Aurelia Butler

Spending on new energy vehicles (NEVs) should also be supported, said Meng Wei, spokeswoman for the National Development and Reform Commission (NDRC).Data on Monday showed March retail sales contracted the most on an annual basis since April 2020 due to widespread COVID-19 curbs across the country. More

ORLANDO, Fla. (Reuters) – Hedge funds remain bullish on the dollar, holding a net long dollar position in currency futures markets for more than nine months. But remove the Japanese yen from the equation, and the picture is much more blurred.U.S. futures market data show that speculators trimmed the value of their overall long dollar position against a range of currencies for a second week, but increased their net short yen position to the largest in three and a half years. Indeed, there are only a handful of periods since Commodity Futures Trading Commission (CFTC) yen futures contracts were launched in 1986 where funds have been more bearish on the Japanese currency than they are right now.The latest CFTC data for the week ending April 12 show that funds increased their net short yen position to 111,827 contracts from the previous week’s 103,829. That is the biggest since October, 2018. As the following chart shows, it is approaching historic levels.CFTC Funds’ Yen Position https://fingfx.thomsonreuters.com/gfx/mkt/egvbkenobpq/CFTCYEN2.jpgDollar/Yen Vs CFTC Positions https://fingfx.thomsonreuters.com/gfx/mkt/zjvqkmqylvx/CFTCYEN1.jpgThe size of that bet against the yen in dollar terms is large, but not quite as extreme. It stands at $11.15 billion, the biggest since November last year and up from $10.5 billion the week before. Buying dollars and selling yen has been the one FX trade that speculators have got spectacularly right this year, as the divergence between U.S. and Japanese interest rates and bond yields in the dollar’s favor has exploded. The Federal Reserve is in the early stages of what is shaping up to be the most aggressive inflation-busting cycle of interest rate rises since 1994. The Bank of Japan, meanwhile, is sticking with its massive stimulus program to support a fragile economic recovery.US-Japan 2-Year Yield Spread https://fingfx.thomsonreuters.com/gfx/mkt/movanomqxpa/USJP2Y.pngThe dollar made a fresh 20-year high last week above 125.85 yen and on Monday it nudged 127.00 yen, lifting the broader dollar index to a two-year peak. Japanese policymakers have voiced disquiet about the yen’s decline. But it may require more than well-intentioned words to stop the rot. “The prospects of a change in the yen’s depreciation trend will ultimately be determined by U.S.-Japan monetary policy divergence and, hence, global inflation trends,” Barclays (LON:BARC) analyst Shinichiro Kadota wrote on Monday. Selling pressure on the yen should persist in the near term, he added. Hedge funds’ stance on the dollar against other currencies, however, is much more mixed. The latest CFTC data show that they trimmed their bets on a stronger dollar against a range of six major currencies, including the yen, to $13.22 billion from $14.136 billion. That reduction was mostly driven by the euro.Funds increased their net long euro position by 11,690 contracts to 39,060 contracts, an aggregate bet worth $5.285 billion. That is funds’ most bullish euro view in five weeks.CFTC Dollar, Euro Positions https://fingfx.thomsonreuters.com/gfx/mkt/gkvlgkmlnpb/CFTCEUR.jpgBut it isn’t paying off. The euro last week fell to a one-year low of $1.0756 after comments from European Central Bank (ECB) President Christine Lagarde were viewed as a sign that the ECB was in no rush to match the Fed in raising interest rates.A growing number of analysts are now predicting that the euro could fall towards parity with the dollar in the months ahead. That’s not something funds are positioning for. Related columns: Euro FX reserve demand returns after years of neglect (Reuters, April 13) ‘Japanification’ still lurks behind hawkish Fed frenzy (Reuters, March 29)That rare crisis, when the yen falls (Reuters, March 15) (The opinions expressed here are those of the author, a columnist for Reuters) (By Jamie McGeever; Editing by Kenneth Maxwell) More

(Reuters) – The company behind a cannabis mega-factory in California is hoping federal legalization of the substance will allow it to expand distribution of joints, oils and edibles beyond the borders of the most populous U.S. state.California legalized recreational cannabis in 2016, but it remains on the federal list of controlled substances.The U.S. House of Representatives passed a bill on April 1 to end the federal ban on marijuana, though the measure is seen as unlikely to pass the Senate.Joshua Krane, vice president of operations for cannabis operator 4Front, said the company’s 170,000-square-foot (15,793 square meter) manufacturing and processing space outside of Los Angeles has the capacity to supply the U.S. west coast with cannabis products, if restrictions are lifted”This facility was designed to really be future-proof for us in terms of being able to service not just the entire California market, but once we have the ability to transport cannabis and sell cannabis across state lines, to be able to really feed the West Coast of the country,” he said.The factory, which opened in November 2021, is operating at 20-25% of capacity, Krane said.”As we see the natural ramp-up of the industry, that will likely meet an additional demand curve as we get into federal legalization,” he added. “And so we would continue to ramp up more and more production from this building as the state and hopefully this side of the country would require.”Krane said the highly automated facility is the largest in California. It manufactures both in-house and partner brands, including oils, tinctures and several types of candies.Edible items are the most popular, and demand has soared since the coronavirus pandemic began in 2020, Krane said.”It’s been somewhat difficult to keep up with the additional demand in terms of manufacturing enough for those new customers. There’s been a tremendous pivot from alcohol and other vices to cannabis.”In March 2020 as lockdowns went into effect, sales of recreational cannabis across key U.S. markets rose almost 50% from a year earlier, according to cannabis point of sale and data platform Flowhub.With a machine that can roll 2,000 joints per hour and a kitchen capable of producing 400,000 pieces of candy in a single shift, the factory in Commerce, California, is ready for the demand to continue. More

WELLINGTON (Reuters) -New Zealand central is bank focused on constraining inflation expectations and expects to put into effect more interest rate increases in coming quarters, the country’s top policymaker said in a speech released on Tuesday.Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr said there was a risk that if the central bank increased interest rates too slowly then inflation expectations could get away from them. “At the moment, the risks as far as the Monetary Policy Committee is concerned, is very much weighted toward constraining those inflation expectations in the medium term to be within the target range,” he said in a recorded interview with the International Monetary Fund.The central bank raised interest rates by a hefty 50 basis points to 1.50% last Wednesday, its fourth hike in a row. It expects annual inflation to peak around 7% in the first half of this year, well above its 1-3% target, underlining the urgency to temper price-setting behaviour.Orr added that the bank had to balance inflation expectations with concerns that if interest rates rose too fast or too far it ran the risk of having a sharp slowdown in economic activity.Although New Zealand’s central bank has been aggressive in its cash rate hikes to date, Orr said that the decision to lift the cash rate by 50 basis points in the April meeting was “about doing it sooner rather than believing we have to do more.”He said the central bank remain focused on low and stable inflation and contributing to maximum sustainable employment, and while house prices were not specifically part of their remit they did contribute to inflation.”House prices were well above any measure of sustainable and our actions have been bringing house prices back towards a sustainable level,” he said.House prices have come off slightly in the first quarter of 2022 and the market is expecting further falls in the coming months.At the February meeting the RBNZ announced plans to wind down its NZ$50 billion bond holdings acquired under the Large Scale Asset Purchase (LSAP) programme, through both bond maturities and managed sales.Orr said this was about creating fiscal headroom for the future if needed.”Quantitative easing has had its moment for now,” he added. More