South Koreas acting President Choi Sang-mok says lifting of short selling ban is on track

February 14, 2025 at 03:18AM South Korea’s acting President Choi Sang-mok announced that authorities will closely monitor financial markets, highlighting concerns over uncertainty driven by U.S. trade policy and global geopolitical tensions. Choi added that officials plan to engage with market participants as they move forward with lifting the stock short-selling ban, which was introduced in November 2023, by the end of this quarter as scheduled. This article was written by Eamonn Sheridan at www.forexlive.com.

Goldman Sachs: Trump’s Trade Strategy Signals Potential Tariffs and Negotiation Leverage

February 14, 2025 at 02:54AM Goldman Sachs analysts indicate that President Trump’s “Fair and Reciprocal Plan” could reshape U.S. trade policies, aligning tariffs, taxes, and non-tariff barriers with those of major trading partners. The firm cites a memo suggesting that while no firm deadline has been set, the administration expects to unveil the plan between April and August. Analysts view the extended timeline as a potential signal aimed at encouraging trade negotiations. The investment bank maintains its outlook, forecasting another 10% tariff on Chinese imports and additional duties on key sectors such as semiconductors, pharmaceuticals, and automobiles from the European Union. Although a broad reciprocal tariff policy remains unlikely, Goldman Sachs notes that a narrower version could emerge, targeting select trading partners later this year. According to the report, Trump’s trade strategy appears to be a tactical effort to apply pressure on trading partners while maintaining flexibility for negotiation, reflecting ongoing U.S. trade policy trends. This article was written by Eamonn Sheridan at www.forexlive.com.

Rubio’s turned around plane drama turned around the USD for a little while also tiny move

February 14, 2025 at 02:36AM The post on Rubio’s return is here: Reports that US Sec State Rubio’s plane on its way to Munich has turned back The initial reports were very sketchy, some sort of problem caused the flight to turn around and head back towards Joint Base Andrews in Maryland. The plane also descended to 10,000 feet, which is often a sign of some of problem with the aircraft.. The latest reports are it was a crack in the windshield and Rubio came back to switch planes. At times of uncertainty about very senior US officials like this the USD can catch a bid, a ‘flight to safety/liquidity” (not a pun) move. Major FX did turn around just a little, the USD rose a bit. There wasn’t much in it. What moved more was gold. I posted earlier on gold, saying it’d have to do some work to get higher than its high earlier this week. Its turned just a touch lower and doing such work now. This article was written by Eamonn Sheridan at www.forexlive.com.

Reports that US Sec State Rubio’s plane on its way to Munich has turned back

February 14, 2025 at 01:48AM US Secretary of State Marco Rubio’s was on his way to Munich for the negotiations on the war in Ukraine, expected to take place on the sidelines of the Munich Security Conference His plane has turned around to head back towards its DC departure point. Not many details at this stage. More: plane has descended to 10,000 feet … this is low and while I an’t an aviation expert the conjecture is it could be some sort of pressurization issue More: Reports now say its a crack in the windshield. Rubio turning back to switch planes. This article was written by Eamonn Sheridan at www.forexlive.com.

PBOC sets USD/ CNY reference rate for today at 7.1706 (vs. estimate at 7.2739)

February 14, 2025 at 01:15AM The People’s Bank of China (PBOC), China’s central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a “band,” around a central reference rate, or “midpoint.” It’s currently at +/- 2%. The previous close was 7.2899 The PBOC has injected 98.5bn yuan in reverse repos via Open Market Operations 7 days at an unchanged rate of 1.5% 183.7bn yuan mature today the net impact is a drain of 85.2bn yuan This article was written by Eamonn Sheridan at www.forexlive.com.

PBOC is expected to set the USD/CNY reference rate at 7.2739 Reuters estimate

February 14, 2025 at 01:02AM People’s Bank of China USD/CNY reference rate is due around 0115 GMT. The People’s Bank of China (PBOC), China’s central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a “band,” around a central reference rate, or “midpoint.” It’s currently at +/- 2%. How the process works: Daily midpoint setting: Each morning, the PBOC sets a midpoint for the yuan against a basket of currencies, primarily the US dollar. The central bank takes into account factors such as market supply and demand, economic indicators, and international currency market fluctuations. The midpoint serves as a reference point for that day’s trading. The trading band: The PBOC allows the yuan to move within a specified range around the midpoint. The trading band is set at +/- 2%, meaning the yuan could appreciate or depreciate by a maximum of 2% from the midpoint during a single trading day. This range is subject to change by the PBOC based on economic conditions and policy objectives. Intervention: If the yuan’s value approaches the limit of the trading band or experiences excessive volatility, the PBOC may intervene in the foreign exchange market by buying or selling the yuan to stabilize its value. This helps maintain a controlled and gradual adjustment of the currency’s value. This article was written by Eamonn Sheridan at www.forexlive.com.

Reserve Bank of Australia expected to cut its cash rate by 25bp on February 18

February 14, 2025 at 12:19AM The Reserve Bank of Australia meet on February 17 and 18. The Statement is expected at 2.30pm local time on the 18th: Reserve Bank of Australia Governor Bullock will hold her press conference an hour later. Via Reuters poll: Reuters poll indicates the Reserve Bank of Australia (RBA) will cut the cash rate to 4.10% on February 18, with 40 of 43 economists predicting a 25 basis point (bps) reduction. Median forecasts project an additional 75 bps of cuts this year, lowering the rate to 3.60% by end-2025. Easing inflation, which fell to 2.4% (within the RBA’s target), and slowing economic growth support the decision to cut rates. Despite moderating inflation, a strong labour market and wage growth reduce the urgency for aggressive cuts. Major banks (ANZ, CBA, NAB, Westpac) expect a 25 bps cut on February 18 and between 50-100 bps in total cuts for 2025. Over 75% of economists foresee another 25 bps cut in Q2, bringing rates to 3.85%. The cash rate is projected to reach 3.60% by September, followed by a pause through early 2026. Unlike other developed economies, apart from Japan of course, the RBA has held rates steady. The first cut is expected next week. I don’t think the RBA would be brave enough to not cut in the face of such overwhelming expectations. This article was written by Eamonn Sheridan at www.forexlive.com.