Economy

(Reuters) – A look at the day ahead in Asian markets.Hold on to your hats, or prepare for lift off? In the end, the much-anticipated release of Nvidia (NASDAQ:NVDA)’s second quarter results on Wednesday is unlikely to push investors to either extreme, but Asian markets on Thursday may still open on the defensive.The AI golden goose and world’s second-most valuable company reported second-quarter revenue of $30.04 billion, beating estimates of $28.70 billion, and forecast third-quarter revenue of $32.5 billion, compared with analysts’ average estimate of $31.77 billion.But that doesn’t appear to have sufficiently impressed investors who have gotten used to Nvidia’s profits, revenue and forecasts smashing forecasts, not just beating them. Nvidia shares fell as much as 3.5% in volatile U.S. after-hours trading, which should weigh on tech stocks and equities more broadly at the open in Asia.Or perhaps when the dust settles a little, investors in Asia will look more favorably on what appears to be a pretty solid set of results?The backdrop to the trading day in Asia on Thursday was already challenging – Wall Street had closed lower before Nvidia’s earnings on Wednesday, with the Nasdaq losing more than 1% and chip stocks down 1.8%, while the U.S. dollar and bond yields climbed higher.The dollar posted its biggest rise since early June, gaining more than 0.5% against a basket of major currencies and declining against emerging market currencies for a second day.The Asia/Pacific calendar on Thursday is extremely light, with only Japanese consumer confidence and capex data from New Zealand likely to pique investors’ interest at all. Investor sentiment towards China remains bleak and Shanghai stocks closed lower on Wednesday for a third day, sliding to their lowest level in six and a half months. Swiss investment bank UBS on Wednesday cut its 2024 GDP growth forecast for China to 4.6% from 4.9%, citing a heavier-than-expected drag on overall economic activity from the property sector slump.More alarmingly, perhaps, it also cut its 2025 GDP growth forecast to 4% from 4.6% and next year’s average inflation rate to 1.0% from 1.4%, indicating China’s economic malaise is likely to deepen rather than lift in the coming year. Top Chinese and U.S. officials, meanwhile, discussed holding fresh talks between Presidents Joe Biden and Xi Jinping in the near future, the two countries said on Wednesday during high-level meetings in Beijing.The discussion occurred during lengthy talks between China’s top diplomat, Wang Yi, and U.S. national security adviser Jake Sullivan held against the backdrop of sharp disagreements between the superpowers, including trade and tit-for-tat tariffs.Progress, or another false dawn?Here are key developments that could provide more direction to Asian markets on Thursday:- Japan consumer confidence- New Zealand capex (Q2)- Germany inflation (August) More

(Reuters) – Social media platform Reddit said on Wednesday it has resolved an issue related to an update that led to an outage affecting thousands of users.”Earlier today we shipped an update that unintentionally impacted platform stability. We deployed a fix and are back up and running,” the company said in a statement to Reuters.Reddit is known for its forums, or “subreddits”, where communities discuss various topics. It primarily relies on advertising for its revenue.Downdetector, which tracks outages by collating status reports from several sources including users, showed over 152,982 reports of outages in the U.S. as of 04:09 PM ET. More

BRASILIA/SAO PAULO (Reuters) – Brazil’s President Luiz Inacio Lula da Silva has picked central bank monetary policy director Gabriel Galipolo to be the institution’s next governor, replacing Roberto Campos Neto whose term ends in December, Finance Minister Fernando Haddad said on Wednesday.”It is a great honor, a significant responsibility, and I am very pleased,” Galipolo told journalists in Brasilia alongside Haddad. His naming had been widely expected.Galipolo’s appointment must be confirmed by the Senate’s economic affairs committee before going to the full Senate for approval for him to take the post in January. Haddad said the Senate will know when “the best moment” to hold Galipolo’s hearing will be.A source with knowledge of the matter, who spoke anonymously, said the Senate hearing is expected to occur on Sept. 10 before the Upper House Economic Affairs Committee.This would allow Galipolo to receive senators’ greenlight before the next monetary policy meeting on Sept. 17-18, aligning with the government’s strategy to increase the significance of his remarks as Campos Neto’s departure approaches.In a press statement, current governor Campos Neto congratulated his successor and stated, “The transition will be carried out as smoothly as possible, preserving the institution’s mission.”Following the announcement, the Brazilian real weakened further against the U.S. dollar, while interest rate futures increased. According to Haddad, the government will now focus on selecting Galipolo’s replacement as monetary policy director, as well as the upcoming nominations for directors of regulation and institutional relations, which must be made by the end of the year.The former second-in-command at the finance ministry, Galipolo is a 42-year-old economist who holds a master’s degree in political economy from the Pontifical Catholic University of Sao Paulo.His close relationship with Lula began in 2021 due in part to his longstanding ties with Luiz Gonzaga Belluzzo – a key Lula adviser and economics professor at Unicamp, a Sao Paulo university known for its unorthodox thinking – with whom Galipolo has co-authored books on economics.Outside of academia, Galipolo is known for his diverse professional background.He served as an economic adviser to the Sao Paulo state government under center-right Governor Jose Serra, became familiar with financial markets as CEO of investment bank Banco Fator and served as an adviser on public-private partnerships.Galipolo’s recent hawkish comments as monetary policy director, in which he stressed that a rate hike is on the table amid an uncomfortable inflation scenario, helped ease asset prices after the Brazilian real suffered a steep decline against the U.S. dollar.The Selic benchmark interest rate is currently at 10.5%.Galipolo’s stance contrasts with his position in May, when he sided with a minority group of central-bank directors chosen by Lula in advocating for a larger rate cut than the one ultimately decided by the majority.The division sparked fears that the central bank would be more tolerant of inflation when Lula holds a majority of seven picks on the nine-member board starting next year.Galipolo has publicly emphasized that Lula respects the independence of the rate-setting committee. At the same time, he has praised the performance of Campos Neto, saying he is “taking a victory lap” at the end of his term.Appointed by former far-right President Jair Bolsonaro, Campos Neto has faced persistent criticism from Lula for what the leader considers high interest rates and politicization of the central bank by the monetary authority head. More

MEXICO CITY (Reuters) -The Bank of Mexico cut its forecast for economic growth this year and next, according to the central bank’s quarterly report on Wednesday, citing weaker foreign manufacturing demand while inflation remains stubborn.The central bank for Latin America’s No. 2 economy now expects 2024 gross domestic product growth of 1.5%, down from a previous forecast of 2.4%, and 1.2% growth next year from a prior forecast of 1.5%.Banxico, as the central bank is known, said it had reduced this forecast due to weaker-than-expected second-quarter growth, noting external demand should remain soft due to expected weakness in U.S. manufacturing as well as fewer public infrastructure projects boosting domestic construction.”We expect the economy to keep growing in the coming quarters, though at a more moderate pace,” bank Governor Victoria Rodriguez said on a call, saying that U.S. manufacturing should recover and help fuel growth next year.Official statistics last week showed that Mexico’s GDP expanded 0.2% in the second quarter from the previous three months, reinforcing a slowdown trend seen since late last year.The monetary authority raised its inflation forecasts and said it sees the balance of risks regarding inflation as biased to the upside, after previously regarding this as balanced.However, it maintained its forecast that both inflation metrics should converge toward its 3% target by the fourth quarter of next year.For this year, Banxico edged up its fourth-quarter core inflation forecast to 3.9% from 3.8%, while headline inflation is expected to hit 4.4% by the last quarter of this year, up from prior guidance of 4%.The central bank pointed to expected price rises affecting produce and energy, as well as stubborn services inflation, which the report said remains high without showing a clear downward trajectory. “We need to break this persistence,” said Deputy Governor Jonathan Heath. “Once services inflation starts to show a clear downward tendency, I would say we would be much closer to winning this battle.” Annual inflation ran at 5.16% in the first half of August, gradually cooling from a two-decade peak in 2022 while remaining stubbornly far from the 3% target.However, the bank said in its report it expects the inflationary environment to allow discussion of further cuts to the benchmark interest rate.Earlier this month, Banxico lowered its benchmark interest rate by 25 basis points to 10.75% in a divided vote, signaling that prices could still rise higher than previously expected. More

The Labor Department provided insight into a recent lapse in which revised payroll data was given out à la carte before it went online.Banks and research firms that serve hedge funds managed to confirm a closely watched economic data point last week as much as 20 minutes before the data was posted online, giving them a possible jump on financial market trading — the latest in a series of lapses at the Bureau of Labor Statistics.Now, details into what happened are beginning to emerge.A technical issue prevented the data, which showed a large downward revision to job growth in 2023 and early 2024, from publishing on the agency’s website at 10 a.m. as scheduled last Wednesday, according to details provided by the Department of Labor.In response, agency technology staff began to load the data onto the site manually. At that point, starting a bit after 10:10 a.m., other bureau staff could see the update on the website — even though it wouldn’t be visible to the public until 10:32 a.m. And bureau staff began replying to people, including those at Wall Street firms, who called or emailed with questions. That enabled some to get access to key data before others.It isn’t clear how many investors got early access to the data, or whether anyone actually traded on the information. The revisions ultimately did not have a huge effect on stock markets. But the fact that Wall Street funds that make money by betting on every minor move in economic data — including reports like this one — managed to get the figures before the public has raised serious questions about what happened.Part of the problem, according to the information provided by the department, is that the payroll revision data was not considered a “news release” like the monthly jobs data and inflation numbers. That data is subject to strict to controls to avoid leaks. Instead, it was considered a “website release,” which has fewer guardrails.The bureau had no backup plan to make sure there was a way to quickly push a website update out to the broader public, such as with prepared social media posts of data highlights.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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$75 per monthComplete digital access to quality FT journalism with expert analysis from industry leaders. Pay a year upfront and save 20%.What’s included Global news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print edition More

$75 per monthComplete digital access to quality FT journalism with expert analysis from industry leaders. Pay a year upfront and save 20%.What’s included Global news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print edition More