· The U.S. dollar fell on Monday after posting its biggest weekly rise this year last week as investors took profits and grew cautious amid news that President Donald Trump’s former campaign manager faces charges of conspiracy against the United States.
Tax cuts were in the spotlight overnight following a Bloomberg report that planned reductions in the corporate tax rate would be gradually implemented. That plan would lower the corporate tax rate by three percentage points each year from the existing 35 percent beginning in 2018.
Following the tax cut news, the dollar was steady at 94.493 after declining broadly against a basket of currencies overnight. That was below levels around the 94.7 handle seen during Asian trade on Monday. Against the Japanese yen, the greenback softened to trade at 113.07.
The day's risk aversion lifted the Japanese yen JPY=, often sought in times of geopolitical uncertainty, against the greenback. The dollar fell to a one-week low against the yen of 113.04 yen.
The euro EUR= gained 0.25 percent against the dollar, bouncing back from a three-month low touched Friday.
· President Donald Trump is likely to pick Federal Reserve Governor Jerome Powell as the next head of the U.S. central bank, a source familiar with the matter said on Monday, prompting investors to push down yields on Treasury notes.
The Republican president, who is considering Powell, current Fed Chair Janet Yellen and three others for the top central bank job, will announce his decision on Thursday, a White House official said separately.
· Benchmark 10-year Treasury notes US10YT=RR were yielding 2.37 percent in mid-afternoon trading on Monday, down from 2.43 percent on Friday.
· The Fed, which is holding a two-day policy meeting this week, has lifted rates twice this year and is expected to do so again in December.
· U.S. consumer spending grows at fastest pace since 2009, savings drop
U.S. consumer spending recorded its biggest increase in more than eight years in September, likely as households in Texas and Florida replaced flood-damaged motor vehicles, but underlying inflation remained muted.
· Tax cuts were in the spotlight overnight following a Bloomberg report that planned reductions in the corporate tax rate would be gradually implemented. That plan would lower the corporate tax rate by three percentage points each year from the existing 35 percent beginning in 2018.
· President Donald Trump's onetime campaign chairman, Paul Manafort was indicted on 12 counts related to hiding foreign payments, including one count of "conspiracy against the United States."
· Spain’s state prosecutor accused sacked Catalan leader Carles Puigdemont of rebellion and sedition on Monday as the former regional president traveled to Belgium with other members of his ousted administration and hired a lawyer there.
· The Bank of Japan is set to keep monetary policy steady and roughly maintain its ambitious price forecasts on Tuesday, pointing to signs of growing strength in the economy that policymakers hope will accelerate inflation towards its elusive 2 percent target.
· China reported Tuesday that its official manufacturing Purchasing Managers' Index for the month of October came in at 51.6 — missing expectations.
Analysts polled by Reuters expected China to post official PMI of 52.0 for October, down from 52.4 in September.
· Brent oil closed on Monday at its highest level since July 2015 and U.S. crude closed at a peak not seen since February on expectations OPEC-led production cuts would be extended beyond March, although such gains are likely to spur more U.S. production.
Brent crude futures LCOc1 settled at $60.90 a barrel, up 46 cents. Brent has gained 9.5 percent in the last 16 trading days.
U.S. West Texas Intermediate (WTI) crude futures CLc1 settled up 25 cents at $54.15 a barrel, highest since Feb. 23, 2017. The U.S. contract has been strong of late as well, gaining 10 percent in the last 16 trading days.
Reference: Reuters, CNBC
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