2025-08-13 11:46

LONDON, Aug 13 (Reuters) - The pound rose to three-week highs against the dollar on Wednesday, as investors grew increasingly convinced that U.S. interest rates are likely to fall more quickly than British ones, following a benign reading of U.S. inflation. Data on Tuesday showed U.S. consumer prices rose by an annual 2.7% in July, compared with expectations for 2.8%. Sign up here. An underlying measure of inflation that excludes food and energy rose more quickly than forecast, up 3.1% year-on-year, versus expectations for a rate of 3%, reflecting the increased cost of some goods and services, as tariffs started to kick in. Sterling , which has gained 8.3% this year against the dollar, was last up 0.5% at $1.3569, having hit a session peak of $1.3578, the most since July 25. The pound has risen by nearly 2.4% in August against the dollar, which, if maintained, would be the largest monthly increase since April. Money markets show traders fully expect the Federal Reserve to lower borrowing costs in September and see a strong possibility of further easing by year-end, following the CPI data. Last week's employment report showed the U.S. economy created far fewer jobs than expected between May and July, putting a September rate cut firmly on the table. In contrast, UK labour data on Tuesday showed weakness in hiring but persistent wage growth, a positive for British consumers but a headache for the Bank of England, which is juggling the risks of a slowing economy and stubborn inflation. The BoE last week cut rates, but signalled concern over the outlook for UK inflation. Traders now think the next BoE cut might only come in November. If both scenarios play out, UK rates would end the year roughly on a par with U.S. ones, around 3.7-3.8%, which, in theory, removes some of the dollar's competitive advantage against sterling. Next up for UK markets is gross domestic product data on Thursday, which economists expect to show the UK economy expanded by 0.1% in the three months to June, compared with an expansion of 0.7% in the first quarter, based on data from the Office for National Statistics. "Sterling's resilience underscores how sensitive the currency is to rate expectations. Tomorrow's flash Q2 GDP report is the next hurdle; we expect a slight uptick in quarterly growth, but any disappointment could prompt a reversal in recent gains," analysts at Monex said. https://www.reuters.com/markets/europe/sterling-edges-up-highest-level-since-july-rate-outlook-2025-08-13/

2025-08-13 11:22

IEA expects global supply to rise by 2.5 million bpd in 2025 Trims forecast for demand growth this year to 680,000 bpd Global crude refining runs will approach record high in August Implied surplus to approach 3 million bpd in 2026 LONDON, Aug 13 (Reuters) - World oil supply will rise more rapidly than expected this year and next as OPEC+ members further increase output and supply from outside the group grows, the International Energy Agency said on Wednesday. Supply will rise by 2.5 million barrels per day (bpd) in 2025, up from 2.1 million bpd previously forecast, the IEA, which advises industrialised countries, said in a monthly report, and by a further 1.9 million bpd next year. Sign up here. OPEC+ is adding more crude to the market after the Organization of the Petroleum Exporting Countries, Russia and other allies decided to unwind its most recent layer of output cuts more rapidly than earlier scheduled. The extra supply, along with concern about the economic impact of President Donald Trump's tariffs, has weighed on oil this year. Supply is rising far faster than demand in the IEA's view. It expects world oil demand to rise by 680,000 bpd this year and 700,000 bpd next year, both down 20,000 bpd from the previous forecast. "The latest data show lacklustre demand across the major economies and, with consumer confidence still depressed, a sharp rebound appears remote," the agency said in the report that linked its higher output forecast to increased OPEC+ production targets. "Oil market balances look ever more bloated." IEA demand forecasts are at the lower end of the industry range, as the agency expects a faster transition to renewable energy sources than some other forecasters. OPEC on Tuesday maintained its forecast for demand to rise by 1.29 million bpd this year - almost double the IEA figure. Oil prices extended losses after the IEA published its report at 0800 GMT, with Brent crude trading lower than $66 a barrel. IMPLIED SURPLUS TO RISE The report implies that supply may exceed demand by almost 3 million bpd next year, driven by growth from outside the wider OPEC+ group and a limited expansion in demand. Despite higher OPEC+ production, non-OPEC producers will continue to lead supply growth this year and next owing to rising output in the U.S., Canada, Brazil and Guyana, according to the IEA. Still, additional sanctions on Russia and Iran may curb supplies from the world’s third and fifth largest producers, the IEA said. The U.S. announced new sanctions on Iran last month and the European Union lowered a price cap for Russian oil as part of its latest sanctions on Moscow. "It is clear that something will have to give for the market to balance," the IEA said. Continued Chinese stockbuilding due to major institutional and policy developments aimed at enhancing energy security may help absorb the surplus, the agency said. This helped support prices earlier in the year, analysts have said. Despite lowering its demand forecast, the IEA expects global crude oil refining rates to approach a fresh all-time high of 85.6 million bpd in August, after reaching 84.9 million bpd in July. Global refinery runs will rise by 670,000 bpd to 83.6 million bpd in 2025 and by a further 470,000 bpd to 84 million bpd in 2026, driven by better than expected data for market economies grouped in the Organisation for Economic Co-operation and Development (OECD) and China, the agency said. https://www.reuters.com/business/energy/world-oil-market-looks-more-bloated-after-opec-hike-iea-says-2025-08-13/

2025-08-13 11:19

Russia says peace conditions have not changed Putin set out terms in 2024 Putin then demanded Ukraine abandon NATO membership bid Trump has said both sides will have to cede land MOSCOW, Aug 13 (Reuters) - Russia said on Wednesday that its stance on ending the war in Ukraine has not changed since President Vladimir Putin set out his conditions last year: the full withdrawal of Kyiv's forces from key Ukrainian regions and the abandonment of its NATO ambitions. Putin and U.S. President Donald Trump are due to meet on Friday in Alaska, the first U.S.-Russian summit since 2021, to discuss efforts to end the war. Trump has said both sides will have to swap some of the land they currently hold to make this happen. Sign up here. Russia currently controls 19% of Ukraine including all of Crimea, all of Luhansk, more than 70% of the Donetsk, Zaporizhzhia and Kherson regions, and slivers of the Kharkiv, Sumy, Mykolaiv and Dnipropetrovsk regions. After reports by some media that Washington understood Putin was ready to compromise on his territorial demands, the Russian Foreign Ministry's deputy spokesperson, Alexei Fadeev, was asked by reporters if Russia's position had changed or not. "Russia's position remains unchanged, and it was voiced in this very hall just over a year ago, on June 14, 2024," Fadeev said, referring to a speech Putin delivered then at the foreign ministry. At that time, in his fullest public remarks so far about the shape of a possible settlement, the Kremlin chief set out demands including the withdrawal of Ukrainian troops from the parts of Donetsk, Zaporizhzhia and Kherson that they still control. Putin also said that Kyiv would have to officially notify Moscow that it was abandoning its plans to join the U.S.-led NATO military alliance, and that it intended to remain neutral and non-aligned. In addition, Putin said that the rights and freedoms of Russian-speakers in Ukraine would have to be ensured, and the "realities" that Crimea, Luhansk, Donetsk, Zaporizhzhia and Kherson were now part of Russia. Putin has said his conditions would also have to be reflected in international agreements. At the time of his 2024 speech, Ukraine rejected his demands as tantamount to an absurd ultimatum. Ukraine has repeatedly said it will never recognise Russian occupation of its land, and most countries recognise Ukraine's territory within its 1991 borders. Based on the current frontlines, Putin's demand would entail Ukraine ceding an additional 21,000 sq km (8,100 sq miles) to Russia. Ukrainian President Volodymyr Zelenskiy has said Russia must agree to a ceasefire before territorial issues are discussed. He would reject any Russian proposal that Ukraine pull its troops from the eastern Donbas region and cede its defensive lines. https://www.reuters.com/world/europe/russia-says-its-demands-are-unchanged-full-ukrainian-withdrawal-regions-that-2025-08-13/

2025-08-13 11:15

Winds reach up to 191 kph One person missing, 33 injured in Taiwan Typhoon expected to hit China late Wednesday, early Thursday TAIPEI, Aug 13 (Reuters) - Typhoon Podul blew through southern Taiwan on Wednesday packing winds of up to 191 kph (118 mph) and leaving one person missing, as a large swathe of the island shut down and hundreds of flights were cancelled. Taiwan is regularly hit by typhoons, generally along its mountainous east coast facing the Pacific. Sign up here. Podul slammed into the southeastern city of Taitung around 1 p.m. (0500 GMT), passed through the southern tip of the island and then into the Taiwan Strait some three hours later, Taiwan's Central Weather Administration said. It is expected to next make landfall on China's southern coast late on Wednesday or early Thursday, affecting Fujian and Guangdong provinces, according to Chinese state broadcaster CCTV. In Taiwan, one person was reported missing and 33 others injured, the government said. Nine cities and counties announced the suspension of work and school for Wednesday, including the southern metropolises of Kaohsiung and Tainan. In the capital Taipei, home to Taiwan's financial markets, there were blustery winds but no impact. Authorities also evacuated those whose homes were damaged by a July typhoon that brought record winds and damaged the electricity grid in a rare direct hit to Taiwan's west coast. The government said more than 5,500 people had been evacuated ahead of the typhoon's arrival. All domestic flights were cancelled on Wednesday - 252 in total - while 155 international flights were also called off, the transport ministry said. Taiwan's two main international carriers China Airlines (2610.TW) , opens new tab and EVA Air (2618.TW) , opens new tab said their cancellations were focused on routes out of Kaohsiung, with some flights from the island's main international airport at Taoyuan stopped as well. As much as 600 mm (24 inches) of rain was forecast in southern mountainous areas over the coming few days, the Central Weather Administration said. More than a year's rainfall fell in a single week this month in some southern areas, unleashing widespread landslides and flooding, with four deaths. https://www.reuters.com/business/environment/typhoon-podul-blows-through-southern-taiwan-leaving-one-person-missing-2025-08-13/

2025-08-13 11:13

Dollar falls as markets ramp up Fed cut bets US inflation data in line with expectations Trump weighing lawsuit against Powell over renovations LONDON, Aug 13 (Reuters) - The dollar fell to a two-week low on Wednesday after a tame reading on U.S. inflation bolstered expectations of a Federal Reserve rate cut next month, with President Donald Trump's attempts to extend his grip over U.S. institutions also undermining the currency. The dollar index , measuring the currency against a basket of peers, fell to 97.62, its lowest since July 28, extending its 0.5% fall on Tuesday. It was last down 0.3% at 97.70. Sign up here. U.S. consumer prices increased marginally in July, data showed on Tuesday, in line with forecasts and as the pass-through from Trump's sweeping tariffs to goods prices has so far been limited. Investors eyeing imminent Fed cuts moved to price in a 98% chance the central bank would ease rates next month, according to LSEG data. Also eroding investor confidence in the dollar were Trump's latest attempts to undermine Fed independence, after White House spokeswoman Karoline Leavitt said on Tuesday that the president was considering a lawsuit against Fed Chair Jerome Powell in relation to his management of renovations at the central bank's Washington headquarters. Trump has been at loggerheads with Powell and has repeatedly lambasted him for not easing rates sooner. Michael Pfister, FX analyst at Commerzbank, said these political developments carried echoes of autocratic countries, where heads of statistics agencies or central banks are replaced and critical data series often discontinued or manipulated. "I'm not saying that this will necessarily happen here. But the developments of the last few days and weeks do not exactly fill me with optimism about the future, or the U.S. dollar," Pfister said. Trump also hit out at Goldman Sachs (GS.N) , opens new tab CEO David Solomon, saying the bank had been wrong to predict U.S. tariffs would hurt the economy. Trump questioned whether Solomon should lead the Wall Street institution. Elsewhere, the dollar's weakness supported the euro and sterling . The single currency was last up 0.4% to $1.1719, briefly hitting its highest since July 28. Similarly, the British currency rose 0.5% to $1.3570, briefly hitting its highest since July 24. Britain's jobs market weakened again though wage growth stayed strong, according to data on Tuesday, underscoring why the Bank of England is so cautious about cutting interest rates. The Australian dollar was up 0.4% to $0.6556, while the New Zealand dollar rose 0.6% to $0.5989. The Reserve Bank of Australia on Tuesday cut interest rates as expected, and signalled further policy easing might be needed to meet its inflation and employment goals as the economy lost some momentum. In cryptocurrencies, ether scaled a nearly four-year high of $4,710. "Ethereum's quiet breakout is being fuelled by real-world adoption and capital confidence," said Gracie Lin, Singapore CEO of crypto exchange OKX. "On our platform, ETH has now overtaken BTC as the most traded asset over the past month." https://www.reuters.com/world/middle-east/dollar-slips-two-week-low-investors-eye-fed-cut-2025-08-13/

2025-08-13 11:07

Aug 13 (Reuters) - Standard Chartered raised its year-end target for ether to $7,500 from $4,000 on Wednesday, citing improvement in industry engagement and uptick in holdings of the cryptocurrency in recent months. The brokerage's new year-end target represents a premium of near 60% from ether's more than 3-1/2 year high of $4,700 on Wednesday. Sign up here. The world's second largest cryptocurrency has become the token of choice for those looking for more active returns. Unlike bitcoin , which solely relies on price appreciation, ether can be used in staking, a practice where holders lock up their tokens to support the ethereum network in exchange for rewards. Ether has soared over 50% in the past four weeks, helped by the passage of the Genius Act, a law to create a regulatory regime for dollar-pegged cryptocurrencies known as stablecoins. Prices of other crypto assets also rose, on hopes the law would lead to increased acceptance. "We project that the stablecoin sector will grow by around 8x by end-2028, which would have a significant direct impact on fees on the Ethereum network," said Geoff Kendrick, Standard Chartered's head of digital assets research. Most stablecoins are issued and transacted on the underlying Ethereum blockchain, driving up demand for ether to pay for transaction fees. Ethereum's long-term growth depends on using its main blockchain (Layer 1) for high-value transactions, especially those tied to traditional finance, Kendrick said, adding that a big boost in Layer 1's capacity would help make this possible. The brokerage raised its 2028 year-end ether forecast to $25,000 from $7,500. Kendrick also sees potential for Ethereum treasury companies to increase their holdings of the token to 10% of all ether in circulation. https://www.reuters.com/business/standard-chartered-lifts-year-end-ether-forecast-7500-2025-08-13/