2025-02-21 09:14

JOHANNESBURG, Feb 21 (Reuters) - South Africa's rand was stable on Friday after a volatile week in which it weakened over the last-minute postponement of the national budget but then recovered thanks to buoyant global gold price. At 1508 GMT, the rand traded at 18.32 against the dollar , near its previous close of 18.3225. The national budget was delayed on Wednesday due to disagreements within the country's coalition government over a proposal to hike value-added tax. Analysts said the postponement, the first in the country's post-apartheid history, meant weeks of uncertainty before a new budget is presented in mid-March. The delay "highlights the risk that this grand coalition is an experiment that can go wrong at any time," Commerzbank analyst Volkmar Baur said in a research note. Andre Cilliers, a currency strategist at TreasuryONE, said markets would be looking to see whether the revised budget focuses on debt consolidation and expenditure cuts. If it does, the rand could strengthen, he said in another note. Prices of gold, a major South African export, were on track for an eighth week of gains. On the stock market, the Top-40 (.JTOPI) , opens new tab index was little changed. South Africa's benchmark 2030 government bond was stronger, with the yield down 3.5 basis points at 9.155%. Sign up here. https://www.reuters.com/markets/currencies/south-african-rand-stable-after-volatile-week-2025-02-21/

2025-02-21 08:24

BOJ may hike rates to 0.75% in March, 1% by year-end, Shirai Japan is facing typical cost-push inflation due to weak yen BOJ can justify rate hikes as aimed at countering weak yen TOKYO, Feb 21 (Reuters) - The Bank of Japan may raise interest rates in March if U.S. President Donald Trump pushes through on his tariff threats and adds to already mounting domestic inflationary pressures, former central bank board member Sayuri Shirai said on Friday. While Trump's threatened new tariffs on imports from Canada and Mexico were postponed for a month at the beginning of February, a 10% levy on all Chinese imports has been imposed. Trump may also threaten or slap tariffs on European goods which, combined, could push up inflation across the globe, Shirai said. "The BOJ is probably keeping a close eye on the tariff developments. March would be a good opportunity to raise rates again" as domestic inflation is already quite high, Shirai told Reuters in an interview. A majority of economists polled by Reuters expect the BOJ to hike rates once more this year, most probably during the third quarter, to 0.75%, though money markets suggest investors are betting on a near-70% possibility of two more hikes this year. None of those polled expected the BOJ to raise interest rates at the March 18-19 meeting. While Japan's broader economy remains weak, the central bank must keep raising interest rates to counter the weak yen as it is among major factors driving up food and energy prices, said Shirai, who is now a professor at Japan's Keio University. "What Japan is facing is typical cost-push inflation driven in large part by a weak yen," she said. "If the weak yen is accelerating inflation and becoming a major problem for Japan's economy, the BOJ should say so and keep raising rates." While the yen has bounced back from a three-decade trough near 162 hit in July last year, many analysts see the currency as still under-valued and causing more harm than good to the economy by pushing up import costs. The yen was around 150 to the dollar on Friday. The BOJ exited a decade-long, massive monetary stimulus last year and raised its short-term interest rate to 0.5% from 0.25% in January, reflecting its conviction that Japan was making progress in sustainably achieving its inflation target of 2%. Governor Kazuo Ueda has signalled his readiness to keep raising rates if wages continue to increase and underpin consumption, thereby allowing firms to keep hiking pay. If the BOJ were to raise rates in March to 0.75%, it could hike again to 1.0% later this year depending on how Trump's tariffs affect yen moves, Shirai said. "There's a possibility the BOJ could hike rates to 1% by the end of this year, though there's a lot of uncertainty surrounding the fallout from Trump's policies," she said. "BOJ policymakers probably want to hike rates when they can, so they have scope to cut them in times of economic difficulty," Shirai said. Governor Ueda has said the yen's weakness could accelerate inflation by pushing up import costs. But the BOJ has never said its rate hikes are directly aimed at propping up the yen, as doing so could draw complaints from its G20 counterparts as currency manipulation. But Shirai said a long-held agreement among G7 and G20 nations to refrain from using monetary policy to influence currency rates is aimed at preventing countries from devaluing their currencies to gain a competitive trade advantage. "I don't think any country will complain about Japan trying to stop excessive yen declines" through rate hikes, she said. Sign up here. https://www.reuters.com/markets/rates-bonds/boj-could-raise-interest-rates-march-says-ex-policymaker-shirai-2025-02-21/

2025-02-21 07:53

TOKYO, Feb 21 (Reuters) - Japan's biggest refiner, Eneos Corp, said on Friday it had shut down a 141,000 barrels-per-day (bpd) crude distillation unit (CDU) at its Sakai refinery on February 17 after a fire there that day. A company spokesperson declined to comment on the cause of the unplanned shutdown or say when it might restart. The refiner, which is a unit of Eneos Holdings (5020.T) , opens new tab, restarted the 172,100 bpd No.2 CDU at its Kawasaki refinery on February 13 after an unplanned shutdown on January 29, the spokesperson added. Eneos also conducted an unplanned shutdown of the 136,000 bpd CDU at its Oita refinery from January 21 to 27, the spokesperson said. The company plans to shut the 105,000 bpd No.3 CDU at its Mizushima-B refinery later this month for scheduled maintenance. Sign up here. https://www.reuters.com/business/energy/japans-eneos-shuts-141000-bpd-sakai-cdu-after-fire-2025-02-21/

2025-02-21 07:42

EDF sees FID on six new nuclear reactors in 2H 2026 Reports smaller core profit for 2024 on lower prices Sees further hit to 2025 income as prices fall Debt levels poses challenge - analyst PARIS, Feb 21 (Reuters) - French power giant EDF doesn't expect to make a final decision on building six new nuclear reactors in the country until the second half of 2026, CEO Luc Remont said on Friday, after auditors flagged uncertainties over financing and design. French President Emmanuel Macron announced a plan in 2022 for the state-owned utility to build six new reactors to rejuvenate its ageing nuclear fleet, with construction due to start in 2027. EDF, which runs Europe's largest nuclear fleet, had said last year it would take a final investment decision (FID) at the end of 2025 or early 2026. Costs were estimated in 2023 at 67 billion euros ($70.12 billion). Last month the French court of auditors recommended that the company should not take a final investment decision until it finalises its designs and secures financing. Speaking to reporters on Friday as EDF announced annual results, Remont said a decision was now expected "around the second half of 2026". EDF's core profit fell last year to 36.5 billion euros ($38.28 billion), down from 39.9 billion euros a year earlier, it said on Friday, hit by lower power prices. With more renewable power reaching the grid and power demand low, the number of hours with market prices below 10 euros per megawatt hours almost tripled compared to 2023, it said. A reduction of another 7-9 billion euros in EBITDA is expected this year, said Remont. Low prices will challenge EDF, said Nicolas Goldberg, partner at Paris-based Columbus Consulting. "If EDF can't wipe out its debt this year with profits, it can be concerning because it would mean the debt from their maintenance work is persistent and would reduce the group's ability to finance their investments through debt," he said. The company said 2024 net debt was stable at 54.3 billion euros. EDF's net profit rose to 11.4 billion euros, compared to 10 billion in 2023 thanks to a significant reduction in impairment charges on Britain's long-delayed Hinkley Point C project. Remont said the company continues to seek new investors in the project after Chinese partner CGN pulled out. EDF also took a 900 million euro impairment charge on the Atlantic Shores offshore wind farm project in the United States "to reflect the new American political landscape", said Remont. Partner Shell has already written down its stake in the venture. ($1 = 0.9555 euros) Sign up here. https://www.reuters.com/business/energy/edf-annual-core-earnings-drop-lower-electricity-prices-2025-02-21/

2025-02-21 07:26

Libra is latest high-profile meme coin Majority of traders left with losses Crypto industry wary as coins spark backlash Feb 21 (Reuters) - A cryptocurrency that briefly surged on Argentine President Javier Milei's support before crashing is the latest in a series of politically endorsed meme coins facing a backlash. The Libra cryptocurrency was launched in Argentina last Friday, after U.S. President Donald Trump and his wife released cryptocurrencies named after themselves three days before Trump's inauguration on January 20. Central African Republic's President Faustin-Archange Touadera also created an official meme coin earlier this month. Meme coins are crypto tokens named after popular internet trends or people. While most never take off, some catch on: dog-themed Dogecoin, which soared when billionaire Elon Musk began tweeting about it in 2020, remains the eighth-biggest cryptocurrency. While some crypto executives cheer the tokens' ability to attract new investors, others say the politician-linked coins go too far, and risk harming the industry's attempts to improve its image after years of scandals. "It's a very controversial topic," said Thomas Puech, CEO of Miami-based crypto fund INDIGO. "You can look at it from the perspective that all publicity is good publicity," but when it comes to the Trump token, Puech said "a lot of retail traders or crypto novices trying to surf a wave were left with a bad taste in their mouth." Meme coins, if they take off, tend to post staggering rises in price before collapsing. Most people who buy lose money, while a small group of traders and the coin creators profit. "Some meme coins have clearly gone too far lately, to the extent people are insider trading," Brian Armstrong, CEO of crypto exchange Coinbase (COIN.O) , opens new tab, said on X without naming any coins. After peaking above $70 within two days of its launch, Trump's coin has plunged to around $17, data from CoinGecko shows. For the Libra coin - which Milei promoted in a post on X - most traders lost money but 34 accounts made $124.6 million between them, according to crypto researchers Nansen. The token peaked above $4.50 on Friday, but plunged more than 95% over the next few hours. Milei later deleted the post and denied having any business link to the cryptocurrency. A federal judge is investigating the token's launch and Milei's involvement. Argentina's stock market fell but soon recovered after investors decided it was unlikely the scandal would result in Milei's impeachment. Rodolfo Andragnes, founder of Bitcoin Argentina NGO, a non-profit that promotes crypto, said the Libra incident was "a missed opportunity" for Argentina's cryptocurrency industry. Crypto company Nansen agreed. "What started with a presidential endorsement and a $4.5B valuation quickly unraveled as 'insiders' took profits, retail got burned, and key backers distanced themselves," Nansen said in a report. "The real damage? Trust erosion and broader fatigue from yet another viral token blowing up before most people even had a chance to process what was happening." Around $99 million worth of cryptocurrency was withdrawn from Libra's marketplace by eight digital wallets linked to the crypto token's creator, blockchain data showed. A little-known crypto executive behind the token denied it was a 'rug-pull' scam. Hayden Davis, whose now-unavailable LinkedIn page said he is CEO of Kelsier Ventures, described himself in a statement on the crypto company's X account on Sunday as a "launch advisor" for the token. In an interview with crypto YouTuber Stephen Findeisen, known as "Coffeezilla," released on Monday, Davis said he was also connected with the launch of the $MELANIA meme coin, which was promoted last month by first lady Melania Trump. That token initially surged to as high as $13.05 before crashing to around $3.49 hours later, according to crypto data provider CoinGecko. EXPERIMENT Crypto executives also worry that the speculative nature of meme coin trading risks undermining the industry's bid to be taken seriously. Their makers dispute this. The Central African Republic's president said its token was an experiment to "unite people, support national development" and put the country on the world stage. A website promoting the Libra token said it would "channel funding" into promoting growth in Argentina. Trump's token triggered warnings last month from ethics advisers that it created new conflict-of-interest concerns because his administration will regulate an industry in which he has a stake through the coin. Trump had pledged to put his assets in a trust managed by his children on entering the White House. Meme coins' total market cap, at $68.3 billion, is down sharply from a peak in June 2024 of $127.3 billion, according to CoinMarketCap data. "One cannot evaluate it as a rational investment as the product isn't rational," said Puech, adding that INDIGO puts a "very small" part of its funds into meme coins. "It's a game of hot potato and you need to make sure you're not the last one holding it; otherwise you get your hands burnt." Sign up here. https://www.reuters.com/technology/politician-linked-meme-coins-backfire-after-libra-scandal-2025-02-21/

2025-02-21 07:21

LONDON, Feb 21 (Reuters) - The pound traded around two month-highs on Friday after data showed UK consumer spending picked up much more sharply than expected in January, while a separate survey of business activity showed British companies are rapidly cutting staff. Finance minister Rachel Reeves, as part of her budget in late October, raised taxes on employers, which has prompted businesses to dramatically scale back their hiring plans. The preliminary reading of the UK S&P Composite Purchasing Managers' Index (PMI) for February dipped marginally to 50.5 from 50.6 in January, remaining just above the 50 level that separates growth and contraction. But there was a sharper fall in employment which sank to 43.5 from 45.3, its lowest since November 2020 or since the 2007-08 financial crisis excluding the COVID pandemic period. Sterling was last up 0.1% on the day at $1.2675, around its highest in two months, having traded at $1.266 prior to the figures. The euro was last down 0.1% against the pound at 82.81 pence, from 82.85 before the data. Wage growth in the UK remains strong, with regular pay rising at a rate of 5.9% in January, based on data earlier this week. Consumer inflation hit a 10-month high of 3% last month, while economic growth has been stronger than expected, but still fairly middling, at just 0.1% in the final quarter of 2024. The prospect of an economy that is barely growing and sticky inflationary pressures has prompted traders to price in no more than two more rate cuts this year from the Bank of England. The pound has been grinding higher since the start of the year, up 1.2%, ranking it towards the bottom of the G10 pack, following its performance as the biggest gainer among major currencies against the dollar in 2024. "We would not be jumping on sterling longs given the current stretched levels and the appreciation recorded since mid-January," strategists at BBVA said in a note. A separate data release earlier on Friday showed British retail sales rose by 1.7% in January, according to the Office for National Statistics, above forecasts for a rise of 0.3%. December's figure was revised down to show a monthly drop of 0.6%, from an initial reading of a 0.3% decline. Sign up here. https://www.reuters.com/markets/currencies/sterling-edges-up-after-stronger-uk-retail-sales-2025-02-21/