• The dollar held firm on Wednesday after Wall Street shot to record peaks amid signs of progress on U.S. tax cuts, while bitcoin topped $10,000 on a host of exchanges as the frenzy for cryptocurrencies showed no sign of fading.
All of which helped the dollar regain some ground. Against a basket of currencies it was steady at 93.219 .DXY and off a two-month trough of 92.496 touched on Monday.
• Annual Japanese retail sales fell for the first time in a year last month, government data showed on Wednesday, as poor weather including two typhoons kept consumers away from stores and restaurants.
Retail sales edged down 0.2 percent in October compared with the same month last year, led by weak sales of food and beverages, the Ministry of Economy, Trade, and Industry said.
October’s fall in retail sales follows a rare decline in overall private consumption in the July-September quarter, but economists see the downturn as temporary due to one-off factors.
Consumer confidence is at four-year highs, emboldened by an economy that has grown for seven straight quarters - its longest expansion in 16 years - while expectations are growing for bigger increases in wages.
Sales of food and beverages fell 1.5 percent from a year earlier, the first drop in eight months.
At large-scale retailers - department stores and supermarkets - sales fell 0.7 percent from a year earlier after adjustment for change in the number of stores.
Wednesday’s retail sales report is the first piece of major consumption data for the current quarter, and kicks off a busy slate of October indicators over the coming days.
Also on the consumer spending front, household spending, due on Friday, is expected to have slipped. But the jobless rate is forecast to have held at a 23-year low, and the government hopes the tight labor market will soon lead to higher wages and bolster consumption.
• The digital currency hit $10,000 Tuesday, according to CoinDesk, marking an exponential ascent from 6 cents seven years ago and less than $1,000 at the start of this year.
The cryptocurrency had hovered above the $9,800 level for most of the day, but finally broke through the milestone level around 8:30 p.m. ET, according to CoinDesk. After a brief stutter, bitcoin continued its ascent, reaching $10,044.29 some 20 minutes later.
• Bank of England Deputy Governor Jon Cunliffe said bitcoin, which hit a record high above $10,000 earlier on Wednesday, is not at a size where it would pose a risk to the global economy.
• Jerome Powell, President Donald Trump’s choice to lead the U.S. Federal Reserve, defended plans to potentially lighten regulation of the financial sector during a controversy-free hearing on his nomination to take over the central bank.
Tapped to replace current chair Janet Yellen, Powell on Tuesday skirted several efforts by members of the Senate Banking Committee to draw him into the debates preoccupying Capitol Hill, refusing to analyze the impact of proposed tax cuts or, as some of his colleagues at the Fed have done, argue for more immigration to boost the labor force. He said economic growth was likely bound in a range of between 2 and 2.5 percent annually, short of Trump’s 3 percent goal, without a jump in productivity that many economists regard as unlikely.
• Andrew Sheets, chief cross-asset strategist at Morgan Stanley, said in a note Sunday he expects U.S. economic growth to moderate as the economy moves deeper into the later innings of the current economic cycle. In China, Sheets expects the economy to slow down amid policy uncertainty.
For 2018, Morgan Stanley forecasts U.S. GDP to grow by 2.5 percent, slightly above their 2.3 percent forecast for 2017, and China's GDP to grow by 6.5 percent, below China's 2017 forecast of 6.8 percent. Sheets said emerging markets excluding China are "central to this story, and we see EM growth accelerating from 4.7%Y this year to 5.0%Y in 2018, led by Brazil and India."
• Democratic leaders in Congress skipped a meeting with President Donald Trump on Tuesday that was to have focused on the budget, raising the risk of a government shutdown next month with both sides far apart on the terms of an agreement.
• Germany’s eight-year growth run has increased the chance that investors and households underestimate financial risk, increasing the economy’s vulnerability, the Bundesbank said in a regular stability report on Wednesday.
“There is a danger that low interest rates and the favorable economic conditions in Germany might cause market participants to underestimate risks,” the central bank said.
• OPEC oil ministers will be in Vienna Thursday and there is widespread expectation that members will decide to extend oil output cuts beyond a deadline of March 2018, a move that has helped to stabilize prices. However, there is some anxiety that the biggest non-OPEC producer that also signed up to the output cut, Russia, could pull out of an extension, sending markets sharply lower.
Croft, the global head of commodity strategy at RBC, told CNBC that Russia — or specifically Russian President Vladimir Putin — was the wildcard that could disappoint markets.
Putin is under pressure at home to not overdo the extension of output cuts, with a number of Russia's largest oil companies reportedly showing displeasure at a possible extension to the current deadline of March 2018.
• OPEC and Russia look set to prolong oil supply cuts until the end of 2018 this week while signalling that they may review the deal when they meet again in June if the market overheats.
• Oil prices fell on Wednesday on doubts OPEC and Russia will agree on extending a crude production cut to cover all of 2018, and after a report of an unexpected rise in U.S. crude oil inventories.
U.S. West Texas Intermediate (WTI) crude futures were at $57.76 a barrel at 0749 GMT, down 23 cents, or 0.4 percent below their last settlement.
Brent crude futures were at $63.31 a barrel, down 30 cents, or 0.4 percent.
Traders said WTI was pulled lower by a report from the American Petroleum Institute (API) late on Tuesday that showed U.S. crude inventories rose by 1.8 million barrels in the week ended Nov. 24 to 457.3 million barrels.
Reference: Reuters, CNBC
Thai
Eng