Bitcoin Falls in Wake of U.S. Ruling Out New Purchases — Market Talk
0818 GMT - Bitcoin falls to a one-and-a-half-week low in the wake of the U.S. Treasury ruling out new purchases of the cryptocurrency for its strategic reserve, FP Markets analyst Aaron Hill says. Treasury Secretary Scott Bessent told Fox Business Thursday the government wouldn't buy additional bitcoins to supplement its existing supply. Speculators have liquidated more than $40 million worth of bitcoin long positions, or bets on it rising, Hill says. Profit-taking by long-term and large bitcoin holders have also contributed to the cryptocurrency's decline along with seasonal August weakness and geopolitical tensions, he says. Moreover, last week's higher-than-expected U.S. wholesale inflation data dampened expectations for aggressive Federal Reserve interest-rate cuts. Bitcoin falls to a low of $15,007, LSEG data show. ([email protected])0814 GMT - Long-end eurozone government bond yields recover in European morning trade, with 30-year Bund yields off from Friday's multi-year high. The big moves in eurozone rates are coming from the long end of the curve where both fiscal concerns and Dutch pension reforms are putting upward pressure on yields, ING rates strategists say in a note. "While these structural drivers are acting on the back end, markets will let economic data determine the way forward for shorter maturities," they say. The 30-year Bund yield falls 2.6 basis points at 3.314%, having hit a high of 3.354% on Friday, according to LSEG data. ([email protected])0800 GMT - Yields on U.K. government bonds, or gilts, fall, reversing a significant rise on Friday as investors switch their attention to Wednesday's U.K. inflation data. Yields rose last week as investors turned skeptical about whether the Bank of England will cut interest rates again this year following better-than-forecast U.K. GDP data and resilient jobs data. If inflation data are below forecasts they could revive rate-cut expectations and send gilt yields lower, says FP Markets' Aaron Hill in a note. "The BOE will have more conviction in cutting this year if inflation eases," he says. U.K. 10-year gilt yields fall 1.7 basis points to 4.663%, having hit an 11-week high of 4.697% on Friday, Tradeweb data show. ([email protected])0800 GMT - The Philippines' external sector is expected to come under pressure in the medium term amid mounting global trade headwinds, say analysts at BMI, a unit of Fitch Solutions. The country's major trading partners are facing their own economic challenges, which will limit the Philippines' export performance, they write, adding that Trump's tariffs will also weigh on the global economy. China, one of the Philippines' key trading partners, is grappling with a prolonged property downturn that continues to weaken household wealth and spending. Meanwhile, growth in the U.S., the Philippines' largest export destination, is expected to slow amid high interest rates and policy uncertainty.([email protected])0750 GMT - Gold futures tick higher, though they remain within a narrow price range in relatively thin trading. Futures are up 0.4% at $3,395.50 a troy ounce. The precious metal has fallen on week as easing trade tensions, steady interest rates and an equity-market rally dented safe-haven demand, but this appears temporary, ANZ Research analysts write. Macroeconomic and geopolitical risks will likely intensify in the second half of the year, enhancing gold's haven desirability, analysts say. The U.S. Federal Reserve is poised to cut interest rates in September, which will boost non-interest bearing bullion's appeal. Equally, waning trust in U.S. assets and volatile geopolitics should encourage central banks to further diversify reserves into gold, ANZ says. This should see gold breach record highs later this year, analysts add. ([email protected])0748 GMT - Singapore's non-oil domestic export momentum is likely to slow in 2H, RHB Bank's group chief economist and head of market research Barnabas Gan says in a report. July's 4.6% on-year decline in NODX offered an early sign of the expected slowdown, he writes. Singapore's reliance on exports such as electronics and pharmaceuticals makes it vulnerable to sector-specific trade actions, he adds. "Tariffs imposed on these key industries could have an outsized impact on the country's export performance and GDP trajectory, given the economy's exposure, amid Singapore's high trade-to-GDP ratio," he says. RHB forecasts NODX to grow 2.0% in 2025. ([email protected])0715 GMT - Thailand's economy will likely struggle over the coming months, Capital Economics' Gareth Leather writes in a note. Softer exports, slower government spending and weak private consumption will weigh on demand, the economist says. Exports, the economy's main driver in 2Q, rose 12.2% on year during the period. However the strong export momentum is unlikely to last due to U.S. tariffs, he says. "Any boost from tariff front-running is also likely to dissipate now that we have more certainty over future tariff arrangements." Capital Economics expects Thailand's GDP to grow 2.7% for 2025. ([email protected])0715 GMT - The Russian ruble could weaken over the coming year as a resolution to the Russia-Ukraine conflict looks unlikely, Commerzbank's Tatha Ghose says in a note. European leaders and Ukraine President Volodymyr Zelensky will meet with President Trump in Washington Monday following Friday's summit between Trump and Russian President Vladimir Putin. Putin wants a peace treaty that allows Russia to take more Ukrainian territory. "It is difficult to see how this path leads to a solution where some sanctions on Russia will be removed in any foreseeable timeframe," Ghose says. Russia's economy will continue to face drags with exports and imports slumping and oil and gas revenue contracting, he says. The dollar rises 0.1% to 80.2000 rubles. ([email protected])0658 GMT - Markets are almost fully pricing in a 25bp rate cut by the RBNZ on Wednesday, taking the cash rate to 3.00%, says Aaron Hill at FP Markets. Since the last meeting, where the central bank emphasized the possibility of further easing if price pressures continue to decline, inflation has ticked higher but is still within the target band. Inflation expectations have edged lower. With a cut baked in, attention falls on guidance. A hawkish scenario, which should underpin a bid in the NZD, could unfold if the RBNZ indicates a high bar for further easing, says Hill. This may happen if it lacks confidence in the inflation path. A dovish scenario, which could be NZD negative, may see policymakers suggest cuts at subsequent meetings. ([email protected])0644 GMT - The dollar rises marginally as investors await the Federal Reserve's Jackson Hole economic symposium later this week. Fed Chair Jerome Powell will speak Friday at the event and the market will be looking for any hints on whether the Fed will resume cutting interest rates in September as widely expected. Powell's Jackson Hole speech has often been used to send important policy signals and last year he said it was time to adjust policy before the Fed cut rates at the next meeting, Deutsche Bank analysts say in a note. Investors will also monitor a meeting Monday between European leaders, Ukraine President Volodymyr Zelensky and President Trump in Washington over Ukraine's future. The DXY dollar index rises 0.1% to 97.907. ([email protected])0635 GMT - Thailand's 2H growth momentum is expected to slow due to the impact from higher U.S. tariffs and increasing headwinds, says ANZ Asia economist Krystal Tan. With few alternative growth drivers, the Thai economy faces additional pressure from muted tourism and lackluster domestic demand, she writes in a report. The negative repercussions from the 19% U.S. tariff on Thailand will become more apparent in 2H. Thailand is also among the most exposed economies in Asia to more competition from a redirection of exports from third-party markets that were previously bound for the U.S. ANZ maintains its 2025 growth forecast for Thailand at 1.8%.([email protected])0621 GMT - Structural steepening in eurozone government bond yield curves has been RBC Capital Markets' core view and recommendation since late last year, its analysts say in a note. "We've specifically been running an outright hedged euro 5-30-year curve steepener in our portfolio since," they say. The drivers and catalysts to last week's moves--with weakness in long-end bonds--in particular remain a topic for debate, they say. However, they also find that there were potentially new catalysts at work as well that aided this very recent steepening move in particular, they say. "These significant technical breakouts add further conviction to our long-standing structural curve steepening views and could be indicating that we will see more of this to come sooner versus later." ([email protected])