2025-01-30 18:07
SANTIAGO, Jan 30 (Reuters) - Canadian miner Lundin (LUN.TO) , opens new tab must permanently close its Alcaparrosa copper mine in Chile, the South American nation's environmental regulator said on Thursday, after a massive sinkhole cracked open near the small mine in 2022. Lundin had paused work at the site after a sinkhole more than 60 meters deep opened in the Tierra Amarilla village in northern Chile, but had pushed to restart mining at Alcaparrosa. Chile's SMA regulator said in a statement that it had ruled Lundin was responsible for the sinkhole, that it must shutter the mine and pay a fine of 3.36 billion pesos ($3.41 million). Lundin "operated in unauthorized sectors, up until the Copiapo River aquifer, which allowed more water to infiltrate in and subsequently weaken the rock mass," regulator head Marie Claude Plumer said in a statement. "The company caused irreparable environmental damage," she added. The miner's local unit, Ojos del Salado, said in a statement that it would review the ruling and determine its nexts steps. ($1 = 984.0500 Chilean pesos) Sign up here. https://www.reuters.com/world/americas/chile-orders-lundin-shut-small-copper-mine-after-causing-massive-sinkhole-2025-01-30/
2025-01-30 18:03
Lula calls for mutual respect in Brazil-U.S. trade relations Lula supports Petrobras' autonomy in pricing decisions Brazilian real and Bovespa index react positively to Lula's remarks BRASILIA, Jan 30 (Reuters) - Brazilian President Luiz Inacio Lula da Silva said on Thursday that his government would reciprocate if U.S. President Donald Trump decides to impose tariffs on Latin America's largest economy, and called for mutual respect. "It is very simple: if he taxes Brazilian products, there will be reciprocity," Lula told a press conference in Brasilia. The United States runs a trade surplus with Brazil, which according to Brazil's government hit $253 million last year. But Trump this week named the country among those he believes meant the U.S. "harm," threatening potential tariffs. "China is a tremendous tariff maker, and India, Brazil, so many countries," Trump said in a speech on Monday. "So we're not going to let that happen any longer, because we're going to put America first." The U.S. is a large buyer of Brazilian oil, steel products, coffee, aircraft and orange juice, while the South American country buys energy products, pharmaceutical goods and aircraft parts from the U.S., among other products. A Brazilian official had previously said the country hoped its trade deficit with the U.S. would help it avoid tariffs pledged by Trump on many nations. Brazil has not run a trade surplus with the U.S. since 2008. "I have governed Brazil while the U.S. had Republican and Democratic presidents, and our relationship has always been between two sovereign countries," said Lula, who in 2023 took office for his third non-consecutive term. "Trump was elected to run the U.S. and I was elected to run Brazil. I will respect the U.S. and want Trump to respect Brazil. That's all," Lula said. Leftist Lula had friendly relations with Trump's Democratic predecessor, Joe Biden, while Trump is closer to Brazil's former far-right President Jair Bolsonaro, who has been called "Trump of the tropics." MARKET-FRIENDLY REMARKS Lula at the press conference voiced support for government non-interference in monetary policy and the pricing strategy of state-run oil giant Petrobras, in market-friendly remarks that followed a drop in his approval ratings. He also said that if additional fiscal measures are needed during the year, "we will consider them," amid growing market concerns over Brazil's rising public debt. Lula said central bank chief Gabriel Galipolo "did what he thought was necessary" after policymakers raised the key interest rate by 100 basis points to 13.25% on Wednesday. Lula said Galipolo, who took office earlier this month, would set the conditions for lowering interest rates "at the appropriate time" and would have full autonomy in his role. Amid reports that Petrobras (PETR4.SA) , opens new tab was considering a diesel price hike, Lula emphasized that the decision rests with the company, "not the president." "Petrobras does not need to tell me (about fuel price tweaks). If Petrobras decides that it is important to make an adjustment, then they can do it," he said. A Genial/Quaest poll released this week showed Lula's approval ratings slipping, with disapproval surpassing approval for the first time in two years, driven by rising food prices, concerns over increased taxation, and market volatility. When asked about measures to ease food-related inflation, Lula ruled out steps that could lead to the creation of a black market. "What we can do is increase production of everything we can produce," he said. The Brazilian real pared some earlier losses after Lula's remarks, trading down about 0.4% against the U.S. dollar, while the benchmark Bovespa stock index (.BVSP) , opens new tab extended gains, rising 1.8%. Sign up here. https://www.reuters.com/world/americas/brazils-lula-says-petrobras-free-decide-fuel-price-tweaks-2025-01-30/
2025-01-30 17:53
Loonie trades in a range of 1.4393 to 1.4436 10-year yield touches a 7-week low at 3.120% Oil touches a 4-week low TORONTO, Jan 30 - The Canadian dollar tumbled to a near five-year low against its U.S. counterpart on Thursday and bond yields fell as U.S. President Donald Trump repeated his threat of hefty tariffs on goods from Canada and Mexico, potentially dashing hopes that the import taxes could be avoided. The loonie was trading 0.5% lower at 1.45 per U.S. dollar, or 68.97 U.S. cents, after hitting its weakest level since March 2020 at 1.4592 in a volatile move. Trump said he would likely decide by the end of the day whether to put a 25% tariff on that would take effect on Feb 1. "Confusion reigned for a few minutes on the headlines," said Adam Button, chief currency analyst at ForexLive, adding that there was an initial impression among traders that Trump was in the process of signing executive orders on the tariffs which led to a brief bout of market panic. "Later, as it became clear as he was once again threatening tariffs, much of the move faded but not all of it. The market reaction shows how on edge everyone is around tariffs," Button said. Remarks on Wednesday by U.S. Commerce Secretary nominee Howard Lutnick had brought some calm to the Canadian dollar market that proved short-lived. Lutnick said Canada and Mexico could avoid the tariffs if they acted swiftly to close their borders to fentanyl. The Mexican peso was trading 1.1% lower at 20.7260 per U.S. dollar. The Bank of Canada on Wednesday said a tariff war could cause major economic damage as it cut its benchmark interest rate by 25 basis points. Most of the loonie's decline in recent months was due to rising uncertainty around trade policies, the central bank said. Canadian bond yields fell across the curve. The 2-year was down 5.9 basis points at 2.738%, while it was trading 4.4 basis points further below the equivalent U.S. yield to a gap of about 147 basis points. That's the largest gap since September 1997. Sign up here. https://www.reuters.com/markets/currencies/canadian-dollar-steadies-investors-assess-us-trade-tariff-clues-2025-01-30/
2025-01-30 16:29
FRANKFURT, Jan 30 (Reuters) - European Central Bank President Christine Lagarde slapped down on Thursday a suggestion by her Czech colleague Ales Michl to include bitcoin among his country's official reserves. While the Czech Republic does not use the euro, it is part of the European Union and therefore its central bank sits on the ECB's General Council, which is chaired by Lagarde and advises member states on financial policy. Asked about including bitcoin in reserves, Lagarde - who said she had spoken to Michl - reaffirmed there was no place for the cryptocurrency in European central banking. "I am confident that ... bitcoins won't enter the reserves of any of the central banks of the General Council," she told a press conference following the ECB's interest rate decision. Michl's comments on Wednesday made waves in the financial community because central banks have steered well clear of cryptocurrencies, which were originally envisaged as an alternative to the official monetary system. Lagarde said she had a "good conversation" with Michl after his comments and that he agreed that central bank reserves should be "liquid, secure and safe". Bitcoin has rocketed in value over the last few years but it remains volatile and concentrated in the hands of relatively few holders. The Czech National Bank said on Thursday its board had approved conducting an analysis to look at broadening its reserves portfolio to include other asset classes, without mentioning bitcoin. Poland's central bank said on Thursday it was not considering investing in cryptocurrencies, "an asset class with very high risk". The Romanian central bank has also said it has no plans to include crypto in any way. Federal Reserve chair Jerome Powell said last month that the U.S. central bank was not allowed to own bitcoin. But U.S. President Donald Trump has sketched out an ambitious crypto strategy including a possible national cryptocurrency stockpile and support for globally available stablecoins pegged to the U.S. dollar. Sign up here. https://www.reuters.com/markets/europe/ecbs-lagarde-slaps-down-czech-proposal-bitcoin-reserves-2025-01-30/
2025-01-30 15:46
FRANKFURT, Jan 30 (Reuters) - A further European Central Bank interest rate cut is likely to go through in March without much resistance among policymakers before the debate between them on further easing becomes more heated, three of them told Reuters. The euro zone's monetary policymakers unanimously cut rates for a fifth time on Thursday, repeating that they expect inflation to settle at their 2% target this year against a backdrop of still-weak economic growth. Three policymakers who spoke to Reuters after the meeting said they saw a consensus for a further rate cut at the ECB's March 6 meeting, to take the rate the ECB pays on deposits to 2.5%. But they expected a broader, deeper discussion about any further cut after that, possibly implying a pause in April. They were expressing their views on condition of anonymity as these matters have not yet been discussed by the Governing Council. An ECB spokesperson declined to comment. ECB President Christine Lagarde said there was no discussion at Thursday's meeting about the final destination for rates and that the size and sequence of any future cut will be determined by incoming data. But she said the central bank's staff will publish a new estimate on Feb. 7 of the "neutral" interest rate that neither spurs nor curbs economic growth. The ECB currently sees the neutral rate at 1.75%-2.50%. Sign up here. https://www.reuters.com/markets/rates-bonds/ecb-governors-see-one-more-cut-before-debate-heats-up-sources-say-2025-01-30/
2025-01-30 15:12
BUENOS AIRES, Jan 30 (Reuters) - Traders and analysts expect Argentina's central bank to lower its benchmark interest rate as soon as Thursday, as inflation falls sharply and as the bank is set to slow the monthly pace of devaluation of the local peso currency. Starting Monday, the devaluation, known as the crawling peg, will slow down to 1% a month from 2% a month previously. The central bank's board meets every Thursday, and a rate cut could come by the afternoon or in the following days, analysts told Reuters. The bank did not respond to a request for comment. The benchmark rate, currently at 32%, will likely be cut by around 400 basis points, the analysts estimated. "A rate cut is coming, and the market is already expecting it," analyst Salvador Vitelli said. President Javier Milei, a libertarian economist who has vowed to take a "chainsaw" to public spending, has brought inflation down from the eye-popping double-digit increases recorded each month when he took over at the end of 2023. December's monthly inflation rate came in at 2.7%, with South America's second-largest economy ending Milei's first full year in office with annual price growth of 117.8%. With inflation expected to continue its slowdown this year, the central bank announced earlier this month it would slow the pace of peso devaluation. "The central bank would need to cut the interest rate 1,150 basis points to keep the 'spread' between the rate and the crawling peg - currently at 0.7% - unchanged," local financial advisory firm Delphos Investment said in a note. "However, we estimate that the cut will be around 400 basis points, which would leave a higher spread and further encourage traders to borrow in foreign currency." Markets in Argentina have rallied in recent days on the strength of their expectations. "The imminent reduction of the crawling peg, the potential rate cut, along with calm in the exchange rate, continues to create a snowball effect in favor of placements in pesos," economist Gustavo Ber said. Sign up here. https://www.reuters.com/world/americas/argentina-markets-brace-rate-cut-peso-crawling-peg-slows-2025-01-30/
