2026-01-16 19:31

Shell sounding out buyer interest for up to 30% stake in LNG Canada, sources say Cost to buyer could be as much as $15 billion including all commitments, one source estimates Mitsubishi in early stages of exploring options for its 15% stake, sources say LNG Canada Phase 1 operational since June; only major North America Pacific Coast LNG export facility online HOUSTON/NEW YORK/LONDON, Jan 16 (Reuters) - Oil major Shell (SHEL.L) , opens new tab and Japanese conglomerate Mitsubishi Corp (8058.T) , opens new tab are exploring sale options for their respective stakes in the C$40 billion ($28.8 billion) LNG Canada project, three sources familiar with the matter told Reuters. The moves come as owners of the massive liquefied natural gas facility weigh a potential expansion, and after another stakeholder, Petronas, successfully offloaded a piece of the project. Sign up here. Shell, the largest owner with a 40% stake in LNG Canada, has been working with investment bankers at Rothschild & Co to sound out interested parties in recent weeks, said two of the sources. Two sources added that Shell could offload as much as three-quarters of its holding, or 30% of the project. Shell has expressed willingness, however, to consider different options relating to its exposure to the project's Phase 1, which is operational, and the proposed Phase 2, given their different risks. One of the sources estimated that any buyer for Shell's stake could be committing roughly $15 billion, inclusive of the equity stake, debt and capital requirements for Phase 2. MITSUBISHI HIRES RBC Mitsubishi, which holds a 15% stake, has hired RBC Capital Markets as it weighs its options, two of the sources said, cautioning deliberations were early and any sale effort would not kick off until later this year. The sources did not elaborate on how much of its stake Mitsubishi could market. All the sources said sales involving Shell and Mitsubishi were not guaranteed, and spoke on condition of anonymity to discuss confidential deliberations. LNG Canada referred questions to Shell and Mitsubishi. Shell declined to comment. Mitsubishi was not immediately reachable outside Japanese office hours. RBC declined to comment. Rothschild did not immediately respond to a comment request. MidOcean, backed by investment firm EIG and Saudi Aramco , closed a deal in December to buy a fifth of the Petronas venture that held a 25% stake in LNG Canada. PetroChina (601857.SS) , opens new tab holds a 15% stake, while Korea Gas Corporation owns 5% of LNG Canada. LNG CANADA'S COST ADVANTAGE LNG Canada is the first major LNG facility in North America with direct access to the Pacific Coast. The project in Kitimat, British Columbia, has a supply cost advantage because prices for Canadian natural gas consistently trade at a discount to the U.S. Henry Hub benchmark. Even so, existing and potential owners will consider industry fears of global oversupply of the supercooled fuel, as new LNG output comes online. Energy Transfer (ET.N) , opens new tab said in December that it was suspending development of its Lake Charles LNG export facility in Louisiana. LNG Canada started production in June, but has since run into operational problems. Its second processing unit, known as Train 2, was down in December, nearly a month after its startup, two sources told Reuters. When fully ramped up, Phase 1 will have the capacity to export 14 million metric tons of LNG per year. Shell told potential bidders it will keep a gas contract with the terminal for 30 years, one source said. Developers of major infrastructure projects often reduce their stakes once they become operational, allowing them to book profits and recycle cash into new ventures. Large investment firms and infrastructure funds are ready buyers of such stakes, as they like the projects' steady revenue. Shell, the world's biggest LNG trader, said in March it targeted a 4% to 5% annual increase in LNG sales over the next five years and 1% annual production growth. Shell and its partners were working toward a final investment decision for Phase 2, as soon as this year, which would double capacity. ($1 = 1.3900 Canadian dollars) https://www.reuters.com/business/energy/shell-mitsubishi-exploring-sale-options-their-stakes-lng-canada-sources-say-2026-01-16/

2026-01-16 19:26

Jan 16 (Reuters) - Swiss commodity trading group Mercuria posted a profit of $1.3 billion last year as it paid almost no tax, Bloomberg News reported on Friday. The company reported taxation of $1 million on its profit of $1.31 billion, an effective tax rate of 0.08%, Bloomberg reported, citing a copy of its accounts. Sign up here. Privately-held Mercuria does not report its results publicly, but recently communicated its accounts for the year ending September to lenders, Bloomberg reported, citing sources. The company is preparing separate results for the year to December and will finalize its year-end calendar results within about 14 days and will communicate them directly to its banks and counterparties, according to Bloomberg. Mercuria is one of several energy traders expanding into metals trading, betting that structural changes in global energy systems will prove lucrative. Mercuria said last month that a squeeze in global copper markets would tighten again next year, pushing up prices of concentrate and refined metal. The company has made a few deals over the recent months with other metal producers including extending up to $100 million to Kazakh mining giant Eurasian Resources Group (ERG) as an upfront payment for copper from the Democratic Republic of Congo. The group's profit was down 37% from the previous year, but was flattered by an extremely low tax bill, according to the report. Mercuria did not immediately respond to a Reuters request for comment. https://www.reuters.com/business/energy/mercuria-posts-13-billion-2025-profit-bloomberg-news-reports-2026-01-16/

2026-01-16 16:53

Fed's Bowman says job market keeps alive prospect of rate cuts She says it is not a good idea to signal rate-cut pause Bowman says inflation retreating to Fed's 2% target FOXBOROUGH, Massachusetts, Jan 16 (Reuters) - Federal Reserve Vice Chair for Supervision Michelle Bowman said on Friday a fragile job market that could weaken quickly means the U.S. central bank should stand ready to cut interest rates ‌again if needed. "Absent a clear and sustained improvement in labor market conditions, we should remain ready to adjust policy to bring it closer to neutral," Bowman said in a speech delivered before the Outlook 26: The New England Economic Forum in Foxborough, Massachusetts. She added that while monetary policy is not on a preset course, "we should also avoid signaling that we will pause" on further rate cuts "without identifying that conditions have changed." Sign up here. Bowman added that "my baseline expectation is that economic activity will continue to expand at ‌a solid pace and the labor market will stabilize near full employment as monetary policy becomes less restrictive." But she also said risks to the Fed's inflation and job mandates are uneven, noting that price pressures are likely to abate as the impact of trade tariffs wanes, with underlying inflation close to the central bank's 2% target. Meanwhile, the job market, which is currently near full employment, "has become increasingly more fragile and could continue to ‍deteriorate in the coming months," Bowman said. She warned that conditions could change quickly, which is why the Fed should be nimble on the policy front. Bowman described the current stance of monetary policy as "moderately restrictive" and said Fed officials should be forward-looking in setting interest rate policy. "We should rely on forecasts that are informed by a broad set of indicators and ⁠by ongoing engagement with businesses and communities across the country," she said. FED OFFICIALS HAVE SIGNALED NO URGENCY TO ACT The Fed enters 2026 amid expectations among ‍its policymakers that inflation pressures will moderate, the job market will stabilize and growth will turn in a decent performance as uncertainty from President Donald Trump's erratic economic policies abates. Over ‌the closing ‌months of 2025, the Fed lowered its benchmark interest rate by three-quarters of a percentage point, to the 3.50%-3.75% range. The central bank reduced the cost of short-term borrowing in a bid to offer support to a weakening job market while still providing enough restraint to bring down still-high inflation pressures. At the December 9-10 policy meeting, Fed officials penciled in a single quarter-percentage-point rate cut for 2026. In comments over the start of the year, they have signaled no urgency to act ⁠as they seek further evidence that inflation, ⁠which remains well over the 2% target, will abate. As the Fed seeks data that would give it the green light to cut again, it continues to face considerable pressure from Trump over lowering rates. The president will get to select a successor to Fed Chair Jerome Powell, whose term as central bank chief ends in May, and is expected to announce the outcome of that ‍search soon. The battle between the president and the Fed escalated in recent days amid the revelation that the central bank is being criminally targeted by the administration over issues with costs associated with the renovation of the Fed's headquarters. Powell said the latest attack is really about the Fed exercising independent judgment in setting rates. In her remarks, Bowman noted some fragilities in financial markets. She said stock prices "may appear stretched" and added, "I am concerned that disappointing news on ‍AI investment returns could lead to a sharp correction in equity prices." On the banking oversight front, Bowman said "we will continue to focus on improving the mergers and acquisitions review process, assessing the appropriateness of capital requirements across the banking system, addressing payments and check fraud, and strengthening examiner training and development." https://www.reuters.com/business/bowman-says-fed-should-be-ready-cut-rates-again-amid-job-market-risks-2026-01-16/

2026-01-16 15:09

BUENOS AIRES, Jan 16 (Reuters) - Argentina's economy is set to grow at a slightly slower pace this year and in 2027, a Reuters poll of economists showed on Friday, with a lot hinging on a potential comeback to debt markets currently closed to the serial defaulter. Inflation, which has eaten away at the living standards of Argentines for many years, is expected to decelerate, but linger in the double-digit area and be somewhat higher than was expected in a quarterly poll taken in October. Sign up here. The median forecast for gross domestic product growth is 3.0% this year and in 2027 after an expected 4.3% increase in 2025, according to estimates from 25 economists polled in the January 12-16 period. The highest GDP growth call for this year was 5% and the lowest was 1.6%, reflecting the most optimistic view on President Javier Milei's reform drive and worries about their impact on the real economy, respectively. Inflation as measured by the annual change in the Consumer Price Index is predicted to moderate to an average 25.3% in 2026 compared to an average 44.5% in 2025. The expected 25.3% rate is down from the 31.5% reported in December of last year, but above a median forecast of 23.7% in an October poll, as the downtrend in price increases is limited by sticky services inflation. Still, the headline rate has fallen sharply from a peak of 237% in 2024, when Milei began his term with a vow to "chainsaw" runaway spending. An intensification of austerity steps this year and the possible foray into global capital markets are set to further push Argentina's shift to an economic model based on commodity exports, analysts said. Milei's approach has already caused disruption by powering mining and energy investments in resource-rich provinces while manufacturing activity in populous metropolitan areas collapses. "In 2026, agriculture, mining, and the financial sector are projected to perform well," said Marcos Cohen Arazi, an economist at Fundacion Mediterranea's IERAL institute. "Meanwhile commercial activity, tourism, manufacturing, and construction are expected to perform weaker, although with some improvement compared to 2025." TAPPING INTERNATIONAL DEBT MARKETS Regaining access to international debt markets that Argentina has been shut out from since 2018 will be crucial for the country's economic prospects. At the end of 2025, Argentina's central bank said the country would seek to do so in order to refinance its maturities. This move would bolster confidence and extend a calm period for the local peso currency, allowing room for inflation to fall further. "The key is at least being able to place debt in international markets to cover principal payments due in the first half of the year," said Claudio Caprarulo, an economist and director at Analytica. "We project the government will be able to issue debt, although the volume and interest rate will depend on the conditions at that time." Officials hope the sovereign risk premium will soon fall to levels consistent with an interest coupon under 10% that would be acceptable for a foreign-law bond deal, in line with local law debt conditions. But this scenario requires solid proof that Milei's reforms are generating sustainable reserve accumulation by fixing Argentina's current account deficit to cut its dependence on the International Monetary Fund. In a sign that a foreign bond transaction may be closer, the IMF welcomed this week the government's efforts to rebuild foreign exchange reserves. But some analysts remain cautious. "The question is whether supply of U.S. dollars (from trade) will be enough or not," said Sebastian Menescaldi, associate director at EcoGo. "If it is insufficient, there will be complications with the currency scheme." (Other stories from the Reuters global economic poll) https://www.reuters.com/world/americas/argentina-growth-outlook-stable-much-depends-potential-debt-comeback-2026-01-16/

2026-01-16 13:57

TORONTO, Jan 16 (Reuters) - Canadian housing starts rose 5.6% in 2025 to 259,028 units as starts increased more than expected in December, data from the national housing agency showed on Friday. The annual level of starts was the fifth highest on record, the Canada Mortgage and Housing Corporation (CMHC) said. Sign up here. In December, the seasonally adjusted annualized rate increased 11% to 282,439 units from a revised 254,625 units in November. Economists had expected starts to rise to 260,000. The six-month trend was less upbeat, showing a December decline of 0.1%. "While housing starts in 2025 finished ahead of 2024 and inched up in December, most of the momentum in housing construction occurred in the spring and summer, CMHC's chief economist Mathieu Laberge said in a statement. "Since September, the trend in housing starts has consistently decreased." Canadian Prime Minister Mark Carney , opens new tab has pledged to improve affordability and reduce homelessness while increasing home construction, while the Bank of Canada has lowered its benchmark interest rate to a three-year low of 2.25% to support the economy. https://www.reuters.com/world/americas/canadian-housing-starts-rise-56-2025-december-beats-expectations-2026-01-16/

2026-01-16 12:55

LONDON, Jan 16 (Reuters) - Transactions on a new China-led digital currency platform have surged to over $55 billion, a new report shows, the latest sign that efforts to build alternatives to dollar-dependent global payment systems are gaining traction. Data crunched by the Washington-based Atlantic Council showed the prototype 'mBridge' platform, which is being ‌tested by central banks in China, Hong Kong, Thailand, the United Arab Emirates and Saudi Arabia, had now processed more than 4,000 cross-border transactions. Sign up here. The cumulative $55.5 billion value of those payments represents a roughly 2,500-fold increase since the project's early days of 2022, with the digital yuan estimated to now account for approximately 95% of the volume. The e-CNY, as it ‌is also known, remains the world's largest live central bank digital currency experiment. Recent People’s Bank of China (PBOC) figures showed it had processed more than 3.4 billion transactions worth roughly 16.7 trillion yuan ($2.4 trillion), a more than 800% leap from 2023. Chinese state media reported last month that the e-CNY will also ‍start paying interest to those holding it in their digital bank accounts or wallets this year, a move widely seen as designed to boost usage. "Taken together, these developments point to a gradual expansion of the yuan’s internationalization through digital infrastructure," the Atlantic Council's ⁠Alisha Chhangani said. Rather than seeking to displace the dollar outright, China and its counterparts are building parallel settlement ‍rails, Chhangani said, that reduce reliance on existing dollar-based systems. "Project mBridge is unlikely to challenge dollar dominance directly, but it may ‌incrementally ‌erode it," she added. The PBOC did not immediately respond to an out-of-business-hours request for comment on the figures. THE RACE IS ON The progress of mBridge is being closely watch by policy makers globally. It was originally overseen by central bank umbrella body, the Bank for International Settlements, but the Switzerland-headquartered institution unexpectedly quit the project in late 2024. Although not ⁠a direct rival, the BIS ⁠now focuses efforts on another project with seven top - mostly Western - central banks including the New York Federal Reserve, Banque de France on behalf of the European Central Bank, the Bank of Japan, Swiss National Bank and Bank of England. This week, the group, which is ‍also working with over 40 major commercial banks, said it was stepping up testing. Mbridge's development remains far ahead for now, however. The United Arab Emirates' Ministry of Finance and the Dubai Department of Finance carried out the first government transaction using wholesale digital dirham on the platform in November. The Atlantic Council's Chhangani said mBridge was ‍likely to increasingly focus on trade settlements, particularly in energy and commodity-linked transactions, where China already plays a central commercial role. ($1 = 6.9675 Chinese yuan renminbi) https://www.reuters.com/world/asia-pacific/china-led-cross-border-digital-currency-platform-sees-surge-2026-01-16/