NAGOYA (Reuters) – Bank of Japan Governor Kazuo Ueda said on Monday the central bank will keep raising interest rates if economic and price developments move in line with its forecasts.

“The timing for when we’ll adjust the degree of our monetary support will depend on the economic, price and financial outlook,” Ueda said in a speech in the central Japan city of Nagoya, adding that the BOJ will scrutinise various risks including from overseas and market developments.

By Jamie McGeever

(Reuters) – A look at the day ahead in Asian markets. 

Asian markets could be in for a rocky ride on Monday, as rising U.S. bond yields, a surging dollar and a wobble on Wall Street on Friday call into question the wisdom of buying local assets.

Fed Chair Jerome Powell’s comments on Thursday – that the central bank is in no rush to lower interest rates – continue to reverberate around world markets.

The 10-year U.S. Treasury yield on Friday hit 4.50% for the first time in over five months, and Wall Street fell. The Nasdaq lost more than 2% and has fallen four days in a row – the last time it did that was in April.

The MSCI World equity index has also fallen four days in a row, its longest losing streak since the first week of September, while the MSCI Asia ex-Japan index lost 4.35%, its biggest weekly decline since June, 2022.

If that wasn’t enough for emerging market investors, they are having to grapple with an extraordinary rally in the U.S. dollar.

The dollar index last week leapt 1.6%, hit its highest in over a year, and recorded a seventh weekly rise in a row. It is no doubt due for a correction, but momentum is strong and it looks like it will take some bravery and conviction to stand in its way right now.

Goldman Sachs’s emerging market financial conditions index last week spiked to a three and a half month high.

Against that potent mix of strong U.S. economic data, yields and dollar, it’s no surprise emerging markets are struggling. Citing EPFR Global data, strategists at Barclays (LON:BARC) note that emerging market funds have now posted outflows five weeks in a row, with bond fund outflows particularly strong.

Asia’s calendar on Monday is fairly light, with the main highlights likely to be New Zealand producer prices, Singapore non-oil trade figures, Japanese machinery orders, earnings from Mitsubishi UFJ (NYSE:MUFG), and GDP data from Thailand.

Economists polled by Reuters expect Thailand’s growth accelerated to a 2.6% annual rate from 2.3% in the April-June period. That would be the fastest pace of growth in one-and-a-half years.

The Thai baht has been one of the better-performing Asian currencies against the dollar this year, down only 1.3% year-to-date, and markets are expecting less than 50 basis points of Bank of Thailand easing by the end of next year.

Strained U.S.-Sino relations remain in the spotlight, after China’s President Xi Jinping told his U.S. counterpart Joe Biden that the issues of Taiwan, democracy, human rights and rights to development are “red lines” for China and not to be challenged.

But Xi also said China is ready to work with the new U.S. administration to “maintain communication, expand cooperation and manage differences.”

Here are key developments that could provide more direction to markets on Monday:

– Thailand GDP (Q3)

– Japan machinery orders (September)

– G20 summit in Rio de Janeiro begins

MANILA (Reuters) – The Philippine central bank announced the launch on Monday of an interest rate swaps market anchored to a newly established benchmark rate to enhance bond market trading and liquidity.

The start of IRS transactions follows the recognition by the International Swaps and Derivatives Association of the benchmark – the overnight reference rate (ORR) – which the Bankers Association of the Philippines helped establish.

IRS, a fixture of developed fixed-income markets, lets parties manage rate risk or bet on the direction of borrowing costs by exchanging fixed and floating interest rate streams.

The ORR, to be based on the central bank’s daily reverse repurchase auctions, is expected to provide a better benchmark for pricing loans, now based on yields from thinly traded government securities.

“We are excited for PESO IRS to go live to help boost transactions, create a benchmark yield curve, and deepen our capital markets,” central bank Governor Eli Remolona said in a statement. “A benchmark curve will help banks and other lenders price loans at various maturities.”

Sixteen banks have committed to be market makers for the ORR-based IRS, ensuring pricing across maturities from one month to 10 years and enhancing interest rate transparency, the central bank said.

Bangko Sentral ng Pilipinas also said it was working on adopting global master repurchase agreement contracts that will allow banks to access treasury bonds for repo transactions to boost the government securities repo market.

By Asif Shahzad

ISLAMABAD (Reuters) – Pakistan discussed its $7 billion bailout reform agenda with the International Monetary Fund during an unscheduled staff visit last week, Finance Minister Muhammad Aurangzeb said on Sunday, suggesting no new taxes are to be imposed.

The talks in Islamabad came within six weeks of the IMF approving the bailout, an unusual move as it is rare for the fund to discuss reforms ahead of a review of the reform plan under the loan programme.

A first review of Pakistan’s reforms is due in the first quarter of 2025.

“We discussed reforms in taxation, energy sector, privatisation of loss-making state-owned enterprises (SOEs) and public finance,” Aurangzeb said in a recorded video statement broadcast by state-run television.

After wrapping up the visit, the IMF had said it was encouraged by Islamabad’s reaffirmed commitment to the economic reforms under the Extended Fund Facility its board had approved in September to reduce vulnerabilities.

The mission did not state the weaknesses, but sources in Pakistan’s finance ministry have said some major lapses prompted the IMF’s visit.

Among these were a shortfall of nearly 190 billion rupees ($685 million) in revenue collection during the first quarter of the current fiscal year, the sources said.

The period also saw an external financing gap of $2.5 billion, while Pakistan failed in the bid to sell its national airline.

It had prompted fears that Pakistan might need to impose new taxes to bridge the shortfall.

But Aurangzeb said the shortfall will be met only with enforcement to get people to pay their taxes, implying there would not be any new revenue measures.

“We are going to be very firm on compliance and enforcement,” he said, adding that al the sectors will have to play their role in contributing towards the country’s economy.

The IMF said both sides agreed on the need to continue prudent fiscal and monetary policies, and to mobilise revenue from untapped tax bases.

Pakistan’s $350 billion economy has struggled for decades with boom-and-bust cycles, needing 23 IMF bailouts since 1958.

By Md Manzer Hussain

(Reuters) – Most Gulf stock markets fell on Sunday after U.S economic data and comments from Federal Reserve officials pointed to a slower pace of interest-rate cuts.

Investors increased bets on the Fed leaving interest rates unchanged at its December meeting and dialled back expectations for easing in 2025.

The Fed’s decisions have a significant impact on monetary policy in the Gulf as most of the region’s currencies are pegged to the U.S. dollar.

The Qatari benchmark index slipped 0.4%, with almost all of its constituents falling, led by the finance, communication and energy sectors.

Qatar National Bank, the region’s largest lender, lost 1.4% and Qatar Navigation was down 1.1%.

Saudi Arabia’s benchmark index snapped three sessions of losses, edging up 0.2% helped by gains in the IT, utilities, real estate, industry, healthcare and insurance sectors.

Medgulf (TADAWUL:8030) rose 10% for its biggest daily gain in more than six months. The insurer said in a statement to the Saudi Exchange that it had received a circular from the Insurance Authority on a new mechanism for allocating reinsurance premiums to the local market.

All bar two insurance stocks closed higher with Al Rajhi Company For Cooperative Insurance up 3.9%, and Saudi Reinsurance gaining 6.9%.

Saudi Re said in a statement that the new mechanism would help increase Saudi reinsurance revenue by more then 5% from 2023.

Outside the Gulf, Egypt’s blue-chip index reversed the previous session’s gain with a 0.7% fall, with most sectors in the red. Telecom (BCBA:TECO2m) Egypt lost 2.6% after it reported a 13% decrease in quarterly net profit on Thursday.

However, Juhayna Food gained 3.7% after it posted around a 200% jump in third quarter net profit.

SAUDI ARABIA rose 0.2% to 11,812

KUWAIT was up 0.2% to 7,849

QATAR lost 0.4% to 10,411

EGYPT dropped 0.7% to 31,252

BAHRAIN ended flat to 2,053

OMAN was down 0.4% to 4,626

Investing.com — The majority of gig workers worked for only one to three months in the past year, according to Bank of America’s recent note.

The report, based on internal deposit account data, finds that nearly half of gig workers earned income from these platforms for just one month over the last year, while 74% worked three months or fewer.

Despite the flexibility and accessibility of gig jobs, these findings suggest that most individuals turn to gig work to supplement spending rather than as a consistent income source.

Bank of America’s aggregated spending data further illustrates this trend. In September 2024, gig workers exhibited a 23% higher median discretionary spending than non-gig workers, while their necessity spending—covering rent, groceries, and other essentials—was only 5% higher.

This discrepancy highlights that many gig workers use these roles to supplement their discretionary purchasing power, such as dining out, travel, and electronics, rather than relying on gig income for day-to-day expenses.

The gig economy’s participation rate among Bank of America’s deposit customers has grown modestly, rising to 3.8% in September 2024 from 2.8% in September 2019. However, its overall scale remains small and stable.

Within the gig categories, ridesharing and social commerce saw a year-over-year uptick.

For social commerce, the annual increase “could be due in part to increased consumer demand for thrifted items bought via social commerce sites, which mirrors the broader trend of consumers trading down on goods in order to spend on experiences,” the report states.

Meanwhile, food delivery participation has slightly declined, possibly reflecting consumer sensitivity to the rising costs associated with delivery services.

The share of income from vacation rentals has been consistently minimal, “likely as rising real estate prices remain a high barrier of entry and international tourism remains strong,” BofA notes.

Another key finding is that gig workers overwhelmingly stick to a single gig platform. Over 92% of gig workers earned income from just one platform in September 2024, a number that has remained stable despite minor increases in the share of workers participating in two or more gigs.

“Overall, the stability in gig employment is likely a good thing for the labor market,” BofA concludes.

“Although it’s not likely to be a major driver of full-time employment, it can be especially helpful for those looking to supplement their household’s spending or for people who need flexible work arrangements.”

By Eduardo Baptista and Lucinda Elliott

LIMA (Reuters) -With Donald Trump’s imminent return to the U.S. presidency looming over the Asia-Pacific Economic Cooperation (APEC) summit in Lima, Chinese President Xi Jinping said on Friday that unilateralism and protectionism needed to be rejected in favour of economic globalization.

Xi’s critique of protectionism at APEC offers a preview of how China will seek to position itself once Trump takes office in January.

Trump has pledged to impose tariffs on Chinese imports in excess of 60% but Beijing and Chinese companies are hoping that his protectionist policies will also irk U.S. allies in Europe and Asia – giving China an opening to increase its global influence and improve trade ties.

In a speech read out to business executives by Chinese commerce minister Wang Wentao on Friday at the APEC CEO Summit, Xi said that economic globalization was facing “countercurrents,” without specifying any particular country or leader.

“The world has entered a new period of turmoil and change, unilateralism and protectionism are spreading, the fragmentation of the world economy has intensified,” Xi said.

“Hindering economic cooperation under various pretexts, insisting on isolating the interdependent world, is reversing the course of history,” he added.

Xi listed a series of recent measures the Chinese government has taken to attract foreign investment, including increasing the number of Chinese industries that can receive foreign investment, as well as unilateral visa exemptions to foreigners visiting China.

“China will implement more independent and unilateral opening-up policies, expand the network of high-standard free trade zones facing the world, and open even further the door into China,” said the Chinese leader, who is due to meet U.S. President Joe Biden on Saturday in Peru.

However, some analysts said that China’s pitch as an alternative or counterbalance to a protectionist Trump-led United States has lost its shine compared to 2016, when Trump was first elected.

Ja Ian Chong, a political scientist at National University of Singapore, said that unlike 2016, there were now widespread concerns in the international community about how Chinese state subsidies to industrial sectors and their resulting overcapacity negatively affect other countries’ economies.

“China is as protectionist as the U.S. might be, its economy is far less open today than it used to be,” Chong said.

BUSINESS PITCH

Xi was accompanied by hundreds of Chinese business executives on his trip to Peru, as Beijing seeks to significantly expand trade ties with resource-rich Latin America.

Several business leaders at the APEC CEO Summit, running alongside the main event, said the Asian presence this year outweighed that of the U.S., Canada and Australia, with the Mexicans notably absent.

One Peruvian businessman quipped how the Chinese “vastly outnumbered” everyone else, motivated by the official visit of President Xi. “The only Americans we saw were those sponsoring like Google (NASDAQ:GOOGL),” he said.

Several Chinese executives Reuters spoke to said the state visit and the inauguration of a Beijing-backed megaport project were a big incentive: “Most businesses like mine in logistics came because the President is here,” said one businessman who had travelled from Shanghai to Lima.

“We get a lot of second hand information, being here in Peru makes a difference,” he added.

Preliminary plans to build an e-commerce distribution center in Chancay to house merchandise from China were discussed on sidelines of the Asia-Pacific Economic Cooperation CEO Summit on Friday, two Peruvian delegates said.

The proposal would transport goods from over 75,000 shops in southern China’s Yiwu, an export hub, to the Pacific port that is expected increase trade between Asia and South America.

SYDNEY (Reuters) -Australia Prime Minister Anthony Albanese said his relationship with U.S. President-elect Donald Trump has had a “very good beginning”, elaborating on a phone call between the pair after the Republican’s U.S. election win.

Albanese this week said he told Trump on the call that the United States has a trade surplus with Australia and it was in Washington’s interest to “trade fairly” with its ally.

Under the first Trump presidency, Australia won an exemption from U.S. tariffs for its aluminium and steel exports.

In remarks broadcast on Sky News on Sunday, Albanese described the call as a “very good beginning to our relationship”.

It was a “positive phone call that we had. We spoke for 10 minutes, it was one of the first phone calls that he made,” the leader of Australia’s centre-left Labor government said, according to a transcript.

Albanese’s call with Trump also covered security ties including the AUKUS deal, which will see Australia buy U.S. nuclear submarines next decade and develop a new class of nuclear powered submarines with the U.S. and Britain.

Australian Foreign Minister Penny Wong said this month that the government was confident of its alliance with the United States, its biggest security partner.

One potential issue for the government is the relationship between the incoming administration and Australia’s ambassador in Washington, former Labor Party prime minister Kevin Rudd, who previously made disparaging comments about Trump in his capacity as the head of a U.S.-based think tank.

Albanese, asked if Rudd would stay in the role, said he was doing “a terrific job” and would remain.

“He is Australia’s appointment and it says something about the importance of the United States that we have appointed a former prime minister,” Albanese told the Australian Broadcasting Corp., according to a transcript on Sunday.

BEIJING (Reuters) – China’s President Xi Jinping told his U.S. counterpart Joe Biden that the issues of Taiwan, democracy, human rights and rights to development are “red lines” for China and not to be challenged, the official state media Xinhua said on Sunday.

Xi warned the United States not to get involved in bilateral disputes over islands and reefs in the South China Sea or “aid or abet the impulsion to make provocations” in that region, it said.

China and United States would roil or even see relations take a setback in rivalry with each other, but could make considerable progress by treating each other as partners and friends, Xi told Biden on the sidelines of the Asia-Pacific Economic forum summit in Peru, according to Xinhua.

LONDON (Reuters) – A senior economic adviser to U.S. President-elect Donald Trump has said Britain should align itself with the United States on trade rather than pursue closer ties with the European Union.

Speaking to BBC radio, Stephen Moore said the EU had a “socialist model” and suggested the U.S. would be less interested in a free trade deal with Britain if the government put its economic relations with the EU ahead of those with the U.S.

“The UK is kind of caught in the middle of these two forms of economic model and I believe that Britain would be better off moving towards more of the American model of economic freedom. And if that were the case, I think it would spur the Trump administration’s willingness to do the free trade agreement with the UK,” said Moore.

Bank of England Governor Andrew Bailey on Thursday urged Britain’s new Labour government to rebuild ties with the EU.

While the government has ruled out rejoining the EU’s single market or customs union, Prime Minister Keir Starmer has said he wants to improve trade ties and diplomatic relations with the bloc.

Finance minister Rachel Reeves, speaking just before Bailey at the same event, said Britain needed to “reset” its relationship with the EU, and that she also looked forward to working closely with Trump to strengthen trade ties.

While Bailey did not refer directly to the U.S. election in his speech, policymakers around the world are still digesting Trump’s victory and the prospect of double-digit tariffs on goods imported by the United States.