Bitcoin Prints New Highs as Crypto Optimism Builds — Market Talk

0542 GMT - Bitcoin hits new highs amid optimism about U.S. cryptocurrency legislation. The surge follows increased bipartisan Congressional support for regulation on stablecoins, digital currencies pegged to the dollar, says Devarsh Vakil at HDFC Securities. The Trump administration is trying to push two crypto bills through Congress. The recent rally stems in part from supportive macro conditions and institutional inflows into crypto, says Linh Tran, market analyst at XS.com. A softer dollar has also enhanced Bitcoin's appeal as an alternative store of value, Tran adds. On the policy front, Tran flags more positive developments like Texas approving a bill to establish a state-controlled Bitcoin reserve, signaling growing legislative acceptance of Bitcoin as a long-term reserve asset. Bitcoin was last at $111,439 after nearing $112,000 earlier; the next psychological level to watch is $115,000. ([email protected])0527 GMT - ​LPL Financial prefers a neutral view on fixed-income assets in the short term due to opposing forces between persistent inflation and slowing growth, says portfolio strategist George Smith in a note. "The bond market continues to reflect a tug-of-war between sticky inflation and slowing growth," he says. This is accompanied by elevated volatility which is likely to stay, while the yield curve has steepened as long-term rates rise, he says. "Overall, we are neutral [on] fixed income from a tactical perspective," he says. ([email protected])0519 GMT - Singapore is likely to post softer economic growth in 2H, due to trade frictions and weaker business sentiment, DBS senior economist Chua Han Teng writes in a note. The city-state's external-oriented economy faces heightened uncertainties and downside risks from the tariff chaos, he says. "The global economy and financial markets, including Singapore's, remain beholden to the U.S. tariff roller coaster that will likely persist over the coming months," Chua says. Deteriorating external demand will hurt outward-oriented sectors, particularly trade-related firms. The trade policy-related economic uncertainty could also weigh on business investment, hiring decisions as well as consumer confidence, Chua adds. DBS maintains its 2025 GDP growth forecast for Singapore at 2.0%.([email protected])0517 GMT - A common problem across developed markets when it comes to dealing with ballooning budget deficits is the short-term nature of politics, says Pepperstone's Michael Brown in a note. "The short-term nature of politics and electioneering discourages anyone from making the tough and unpalatable choices needed to put the fiscal backdrop on a more sustainable footing," the senior research strategist says. While developed market nations can borrow with ease, they will continue to spend with the same ease too, he says. ([email protected])0506 GMT - The victory of South Korea's opposition Democratic Party in the upcoming June 3 presidential election, could lead to faster economic growth in the short term, Citigroup analysts write in a note. The analysts point to the party's combination of aggressive industrial policies and expansionary fiscal policies. However, these short-term economic benefits could have long-term economic costs, including a larger-than-expected government debt, they say. In a separate note, Citi says it expects Lee Jae-myung, the left-wing candidate leading the presidential race, to widen fiscal deficit to spur growth, if elected president. Citi notes that the candidate emphasizes government-led growth through larger spending and direct intervention. ([email protected])0450 GMT - Maybank has turned more positive on Indonesia rupiah, its FX analysts say in research report. Among the factors in favor of IDR is improving inflows into Indonesian bonds, which could persist, the analysts say. There can still be more Bank Indonesia rate cuts this year and this would help improve appetite toward Indonesian bonds, the analysts say. Other factors are gradual diversification out of U.S. assets into other countries' assets and improved appetite for Indonesian equities. Maybank maintains its view for USD/IDR's downward trajectory, forecasting the currency pair at 16,250 for 3Q, 16,150 for 4Q, and 16,000 for 1Q 2026. USD/IDR is down 0.2% at 16,324.30. ([email protected])0336 GMT - Singapore's CPI likely rose 0.8% on year in April, according to the median estimate of seven economists surveyed by The Wall Street Journal. That would be slightly lower than March's 0.9% increase. Nomura analysts say falling petrol prices likely weighed on the headline inflation print, while Barclays pointed to a high base a year earlier. Core CPI likely rose 0.6% in April, up from March's 0.5% increase, according to six of the economists polled. The expected pickup in core inflation is due to a hike in water tariffs, Nomura says in a note. The CPI data are due Friday. ([email protected])0333 GMT - The Singapore dollar is steady against its U.S. counterpart in the Asian session, supported by U.S. fiscal-deficit concerns. President Trump has continued to insist on proceeding with his "big beautiful" tax bill, Maybank analysts note in a report. A passing of this bill may risk further pressure on U.S. assets, including the U.S. dollar, the analysts say. "The greenback has also been weighed down by speculation on the U.S. seeking a weaker dollar in trade talks," the analysts add. USD/SGD is little changed at 1.2886. ([email protected])0310 GMT - Super-long JGB yield curve is steepening on the back of supply-demand worries, Mitsubishi UFJ Morgan Stanley Securities' Takahiro Otsuka says in a research report. Japanese investors are unlikely to lead any easing of these worries, the senior fixed income strategist says, noting demand from domestic investors, primarily life insurers, has been sluggish in recent years. Also, while foreign investors have been large net buyers since the start of 2025, it's difficult to expect more demand from these investors, at least in the near term, the strategist says. There's a strong possibility that these investors are now carrying unrealized losses, the strategist adds. The 20-year JGB yield is 2bps higher at 2.560%; 30-year yield is up 1.5bps at 3.150%; 40-year yield is 1.5bps higher at 3.630%. ([email protected])0304 GMT - Bank Indonesia is expected to cut its policy rate by another 25 bps in 3Q, bringing the policy rate to 5.25% and holding steady through the year-end, UOB economists Enrico Tanuwidjaja and Vincentius Ming Shen say in a note. Further easing in 2026 may be possible, depending on whether inflation stays within the central bank's target as well as rupiah stability, they say. UOB sees Bank Indonesia's latest 25bps cut as a move to support credit growth amid global uncertainties and slower domestic expansion. ([email protected])0233 GMT - Surging super-long JGB yields reflect structural lack of Japanese private-sector demand, two members of Barclays' FICC Research say in a research report. Position adjustments and long-term fiscal worries may also be contributing to the yield surge, the two members say. Until structural supply-demand improves, the super-long sector is unlikely to stabilize, they say. Amid the absence of sufficient demand from private investors, any adjustments to the BOJ's quantitative tightening and/or JGB issuance will probably "take the spotlight," the members say. 20-year JGB yield is 2 bps higher at 2.560%, 30-year yield is up 1.5 bps at 3.15%, and 40-year yield is 1.5 bps higher at 3.630%. ([email protected])0230 GMT - Indonesia's central bank is expected to continue monetary easing contingent on a stable rupiah and steady market sentiment, CIMB economists say. They see 25bps cuts in both 3Q and 4Q, bringing the policy rate to 5.0% by end-2025. Bank Indonesia's recent rate cut was an opportunistic move to support the country's diminishing growth momentum, amid a firmer rupiah and benign inflation, they say in a note. While there is room for further easing, CIMB cautions that future decisions will be "highly dependent on conditions being right", namely on the rupiah's stability and financial market clarity. ([email protected])