2024-11-06 07:03

KUALA LUMPUR, Nov 6 (Reuters) - Malaysia's central bank kept its benchmark interest rate (MYINTR=ECI) , opens new tab unchanged on Wednesday, in line with market expectations, amid a positive economic growth outlook and steady inflation. All 30 economists surveyed by Reuters had expected Bank Negara Malaysia to maintain its overnight policy rate at 3.00% at its final policy meeting of the year. Sign up here. https://www.reuters.com/markets/rates-bonds/malaysia-cbank-keeps-key-rate-300-final-policy-meeting-year-2024-11-06/

2024-11-06 07:02

Nov 6 (Reuters) - Belgian chemicals group Solvay (SOLB.BR) , opens new tab said on Wednesday it expected its 2024 core profit decline to be closer to 10%, at the positive end of its earlier guidance range, as its cost cutting measures yield results faster than anticipated. Solvay has been cutting costs due to soft demand and a volatile macroeconomic and geopolitical environment, aiming to save 300 million euros by 2028. Most recently, it said it planned to close its Salindres site in France in 2025, which would lead to a loss of 68 jobs. "While we still expect to reach 150 million euros ($161 million) savings by the end of 2025 ... we will end up 2024 above our 80 million euros objective that we announced earlier last quarter," CEO Philippe Kehren told journalists in a call. Solvay, which spun off speciality chemicals firm Syensqo (SYENS.BR) , opens new tab last year, had previously guided for a 10% to 15% decline in annual underlying earnings before interest, taxes, depreciation and amortisation (EBITDA). It reported underlying EBITDA of 259 million euros for the third quarter, little changed from last year and ahead of analysts' forecast of 250 million euros in a Vara consensus. However, it said negative pricing trends and soft demand would persist into the fourth quarter, coupled with potential seasonality effects towards the end of the year. "All in all, if we look at our main essential products, what we see is stability," Kehren said. "That's why we're saying we will continue to focus on what we control; our cost, our cash discipline, and prepare ourselves to be ready when the market recovers," he added. ($1 = 0.9315 euros) Sign up here. https://www.reuters.com/markets/commodities/belgian-chemicals-group-solvay-reports-q3-core-profit-beat-2024-11-06/

2024-11-06 07:00

Dollar index hits four-month high Trump beats Harris to retake White House Bitcoin hits record high Nov 6 (Reuters) - The dollar soared to a four-month high on Wednesday after Republican Donald Trump won the U.S. presidential election, with policies on immigration, tax and trade expected to spur higher U.S. growth and inflation. Trump beat Democrat Vice President Kamala Harris to retake the White House while Republicans also won a U.S. Senate majority. Control of the House of Representatives remains in question, with Republicans currently holding a majority. A full sweep by Republicans would allow the party to make larger legislative changes and in turn would likely provoke larger currency moves. Trump’s policies on restricting illegal immigration, enacting new tariffs, lower taxes and deregulation may boost growth and inflation and crimp the Federal Reserve’s ability to cut rates. "This can push inflation higher and force the Fed to a slower easing path, which is dollar-positive," said Nikos Tzabouras, senior market specialist at trading platform Tradu. The euro zone, Mexico, China and Canada are viewed as being at risk of potential new tariffs, which may hurt economic growth in the regions. That would widen their interest rate differentials with the United States and weigh on their currencies. The euro may also be weighed down by political uncertainty in Germany. German Chancellor Olaf Scholz sacked his Finance Minister Christian Lindner on Wednesday after weeks of wrangling over the economic direction of the government. Newspaper Bild had earlier reported that Lindner had recommended early elections as a solution to the budget impasse, a proposal Scholz had rejected. Nick Wood, head of execution at MillTechFX and Millennium Global notes that currency moves on Wednesday have been orderly, with some market participants holding relatively light positions heading into the U.S. election. “It seems like elements of the market were actually kind of running quite light in terms of risk, so therefore they can be a little bit more patient in terms of entering positions as opposed to feeling like you're the wrong side of something and having to exit a position at a speed,” he said. A complicating factor for the dollar outlook longer term, meanwhile, could be that Trump has stated a preference for a weak U.S. currency. “Both this year, but also during his previous stay at the White House, he had essentially challenged the longstanding strong dollar mantra, because he prefers a weaker currency to help with exports and American economic activity," said Tzabouras. "And he had also called for lower interest rates, so this could actually pose headwinds for the dollar in the long run as these policies begin to take shape.” The dollar index was last up 1.66% at 105.09 and reached 105.44, the highest since July 3. The euro dropped 1.78% to $1.0735 and got as low as $1.0683, the lowest since June 27. The greenback rose 1.92% to 154.5 Japanese yen and reached 154.7, the highest since July 30. The Japanese yen could now approach levels that prompted officials to intervene and shore up the currency earlier this year. Japan's chief cabinet secretary Yoshimasa Hayashi said on Wednesday that the government intended to closely watch moves on the foreign exchange market, including speculative moves, with a higher sense of urgency. Trump has also expressed favorable views on cryptocurrencies, which helped to lift bitcoin more than 10% to a record high of $76,134. The Fed is expected to cut rates by 25 basis points at the conclusion of its two-day meeting on Thursday and investors will also watch for any new clues on whether the U.S. central bank could pause cuts in December. A much stronger-than-expected jobs report for September led investors to pare back expectations on how many times the Fed is likely to cut rates. A much weaker-than-anticipated report for October has raised some doubts over this view though this data was clouded by the impact of recent hurricanes and labor strikes. Traders are now pricing 71% odds the Fed will also cut in December, down from 77% on Tuesday, according to the CME Group’s Fed Watch Tool. The Bank of England is expected to cut rates by 25 basis points on Thursday, while the Riksbank is seen easing by 50 basis points and the Norges Bank is expected to stay on hold. Sign up here. https://www.reuters.com/markets/currencies/dollar-climbs-trump-makes-early-gains-exit-polls-bitcoin-rises-2024-11-06/

2024-11-06 06:32

LITTLETON, Colorado, Nov 6 (Reuters) - Brazil is set to import nearly 900,000 metric tons of thermal coal this month, the highest monthly tally on record and three times the monthly average for 2024 so far, according to data from ship-tracking firm Kpler. The coal buying binge comes as an enduring drought has slashed hydropower output to three-year lows, leaving power producers low on power-generating fuels heading into the hottest months of the year when electricity demand peaks. Power firms have also lifted imports of liquefied natural gas (LNG) to their highest since late 2021, indicating that a steep rise in fossil fuel-fired generation is looming in South America's largest economy. Higher use of fossil fuels will in turn lift Brazil's power sector emissions, which are already at their highest since 2021. HYDRO LETDOWN Hydro power typically accounts for around 65% of Brazil's utility-scale electricity production, with hydro-electricity generation averaging just under 40 terawatt hours (TWh) a month throughout the first half of 2024, Ember data shows. However, in September hydro output fell to just 28.7 TWh as a drop in precipitation from the year before hit dam output. Cumulative rainfall in Brazil's southeast - home to many of the country's biggest dam systems - was just 584mm (23 inches) over the first 10 months of the year, according to LSEG. That was 10% less than the average from 2019 through 2023, and marks the second straight year of less than 600mm of rain over the opening 10 months of the year. The drop in actual hydro output also cut hydro's share of Brazil's generation mix to just 50% in September, forcing power suppliers to boost output from alternate sources in order to meet system demands. CLEAN CUT While Brazil has one of the world's cleanest power systems, utilities will likely rely on fossil fuels to generate much of the lost hydropower as output from gas and coal-fired power plants can be quickly adjusted to balance system needs. So far this year, hydro dams have generated around 63% of total electricity supplies, wind farms have accounted for around 15%, while solar farms have generated around 10%. Nuclear plants have accounted for an additional 2.5% share, while bioenergy plants - which mainly burn sugar cane pulp - have generated an additional 1.5%. The cumulative share of power generation from clean sources so far in 2024 is 92%, which remains one of the highest globally. However, the remaining 8% share of generation has come from fossil fuels, which look primed to be used in even greater volumes over the coming months if hydro output remains hindered. Natural gas has generated around 6% of Brazil's electricity so far in 2024, while coal and oil-fired plants produced an additional 2.2%. PEAK DEMAND A steep climb in overall power consumption is also placing Brazil's power firms under pressure to lift output. Brazil's electricity demand over the first nine months of 2024 is up nearly 7% from the same months in 2023, which is the strongest growth pace for that period since 2021 when the country's economy recovered from COVID-19-related restrictions. But overall power demand is likely to climb higher still heading into 2025 as homes, factories and offices all dial up the use of power-hungry cooling systems during summer. Average temperatures in Sao Paolo - Brazil's most populous city - can average over 10 degrees Fahrenheit (5.6 degrees Celsius) more during November through February than during the other months of the year, according to Weatherbase. Those higher summer temperatures - which can top 30C (86F) - tend to boost the use of air conditioners around the clock, and strain power networks. To meet those higher demand levels, utilities look set to lift output from the country's coal and gas-fired power plants, which will be well stocked from the scheduled imports of both coal and LNG that are en route. A sharp rebound in precipitation levels could help restore output from dam networks and limit the overall use of fossil fuels in 2025. But for the remainder of 2024 at least, substantially higher generation from coal and gas looks imminent, and means a flare up in regional power emissions will follow. Sign up here. https://www.reuters.com/business/energy/brazil-lifts-coal-imports-record-hydro-hit-lingers-maguire-2024-11-06/

2024-11-06 06:26

MUMBAI, Nov 6 (Reuters) - Economic activity in India remains strong, with the agriculture and services sectors doing well, India's central bank governor said on Wednesday, commenting on fears of slowing growth. Inflation, however, remains a challenge and the next move on interest rates must be weighed carefully, Shaktikanta Das, governor of the Reserve Bank of India, said at an event. "(Economic) data which is coming in is mixed. But the positives outweigh the negatives and, by and large, underlying activities remain strong," Das said. Corporate earnings for the July-September quarter have shown weakness in urban consumption, with fast moving consumer goods (FMCG) firms reporting flat or declining volume growth. High-frequency indicators, such as the purchasing managers index for manufacturing and services, slowed in September but rebounded in October. Das said he would not "rush to say the economy is slowing". Last month, the RBI retained its growth forecast for the current financial year at 7.2% and while it maintained interest rates, it eased its monetary policy stance to 'neutral' from 'withdrawal of accommodation', opening the door to rate cuts. High food costs has led to inflation accelerating recently -- from 3.65% in August to 5.49% in September -- and Das said the October inflation print, due next week, is going to be "very high". "A change in stance doesn't mean there will be a rate cut in the very next meeting," Das said. A Reuters poll showed that a small majority of economists expect the RBI to cut rates in December. Sign up here. https://www.reuters.com/world/india/india-cenbank-governor-says-economic-activity-remains-strong-2024-11-06/

2024-11-06 06:22

Exports climb 10.1% in October y/y Imports up 13.6% y/y, mostly raw materials for manufacturing Industrial output grows 7% in Oct vs 10.8% in Sept Export growth to be solid, led by textiles, computers - Oxford HANOI, Nov 6 (Reuters) - Vietnam reported an October trade surplus of $2 billion, narrowing from the previous month as imports grew at a faster rate than exports, government data showed on Wednesday. The Southeast Asian country, a regional manufacturing hub, relies heavily on exports for its economic growth. Shipments rose 10.1% in October from a year earlier, the General Statistics Office (GSO) said, while imports increased by 13.6%. October's trade surplus was the smallest since May, according to GSO data. The agency said nearly 94% of imports in October were raw materials for manufacturing. "Export growth will remain solid from resilient export growth in textiles and computers," Oxford Economics said in a note following the October data. China is Vietnam's biggest source of imports. According to the GSO's data breakdown, as of August, Vietnam's imports this year from China reached $92 billion, up 26% compared to the same period last year. That represented 37% of Vietnam's imports this year. For the January-October period, exports rose 14.9% from a year earlier to $335.59 billion, while imports were up 16.8% to $312.28 billion, the GSO said. Industrial production gained 7.0% in October from a year earlier, slower than the 10.8% growth the previous month, which Oxford Economics said could reflect the impacts of Typhoon Yagi, which wreaked havoc in Vietnam in September. Last month, the prime minister said the government wanted to drive economic growth above an expected rate of 6.8% to 7.0% this year. In the September quarter, annual growth hit a two-year high of 7.4%. The consumer price index rose 2.89% in October from a year earlier, below the government's cap for 2024. It was up 0.33% on the previous month. Standard Chartered in a note on Tuesday said that amid the ongoing upward trend in inflation, coupled with a likely weaker dong, the central bank could raise interest rates by 50 basis points in the second quarter of 2025. ($1 = 25,380.0000 dong) Sign up here. https://www.reuters.com/markets/asia/vietnam-records-2-bln-trade-surplus-oct-2024-11-06/