2025-05-07 07:06

U.S. dollar edges up 0.6% Fed leaves rates unchanged, cites rising risk of higher inflation and unemployment BofA: Gold to push higher in 2H25, potentially hitting $4,000/oz China's central bank buys gold for sixth straight month in April May 7 (Reuters) - Gold prices extended losses on Wednesday, weighed by a stronger dollar and easing China-U.S. trade tensions, while traders were left dissatisfied by Federal Reserve Chair Jerome Powell's cautious remarks on the U.S. economy. Spot gold , which was already down more than 1% before the meeting, slipped further after Powell's comments. It was down 1.8% to $3,368.42 an ounce by 03:32 ET (19:32 GMT), while U.S. gold futures settled 0.9% lower at $3,391.9. Sign up here. The U.S. dollar (.DXY) , opens new tab gained 0.6% against a basket of major currencies, making bullion more expensive for non-dollar buyers. The Federal Open Market Committee (FOMC) concluded its two-day policy meeting with a unanimous decision to leave interest rates unchanged at 4.25%-4.50%, where they've been since December. "Uncertainty about the economic outlook has increased further," the FOMC said in its post-meeting statement. Federal Reserve Chair Jerome Powell reinforced that sentiment, saying the central bank cannot act pre-emptively when the path forward is unclear. "Powell held his cards very close repeating the message of the Fed will 'wait and see' and that it cannot be pre-emptive. It leaves the market a little dissatisfied which will do nothing to change gold's strong bullish bias," said Tai Wong, an independent metals trader. "Dips will be bought as gold is the one market where investors are highly confident," he added. Gold, seen as a safe haven asset in uncertain times, has surged 28.6% this year, amid geopolitical risks and strong central bank buying. China's central bank added to reserves for a sixth straight month in April. "I think a big part of (gold's fall) is China and the U.S. coming together for tariff talks. The Fed announcement just seems really neutral from what Powell's saying right now... So there's no surprises there," Daniel Pavilonis, senior market strategist at RJO Futures said. U.S. Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer are scheduled to meet Chinese economic tsar He Lifeng in Switzerland this weekend, a move seen as a potential breakthrough in resolving trade tensions. Elsewhere, spot silver dropped 2.9% to $32.27, while platinum fell 0.9% to $975.60 and palladium was down 1.2% at $963.34 per ounce. https://www.reuters.com/markets/commodities/gold-slips-us-china-trade-talk-hopes-traders-eye-fed-policy-2025-05-07/

2025-05-07 06:53

Formal guidelines issued for use of carbon finance to shut coal-fired power Plan could mobilise $110 billion in finance, Rockefeller Foundation says SLTEC plant in Philippines first in line to adopt carbon credit scheme SINGAPORE, May 7 (Reuters) - The Rockefeller Foundation aims to sign up 60 projects by 2030 to a new carbon finance scheme for phasing out coal-fired power in developing countries, it said on Wednesday, after its rulebook was given the go-ahead. Around 2,000 coal-fired power plants need to be decommissioned from now until 2040 in order to meet global climate targets, the International Energy Agency says, but only 15% are covered by decommissioning pledges. Sign up here. The Rockefeller Foundation's Coal to Clean Credits Initiative (CCCI) is one of several schemes , opens new tab under development that aim to use carbon finance to help close them earlier than scheduled and replace them with renewable power. "That target of 60 projects by 2030 is our overall goal, our ambition," said Joseph Curtin, who runs the Rockefeller Foundation's "coal to clean" programme. In Singapore on Tuesday, carbon standards organisation Verra launched CCCI's methodology for determining which projects are eligible and how emission reductions from early coal plant shutdowns will be calculated, allowing them to generate carbon credits. The first project to use the methodology will be the South Luzon Thermal Energy Corporation (SLTEC) plant in the Philippines, with the transaction expected to be completed next year. "Obviously if we can close one transaction - and we're getting much closer - we think that will have a very strong impact on the market and will hopefully reverberate across the region and send a signal that this is indeed possible." Curtin said his team has identified around 1,000 coal-fired plants in developing countries that would be eligible under the methodology. The 60 project target could attract $110 billion in public and private investment by 2030, he said, citing research commissioned by the foundation. The early retirement of SLTEC is backed by Philippine energy firm ACEN (ACEN.PS) , opens new tab together with Singapore clean investment group GenZero, the infrastructure conglomerate Keppel (KPLM.SI) , opens new tab, Japan's Mitsubishi (8058.T) , opens new tab and its subsidiary Diamond Generating Asia. Revenue from carbon credits will be used to cover foregone cashflows brought about by the closure, help pay for the energy storage needed to support renewables and protect the interests of local workers and communities, said Eric Francia, ACEN's chief executive. CCCI went through seven rounds of consultations on its methodology, partly to allay concerns of environmental groups, who say carbon finance should not be used to bail out coal asset owners. "The risk with this is how do you determine you are not giving finance to something that was a stranded asset, that wasn't going to be viable in the future?" said Jonathan Crook of Carbon Market Watch, a research group. The CCCI initiative's criteria will only select projects that are profitable and owned by companies or countries that have made firm "no new coal" commitments, said Curtin. While there is a moratorium on new coal plants in the Philippines, new facilities approved before the ban are still expected to come on line in the next few years. But the early retirement of SLTEC would still deliver progress on the energy transition, ACEN's Francia said. "Of course we need to manage the perception, which is admittedly not good, but we look at the substance, and that is really the equation here," he said. https://www.reuters.com/sustainability/cop/new-carbon-credit-scheme-targets-60-plants-by-2030-coal-phaseout-2025-05-07/

2025-05-07 06:38

May 7 (Reuters) - A major coal processing plant in far northeastern Russia halted work after a fire injured four people, the plant's owner, Russian miner Mechel (MTLR.MM) , opens new tab, said on Wednesday. Mechel said in statements that work had been stopped and staff evacuated from the plant in Neryungri in the Republic of Sakha, also known as Yakutia. A preliminary investigation pointed to a methane fire as the cause of the incident, it added. Sign up here. The Yakutia emergencies ministry said in a statement on Telegram that the fire had been extinguished after causing damage to warehouses, buildings and a conveyor belt. Russia's Investigative Committee, which handles serious crimes, said it had opened a criminal case into negligence at the plant. Mechel owns the Neryungri plant and its parent company, Yakutugol, one of the largest coal mining companies in the Sakha Republic. The Neryungri plant, which started operations in 1985, has an annual capacity of nine million tons of coking coal. More than 50 firefighters and 12 pieces of equipment were involved in tackling the fire, Denis Gerasimenko, deputy chief of the Neryungri Firefighting and Rescue Squad, said in a video on the Telegram messaging app. "The difficulty lies in the design of the building and the presence of a flammable load," Gerasimenko said. Several Russian Telegram news channels reported an explosion at the plant. Reuters could not independently verify the reports of an explosion. https://www.reuters.com/world/europe/four-people-injured-fire-coal-processing-plant-russias-far-east-officials-say-2025-05-07/

2025-05-07 06:37

Endesa calls for better nuclear, grid investment frameworks Company's power plants, grid worked normally before outage Endesa's first-quarter profit beat expectations MADRID, May 7 (Reuters) - The chief of Spanish power utility Endesa (ELE.MC) , opens new tab on Wednesday urged the country's policymakers to review the tax burden on nuclear plants and improve remuneration of investments in power grids in the wake of last week's unprecedented blackout. The outage that hit the Iberian Peninsula on April 28 has reignited the debate over a plan to phase out all of Spain's reactors by 2035 and the need to invest so grids can handle growing solar and wind output. Sign up here. "We need a robust and resilient grid, which requires significant investments, along with fair remuneration," Chief Executive Jose Bogas said. "A diversified and competitive generation mix is also crucial," he said. "To this end, it is essential to review the taxation of nuclear power to ensure its economic viability so that it can provide security of supply for years to come," Bogas said. On Tuesday, the nuclear lobby group asked policymakers to lower taxes, saying they make the plants unable to compete on the market. Returns on investment in the grid should be raised to around 7.5% from the current 5.6% and a cap set on how much companies can invest has to be reviewed, Endesa - owned by Italian energy giant Enel (ENEI.MI) , opens new tab, said. POWER OUTAGE Endesa has been working closely with grid operator Red Electrica, owned by Redeia (REDE.MC) , opens new tab, to identify the cause of the power outage, Bogas told analysts on a call, adding that the system operator is responsible for guaranteeing the continuity and security of the electricity supply. Bogas and finance chief Marco Palermo said that it is still too early to estimate how much the outage could cost the company. That day, its power plants were operating in line with instructions from the grid operator and its distribution network was working normally. "We believe that we were among the parties affected by the incident," Palermo said. Endesa's first-quarter net profit doubled to 583 million euros ($662.00 million) from 292 million euros a year earlier, beating expectations. ($1 = 0.8807 euros) https://www.reuters.com/business/energy/spains-endesa-beats-first-quarter-expectations-2025-05-07/

2025-05-07 06:14

CEO blames higher costs, interest rates and execution risks Q1 core profit above forecasts British government hopes to revive the project COPENHAGEN, May 7 (Reuters) - Orsted (ORSTED.CO) , opens new tab will no longer build a major offshore wind farm in Britain, it said on Wednesday, citing a deteriorating global business environment for renewables and dealing a blow to UK ambitions to decarbonise its energy supplies. The Danish company's market value has fallen by around 80% from its 2021 peak as costs have risen, supply chains have been disrupted and U.S. President Donald Trump's opposition to offshore wind has sapped investor confidence. Sign up here. Orsted said cancelling Hornsea 4, one of the world's largest offshore wind farms, would cost it up to 5.5 billion Danish crowns ($837.85 million) in the form of breakaway fees and write-downs, but that the value it would create had fallen. "The combination of increased supply chain costs, higher interest rates, and increased execution risk has deteriorated the expected value creation of the project," CEO Rasmus Errboe said in a statement. Errboe, who was appointed CEO in January, faces the challenge of reviving investor confidence and slimming down the company to meet the new realities of the offshore wind industry. "We believe the decision was needed to ensure we only bring forward assets which we are confident will deliver the value that we would like to see," Errboe told reporters. A final investment decision had not been made for the Hornsea 4 project. Britain's Energy Secretary Ed Miliband hoped the plans could be revived. "We are still committed to working with Orsted to seek to make Hornsea 4 happen by 2030," Miliband told reporters while on a visit to Norway. He said Britain, which has a goal of developing 50 gigawatts of clean power capacity by 2030, has a big pipeline of renewables projects and is confident of meeting its target. TRUMP SHARE IMPACT Shares in Orsted rose 0.7% by 1045 GMT but are down by roughly a third since Trump's election to a second term in November of last year. "The cancellation of Hornsea 4 comes as a surprise but highlights stronger discipline under the new CEO," Bernstein said in a research note. Barclays analysts called the cancellation an eye-opener. While Trump has backed the continued use of fossil fuels, Britain, the biggest offshore wind market outside China and usually a stable growth region for Orsted, is striving to decarbonise its electricity to help curb global warming. Orsted in September last year secured a 2.4 gigawatt contract for the Hornsea 4 project, located off the Yorkshire coast of northern England, in a British renewables power auction aimed at making the project more secure. "We believe that the UK government is doing everything right in terms of the framework," Errboe said. The industry has struggled in recent years with rising costs, supply chain bottlenecks, higher interest rates, and more recently trade tensions. Orsted said on Wednesday U.S. tariffs imposed on steel, aluminium and related products had increased costs for its two offshore projects in the U.S., resulting in an impairment of 1.2 billion crowns, but that construction would go ahead. It also posted first-quarter profit before interest, tax, depreciation and amortisation, and excluding new partnerships and cancellation fees, of 8.6 billion Danish crowns for the January to March. Analysts had on average expected an EBITDA of 7.88 billion crowns, a poll compiled by the company showed. Orsted kept its 2025 outlook, excluding new partnerships and cancellation fees, unchanged, but the outlook did not include the cost of the Hornsea 4 cancellation. ($1 = 6.5644 Danish crowns) https://www.reuters.com/sustainability/climate-energy/offshore-wind-developer-orsted-q1-beats-forecasts-2025-05-07/

2025-05-07 06:11

Federal Reserve leaves interest rates unchanged Dollar gains against yen and Swiss franc Euro edges down versus the dollar Pound sterling weakens ahead of BoE rate decision NEW YORK, May 7 (Reuters) - The U.S. dollar remained slightly stronger against major currencies including the yen and the euro on Wednesday after the Federal Reserve left interest rates unchanged, in line with market expectations. The Fed kept its benchmark interest rate steady in the 4.25%-4.50% range, but said that the risks of higher inflation and unemployment had risen and that the U.S. economic outlook remains uncertain. Sign up here. "They were a little more hawkish than a lot of the market expected, and they didn't really change or water down any of the views on inflation being above average or the jobs market selling at a low level," said Marvin Loh, senior global market strategist at State Street in Boston. "I still think we're in an extended hold period until data tells them that they need to do something and/or we get a lot more trade clarity," Loh added. The greenback was up 1% versus the yen at 143.840 , breaking a three-day falling streak, with Japanese markets reopening after a two-day holiday. During his subsequent press conference, Fed Chair Jerome Powell said the central bank cannot make preemptive policy decisions until there is clarity about where the economy is headed. The U.S. dollar was up 0.09% against the Swiss franc in choppy trading at 0.82210 franc. On Monday, it hit its lowest since January 2015 of 0.8032. "The statement had only small changes and the theme which we expected - which is, 'The Fed is feeling the tensions between the two sides of its mandate,'" said Vassili Serebriakov, FX strategist at UBS in New York. "The FX market is well aware of this and that probably explains the lack of initial reaction." President Donald Trump suggested on Wednesday that China initiated upcoming senior-level trade talks between the two countries and said he was not willing to cut U.S. tariffs on Chinese goods to get Beijing to the negotiating table. Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China's economic tsar, He Lifeng, in Switzerland on Saturday for talks, which could lead to a potential thawing of trade tensions. The euro was down 0.44% at $1.131650, snapping three straight session of gains. German conservative leader Friedrich Merz was elected chancellor by parliament on Tuesday in a second round of voting after an unprecedented defeat on the first attempt. The Bank of England will likely cut interest rates on Thursday. The pound sterling was down 0.52% to $1.3310 but up 0.21% to 0.85080 against the euro . The Taiwan dollar has steadied after surging against the greenback since Trump's April 2 announcement of sweeping tariffs on trade partners. The Chinese yuan weakened 0.22% against the greenback to 7.227 per dollar as China announced a long-awaited rate cut. https://www.reuters.com/world/middle-east/dollar-languishes-ahead-fed-meeting-asian-currencies-calmer-2025-05-07/