2024-10-24 11:08
CAIRO, Oct 24 (Reuters) - Egypt's economic growth will increase to 4.0% in the year to the end of June 2025 as austerity measures imposed under an International Monetary Fund programme run their course, a Reuters poll showed on Thursday. The median forecast in the Oct. 9-23 Reuters poll of 13 economists predicted gross domestic product (GDP) growth would then accelerate to 4.7% in 2025/26 and 5.3% by 2026/27. In 2023/24, GDP growth fell to 2.4% from 3.8% a year earlier, according to central bank figures, dragged down by a currency crisis and the war in neighbouring Gaza, which has cut into Suez Canal revenue and slowed tourism. In February, Egypt sold the rights to develop real estate on its Mediterranean coast to UAE sovereign fund ADQ for $24 billion, paving the way the following month for an $8 billion financial reform package agreement with the International Monetary Fund. "Economic prospects in Egypt are improving, but at a gradual pace," said James Swanston at Capital Economics, adding that fiscal policy will remain tight in order to narrow the budget deficit and reduce the debt-to-GDP ratio. "The benefits of the weaker pound are starting to filter through, but while inflation is slowing it will not be until Q1 2025 when interest rates are cut to provide a boost to households and businesses," Swanson said. The poll forecast annual headline inflation of 20.4% in 2024/25 and 11.4% in 2025/26. Inflation picked up slightly over the last two months to 26.4% in September, though that was well below the record 38.0% hit in September 2023. The IMF predicted this month in its World Economic Outlook that Egypt's economy would grow 4.1% in calendar 2025. According to the median currency forecast from analysts the Egyptian pound will weaken to 50.4 per dollar by end-June 2025 and 52.0 by end-June 2026. Before letting it drop as part of the March 2024 IMF programme, the central bank had kept the pound fixed at 30.85 to the dollar. It now trades around 48.8 to the dollar. The central bank's overnight lending rate will decline to 22.25% by the end of next June and 14.25% by end-June 2026, analysts estimated. (Other stories from the Reuters global economic poll) Sign up here. https://www.reuters.com/world/africa/egypt-economy-seen-growing-imf-measures-run-course-2024-10-24/
2024-10-24 11:02
OSLO, Oct 24 (Reuters) - European gas prices are still subject to upward pressure due to rising demand in Asia and concerns over future supply of Russian and liquefied natural gas (LNG), the CEO of Norwegian oil and gas producer Equinor said on Thursday. "Winter is approaching, and European demand will depend on the weather and temperature. A normal or cold winter will put upward pressure on prices," CEO Anders Opedal told reporters after the company reported third quarter earnings. Demand for LNG in Asia, which is driving competition with Europe, and imports of Russian gas will also affect prices, he added. In addition, there is "considerable uncertainty" related to when new LNG projects will start, according to the CEO. "In this picture, Equinor is well positioned in the gas market," Opedal said. Even with a normal winter, European gas storage sites should be around 40% full in April 2025, compared with 60% at the same time this year, CFO Torgrim Reitan said during an earnings call with analysts. The gas market remains "fragile" despite storage being almost full ahead of the winter, Reitan said. European gas storage sites are currently around 95% full, according to data from Gas Infrastructure Europe. The benchmark front-month contract at the Dutch TTF gas hub hit a ten-month high of 42.57 euros per megawatt hour (EUR/MWh) on Thursday, LSEG data showed, on geopolitical risks. Earlier on Thursday, Equinor (EQNR.OL) , opens new tab reported a sharper-than-expected 13% decline in third-quarter profit, citing weaker oil prices and lower production. Sign up here. https://www.reuters.com/business/energy/equinor-sees-upward-gas-price-pressure-lower-storages-next-year-2024-10-24/
2024-10-24 10:59
Hapag-Lloyd raises 2024 EBITDA forecast to $4.6-$5 bln reports preliminary $3.6 bln for first nine months, down from $4.5 bln Says Red Sea disruption has led to higher freight rates Oct 24 (Reuters) - International shipping company Hapag-Lloyd (HLAG.DE) , opens new tab raised its full-year earnings guidance on Thursday citing stronger-than-expected demand and higher freight rates. Despite increased expenses from the diversion of vessels around the Cape of Good Hope, Hapag-Lloyd says it now expects earnings before interest, taxes, depreciation, and amortisation (EBITDA) for 2024 of between $4.6 billion and $5 billion, up from previous guidance of $3.5 billion to $4.6 billion. However, given very volatile freight rates and major geopolitical challenges, the forecast is subject to a high degree of uncertainty, Hapag-Lloyd said. Attacks on international shipping in the Red Sea by Iran-aligned Houthi militants in Yemen since late last year have forced shipping companies to reroute traffic away from the Suez Canal to the longer route around Africa. "The transport times are much longer, which is why we needed significantly more capacity and bought capacity. Despite this, demand was relatively high and capacity was scarce or is still scarce," a spokesperson for Hapag-Lloyd told Reuters. "When capacity is relatively tight, rates simply go up. This was particularly the case on the Far East to Europe route," the spokesperson added. The company, which specialises in global container liner shipping, also announced preliminary earnings before interest, taxation, depreciation and amortisation of about $3.6 billion for the first nine months of the year, down from $4.5 billion a year earlier. Final results are due to be published on Nov. 14. Sign up here. https://www.reuters.com/business/autos-transportation/hapag-lloyd-raises-full-year-outlook-stronger-than-expected-demand-2024-10-24/
2024-10-24 10:56
Oct 24 (Reuters) - Refiner Valero Energy (VLO.N) , opens new tab posted an 86% slump in third-quarter profit on Thursday on falling refining margins, but it managed to beat Wall Street expectations. Globally, refiners have seen a drop in their profitability on soft consumer and industrial demand, especially in China. U.S. refinery margins, measured by the 3-2-1 crack spread , dipped to $14.28 in mid-September, the lowest since early 2021, on lackluster fuel demand. Energy majors like Exxon Mobil (XOM.N) , opens new tab, BP (BP.L) , opens new tab and Shell (SHEL.L) , opens new tab had said earlier this month that they expected weaker refining margins to weigh on their earnings in the third quarter. Valero's net income attributable to stockholders plunged to $364 million, or $1.14 per share, in the quarter from $2.6 billion, or $7.49 per share, a year earlier. However, data compiled by LSEG showed analysts had expected a profit of 98 cents. Valero, which is the second-largest U.S. refiner by capacity, saw refining margins falling to $2.41 billion from $5.41 billion last year in the same quarter. Valero's refining segment reported operating income of $565 million for the third quarter, compared with $3.4 billion a year earlier. However, analysts at Tudor, Pickering & Holt said relative to their profit estimates, all three segments of the company -refining, renewable diesel and ethanol - posted results "a touch higher." Revenue came in at $32.87 billion, compared with estimates of $31.13 billion per data from LSEG, partially on an 18.4% rise in sales volumes for renewable diesel. Additionally, the Texas-based refiner showed a higher payout ratio for the quarter, coming in at 84% against 68% in the same quarter last year, while its interest expense fell nearly 88%. Its total throughput volumes, or amount of crude processed, averaged 2.9 million barrels per day (bpd) in a heavy maintenance season, compared with 3 million bpd and a 95% refinery utilization a year earlier. Sign up here. https://www.reuters.com/business/energy/valero-energy-reports-lower-quarterly-profit-weak-refining-margins-2024-10-24/
2024-10-24 10:53
MUMBAI, Oct 24 (Reuters) - The Indian rupee ended largely unchanged on Thursday, as likely outflows from local equities prevented it from mirroring the rise in its Asian peers, although state-run banks' dollar sales helped keep the currency above its all-time low. The rupee closed at 84.0775 against the U.S. dollar, compared with its close at 84.08 in the previous session. It hit a record low of 84.0825 earlier in the week. The dollar index declined 0.2% to 104.1 after touching a near three-month peak on Wednesday, while Asian currencies were mostly stronger on the day. However, the benchmark Indian equity indices, the BSE Sensex (.BSESN) , opens new tab and Nifty 50 (.NSEI) , opens new tab, declined for the fourth consecutive session. Likely outflows from local stocks kept the rupee under pressure but dollar offers from state-run banks prevented a steeper decline, a trader at a large private bank said. "Like on most days this week, state-run banks were on offer (on USD/INR) near 84.0775-84.08," most likely on the Reserve Bank of India's (RBI) behalf, the trader added. The RBI's routine interventions have helped the rupee avert sharp declines despite equity outflows surging to $9 billion for the month and the gains in Treasury yields and the dollar on heightened odds of a second term for Donald Trump as U.S. president. "Financial markets have been gripped by the recent dollar upmove, which has kept USD/INR above 84," DBS Bank said in a note. "Looming U.S. elections and markets pricing out aggressive Fed rate cut bets are likely to keep the rupee and INR bonds on soft ground." The rupee has weakened about 0.3% this month, while the 10-year Indian bond yield has risen 7 basis points to 6.82%. Sign up here. https://www.reuters.com/markets/currencies/rupee-ends-flat-state-run-banks-dollar-sales-support-while-outflows-weigh-2024-10-24/
2024-10-24 10:49
LONDON, Oct. 24 (Reuters) - Sterling firmed against the dollar and the euro on Thursday, alongside a rise in British government bond yields, as investors assessed the outlook for the Bank of England's monetary policy. The pound firmed 0.4% to $1.29695 against the dollar, not far from the $1.30 mark after sliding to the lowest since mid-August in the previous session. A Guardian report on Wednesday said that British finance minister Rachel Reeves will change how the government assesses the public finances to free up room for billions of pounds in extra capital spending upped the chances of the BoE keeping rates higher for longer. Yields on British government bonds rose as money markets priced in a roughly 89% chance on a quarter-point interest rate cut by the BoE at its November meeting, down from a 100% probability earlier this week. "Higher yields can be a symptom of concern about fiscal policy, but that's not translating into a weaker sterling, so I would not exaggerate too much about the fiscal concern yet," said Kenneth Broux, head of corporate research FX and rates at Societe Generale. Investors are cautiously awaiting Reeves' budget plan next Wednesday, after she has warned some taxes will have to rise after identifying a 22 billion-pound fiscal hole soon after the Labour Party came to power in July. The latest survey of British business activity showed companies reported the slowest growth in 11 months in October, as uncertainty ahead of the Labour government's first budget dampened confidence. Overall, the dollar index stalled after hitting a near three-month high of 104.570 in the prior session, aiding major currency pairs' rise. The pound came under pressure overnight after BoE Governor Andrew Bailey said there were still "outstanding questions" about whether price pressures could remain stubborn. "Additional economic data and clarity on the fiscal and monetary policy outlook will likely be needed before long-run inflation expectations can potentially ease lower again," Lloyds Bank strategists said in a note. Against the euro, sterling ticked higher to 83.293 pence . Sign up here. https://www.reuters.com/markets/currencies/sterling-rises-after-report-stokes-slower-boe-rate-cut-view-2024-10-24/
