Forex - Dollar hits 8-year highs against yen

The broadly stronger dollar rose to eight-year highs against the yen on Tuesday, boosted by the view that the Federal Reserve is on track to raise interest rates later this year.

USD/JPY hit highs of 122.68, the most since July 2007 and was last at 122.49, up 0.77% for the day.

 

The greenback strengthened across the board after Fed Chair Janet Yellen reiterated Friday that the bank still expects to start raising interest rates later this year if the economy continues to improve as expected.

She also attributed a slowdown in first quarter growth to "transitory factors", including a harsh winter.

The greenback received an additional boost after data showed that underlying inflation in the U.S. rose for a third straight month in April.

The dollar’s gains came as markets reopened following a long holiday weekend, after markets in the U.K., Germany and the U.S. remained closed on Monday.

Investors were turning their attention to U.S. data on durable goods orders later Tuesday for a fresh indication on the strength of the economy.

The euro was at one-month lows against the greenback, with EUR/USD down 0.65% to 1.0906.

The euro remained under heavy selling pressure as the prospect of a Greek default continued to weigh.

Athens has warned that the country would be unable to make a €305 million payment to the International Monetary Fund due on June 5 if a cash-for-reforms deal with its international lenders is not reached by then.

EUR/JPY was at 133.58, not far from one-month lows of 133.09 struck overnight.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at five-week highs of 97.06.

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NYMEX crude oil gains in early Asia as on demand prospects

Crude oil prices gained in early Asia on Tuesday as investors looked ahead to demand prospects from a mildly upbeat economic assessment by the Federal Reserve chief last week.

On the New York Mercantile Exchange, crude oil for July delivery rose 0.17% at $59.90 a barrel.

Chair Janet Yellen said that the prospect for higher rates this year is underpinned by signs of a recovery gathering pace, though she reiterated that any decision would be data driven.

Overnight, crude oil futures declined on Monday, as trade volumes were light with U.K. markets closed for a public holiday and markets in the U.S. remaining shut for the Memorial Day holiday.

According to industry research group Baker Hughes (NYSE:NYSE:BHI) on Friday, the number of rigs drilling for oil in the U.S. fell by only one last week to 659, marking the 24th straight week of declines.

Oil traders have been paying close attention to the shrinking rig count in recent months for signs it will eventually reduce the glut of crude flowing into the market.

However, the rate of decline has slowed in recent weeks, fuelling concerns that some shale oil companies will dial up their output in the months ahead if prices stabilize near current levels.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for July delivery was last quoted at $65.44 a barrel.

Concerns over the prospect of a Greek default continued to dominate market sentiment. Greece’s Interior Minister Nikos Voutsis warned on Sunday that the country would be unable to make a €305 million payment to the International Monetary Fund due on June 5 if a cash-for-reforms deal with its international lenders is not reached by then.

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Malaysia: Shares open lower on Tuesday morning

Malaysia share prices fell on Tuesday morning with the FTSE Bursa Malaysia Kuala Lumpur Composite Index down 6.44 points to 1,760.94 points.

Volume was 34.2 million lots worth RM21.2 million.

Gainers outnumbered losers 109 to 73.

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Malaysia: Stocks open lower on Monday

Malaysia share prices slipped on Monday morning with the FTSE Bursa Malaysia Kuala Lumpur Composite Index down 0.48 points to 1,787.02 points.

Volume was 30.2 million lots worth RM 8.6 million.

Gainers outnumbered losers 89 to 51.

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Oil prices edge up on firm Asian, US demand

[SINGAPORE] Crude oil futures edged up on Monday, buoyed by healthy Asian appetite and demand from the U.S. driving season.

Front-month Brent crude prices had gained 2 cents to US$65.39 per barrel by 0312 GMT. US crude prices were up 14 cents at US$59.86 a barrel. "Global oil demand continues to surprise to the upside, with April data showing no signs of slowdown despite a pick-up in prices," Energy Aspects said.

Japan's customs-cleared crude oil imports rose 9.1 per cent to 3.62 million barrels per day (17.28 million kilolitres) in April from the same month a year earlier, the Ministry of Finance said on Monday.

In China, crude imports hit a record 7.4 million barrels per day in April despite a slowing economy, driven largely by healthy car sales. "We expect Chinese imports to be high in H2 15, potentially averaging 7.5 million barrels per day. This is due to the start-up of 39 mb (million barrels) of commercial storage, five SPR (strategic petroleum reserve) sites and linefill for Kunming refinery-buying for which is ongoing we believe, even though the refinery won't start up till early 2016," Energy Aspects said.

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