2025-10-15 12:54
WASHINGTON, Oct 15 (Reuters) - (This Oct. 15 story has been corrected to change the central bank growth forecast for next year to 1.6% from 1.8% in paragraph 5) The fresh flare-up in trade tensions between the United States and China is a big risk to the outlook for Thailand's economic growth, the country's deputy central bank governor said, adding there was little room left to lower rates further. Sign up here. U.S. President Donald Trump on Friday shattered a relative calm in the trade war between the world's top two economies by threatening 100% duties on Chinese goods - on top of rates averaging 55% - in retaliation for Beijing's dramatically expanded export controls on rare earths. "Of course, that's a big downside risk," Bank of Thailand Deputy Governor Piti Disyatat told Reuters on the sidelines of the International Monetary Fund World Bank annual meeting in Washington. "China and the U.S. are both major export and import trading partners, and whatever happens between them, it's not helpful for the rest - so we hope that it will not play out too aggressively." The central bank expects to see growth at 2.2% this year and 1.6% in 2026 - well below the potential growth rate of 2.7%. Despite the sluggish growth, policy makers surprised markets last week by leaving the key interest rate steady rather than cutting, as the economy struggles with a strengthening baht, negative inflation and the fallout from U.S. tariffs. Piti said room for manoeuvre was limited on rates. "The level of policy rate at 1.5% is actually historically low," said Piti, adding lending rates had dipped below this level only three times - during the great financial crisis, and the COVID and the SARS epidemics. "There's not much room left, and the things that are holding back the economy are no longer funding conditions." The central bank would instead rather focus on financial measures together with fiscal authorities, such as debt restructuring schemes for household and small and medium enterprises, such as loan guarantee schemes to get access to credit. "That's where the constraints are and we are doing that, and maybe do more of that going forward," he said. Recent data showing inflation being negative for a sixth straight month in September did not require a rethink of the central bank's inflation target of 1-3%, the deputy governor said. "It's roughly okay," he said, adding declines were driven by lower energy and food prices, both mostly external and supply related, with inflation expectations holding broadly steady. Asked how the political change in Thailand had shaped policy making, Piti said the bank had fared well. "We have had four prime ministers and four finance ministers in five years," he said. "It's been challenging because of the continuity, and you have to always get used to the new administration, but I think overall, we've kind of managed to make it through that period quite well." Asked about the strength of the baht currency, which has firmed around 5% against the dollar since the start of the year, Piti said he recognised it was tough on exporters. "But from an economic fundamental perspective, it's not clearly too out of line." https://www.reuters.com/world/china/flare-up-us-china-trade-tensions-poses-big-risk-thailands-growth-deputy-central-2025-10-15/
2025-10-15 12:32
LONDON, Oct 15 (Reuters) - Senior bankers in Britain will receive their bonuses earlier than previously thought, the Bank of England said on Wednesday, after halving the length of time needed to qualify as part of efforts to boost UK competitiveness. In a consultation on how rules introduced after the financial crisis should be changed, the Bank had recommended a cut to five years, but on Wednesday said the time bankers must wait for the full amount of their bonus would be reduced to four years from eight. Sign up here. The changes take effect from Thursday, in time for 2025 pay awards and any other awards made but not yet fully paid. They also exclude some bankers from the bonus-deferral regime. The BoE's Prudential Regulation Authority said the new rules would allow banker bonuses to be vested on a pro-rata basis from the time they are granted. British regulators had already previously scrapped a cap on banker bonuses that had dated from Britain's membership of the European Union. "These changes are the latest example of our commitment to boosting UK competitiveness," Sam Woods, deputy governor of Prudential Regulation at the Bank, said. Regulators imposed rules to defer senior manager bonuses after the 2007-2009 financial crisis triggered concerns that year-end cash bonuses could encourage bankers to take excessive risks and undermine the global financial system. Critics had said the rules put Britain at a competitive disadvantage to rival financial centres, where most bonuses are typically subject to deferral periods of three-to-five years. Bank lobby group UK Finance said the changes would give companies more flexibility. "A more proportionate approach here will help with attracting global talent and support the competitiveness of the UK's financial services sector," a UK Finance spokesperson said. https://www.reuters.com/sustainability/boards-policy-regulation/boe-speeds-up-time-uk-bankers-receive-bonuses-2025-10-15/
2025-10-15 12:32
Oct 15 (Reuters) - Brazil's Finance Minister Fernando Haddad said on Wednesday that core inflation remained high due to persistent underlying pressures and noted that the central bank was acting accordingly with its restrictive stance. The remarks were made in a written statement marking Brazil's participation in the International Monetary Fund and World Bank's annual meetings in Washington. Sign up here. After highlighting a favorable medium-term outlook for Latin America's largest economy, Haddad acknowledged that "core inflation remains relatively elevated," citing headline inflation expectations above the 3% target. "Accordingly, monetary policy remains in contractionary territory, underscoring the central bank of Brazil's unwavering commitment to delivering on the target and reanchoring expectations," he added. Haddad did not travel to Washington, instead remaining in Brazil to debate alternatives to a key fiscal measure that expired in Congress last week. His statement serves as guidance for the ministry's delegation. Last week, the minister criticized Brazil's interest rates as "excessively restrictive" but stressed that was a personal view and not a challenge to the central bank's autonomy. The bank held its benchmark rate steady at 15% - its highest level in nearly two decades - in September for a second straight meeting and signaled it would remain there for a prolonged period to bring inflation back to the target. Consumer prices rose 5.17% in the 12 months through September, up from 5.13% in August. Haddad said economic activity is now near its potential after outperforming expectations in recent years, and inflation is gradually converging towards the official goal. He also noted that President Luiz Inacio Lula da Silva's administration will continue using fiscal policy to promote social justice and well-being, while considering the economic cycle. Amid global trade tensions, Haddad also called for the removal of unilateral trade restrictions and the restoration of predictable, rules-based frameworks to safeguard global growth. https://www.reuters.com/world/americas/brazils-core-inflation-still-high-central-bank-acting-accordingly-finance-2025-10-15/
2025-10-15 12:06
SAN FRANCISCO, Oct 15 (Reuters) - Vertical Semiconductor, a startup spun out of the Massachusetts Institute of Technology, on Wednesday said it raised $11 million in funding to commercialize chip technology that can deliver electricity to artificial intelligence servers more efficiently. Vertical makes chips out of a material called gallium nitride, an alternative to silicon which is becoming central to an effort led by chip designer Nvidia (NVDA.O) , opens new tab to rework auxiliary chips inside AI data centers to direct electricity and convert it into the form needed by Nvidia's chips. Sign up here. Those data centers currently consume as much power as some cities. However, when converting huge voltages from power stations to the tiny voltages needed by microchips, much of that electricity simply generates heat. That has spurred a frenzy of investment and interest in reducing that loss. "That is power you are not delivering to (computing tasks) - it straight turns into heat," Matt Hersenson, a partner with Playground Global, the venture capital firm that led the funding round, said in an interview. Established chipmakers such as Renesas (6723.T) , opens new tab, Infineon (IFXGn.DE) , opens new tab and Power Integrations (POWI.O) , opens new tab are all working with Nvidia to develop power chips made of gallium nitride, known as "GaN" in the chip industry, for AI data centers. But Vertical, which plans to deliver prototypes this year and to deliver chips next year, has a different approach that it hopes will make its chips smaller and cooler. On most existing GaN chips, the transistors - the fundamental building blocks of chips - are laid out horizontally. Vertical, as its name suggests, stacks the parts of the transistor on top of one another, leading to more compact chips. The approach came out of work at MIT led by Tomas Palacios, a professor at the school who co-founded the firm, and developed by Joshua Perozek, whose doctoral research focused on the technology. Cynthia Liao, who joined as CEO from MIT's Sloan School of Management, said the startup hopes to compete against established players by offering better cost savings to data center owners over time than more established technologies. "We do believe we offer a compelling next-generation solution that is not just a couple of percentage points here and there, but actually a step-wise transformation," Liao said in an interview. https://www.reuters.com/business/energy/mit-spinout-vertical-semiconductor-raises-11-million-ai-power-chip-tech-2025-10-15/
2025-10-15 12:05
Key Rhone pipeline out of action for the winter Outage to reduce France's LNG import capacity Outage comes as LNG terminals also disrupted by strikes Oct 15 (Reuters) - France's LNG import capacity will be restricted this winter by a pipeline outage on the Rhone link, operator NaTran said on Wednesday, limiting the country's energy flexibility as Europe prepares for more supplies of the super-chilled gas. The outage could reduce total supplies by about 43.5 terawatt hours over the winter, equivalent to around 11 days of France’s total winter gas demand. Sign up here. "Transit on the Rhone artery has been interrupted until at least the end of the coming winter following an incident on the network on 26 September," a NaTran spokesperson said. The company did not give details of the incident. STRIKES ALSO DISRUPTING LNG FLOWS With a capacity of 160 gigawatt hours per day, the pipeline allows gas converted from LNG at Fos-sur-mer's two terminals to enter the transmission network and be moved around France. The incident comes on top of ongoing strikes at the Fos-sur-mer and Montoir-de-Bretagne LNG terminals over pay. The strikes have disrupted cargoes to the terminals, operated by Elengy, over the last six weeks, with flows from Fos Cavaou resuming on September 28 after a request from NaTran to Elengy to avert supply risks, said S&P analyst Diane Elijah. Combined flows from the Fos Cavaou and Fos Tonkin terminals fell month-on-month, but that was more than offset by higher flows from terminals at Dunkirk and Montoir, she said. Deliveries at Montoir have continued during the disruption. The strike at Fos is scheduled to end on Wednesday, with flows expected to resume Thursday, while Montoir's stoppage is set to end Thursday. "The end of strike actions at Montoir and Fos is expected to bring more predictability as the market moves deeper into the winter season," said LSEG analyst Yuriy Onyshkiv. However, a meeting will be held on Thursday to decide whether the strikes will continue, a union representative at the Elengy terminals told Reuters. Even if the disputes are resolved, the Rhone pipeline outage will restrict Fos' flows for months, curbing France's regasification potential, Onyshkiv said. A market message from EU gas network operator ENTSOG on October 6 indicated that flows through the impacted entry point would be capped at around 239 GWh per day – roughly half of Fos's technical capacity. https://www.reuters.com/business/energy/rhone-pipeline-outage-limit-french-lng-imports-this-winter-2025-10-15/
2025-10-15 11:59
Analysts expect rise in US crude inventories US-China trade tensions risk disrupting global oil freight IEA predicts oil surplus in 2026 due to OPEC+ output rise NEW YORK, Oct 15 (Reuters) - Oil prices eased on Wednesday to a five-month low on escalating U.S.-China trade tensions and the International Energy Agency's prediction of a supply surplus in 2026. Brent crude futures fell 48 cents, or 0.8%, to settle at $61.91 a barrel. U.S. West Texas Intermediate (WTI) futures fell 43 cents, or 0.7%, to settle at $58.27. Those were the lowest settlements for both benchmarks since May 7 for a second day in a row. Sign up here. Bank of America said Brent prices could slip below $50 a barrel if U.S.-China trade tensions intensify while OPEC+ production ramps up. The world's two largest oil consumers have renewed their trade war over the last week, with the U.S. and China imposing additional port fees on ships carrying cargo between them. The tit-for-tat moves could disrupt global freight flows. Last week, China announced it would increase rare earth export controls and U.S. President Donald Trump threatened to raise tariffs on Chinese goods to 100% and tighten software export curbs from November 1. On Wednesday, U.S. Treasury Secretary Scott Bessent insisted that Washington did not want to escalate the trade conflict, addingTrump is ready to meet Chinese President Xi Jinping in South Korea later this month. Deflationary pressures persisted in China, with both consumer and producer prices falling in September. A prolonged property market slump and trade tensions also weighed. Renewed pose a "material" downside risk to the economic outlook, making it more important that the U.S. Federal Reserve cut its benchmark interest rate, Fed Governor Stephen Miran said on Wednesday. Looser economic policies can boost economic growth and demand for oil. U.S. retail sales excluding motor vehicles and parts likely posted further gains in September, data from the Chicago Fed showed, though part of the rise probably reflected higher prices. On Tuesday, the IEA said the global oil market could face a surplus next year of up to 4 million barrels per day, wider than its previous forecast, as OPEC+ and others raise output and demand remains sluggish. OPEC+ includes the Organization of the Petroleum Exporting Countries (OPEC) and allies like Russia and Azerbaijan. Britain on Wednesday targeted Russia's two largest oil companies, Lukoil and Rosneft, and 51 shadow fleet tankers in what it described as a new bid to tighten energy sanctions and choke off Kremlin revenues. Russia was the second-biggest producer of crude oil in the world after the U.S. in 2024, according to U.S. energy data. Any increase in sanctions due to Moscow's war with Ukraine should keep more of that oil out of global markets. In Azerbaijan, oil output fell by 4.2% to 20.7 million metric tons in January-September from 21.6 million metric tons a year earlier, the energy ministry said on Wednesday. US OIL INVENTORIES The American Petroleum Institute (API) trade group and the U.S. Energy Information Administration (EIA) are due to release weekly U.S. inventory data on Wednesday and Thursday, , a day later than usual due to the U.S. Columbus Day/Indigenous Peoples' Day holiday on Monday. Analysts forecast U.S. crude stockpiles rose by about 0.3 million barrels last week. If correct, that would be the first time energy firms added oil to storage for three weeks in a row since April. That compares with a decrease of 2.2 million barrels during the same week last year and an average increase of 1.1 million barrels over the past five years (2020-2024). https://www.reuters.com/business/energy/oil-drops-investors-weigh-supply-surplus-outlook-us-china-trade-tensions-2025-10-15/
