2024-11-18 02:41

MUMBAI, Nov 18 (Reuters) - The Indian rupee is expected to linger near its all-time low on Monday, wedged between positive cues on mild gains in its regional peers, while persistent foreign portfolio outflows keep a lid on the currency's upside. The 1-month non-deliverable forward indicated that the rupee will open near 84.40 against the U.S. dollar compared with 83.3950 in the previous session. The currency had weakened to its all-time low of 84.4125 last week. Asian currencies were mostly higher between 0.1% to 0.3% on day while the dollar index was a tad lower at 106.6 after declining 0.2% on Friday. The rupee is likely to see "another week of shallow price action," a trader at a state-run bank said. The trader expects the central bank's interventions to offer firm resistance to rupee bears near 84.50 levels. A rally in the dollar and the rise in US bond yields following Donald Trump's victory in the U.S. election has weighed on Asian currencies over the last two weeks, including the rupee. Analysts reckon Trump's touted policies of tariffs, reduced immigration and debt-funded tax cuts will be inflationary, thereby limiting the scope for further interest rate cuts by the Federal Reserve. The 10-year U.S. Treasury yield touched a more than 5-month peak of 4.50% on Friday. Fed Chair Jerome Powell said last week that there was no need for the central bank to rush to cut rates. The cautious message from Powell "failed to provide the dollar with further upside impetus which could be an early signal of the Trump-related dollar buying is fading", MUFG Bank said in a note. In addition to the global cues, the rupee has also been weighed down by sustained portfolio outflows. Foreign investors have pulled out over $3 billion from local stocks and bonds in November, adding to the $11.5 billion outflow last month. KEY INDICATORS: ** One-month non-deliverable rupee forward at 84.51; onshore one-month forward premium at 11 paisa ** Dollar index down 0.1% at 106.63 ** Brent crude futures up 0.4% at $71.3 per barrel ** Ten-year U.S. note yield at 4.43% ** As per NSDL data, foreign investors sold a net $160.2mln worth of Indian shares on Nov. 13 ** NSDL data shows foreign investors sold a net $15mln worth of Indian bonds on Nov. 13 Sign up here. https://www.reuters.com/markets/currencies/relief-asian-peers-may-slightly-aid-rupee-portfolio-outflows-weigh-2024-11-18/

2024-11-18 00:45

SYDNEY, Nov 18 (Reuters) - China's crude oil surplus nearly halved in October, but this was a further sign of weakness as both imports and refinery runs dipped. The volume of excess crude was about 550,000 barrels per day (bpd) in October, according to calculations based on official data, down from 930,000 bpd in September. In more normal circumstances, a decline in crude flowing into inventories may be viewed as a sign that demand was picking up, but so far 2024 is far from a normal year for China's oil sector. The dynamic at play in October was that crude imports fell by more than refinery throughput, thus trimming the amount of spare crude. China, the world's biggest crude importer, doesn't disclose the volumes of oil flowing into or out of strategic and commercial stockpiles, but an estimate can be made by deducting the amount of crude processed from the total of crude available from imports and domestic output. Domestic production in October was 4.04 million bpd, up 2.5% from the same month last year, according to data from the National Bureau of Statistics, while imports were 10.53 million bpd. Putting domestic output together with imports gives a combined total of 14.57 million bpd available for processing in October, down from 15.22 million bpd in September. Refinery throughput was 14.02 million bpd in October, down from 14.29 million in September. This means that refineries processed 550,000 bpd less than what was available from the combined total of imports and domestic production. This was lower than the surplus of 930,000 bpd from September, and the drop in the October figure was enough to lower the excess crude for the first 10 months to 1.05 million bpd from 1.10 million bpd over the first three quarters. It's worth noting that not all of this surplus crude is likely to have been added to storage, with some being processed in plants not captured by the official data. But even allowing for gaps in the official data, it's likely that China has been importing crude at a far higher rate than it needs to meet its domestic fuel requirements. PROFIT BATTLE There are some short-term factors that have resulted in lower refinery processing, with smaller, independent refineries struggling to make profits amid soft demand for diesel and gasoline. This has led to some of them reducing operating rates, with data from consultancy Sublime China Information showing these plants, mostly located in the refining hub of Shandong province, were operating at 58.7% of their capacity by late October, down from 77% a year earlier. China's regulated fuel prices may garner some of the blame for cutting margins for refiners, which have to buy crude at international prices. It's also the case that the world's second-largest economy is battling to build growth momentum, with Beijing's stimulus measures underwhelming market watchers and as yet failing to reverse the downtrend in the key property sector. But there is also a structural shift underway in China's crude oil demand, with the rapid uptake of what Beijing terms new energy vehicles, which include full electric vehicles and hybrids, cutting into gasoline demand. A switch to trucks powered by liquefied natural gas has cut diesel demand, and the ongoing development of battery-powered heavy vehicles means this trend may accelerate in coming years. The move to LNG is largely driven by price as it is cheaper than diesel, while also delivering some environmental benefits. For light vehicles, government subsidies for consumers to switch to new energy cars have boosted sales, but China's competitive advantage in making these types of vehicles means they have become cheaper to own and operate than their gasoline equivalents. China's soft economy and its push to cut the use of vehicles using products derived from crude oil has meant that expectations for strong demand growth that were common among forecasters earlier this year have been overly optimistic. The Organization of the Petroleum Exporting Countries (OPEC) was among the most bullish, forecasting in July that China's oil demand growth would rise by 760,000 bpd in 2024. The group cut this back to 580,000 bpd in its October report, but given that crude oil imports are down 420,000 bpd in the first 10 months of 2024 from the same period last year, even this reduced figure looks way too high. Throw in further risks to China's economy from a potential trade war with the United States when Donald Trump starts his second term as president in January, and it's a challenge to find anything bullish in China's oil outlook. The views expressed here are those of the author, a columnist for Reuters. Sign up here. https://www.reuters.com/markets/commodities/chinas-surplus-crude-oil-eased-october-this-is-still-bearish-russell-2024-11-18/

2024-11-18 00:18

Nov 18 (Reuters) - Australia's Resolute Mining (RSG.AX) , opens new tab said on Monday that it would pay $160 million to Mali's government to help resolve a tax dispute after the West African country detained its CEO Terence Holohan and two other employees this month. Resolute has made an initial payment of $80 million as part of the settlement from existing cash reserves and will make future payments of about $80 million in the coming months from existing liquidity sources, it said in a statement. After the news, Resolute shares fell as much as 14.3% in early trading on Monday to A$0.345, their lowest since March 1. The detained employees were in Mali's capital Bamako to hold discussions with mining and tax authorities regarding general activities related to the company's business practices, the company said last week. Resolute is currently working with the Mali government to release the detained employees, who remain "safe and well" and are receiving support from the UK and international embassies and consulates, the miner said on Monday. "We are supporting three British nationals who have been detained in Mali and are in contact with the local authorities," the British government's foreign office said in response to their detention. Mali is one of Africa's top gold producers and the detention of mining company employees, which have also included some senior local staff at Canada's Barrick Gold (ABX.TO) , opens new tab, is becoming part of a pattern as the government seeks to extract more income from the sector. Resolute's gold mine in Syama, Mali - one of its two operational mines - contributed nearly two-thirds of its annual sales of 329,061 ounces in 2023. Resolute owns an 80% stake in the project, while Mali's government holds the rest. "The Company notes that operations on site continue as normal and have not been impacted," Resolute said in its statement. Sign up here. https://www.reuters.com/markets/commodities/resolute-mining-agrees-pay-160-mln-mali-ceo-employees-remain-detained-2024-11-18/

2024-11-17 23:59

ISTANBUL, Nov 17 (Reuters) - Ship traffic in Istanbul's Bosphorus Strait was suspended on Sunday in both directions due to a rudder failure on a 114-metre tanker, the Nazann, the Transportation Ministry said. The vessel, en route from Russia to Kocaeli in Turkey, had mechanical problems in the strait and the coast guard deployed tugboats, the ministry said. The tanker was safely anchored at Ahırkapı with assistance from tugboats after vessel rudder failure in the Bosphorus. Northbound traffic in the strait resumed at 0050 local time Monday (2150 GMT Sunday) as expected, according to local news reports. The Bosphorus connects the Black Sea in the northeast to the Sea of Marmara to the southwest, and beyond to the Mediterranean. Sign up here. https://www.reuters.com/world/middle-east/traffic-resume-turkeys-bosphorus-after-suspension-due-vessel-rudder-failure-2024-11-17/

2024-11-17 23:56

PARIS, Nov 18 (Reuters) - Farmers will protest across France on Monday as the prospect of a trade deal between European and Mercosur countries sharpens discontent over foreign competition that fuelled a farming crisis earlier this year. A push by the European Union and South America's Mercosur bloc to conclude long-running trade negotiations by the end of the year has rekindled anger in France. Similar frustration was voiced by farmers across Europe last winter after a surge in imports from Ukraine following Russia's invasion. However, the mood in France has soured further, after rain-hit harvests, livestock disease outbreaks and a parliamentary election that delayed measures promised to defuse the previous protests, which saw farmers block highways for weeks. "We have the same demands as in January, nothing has changed," Armelle Fraiture said on her dairy farm north of Paris. "We must make the government understand that enough is enough." As farmers face cheaper imports, burdensome regulations and meagre incomes, a Mercosur deal would represent a bitter "cherry on the cake", Arnaud Rousseau, head of France's main farmers' union, the FNSEA, told BFM TV on Sunday. Tens of thousands of farms in France, the EU's biggest agricultural producer, were in financial trouble, he said. French farmers fear a Mercosur accord will bring more beef, chicken, sugar and maize from Brazil and Argentina, countries they say use pesticides on crops and growth antibiotics in livestock that are outlawed in Europe. Farmers will hold rallies on Monday and Tuesday, mostly in front of government buildings, as part of protests planned until mid-December, Rousseau said. Ahead of the nationwide action, a small group of farmers with tractors blocked one side of a highway near Paris on Sunday evening, displaying slogans like "Let's not import the agriculture that we don't want." President Emmanuel Macron on Sunday reiterated his opposition to a deal with Mercosur as proposed. But with France lacking EU allies in the Mercosur talks, and rural grievances running deep, the authorities may struggle to placate the farmers. "We know we're going out (to protest), but we don't know when we're coming back," Fraiture said. Sign up here. https://www.reuters.com/world/europe/french-farmers-back-streets-mercosur-talks-fuel-discontent-2024-11-17/

2024-11-17 23:12

Dollar holds near one-year high as yields support BOJ Gov flags gradual hikes, but vague on timing Host of Fed, ECB officials to speak this week SYDNEY, Nov 18 (Reuters) - The dollar rose against the yen on Monday after Japan's top central banker flagged further policy tightening ahead but left open the question of timing, leaving the market no clearer on whether a move would come next month. Bank of Japan Governor Kazuo Ueda reiterated that interest rates would continue to rise gradually should the economy develop in line with the central bank's outlook. However, he made no mention of whether a hike would come in December, saying the BOJ would need to pay attention to various risks, including for the U.S. economy. Later in a media conference, Ueda added that they would not wait for clarity on all the risks before acting on rates, and delaying might end up requiring more aggressive hikes. That left the market pricing in a 54% chance of a quarter-point hike at the next policy meeting on Dec. 19, little changed from before the speech. This was his first opportunity to speak directly on monetary policy since Donald Trump's victory in the U.S. presidential election on Nov. 5, leading investors to wonder if he would be more specific on the prospects for a hike. The lack of clear guidance saw the dollar edge up 0.35% to 154.72 yen and away from Friday's low of 153.86. It pulled back late last week after Japanese Finance Minister Katsunobu Kato on Friday put the market on warning of possible intervention if the yen fell too far and too fast. That retreat had helped steady the euro for the moment at $1.0540 , though that was still uncomfortably close to the recent one-year trough of $1.0496. Against a basket of currencies the dollar held at 106.660, having touched a one-year top of 107.07 on Friday. The index climbed 1.6% over the week, marking six weeks of gains in the last seven. The rally has coincided with a savage swing in 10-year Treasury yields, which have climbed 70 basis points since the start of October, fuelling a 5.4% rise in the U.S. dollar index. PRICING U.S. EXCEPTIONALISM "While a period of consolidation looks likely in the near term, we have revised up our forecasts for the dollar and now project a further 5% appreciation by the end of 2025," said Jonas Goltermann, deputy chief markets economist at Capital Economics. "That is based primarily on a view that Trump will push ahead with the core tariff policies he proposed on the campaign trail and that the U.S. economy will continue to outperform its major peers." Markets are eager to hear who Trump will pick as Treasury Secretary, with Howard Lutnick, the CEO of Cantor Fitzgerald, and investor Scott Bessent top candidates for the job. Analysts generally assume Trump's touted policies of tariffs, reduced immigration and debt-funded tax cuts will be inflationary, so limiting the scope for further rate cuts by the Federal Reserve. Futures imply a 60% chance of the Fed easing by a quarter-point in December and have only 77 basis points of cuts priced in by late 2025, compared with more than 100 a few weeks ago. At least seven Fed officials are due to speak this week and traders assume they will sound cautious on aggressive cuts. A number of European Central Bankers are also speaking this week and could sound more dovish given recent soft economic data and the risk of tariffs hitting EU trade. The data calendar for the U.S. is light this week, but the UK, Japan and Canada all have important inflation reports due, while manufacturing surveys out late in the week will offer a clue to how sentiment is faring post the U.S. election. Sign up here. https://www.reuters.com/markets/currencies/dollar-sitting-pretty-yen-bears-wary-boj-hawks-2024-11-17/