Nzd/usd: Still Seems Weak – Uob Group

The GBP/USD pair trades with caution below the crucial resistance of 1.3100 in Wednesday’s London session. The Cable remains under pressure as the US Dollar (USD) extends its upside, with traders pricing out another Federal Reserve (Fed) 50 basis points (bps) interest rate cut in November.

The market sentiment remains risk-averse amid escalating tensions between Israel and Iran. S&P 500 futures have posted some losses in European trading hours. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, strives to rally further above 102.70.

Market participants are not expecting the Fed to reduce interest rates again with a larger-than-usual pace of 50 bps as risks of a United States (US) economic slowdown have diminished after the release of the upbeat labor market data for September, which showed robust job growth and stronger-than-expected wage growth momentum.

In Wednesday’s session, investors will focus on the Federal Open Market Committee (FOMC) minutes for the September meeting, which will be published at 18:00 GMT. In the policy meeting, Fed officials unanimously voted to reduce interest rates by 50 basis points (bps) to 4.75%-5.00%, except Fed Governor Michelle Bowman, who supported a usual rate cut of 25 bps.

In the United Kingdom (UK) region, the Pound Sterling (GBP) will be guided by market expectations for the Bank of England’s (BoE) interest rate outlook for the remainder of the year. The BoE is expected to cut interest rates again by 25 bps in one of its two meetings remaining this year. On the economic front, investors will focus on the monthly Gross Domestic Product (GDP) and the factory data for August, which will be published on Friday.

Source: FXSTREET

Malaysia's Ministry of Agriculture and Food Security will establish the separation of powers among relevant agencies, and introduce new regulations to strengthen the country's paddy and rice sector.

Its Minister Datuk Seri Mohamad Sabu, who is known as Mat Sabu, said the separation of powers would involve the paddy industry development division, rice regulatory division, and government representatives in Padiberas Nasional Bhd (Bernas).

“We are separating those involved in the paddy industry, so that there will be no accusations that an unit head is ‘wearing one hat for two tasks’. This time, it will be ‘two hats for two tasks’, and this decision was made after an extensive and lengthy engagement with all parties.

“Currently, paddy and rice development, and the enforcement division are under one director. Now, they are going to be separated,” he said at a press conference after the ministry's monthly assembly here on Wednesday.

On the new regulations, he said a circular prohibiting the mixing of local white rice with imported white rice will be introduced, with the circular expected to be issued soon.

Mohamad said his ministry had also introduced a new calculation basis for the country’s self-sufficiency rate (SSR) and per capita consumption (PCC) of rice, in line with the standards set by the Food and Agriculture Organization of the United Nations, starting from this year.

“Through this new method, the ministry determined the calculation basis for paddy production in 2023 by only taking into account the amount of clean paddy to be processed into rice,” he said, adding that the calculation does not include the amount of paddy set aside for seed purposes for the same year.

With the adjustment in the methodology for calculating the SSR and PCC of rice using the new method in 2023, the country’s SSR for rice stood at 56.2%, slightly lower compared with 57.9% in 2022.

“A more detailed announcement regarding the new calculation method for the country’s SSR for rice will be made on Friday,” he said.

Commenting on Sarawak’s commitment to the paddy industry, he said the state is allocating RM500 million to increase paddy and rice production, which should be emulated by other states.

“This is because the effort to increase the country’s SSR for rice is not solely the ministry's responsibility, we also require strong support and cooperation from all parties,” he said.

In July, Sarawak Premier Tan Sri Abang Johari Tun Openg announced that RM500 million had been approved for a paddy irrigation scheme in 2025, with allocations for paddy planting areas in Sri Aman, Kuching, and Samarahan.

In another development, Mohamad said his ministry is also focusing on increasing the SSR of meat, which is still below 20%, as the country is still reliant on imported meat from several countries.

He said a special committee, chaired by ministry secretary general Datuk Seri Isham Ishak, would be formed to address the matter, with a strategic plan expected to be formulated by the first quarter of 2025 to improve the country’s meat SSR.

On Budget 2025, Mohamad said his ministry had submitted 32 initiative proposals to the Ministry of Finance to strengthen the food supply chain management, in order to ensure a more organised and structured supply for all levels of society.

Source: The edge markets

 Abu Dhabi has claimed the top spot in a new global ranking of cities based on the capital managed by their sovereign wealth funds, with US$1.7 trillion (S$2.2 trillion) in assets as at October.

This positions the United Arab Emirates’ capital as the largest hub for sovereign fund capital, according to a report released by Global SWF on Oct 8.

The ranking – which for the first time assesses sovereign fund assets at the city level – places Abu Dhabi ahead of Oslo, Beijing and Singapore.

Singapore, home to GIC and Temasek – ranks fourth, managing over US$1.1 trillion in such assets. The Singapore government does not publicly disclose the full size of its reserves managed by GIC.

The report noted that Abu Dhabi’s funds include multiple entities, such as the Abu Dhabi Investment Authority (Adia), Mubadala Investment Company, and ADQ.

These funds are managed under separate mandates, allowing the city to maintain distinct investment strategies, the report said.

Combined, the three institutions have invested US$36 billion globally in the first three quarters of 2024, accounting for 26 per cent of all sovereign fund investments in that period.

“Sustained high oil prices have meant healthy fiscal surpluses for Abu Dhabi since 2020, when it experienced its last stress test,” the report said.

“According to Fitch’s forecasts, if things stay the way they are, the emirate will benefit from US$60 billion in surplus in the next two years – which would flow into the already massive Adia.”

In addition to its financial assets, Abu Dhabi also leads in human capital employed by its sovereign wealth funds, with 3,107 personnel across institutions, according to the report.

Other major cities, including Singapore, Riyadh, Kuala Lumpur and Dubai, follow closely, with each employing more than 1,000 staff within their respective funds.

Globally, sovereign wealth funds managed a total of US$12.5 trillion in assets. Six cities – Abu Dhabi, Oslo, Beijing, Singapore, Riyadh and Hong Kong – account for over two-thirds of this total, the report found.

“The world ranking confirms the concentration of sovereign wealth funds in a select number of cities, underscoring the significance of these financial hubs on the global stage,” said Diego Lopez, founder and managing director of Global SWF. 

Source: Straitstimes

Market picture

The cryptocurrency market has stabilised around the $2.17 trillion level where it was a week and a day ago. The sentiment index has remained in the 49-50 (neutral) range for the fifth day, which contrasts with the near ‘extreme greed’ sentiment in the stock market. This wariness among crypto investors has often heralded stock market sell-offs. Still, this time, it could be due to sell-offs in China and expectations of new signals on the Fed’s monetary policy.

Bitcoin’s price has changed little over the past 24 hours, remaining at $62.4K, sandwiched between the 200-day moving average above and the 50-day below. Potential triggers to break out of this range could be Fed minutes or US inflation data if they lead to a reassessment of expectations in traditional markets. A technical signal could be a move out of the range delineated by the mentioned moving averages at $63.6K and $60.8K, with the potential for further movement towards a breakout.

News background

According to Bitfinex, Bitcoin’s decline from $66,500 to $60,000 last week is a ‘healthy rebuild’ that reduces the risk of a ‘sudden drop’ in the coming days and weeks.

Matrixport expects that miners’ shares may rise as their revenue stabilises after falling and lagging Bitcoin’s momentum. The daily revenue of publicly traded mining companies fell from $70 million to $31 million after the April 2024 halving.

The US Supreme Court has granted permission to sell 69,370 Bitcoins previously seized from the darknet site Silk Road. US authorities declined to comment on whether they plan to sell the bitcoins on the marketplace.

A court in the US has approved a plan to distribute payments to creditors of the collapsed FTX exchange. About 98% of creditors will receive more than $6.8bn in fiat within 60 days of the plan taking effect.

The Crypto.com exchange filed suit against the SEC after receiving a Wells notice. The agency is using the notice to report violations of the law, which is the basis for the planned civil suit.

According to Politico, Robinhood’s general counsel, Dan Gallagher, is the leading candidate to head the SEC if Donald Trump wins the U.S. presidential election. Other contenders include former CFTC Chairman Chris Giancarlo, SEC Commissioner Hester Pearce and former agency general counsel Robert Stebbins.

Crypto investors mostly favor dollar-cost averaging (DCA) when buying into the market, a survey by crypto exchange Kraken has found.

Around 83.5% of investors had used a DCA strategy, and 59% still use it as their primary way to buy crypto, according to Kraken’s survey of 1,109 crypto investors published on Oct. 7.

Dollar-cost averaging involves buying an asset at regular intervals, such as once a month, regardless of price — which Kraken’s researchers claimed can “reduce the impact of short-term price volatility and remove emotions that can cloud judgment.”

Over 46% of those surveyed said the biggest advantage to DCA is hedging against market volatility, while around a third believed it supported consistent investment habits. About 12% said DCA removed emotion from trading.

The reasons for a DCA strategy change depending on income. Those earning less than $50,000 said the biggest benefit of the strategy was that it encouraged consistent investment habits.

Those earning over $50,000 pinned reducing the impact of market volatility as a greater advantage — especially for respondents earning between $175,000 to $199,000, where nearly seven in ten believed reducing market volatility impact was the biggest DCA advantage.

However, just over 8% of respondents maintained their strategy when facing losses, with the researchers adding that those using other investment strategies “were more likely to stay the course during market turbulence.”

“Our survey found that the more an investor earns, the more confident they are about sticking to their investment strategy,” the researchers stated. 

Almost 63% of those with incomes over $100,000 said they have a “very strong” ability to stick to a trading plan when facing market fluctuations. 

The survey found that higher-income investors earning more than $100,000 were more likely to use DCA while lower-income investors — those earning under $100,000 — were more likely to try timing the market. 

Younger investors aged between 18 and 29 also preferred riskier strategies, with half opting to try and time the market.

Kraken noted that older investors aged over 45 kept the closest eye on crypto markets, with two-thirds checking markets more often than traditional investments compared to only a third of those aged 18 to 29 who did the same.

The Kraken team said dollar-cost averaging is “not perfect” but claimed it could reduce the stress of timing the market and offset emotional decision-making.

Source: COINTELEGRAPH

Source: Euronews