2.304 percent set the previous day. The yield has fallen steadily from a seven-month peak near 2.477 percent touched late in October.
The dollar was down 0.2 percent at 113.800 yen JPY=, falling away from an eight-month high of 114.735 touched on Monday.
The euro EUR= rose 0.1 percent to $1.1597, bouncing modestly from a three-month low of $1.1553 plumbed overnight.
• Senate Republicans on Tuesday were considering a starkly different approach to overhauling the tax code than their House colleagues, weighing a delay in the implementation of a major corporate tax cut and other measures to alter the cost and impact of the plan.
Senate leaders were exploring postponing the centerpiece of the effort — an $845 billion corporate tax cut — until 2019, according to four people familiar with a draft of the legislation. The move would make it easier to comply with Senate rules that aim to limit any legislation’s impact on the debt.
At the same time, Republican senators were planning to eliminate the state and local tax deduction, going further than the House, which retained part of the popular tax break, said the people familiar with the matter, speaking on the condition of anonymity because they were not authorized to discuss sensitive deliberations. Senators also were debating how to ensure that fewer of the plan’s benefits flow to the wealthy and more flow to the middle class.
• U.S. President Donald Trump issued a stark warning to North Korean leader Kim Jong Un on Wednesday, telling him that the nuclear weapons he is developing “are not making you safer, they are putting your regime in grave danger”.
“Do not underestimate us and do not try us,” Trump told North Korea as he wrapped up a visit to South Korea with a speech to the National Assembly in Seoul.
• Protectionist sentiment has not yet gone beyond mere words, International Monetary Fund Managing Director Christine Lagarde said on Wednesday, but would hurt Asian economies with open and free markets if it did.
• Catalan secessionist parties on Tuesday failed to agree on a united ticket to contest a December snap regional election, making it more difficult to rule the region after the vote and press ahead with their collective bid to split from Spain.
• China’s exports and import growth eased in October in a sign the world’s second-largest economy is starting to cool after a strong first half, with momentum seen slackening further as Beijing’s crackdown on pollution hits factory output.
October exports rose 6.9 percent from a year earlier in dollar terms, slightly lagging analysts’ forecast of a 7.2 percent increase, compared to 8.1 percent growth in September, official data showed on Wednesday.
Imports grew 17.2 percent year-on-year in October, beating forecast of 16.0 percent growth but slightly slower than the 18.7 percent rise in September.
• China’s raw materials purchases slowed in October from record-breaking levels a month earlier, the latest sign that Beijing’s factories have been clearing inventory ahead of unprecedented government steps to curb smog over winter.
Part of the slowdown from September was seasonal, with factories shut for a week-long national holiday and cutting output ahead of the Communist Party Congress earlier this month.
Imports of commodities from crude oil and iron ore to coal and copper all fell, underscoring expectations of lower demand from the world’s biggest buyer in the months ahead.
• Oil prices fell on Wednesday as Chinese crude imports slipped to their lowest level in a year, although traders said the overall market remains well supported because of OPEC-led supply cuts.
Traders said they were closely eyeing escalating tensions in the Middle East, especially between regional rivals Saudi Arabia and Iran.
Brent futures LCOc1 were at $63.33 per barrel at 0710 GMT, down 36 cents, or 0.6 percent. The decline follows Brent rising to an over two-year high of $64.65 earlier this week.
U.S. West Texas Intermediate (WTI) crude CLc1 was at $56.90 per barrel, down 30 cents, or 0.5 percent, from their last settlement. WTI also hit an over two-year high earlier this week at $57.69.
• China’s October oil imports fell sharply from a near record-high of about 9 million barrels per day (bpd) in September to just 7.3 million bpd, data from the General Administration of Customs showed on Wednesday. That is the lowest level since October 2016 but imports were up 7.8 percent from a year ago.
Reference: Reuters, CNBC, Washington Post
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