2025-03-20 07:28

LONDON, March 20 (Reuters) - The pace of British pay growth was little changed in the three months to January, according to official data published shortly before the Bank of England was expected to keep interest rates on hold as it assesses inflation pressures in the economy. Private-sector pay excluding bonuses - a key gauge of domestic inflation pressure for the BoE - rose by 6.1% the three months to January, compared with the same period a year earlier, marginally slower than an increase of 6.2% in the last three months of 2024, the Office for National Statistics said. Sign up here. Pay growth across the economy, excluding bonuses, stood at 5.9%, unchanged from the fourth quarter, the ONS said. Including bonuses, pay was up 5.8%, slowing from 6.1% in January. A Reuters poll of economists had pointed to both measures of wage growth rising by 5.9%. The BoE is trying to gauge whether inflation pressures in the labour market are easing sufficiently for it to continue cutting interest rates. It is expected to keep rates at 4.5% at 1200 GMT on Thursday after its March meeting. Sterling was little changed against the dollar immediately after the data release. A rise in the social security contributions that employers pay starting in April is expected to lead to slower wage growth as well as weaker hiring. Data published on Wednesday showed pay settlements granted by British employers fell back in line with inflation for the first time since October 2023. https://www.reuters.com/world/uk/uk-wage-growth-little-changed-official-statistics-show-2025-03-20/

2025-03-20 07:25

Fed notes high uncertainty but keeps rate cuts on the table Investors take comfort from Fed attuned to economic risks But many remain cautious about risk exposure amid tariff uncertainty QT slowdown seen as mildly positive for market stability NEW YORK, March 20 (Reuters) - Investors are taking some comfort from the U.S. Federal Reserve's wait-and-see approach, after being rattled by tariff-related turmoil that poses a threat to markets and the economy. Since returning to the White House on January 20, U.S. President Donald Trump's rapid-fire tariff policies have spooked stock markets and dented consumer and business confidence, with investors balancing hopes of a pro-business, deregulatory and lower tax agenda against fears of a trade war and potential recession. Sign up here. Fed policymakers signaled a cautious stance of their own on Wednesday at a policy meeting that left interest rates unchanged but acknowledged rising risks to both growth and inflation. Still, the U.S. central bank remained hesitant to price in a lasting inflation surge or a significant economic blow from Trump’s trade policies. Chair Jerome Powell stressed that uncertainty was high and that the central bank was waiting for greater clarity -- a message that resonated with markets. "The Fed is in tune to the economic risks," said Josh Emanuel, chief investment officer at Wilshire. "I think there's a clear acknowledgement that this is a period of tremendous uncertainty, and it would be somewhat irresponsible for them to imply a meaningful, material shift in policy without clarity on what administrative policies are going to look like." Futures bets in money markets on Wednesday showed traders were now expecting 68 basis points in interest rate cuts this year, up from about 56 basis points - or just over two 25-basis-point cuts - earlier in the day before the Fed issued its rate decision. Stocks pushed higher following the Fed's decision, with the benchmark S&P 500 (.SPX) , opens new tab ending up 1.1% on the day, while benchmark 10-year Treasury yields were down about four basis points. Still, the S&P 500 index has dropped by about 8% over the past month, giving up all of its gains since Trump's November election, and in a sign of mounting investor worries about recession and a global trade war, the spreads between the yields on corporate bonds and U.S. Treasuries last week hit their widest in about six months. A nearly unanimous majority of economists see increased risks of recession, according to a recent Reuters poll. Surveys of business and consumer confidence have weakened, and administration officials have acknowledged their actions could be painful, at least in the short run. "We were on a pretty good trajectory coming into the year, and we know that policy uncertainty ... is pulling back a lot of spending at the consumer level, and it is going to pull back capital expenditure at the corporate level," said James Camp, managing director of strategic income at Eagle Asset Management. "Whether that lasts 100 days or four years is the question,” he said. RISK AVERSION A big focus for markets will be the implementation of new reciprocal and sectoral tariffs that Trump has said will take effect on April 2. "It's all going to come down to the administration's sporadic implementation of tariffs and how that will affect consumers," said Jason Britton, president and chief investment officer of Reflection Asset Management. While taking comfort from a Fed that appears vigilant about economic risks, he said he was not advising clients to make any changes to their investment portfolios. "I didn't hear anything to make me believe there has been a structural shift in the Fed's thinking," he said. Others echoed that approach. Brendan Murphy, head of fixed income for North America at Insight Investment, said he maintained a preference for Treasuries and corporate bonds. He expects 10-year Treasury yields, which move inversely to prices and tend to fall in anticipation of slower growth, to decline to 3.9% over the next year. They stood at 4.25% on Wednesday. Emanuel at Wilshire said he continued to be cautious about his risk exposure. "We are tighter in our active risk relative to our benchmarks because there's so much uncertainty, it's really hard to say what tariff policy is going to actually look like right now." On the margin, a positive note for investors came from the Fed's announcement of a slowdown in its balance sheet drawdown, known as quantitative tightening (QT). The Fed was forced to intervene in 2019 in a prior round of QT because falling bank reserves led to a surge in the cost that banks and other market players pay to raise overnight loans to fund their trades. Mindful of that episode, the Fed is slowing down QT because a binding government debt cap this year could complicate the central bank's ability to gauge market liquidity. "They're definitely trying to make sure that markets remain stable," said Clayton Triick, head of portfolio management for public strategies at Angel Oak Capital. https://www.reuters.com/markets/wealth/feds-balancing-act-gives-respite-tariff-struck-investors-2025-03-20/

2025-03-20 07:09

LONDON, March 20 (Reuters) - Britain's energy regulator said on it would accelerate 4 billion pounds ($5.19 billion) of investment to speed up development of the country's electricity grid and boost the country's chances of meeting clean energy targets. Ofgem, which regulates the companies that build and operate the transmission network, said the funding would help them overcome supply chain difficulties by providing financial flexibility to procure essential equipment, materials and services years in advance. Sign up here. Akshay Kaul, Ofgem's director-general for infrastructure, said there was unprecedented pressure on global supply chains as many nations step up efforts to decarbonise their energy systems. "It's vital that we help the electricity transmission owners move quickly, procuring at scale as early as possible to reduce financial risk – and show the global supply chain that Britain is committed to investing in its energy networks," Kaul said. Britain has three transmission owners: National Grid Electricity Transmission, Scottish and Southern Electricity Networks Transmission, and SP Energy Networks. Thursday's announcement adds to cross-sector efforts by the Labour Party government to make regulators more focused on taking steps that will generate economic growth. The government has set a target to decarbonise Britain's energy generation network by the end of the decade — a goal that the National Energy System Operator has described as a "huge challenge". "This fast-track measure means we can quickly get Britain building the infrastructure we need to deliver clean power by 2030," junior energy minister Michael Shanks said. ($1 = 0.7700 pounds) https://www.reuters.com/business/energy/uk-regulator-fast-tracks-52-billion-energy-grid-investment-2025-03-20/

2025-03-20 07:03

Russia's share in Indian naphtha imports exceeds 50% in 2024-25 Russian naphtha $14-$15/T cheaper than Mideast product this week Asia may stay top Russian naphtha buyer even if sanctions lifted -analyst NEW DELHI, March 20 (Reuters) - Russia has surpassed the United Arab Emirates as India's top naphtha supplier in the year to March 2025, as refiners capitalise on discounted cargoes, preliminary ship-tracking data showed, a trend buyers expect to persist for another year. India, the world's third largest crude importer and oil consumer, has been relying on cheap oil from Russia to reduce import costs despite Western efforts to curtail Moscow's revenues during the Ukraine war. Russia has been India's top crude supplier for the past two years. Sign up here. India imported about 3 million tons (74,000 barrels per day) of naphtha from April 2024 to March 2025, with Russia supplying more than half, up from just 14%-16% of the total in the previous year, ship-tracking data from OilX and Kpler showed. Russian naphtha from Ust-Luga, Sheskharis and Novorossiysk ports arrived at the western Indian ports of Mundra, Hazira, and Sikka, ship-tracking data showed, for petrochemical plants of HPCL Mittal Energy Ltd (HMEL) and Reliance Industries (RELI.NS) , opens new tab. "We will buy from wherever it is cheaper," HMEL Managing Director & Chief Executive Officer Prabh Das told Reuters on Wednesday at an industry gathering, without commenting on its Russian oil purchases. RIL did not respond to a request for comment. Russian naphtha was $14-$15 per ton cheaper than Middle Eastern product as of this week, two trade sources said. India ranks only seventh among Asian naphtha importers, Kpler data showed, but imports will rise due to growing domestic petrochemicals demand and upcoming crackers in the next 3-4 years. Meanwhile, the UAE's share, mainly from Abu Dhabi National Oil Co, dropped to just over 20%, nearly half of its level in the same period, the data showed. ADNOC declined to comment on its naphtha supplies to India. "Prices have been attractive for us and we will continue to purchase from them (Russia)," a source at an integrated refining complex in northern India said, adding that margins in Indian market are lower than their expectation so far this year, so refiners will prefer cheaper feedstock. Russia diverted naphtha exports to Asia after Europe banned Russian oil imports over the 2022 Ukraine invasion. The Trump administration is working on a Ukraine ceasefire deal which could lead to the lifting sanctions on Russian oil, analysts said. However, Asian countries may remain as Russia's top oil buyers as Europe may still avoid Russian imports even if U.S. sanctions are lifted, Rystad Energy analyst Jorge Leon said. Indian naphtha imports (Unit: 1,000 metric tons) https://www.reuters.com/markets/commodities/russia-replaces-uae-top-naphtha-supplier-india-2024-25-2025-03-20/

2025-03-20 07:00

Short bets on Chinese yuan lowest in more than one year Bearish bets on S.Korean won at over 4-month low Dollar weakness prompts cutback on Asia FX shorts March 20 (Reuters) - Investors pared bearish bets on Asian currencies as the U.S. dollar faltered, with markets increasingly anxious that President Donald Trump's protectionist trade agenda could derail growth in the world's largest economy, a Reuters poll showed on Thursday. Short positions on China's yuan fell to their lowest since January 2024 while bearish bets on the South Korean won retreated to levels not seen since mid-October, according to a fortnightly survey of 11 respondents. Sign up here. In a significant shift, analysts turned bullish on the Philippine peso for the first time since early October, with long positions reaching their highest in over three months. Currency markets have pivoted in recent months as traders reassess their earlier view that Trump's policies would bolster the dollar, with the greenback instead weakening amid concerns his aggressive tariff agenda could trigger a broader economic slowdown, with sentiment indicators deteriorating. The dollar index , which measures the currency against six key rivals, has dropped over 6% from the more than two-year peak of 110.17 hit in mid-January. It was at 103.4 by 0635 GMT, struggling to make a decisive move away from a five-month low of 103.21 touched last Tuesday. The specter of an escalating tariff war threatens to hamper global growth and trade while eroding market confidence and pressuring Asian currencies ahead of the April 2 reciprocal tariff deadline, Christopher Wong, FX strategist at OCBC, said. Investors also scaled back short positions on the Singapore dollar and Indonesian rupiah to their lowest since July 11 and December 12, respectively. Despite the improved sentiment, the rupiah remains the region's worst performer this year, down over 2% against the dollar, as investors fret over fiscal sustainability and uncertainty surrounding President-elect Prabowo Subianto's ambitious spending plans and speculation that reputed finance minister Sri Mulyani may resign. "My outlook for EM currencies in Asia, including IDR, is that they will likely be rangebound for the time being as such uncertainties remain but additional factors to worsen the current situations are not expected for now," said Ryota Abe, an economist at SMBC. The survey responses were collected before Bank Indonesia maintained its policy rate on Wednesday and the Federal Reserve held rates steady while signalling two potential quarter-point cuts this year—decisions that further calmed investor sentiment across Asian markets. Analysts have turned decidedly bullish on Philippine markets, citing cooling inflation, expected rate cuts and insulation from Trump's tariff threats, with sentiment further bolstered as the country launched its three-month campaign period for May's midterm elections. In China, Beijing unveiled sweeping consumption-boosting measures including income hikes and childcare subsidies, days after regulators urged credit easing—moves analysts say could revitalize Southeast Asia's largest trading partner. The Asian currency positioning poll is focused on what analysts and fund managers believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht. The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3. A score of plus 3 indicates the market is significantly long U.S. dollars. The figures include positions held through non-deliverable forwards (NDFs). The survey findings are provided below (positions in U.S. dollar versus each currency): https://www.reuters.com/markets/currencies/investors-scale-back-bearish-asian-fx-bets-turn-bullish-philippine-peso-2025-03-20/

2025-03-20 06:58

Sees 2025 EBITDA pre exceptionals at 600-650 million euros, below consensus Stock falls 5.6% in premarket trade March 20 (Reuters) - German speciality chemicals maker Lanxess (LXSG.DE) , opens new tab said on Thursday it expected full-year 2025 earnings to be impacted by slow economic growth and a high likelihood of politically triggered economic turbulence. Lanxess attributed the cautious outlook to the war in Ukraine, conflicts in the Middle East and trade policy changes in the United States. President Donald Trump has imposed a variety of blanket tariffs on several countries since his inauguration, and threatened further levies going forward. Sign up here. Metzler Bank analyst Thomas Schulte-Vorwick said the guidance was "relatively conservative" because it did not include any potential positive impact from the new German government's spending surge or a possible Ukraine peace deal. "However, the first quarter and first half as a whole are more likely to be characterized by increased geopolitical uncertainty and investment restraint, especially in the US," Schulte-Vorwick said. Lanxess fell 5.6% in pre-market trade. Germany's chemical industry has struggled to grow since 2023, with inflation driving up production costs and hurting customer demand. Early signs of recovery in 2024 faded by the half-year point as the country's industrial outlook deteriorated. Lanxess also said it expected the chemicals industry to face challenges in 2025, particularly in the Americas, Europe, the Middle East and Africa regions. This outlook echoes sentiment from Germany's chemicals association VCI, which recently lowered its 2025 sector forecast, blaming geopolitical uncertainty. VCI has said it does not anticipate a recovery before 2026. Lanxess forecast earnings before interest, taxes, depreciation and amortisation (EBITDA) pre exceptionals between 600 million and 650 million euros ($654 million and $707 million) for 2025, including the pro-rata contribution of Urethane Systems. Vara Research analysts had expected the company's 2025 EBITDA pre exceptionals to reach 674.8 million euros. ($1 = 0.9198 euros) https://www.reuters.com/markets/commodities/lanxess-sees-full-year-core-profit-hit-economic-slowdown-political-risks-2025-03-20/