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FOREX-Dollar slides vs yen, euro on soft U.S. services data

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… U.S. services sector growth slowed in December

…Euro helped by data ahead of ECB meeting
…Yen firms as stock markets fall
…Market focus on U.S. Fed minutes, monthly non-farm payrolls data

NEW YORK – The dollar fell from one-month highs against the euro and slid to two-week lows against the yen in light trading on Monday as weaker-than-expected data on the U.S. services sector reflected slowing growth at the end of last year.

The greenback’s losses accelerated after separate readings showed U.S. services sector growth slowed in December, pointing to an economy that continues to expand, but at a modest pace.

“The dollar’s quick dash out of the gates this year encountered a few speed bumps on cooler U.S. services growth last month and caution ahead of risk events this week involving the Federal Reserve and the government’s monthly jobs report,” said Joe Manimbo, senior market analyst, at Western Union Business Solutions in Washington.

Data showed that the pace of growth slowed for a second straight month in December, with business activity expanding at a lower rate and new orders contracting, according to the Institute for Supply Management.

dollarSeparately, financial data firm Markit said its services sector Purchasing Managers Index dipped to 55.7 from 55.9 last month.
The reports affirmed expectations that the U.S. central bank will pare its monthly bond purchases at a gradual pace this year.

New orders for U.S. factory goods, however, rebounded in November, adding to signs of strong economic momentum in late 2013.
Trading was light at the start of this week as the Fed’s December meeting minutes, due on Wednesday, could hint at the timing and pace of any further reductions in stimulus and set the pace for trading in the early part of the year.

Friday will bring the U.S. non-farm payrolls report for December, which could shed light on whether domestic job growth is strong enough for the Fed to continue tapering its asset buying.

The dollar index, which tracks the greenback against a basket of six major currencies, last traded down 0.2 percent at 80.668 after hitting 80.910 earlier in the global session – its highest since Dec. 4.

The euro benefited from positive euro zone data that suggested the European Central Bank will not loosen policy further anytime soon.
The euro recovered from a one-month low to trade 0.33 percent higher at $1.3630, finding support as euro zone sentiment hit its highest in nearly three years.

The euro was down 0.3 percent at 142.02 yen. The euro zone Composite Purchasing Managers Index, which gauges how thousands of manufacturing and services companies fare every month, rose to 52.1 in December, in line with forecasts, with readings above 50 indicating growth.

The upbeat euro zone data came ahead of the European Central Bank’s first policy meeting of 2014 on Thursday. While another rate cut after November’s surprise move is seen as unlikely, the bank has the ability to issue further cheap loans to banks.
“The big question is whether the recovery in the euro zone is real or sustainable. This indicates at least it isn’t faltering,” said Marshall Gittler, head of global FX strategy at IronFX Global in Limassol, Cyprus. “There’s no need (for them) to come out with a sudden move.”

The yen, meanwhile, pulled away from recent five-year lows versus the dollar and the euro as a fall in global stocks prompted traders to buy the safe-haven Japanese currency.

Asian shares led global stocks lower after growth in China’s services sector slowed sharply last month.

The Nikkei and the yen – the weakest major currency of 2013 – tend to move in opposite directions.
“Are we seeing market positioning adjustments or are we seeing a technical reversal?” said Marc Chandler, chief global currency strategist at Brown Brothers Harriman & Co. “I think this is largely market positioning and adjusting of positions.
There’s no fundamental catalyst for this.” The dollar was last down 0.5 percent to 104.26 yen, according to Reuters data. That was the largest daily percentage drop since October.

– REUTERS

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Bitcoin Hits Record High Of $91,705

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Bitcoin surpassed the $91,000 mark for the first time on Wednesday, continuing its postelection momentum as traders digested the latest U.S. inflation data.

The cryptocurrency climbed over 2% in trading, reaching a high of $91,705.

READ ALSO: Massive Blaze Ravages Eco Fitness Hub In Abuja

The surge came after the October Consumer Price Index (CPI) report showed prices increased by 0.2%, bringing the annual inflation rate to 2.6%, a result that was largely in line with analysts’ expectations.

The steady inflation data fueled investor confidence in assets like Bitcoin, which is often viewed as a hedge against inflation due to its limited supply.

Bitcoin’s recent rally has coincided with a broader uptick in risk assets since the U.S. presidential election.

Investors seem optimistic that fiscal policies under the new administration could drive further growth in the crypto market, though some remain cautious about inflationary pressures.

Other major cryptocurrencies followed Bitcoin’s upward trajectory.

Ether and Solana both saw gains of around 1%.

Dogecoin, meanwhile, soared by 8%, building on its postelection boost.

The meme-inspired token has seen increased attention following the news that Tesla CEO Elon Musk played a role in President-elect Donald Trump’s campaign and has join his administration,

Analysts say that this shift could continue as inflation and fiscal policy debates evolve in the months ahead.

 

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How Oil Cabals Crippled Govt Refineries, Now Scheming Against Dangote Refinery – Pastor Adeboye

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The General Overseer of the Redeemed Christian Church of God (RCCG), Pastor Enoch Adeboye, has urged Nigerians to pray for divine intervention in the face of efforts by unscrupulous oil marketers to thwart the operations of the Dangote Petroleum Refinery, following the previous sabotage of Nigeria’s four state-owned refineries.

The respected clergyman made the call for nationwide prayers during the November 2024 Abuja Special Holy Ghost Service themed ‘Total Restoration’, in Nigeria’s capital city.

Though Pastor Adeboye did not explicitly name the Dangote Petroleum Refinery, many read his remarks to have echoed ongoing attempts by oil marketers to prevent the refinery from functioning as it was designed to.

ALSO READ: FIRS Names Dangote Group Most Tax Complaint Business

With the Ibeju-Lekki, Lagos based Dangote Refinery about the only facility currently refining petrol in Nigeria, many read Pastor Adeboye’s comments to reflect the dispute between the refinery and oil marketers, who seek to continue importing refined products.

Pastor Adeboye reminded the congregation that it was God who raised Aliko Dangote to establish a refinery after years of failed attempts to revive Nigeria’s four public refineries, which had consumed billions of Naira with little result.

He questioned the persistence of fuel imports despite Nigeria’s status as a major crude oil producer.

“Are we under a curse?” he asked. “We have four refineries, we poured all kinds of money into them, none of them is working. But God raised someone to build a refinery that works. He is not my relative, he is not from my village. He is not even a Christian, but he is a Nigerian who says, ‘Why should my people suffer when I have the means to build a refinery that can work?’ Now he is refining petrol, and some people want to stop him from selling it, so they can keep importing.”

Pastor Adeboye also pointed out the damage caused by the fuel subsidy, describing it as a significant drain on Nigeria’s resources, contributing to the country’s mounting debts and corruption.

He stressed that when President Bola Ahmed Tinubu announced the end of the subsidy in 2023, Nigerians largely welcomed the decision, but oil marketers, who benefitted from the subsidy regime, were furious.

The marketers, according to the renowned pastor, appear to have gone into alliances with some International Oil Companies (IOCs) and other powerful interests to obstruct the Dangote Petroleum Refinery. This includes restricting access to crude oil, forcing Dangote to import crude from countries like the United States, among others.

He called for prayer for the total restoration of the country, noting that the Nigerian people are suffering the consequences, as the prices of essential goods have soared, pushing many items beyond the reach of ordinary citizens. “The masses are the ones suffering because these marketers, who are bent on keeping imports alive, already have more money than they can ever spend,” he said.

Despite the Dangote Petroleum Refinery’s capacity to meet Nigeria’s entire demand for petroleum products – and even to export surplus fuel – oil marketers continue to pressurise the government to allow ongoing petrol imports. This has placed additional strain on the Naira, which has continued to depreciate.

Recall that the Crude Oil Refineries Owners Association of Nigeria (CORAN) had urged the government to protect local refineries from unfair competition posed by importers and international petroleum traders, in line with provisions in the Petroleum Industry Act (PIA).

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Petrol Prices To Drop As IPMAN, Dangote Strike Supply Deal

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In a major development for Nigeria’s oil market, the Independent Petroleum Marketers Association of Nigeria (IPMAN) has secured an agreement with Dangote Petroleum Refinery to begin lifting petroleum products, directly, for distribution in the domestic market.

This agreement aims to stabilize and potentially lower pump prices for consumers by ensuring a consistent supply of refined products like Premium Motor Spirit (PMS), Automotive Gas Oil (AGO), and Dual-Purpose Kerosene (DPK) directly from the refinery.

Announcing the deal, IPMAN’s National President, Abubakar Garima, highlighted the economic benefits of this collaboration. “The new arrangement with Dangote Refinery will ensure a steady and ceaseless supply of PMS products all over Nigeria at an affordable rate,” Garima stated at a press briefing in Abuja.

This move is expected to reduce the influence of middlemen, cut costs, and enhance price stability in the oil sector, a vital aspect of Nigeria’s economy.

READ MORE: U.S. Offers $25,000 Reward For Nigerian Fugitive Wanted For Alleged Child Murder

The agreement follows recent challenges faced by IPMAN, which, despite paying a substantial sum of N40 billion to the Nigerian National Petroleum Company Limited (NNPCL), struggled to source refined products. In response, Dangote officials had previously remarked that though the refinery held ample stock, marketers had yet to make adequate payments. However, Garima’s remarks reflect optimism that this direct deal will foster smoother operations.

Energy expert Kelvin Emmanuel has suggested the deal could significantly reduce overheads for IPMAN, potentially eliminating certain financing and margin costs previously incurred through NNPCL, bringing down the overall cost per metric tonne of petroleum.

Additionally, IPMAN’s support for the Federal Government’s Compressed Natural Gas (CNG) initiative signals a shift towards diversifying energy sources. The association has called on its members to prepare for CNG infrastructure at their stations, anticipating that CNG will play a vital role in rejuvenating Nigeria’s energy landscape.

With this new arrangement, IPMAN and Dangote aim not only to enhance petroleum accessibility but also to contribute to economic growth and job creation. Garima also emphasized the importance of IPMAN members backing this deal, aligning with the government’s broader goals for energy stability and affordability, especially as Nigeria seeks to lessen its reliance on imports.

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