U.S. payments giant PayPal Holdings Inc (NASDAQ:PYPL) said it would acquire Japanese buy now, pay later (BNPL) firm Paidy in a $2.7 billion largely cash deal, taking another step to claim the top spot in an industry experiencing a pandemic-led boom.
The deal tracks rival Square Inc (NYSE:SQ)’s agreement last month to buy Australian BNPL success story Afterpay Ltd https://www.reuters.com/technology/square-buy-australias-afterpay-29-billion-2021-08-01 for $29 billion, which experts said was likely the beginning of a consolidation in the sector.
“The acquisition will expand PayPal’s capabilities, distribution and relevance in the domestic payments market in Japan, the third largest ecommerce market in the world, complementing the company’s existing cross-border ecommerce business in the country,” PayPal said in a statement on Tuesday.
Fuelled by federal stimulus checks, the BNPL business model has been hugely successful during the pandemic and has upended consumer credit markets. These firms make money by charging merchants a fee to offer small point-of-sale loans which shoppers repay in interest-free instalments, bypassing credit checks.
The dollar was up on Wednesday morning in Asia, remaining near a one-week high. A weaker euro ahead of Thursday’s policy decision from the European Central Bank (ECB) gave the U.S. currency a boost.
The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.03% to 92.543 by 12:01 AM ET (4:01 AM GMT). It remained just below Tuesday’s high of 92.571, last hit on Sep. 1.
The USD/JPY pair inched up 0.02% to 110.30.
The AUD/USD pair inched up 0.05% to 0.7389 and the NZD/USD pair edged up 0.14% to 0.7107.
The USD/CNY pair inched down 0.04% to 6.4636 and the GBP/USD pair inched down 0.03% to 1.3779.
Investors now await the U.S. Federal Reserve’s policy decision for September, where the central bank is widely expected to hold off announcing that it will begin asset tapering.
Gold was up on Wednesday morning in Asia. The yellow metal steadied after slipping 1.6% during the previous session, alongside a strengthening dollar and rising U.S. Treasury yields that capped gains.
Gold futures inched up 0.04% to $1,799.15 by 12:31 AM ET (4:31 AM GMT) hovering slightly above the more than one-week low of $1,791.90 hit on Tuesday. The dollar, which normally moves inversely to gold, inched up to remain near a one-week high on Wednesday.
The benchmark 10-year U.S. Treasury note rose up to 1.385% on Tuesday, the first time it has done so since mid-July 2021.
On the data front, Japan’s GDP grew a better-than-expected 1.9% year-on-year and 0.5% quarter-on-quarter in the second quarter of 2021, according to data released earlier in the day.
The Bank of Canada will hand down its policy decision later in the day, followed by the European Central Bank a day later.
Legal disclaimer: The material does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instruments. UR Trade Fix Ltd accepts no responsibility for any use that may be made of these comments and for any consequences resulting in it. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. The analysis does not involve any specific investment objectives, financial situation and needs of any specific person who may receive it. Past performance does not constitute a reliable indicator of future results and future forecasts do not constitute a reliable indicator of future performance.
It has not been prepared in accordance with legal requirements designed to promote the independence of research, and as such it is considered to be marketing communication. Although we are not specifically constrained from dealing ahead of the publication of our research, we do not seek to take advantage of it before we provide it to our clients. We aim to establish, maintain and operate effective organizational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of interest from constituting or giving rise to a material risk of damage to the interests of our clients. We operate a policy of independence, which requires our employees to act in our clients’ best interests when providing our services