2026-01-23 14:12
BUENOS AIRES, Jan 23 (Reuters) - Brazil's central bank will likely start cutting interest rates for the first time in nearly two years in March to boost a weak economy, according to economists polled by Reuters. Lower interest rates, combined with some stimulus measures, should support consumption and counter a poor performance by the country's vast industrial sector. Sign up here. Analysts polled said it is more likely that Latin America's No.1 economy grows more than expected rather than less in the run-up to a national vote in October in which President Luiz Inacio Lula da Silva will seek reelection. The central bank will probably keep the Selic benchmark rate on hold at 15% in its January 28 meeting for the fifth time in a row, according to 32 of 35 economists polled January 19-22. Two participants forecast a quarter-point cut to 14.75% next week and one expected a 50 basis-point reduction to 14.50%. Of 34 participants who responded to an extra question on the next move of the bank's monetary policy committee, known as Copom, a strong majority of 28 expected the first cut to come in March, with 15 forecasting an initial 50 basis points. Fewer, 13, predicted a 25 basis points cut then to 14.75%. It would be the first reduction since May 2024, when policymakers adopted a hawkish stance against rising consumer prices, with periods of hikes in the cost of borrowing as well as leaving rates unchanged at high levels. "The decrease in inflation expectations, the softening of current inflation, and our expectation that inflation will continue improving would allow Copom to begin the cutting cycle in March," Citi analysts wrote in a report. Annual inflation ended last year at 4.26%, slowing further below the 4.5% threshold that marks the upper limit of the central bank's target of 3% plus or minus 1.5 percentage points. This improvement may lead policymakers to include subtle changes in the accompanying statement of next week's decision, indicating a shift ahead. "A possible new development could be the exclusion of the part regarding the possibility of resuming the cycle of interest rate hikes," said Stephan Kautz, chief economist at EQI Asset. "Some expressions from previous statements, such as 'gradual', 'parsimony', and 'lagged effects' of monetary policy, could be other options to indicate the proximity of the start of the interest rate cut cycle." As economic growth winds down in the first-half of the year, consumer prices are expected to decelerate further before regaining speed in the last months of 2026, a separate Reuters poll showed. Gross Domestic Product (GDP) is set to expand 1.8% this year compared to an expected 2.3% rate for 2025, according to median forecasts of 47 economists. Official data for last year's GDP are due for release in March. Of 18 participants who answered an extra question on risks to their GDP forecasts, a majority of 12 said growth may surprise on the upside this year, while 6 viewed chances of a slower expansion. "The boost will come from household spending... driven by consumption stimulus measures implemented in late 2025 and early 2026," said Laiz Carvalho, Brazil and Chile economist at BNP Paribas. Last month, the government decided to allow 14 million dismissed employees to withdraw a total 7.8 billion reais ($1.45 billion) from a public insurance fund for workers. (Other stories from the Reuters global economic poll) https://www.reuters.com/world/americas/brazil-central-bank-start-cutting-rates-march-boost-weak-economy-2026-01-23/
2026-01-23 12:51
Trade deal could massively increase bilateral trade, business leader says Could also support inward investment Deal could be signed next month, government official says DAVOS, Switzerland/JAKARTA, Jan 23 (Reuters) - A trade agreement being discussed between the United States and Indonesia could lead to a massive expansion in bilateral trade between the two countries, the head of Indonesia's chamber of commerce told Reuters. The agreement, which could be completed next month, could increase trade between the U.S and southeast Asia's largest economy four-fold from the current level of around $40 billion per year, Anindya Bakrie, Chairman of Kadin, said in an interview at the World Economic Forum in Davos, Switzerland. Sign up here. "Trade would become more balanced but the total trade would expand maybe three or four times," Bakrie said. Bakrie, whose organisation represents all businesses in Indonesia, said the country had long run a trade surplus with the United States, which was currently running at around $2 billion per month. "I believe the U.S. would like to balance that. We don't mind because balancing means they want to send more wheat, cotton, oil, and gas and dairy," he said. "But we can also increase our own exports because we get much more free access for our palm oil, garments, electronics, furniture." Last year, the U.S. threatened an additional tariff of 32% on Indonesian exports, but the new deal would lower this to 19%, when it goes into effect. In 2024, exports from Indonesia to the U.S. reached $26.54 billion with major shipments of palm oil, footwear, and electrical machines, according to data from Indonesia’s trade ministry. Meanwhile the U.S. exported $12 billion of products to Indonesia in 2024, a level that has not changed much since 2021, with soybean, wheat, cotton and petroleum oils among the main products. Kadin's Bakrie said the deal could also lead to more investment into Indonesia from the United States. "Indonesia's investment in the U.S. will also increase. There could be more investments in both directions." Indonesia has yet to sign the final deal with the U.S. but both might sign next month depending on each leader's schedule as final discussions between respective delegates have been held, said Susiwijono Moegiarso, a senior official at Indonesia's economic ministry. "Final discussions have been held and all substantive matters are now complete," he told Reuters on Friday without giving more details. https://www.reuters.com/world/asia-pacific/davos-us-indonesian-trade-deal-could-boost-trade-four-fold-kadin-chair-says-2026-01-23/
2026-01-23 12:50
PARIS, Jan 23 (Reuters) - The European Union is deploying emergency generators to Ukraine, saying Russian bombings have left a million people without power and heating, while France plans to hold a call to rally international help for Ukrainians exposed to extreme cold. Electrical engineers have been working around the clock in hazardous conditions for weeks since Russia escalated attacks on Ukraine's grid during a cold snap that has reached temperatures of minus 20 degrees Celsius (minus 4 F). Sign up here. The European Commission will send 447 emergency generators worth 3.7 million euros ($4.3 million) to restore power to hospitals, shelters and critical services affected by "relentless Russian strikes", it said in a statement on Friday. It added the generators will be mobilised from strategic reserves hosted in Poland and distributed in cooperation with the Ukrainian Red Cross to the most affected communities. "Russia's continued attacks on Ukraine's energy infrastructure ... are designed to break Ukrainian spirit", European crisis chief Hadja Lahbib said in the statement. Ukrainian President Volodymyr Zelenskiy has declared an energy emergency after the strikes over winter knocked out power generation and distribution facilities. "We won't let Russia freeze Ukraine. We bring light and warmth where Russia sends darkness," Commission spokesperson Eva Hrncirova told a daily news briefing. FRANCE TO HOLD CALL WITH INTERNATIONAL PARTNERS Earlier on Friday, French Foreign Minister Jean-Noel Barrot told BFM television that France would hold a call with G7 countries as well as Nordic and Baltic states later in the day to coordinate support for Ukraine's energy grid. "He continues to shell Ukrainian cities and energy infrastructure. We will continue to support Ukraine," Barrot said, referring to Russian President Vladimir Putin. He said France would supply Ukraine with the equivalent of 13 extra megawatts of electricity and around 100 generators to replace destroyed infrastructure. Other countries would also pledge assistance during the virtual meeting, he said. ($1 = 0.8524 euros) https://www.reuters.com/business/energy/france-hold-call-with-g7-nordics-urgent-ukraine-energy-support-2026-01-23/
2026-01-23 12:42
RBI to conduct open market bond purchases, FX swap Struggling rupee, rising bond yields pose monetary trilemma RBI has already bought record 5.7 trillion rupees of bonds in FY26 MUMBAI, Jan 23 (Reuters) - The Reserve Bank of India on Friday unveiled measures to inject more than $23 billion liquidity into the banking system through a combination of bond purchases, buy/sell FX swaps and repos. Under Governor Sanjay Malhotra, the central bank has stepped up liquidity injections over the past year to reinforce its rate cuts and to manage the impact RBI's market interventions to support the rupee have on banking system liquidity. Sign up here. The RBI will conduct a 90-day variable rate repo (VRR) operation for 250 billion rupees ($2.7 billion) on January 30, making it the maiden 90-day cash infusion. This will be followed by a three-year $10 billion USD/INR buy/sell swap auction on February 4. The central bank will also purchase 1 trillion rupees of government bonds in two tranches on February 5 and February 12. The RBI has bought 3 trillion rupees of bonds during December-January, boosting the note-purchase tally for the fiscal year to a record high of 5.7 trillion rupees. A persistent rise in bond yields and concurrent pressure on the currency pose a so-called monetary trilemma for the central bank, which throws up trade offs between supporting the currency, anchoring borrowing costs and allowing unfettered capital movement. "The durable liquidity measures were expected to ensure that system liquidity rises to RBI target levels of 0.6% to 1% of net demand and time liabilities," said Gaura Sen Gupta, chief economist at IDFC First Bank. "The VRR is transient liquidity provided to ensure that overnight rates remain contained." She expects another 1 trillion rupees of bond purchases in March which will take the banking system liquidity to 0.9% of net deposits. Steep borrowings have pushed up Indian bond yields over the last few weeks, while the rupee fell to a record low of 91.9650 to the dollar on Friday, pressured by foreign portfolio outflows and weakness in shares. "The announcement was much needed and has come in line with expectations and should lead to some reversal in yields," a trader with a state-run bank said. ($1 = 91.8410 Indian rupees) https://www.reuters.com/world/india/indian-cenbank-moves-inject-over-23-billion-into-banking-system-2026-01-23/
2026-01-23 12:41
Jan 23 (Reuters) - SLB (SLB.N) , opens new tab beat Wall Street estimates for fourth-quarter profit on Friday, as the world's top oilfield services provider benefited from the ChampionX acquisition and unveiled plans to return $4 billion to shareholders this year. The company closed the $7.75 billion all-stock acquisition of ChampionX last July, adding production chemicals and artificial lift technologies to its portfolio. Sign up here. Oilfield service providers have followed energy producers in pursuing deals to navigate operational and pricing pressures, as customers rein in spending on new wells and prioritize returns to investors. The acquisition, which contributed $879 million to total revenue and $206 million in adjusted core profit in the fourth quarter, also helped quarterly revenue from North America rise by about 26% amid softness in the region. SLB raised its quarterly dividend by 3.5% and said it expects to exceed $4 billion in shareholder returns, through dividends and share repurchases in 2026. The company reported an adjusted profit of 78 cents per share for the three months ended December 31, compared with analysts' average estimate of 74 cents, according to data compiled by LSEG. INVESTORS EYE VENEZUELA BOOST SLB shares have risen 23% since the U.S. capture of Venezuelan President Nicolas Maduro on January 3, with investors betting that the company will be a big winner as the South American country's dilapidated oil sector is rebuilt. The company's shares were marginally higher in premarket trading on Friday. Stifel analyst Stephen Gengaro has said SLB and rival Halliburton (HAL.N) , opens new tab are among the best positioned companies to benefit from investment in Venezuela. Earlier this week, Halliburton CEO Jeff Miller on a post-earnings conference call said the company could scale up fairly quickly in Venezuela and added that it was working to secure licenses from the U.S. that allow it to operate in the country. https://www.reuters.com/business/energy/slb-beats-fourth-quarter-profit-estimates-2026-01-23/
2026-01-23 12:34
Jan 23 (Reuters) - UBS (UBSG.S) , opens new tab is planning to offer cryptocurrency investment options to some private banking clients, Bloomberg News reported on Friday, citing people familiar with the matter. The Swiss lender is selecting partners for the proposed crypto offering, the report said. Sign up here. UBS would initially allow select clients of its private bank in Switzerland to buy and sell bitcoin and ether, according to the report, which added that the service could later be expanded to markets including Asia-Pacific and the United States. Reuters could not immediately verify the report. A UBS spokesperson declined to comment on the Bloomberg report, but told Reuters, "As part of UBS's digital asset strategy, we actively monitor developments and explore initiatives that reflect client needs, regulatory developments, market trends and robust risk controls." "We recognize the importance of distributed ledger technology like blockchain, which underpins digital assets." The lender's increased focus on crypto comes partly in response to rising demand for digital assets from wealthy clients, the report said. Last year, Bloomberg News reported that JPMorgan Chase (JPM.N) , opens new tab was considering offering cryptocurrency trading to its institutional clients, while Morgan Stanley (MS.N) , opens new tab said it would offer trading in crypto on its E*Trade platform from the first half of this year. Such a move by UBS would mark another significant step in the broader institutional adoption of digital assets under U.S. President Donald Trump, who has pledged to make America the "crypto capital of the world." https://www.reuters.com/business/finance/ubs-explores-crypto-investing-select-private-banking-clients-bloomberg-news-2026-01-23/
