2025-09-11 12:57
LONDON, Sept 11 (Reuters) - The European Central Bank left interest rates unchanged on Thursday as expected but offered no clues about its next move, even as investors continue to bet that more support will be needed as inflation dips below target next year. Inflation is now seen at 1.9% in 2027, below the 2.0% projected in June, and core inflation is seen at 1.8% then, both below the 2% target, fresh ECB projections showed. Sign up here. The euro briefly slipped but was last trading 0.18% firmer at $1.1715 , while interest rate-sensitive short-dated bond yields were broadly steady on the day , . Europe's STOXX index was up 0.3% from its last close. COMMENTS: MARK WALL, CHIEF EUROPEAN ECONOMIST, DEUTSCHE BANK, LONDON: "The near-term staff forecasts for headline inflation were revised a little higher, which means a less deep undershoot of the inflation target in 2026. However, the downward revision of the core inflation forecast to 1.8% in 2027 signals a potential lengthening of the undershoot. That could have dovish ramifications for monetary policy. The ECB describes the inflation outlook as “broadly unchanged” and the statement is quite succinct. The ECB isn’t rushing to judgement on the 2027 number. The rates pause likely continues." ARNE PETIMEZAS, DIRECTOR RESEARCH, AFS GROUP, AMSTERDAM: "A bit of weakness in euro/dollar as the ECB cut the 2027 core CPI forecast to 1.8% from 1.9%. Yes, that's 2027, and nobody has a clue, and the ECB staff forecasting track record is awful. What matters is that the doves now have a shoe to throw at the hawks." JACK ALLEN-REYNOLDS, DEPUTY CHIEF EURO-ZONE ECONOMIST, CAPITAL ECONOMICS, LONDON: "The ECB’s decision to leave its deposit rate unchanged at 2.0% today and offer no guidance on future rate decisions was in line with expectations. The bank is unlikely to change interest rates again this year, but we think the risks are skewed towards renewed cuts in 2026." IRENE LAURO, EURO ZONE ECONOMIST, SCHRODERS, LONDON: "The ECB today appears to confirm our view that the easing cycle has ended. With trade uncertainty fading, the euro area’s recovery is set to accelerate." "Risks have shifted for the eurozone from trade uncertainty to political instability, with France now in the fiscal spotlight. But the resilience of the economy and strengthening domestic demand means the ECB can afford to keep monetary policy unchanged." FRANCESCO PESOLE, FX STRATEGIST, ING, LONDON: "The euro is a little weaker, it's what we expected, the risks were to the downside. "It could be this GDP forecast for 2026 is a little lower. "There’s no reason why at this point they would change their guidance. It's a small reaction so we'll see what happens in the press conference." "Things that can move a little bit more is probably anything related to bunds and if the market senses that the council or (ECB President Christine) Lagarde are ready to take the French situation into consideration in monetary policy decisions. "But I think it’s still not highly likely that she will give anything away, she will just follow the script where she says the ECB can step in with the necessary tools." MARCHEL ALEXANDROVICH, ECONOMIST, SALTMARSH ECONOMICS, LONDON: "No surprises from the ECB as it leaves interest rates unchanged. However, in terms of the new forecasts, there are downward revisions to the inflation forecasts for 2026 and 2027, which suggests that the ECB maintains a slight easing bias as it heads into year-end." SYLVAIN BROYER, CHIEF EMEA ECONOMIST, S&P GLOBAL RATINGS: "The ECB is done cutting rates. Sticky services and food inflation keep consumer sentiment under strain. Real wage growth still outpaces productivity, and easing the policy rates to weaken the euro would be useless in the present situation." https://www.reuters.com/markets/europe/view-ecb-holds-rates-steady-2-lowers-inflation-forecasts-2025-09-11/
2025-09-11 12:49
NEW YORK, Sept 11 (Reuters) - The U.S. dollar reversed gains against the yen while the euro turned higher on Thursday after inflation data came in mostly in-line with market forecasts, reinforcing the view that the Federal Reserve will resume cutting interest rates at a policy meeting next week. Higher-than-expected jobless claims also weighed on the dollar, suggesting a weakening labor market. Sign up here. The dollar was last slightly down against the yen at 147.44 yen , while the euro rose 0.1% to $1.1712 . https://www.reuters.com/world/africa/us-dollar-pares-gains-vs-yen-euro-turns-higher-after-inflation-data-jobless-2025-09-11/
2025-09-11 12:40
BENGALURU, Sept 11 (Reuters) - The Federal Reserve will cut its key interest rate by 25 basis points on September 17 as labor market softness overshadows inflation risks, said almost all 107 economists in a Reuters poll, with most expecting one further cut next quarter. Stalling job growth in August and a sharp downward revision to 12-month job data through March led many economists to revise their forecasts to include more rate cuts than they had thought previously. Sign up here. Markets have fully priced in a September cut and now anticipate three reductions this year, compared to two just weeks ago. Fed Chair Jerome Powell and other policymakers have hinted at easing monetary policy despite inflation risks related to tariffs. The Fed will lower the interest rate by a quarter point to 4.00%-4.25% next week for the first time this year, 105 of 107 economists in the September 8-11 Reuters poll predicted. Last month, a 61% majority had expected that to happen. "The Fed now has four months of evidence of a slowdown in labor demand that appears more persistent in nature ... In short, ignore where inflation is today and ease policy to support the labor market," said Michael Gapen, chief U.S. economist at Morgan Stanley. "We think a 25bp rate cut in September is more likely than a larger cut." Two of the analysts expected a 50-basis-point reduction. President Donald Trump has repeatedly criticized Powell for his reluctance to cut rates. Trump's nominee for a Fed governor, Stephen Miran, may not join the board in time for next week's meeting, while Governor Lisa Cook continues in her job following a court ruling after the president attempted to remove her. Some board members could dissent next week and vote for a bigger cut or a hold, many economists said. Governors Christopher Waller and Michelle Bowman opposed holding rates steady in July. "It's just a very difficult policymaking environment. I wouldn't be surprised to see more dissents," said Stephen Juneau, a U.S. economist at Bank of America. "If the Fed cuts aggressively to where they're just leaning too much on the story - the labor market has significant downside risk and they don't have to worry about inflation upside risk - then we get in the situation where it's more of a policy error." A 60% majority of respondents, 64 of 107, expected the rate to go down by 50 basis points by end-2025, but 37% predicted 75 bps cuts by year-end, a sharp rise from only 22% in August. More than 60% of the economists, 26 of 42, who answered an extra question said surging inflation or a combination of that with fast-rising unemployment was more likely over the coming year. Inflation is expected to remain above the Fed's 2% target until at least 2027, while unemployment is expected to hover around the current 4.3% for years, the poll found. Later on Thursday, official data is expected to show consumer price inflation accelerated last month. Still, poll medians suggest the central bank will cut rates by another 75 basis points next year to put the fed funds rate at 3.00%-3.25%. "If we get a more dovish Fed chair, which presumably we will, we do think the Fed will cut rates at that point, in the second half of next year by an additional 75 basis points," Bank of America's Juneau added. "How willing are you to cut rates and to what level are you willing to cut rates? That's going to be a key interview question for the next Fed chair." About 76% of the economists said they did not foresee a significant erosion of the Fed's independence during Powell's term, which ends in May. (Other stories from the Reuters global economic poll) https://www.reuters.com/business/september-fed-rate-cut-done-deal-least-one-more-follow-by-year-end-reuters-poll-2025-09-11/
2025-09-11 12:37
WINDHOEK, Sept 11 (Reuters) - Namibia is set to increase its sulphuric acid production in response to rising critical mineral output, with Green Metals Refining and Vedanta (VDAN.NS) , opens new tab announcing plans on Thursday to set up and revive plants, respectively. Sulphuric acid is widely used in the extraction processes for metals including uranium, copper, manganese and rare earths used in clean energy technologies. Sign up here. Namibia, the world's third-largest producer of uranium, is emerging as a leader in the green energy sector, with eight active critical minerals projects set to position it at the forefront of global green energy initiatives. London-based Green Metals Refining plans to spend an initial $59 million on the first phase of a plant that will produce 175,000 metric tons of sulphuric acid a year. The plant's annual output is expected to eventually rise to 720,000 tons, the company said in a statement on Thursday. "As Namibia is a net importer of sulphuric acid with a large pipeline of acid-consuming projects, we have established a compelling business case that can benefit local third-party metals projects," Green Metals Refining CEO Derk Hartman said. The sulphuric acid plant will be situated within the company's planned manganese refinery in the port city of Walvis Bay, supplying the country's uranium and copper mines. Both plants are expected to be commissioned by the end of 2027. Vedanta this week said it plans to recommission a sulphuric acid plant at its Skorpion zinc operations within the next four to six months to produce about 1,000 tons a day The facility has been idle since 2020 when the mine was placed on care and maintenance. https://www.reuters.com/world/africa/namibia-boost-sulphuric-acid-production-critical-mineral-output-rises-2025-09-11/
2025-09-11 12:29
Sept 11 (Reuters) - Abu Dhabi National Oil Company (ADNOC) said on Thursday it has transferred its shareholdings in several of its listed subsidiaries to XRG, its international investment arm for which it has ambitious growth plans. The state oil giant said the transfers, including stakes in ADNOC Distribution, ADNOC Drilling, ADNOC Gas, and ADNOC Logistics & Services, will not affect the operations, leadership or strategic direction of the companies, including dividend policies. ADNOC owns a 100% stake in XRG so ultimate control will not change. Sign up here. "These internal transfers will further strengthen XRG's size and financial position, and drive its long-term development, through access to stable and attractive dividend streams, supported by the listed companies' existing disciplined growth and capital return agendas," ADNOC said. The transfers of ADNOC's stakes in ADNOC Distribution, ADNOC Gas and ADNOC Logistics & Services were completed earlier on Thursday via off-market transactions on the Abu Dhabi Securities Exchange (ADX). The transfer of ADNOC Drilling will follow pending regulatory approvals. ADNOC also said its entire stake in fertilizer maker Fertiglobe is already held through XRG. It reiterated plans to transfer its stake in the planned Borouge Group International (BGI) to XRG once the transaction is completed and approved. BGI is a new entity to be formed through the merger of Borouge and Austria's Borealis, which will also acquire Canada's NOVA Chemicals. Launched in November 2024, XRG is ADNOC's vehicle for international energy investments, with a focus on natural gas, chemicals and scalable energy solutions. https://www.reuters.com/business/energy/adnoc-transfers-stakes-listed-units-international-arm-xrg-2025-09-11/
2025-09-11 12:22
Deposit rate unchanged at 2% as expected Inflation seen below 2% at end of projection horizon Debate over more easing to simmer for months Economy holding up but tariffs impact not yet fully felt Lagarde press conference at 1245 GMT FRANKFURT, Sept 11 (Reuters) - The European Central Bank left interest rates unchanged on Thursday as expected but offered no clues about its next move, even as investors continue to bet that more support will be needed as inflation dips below target next year. The ECB halved its key rate to 2% in the year to June but has been on hold ever since, arguing that the 20-country euro zone economy is in a "good place", even if more easing cannot be ruled out. Sign up here. Recent data has confirmed this sanguine view, giving policymakers time to understand how U.S. tariffs, higher German government spending, looming Federal Reserve rate cuts and political turmoil in France might impact growth and inflation. "The Governing Council is determined to ensure that inflation stabilises at its 2% target in the medium term," the ECB said in a statement. "The Governing Council is not pre-committing to a particular rate path." Such a cautious statement makes it likely that ECB President Christine Lagarde will remain "deliberately uninformative" about the future path of interest rates when she speaks at a 1245 GMT news conference. But Lagarde is unlikely to close the door on further rate cuts, especially since inflation is projected to temporarily dip below the ECB's 2% target next year, keeping alive market bets that a final "insurance" cut could come around year-end. Inflation is now seen at 1.9% in 2027, below the 2.0% projected in June, and core inflation is seen at 1.8% then, both below the 2% target, fresh projections showed. In any case, the public debate is at the margins and focuses on just a single rate cut, indicating that the ECB is done with the bulk of changes to monetary policy, with rates likely to stay around this level for an extended period. Investors see a 50-60% chance of one last cut by next spring, even as they expect the Fed to ease U.S. borrowing costs six times by the end of 2026. RISKS The key debate is around how policymakers see risks. Hawkish Governing Council members, who are opposed to further easing, say the euro zone economy has been unexpectedly resilient in the face of trade tensions and that growth is well supported by buoyant private consumption. They point to rebounding industrial production and a surge in German government spending to argue that growth will remain on a moderately upward path. Although U.S. President Donald Trump's 15% tariffs on European Union imports are higher than predicted, firms are showing adaptability and the certainty of having agreed a deal offsets some of the negatives. But policy doves say that tariffs have yet to fully work their way through the economy and could dampen an already low growth rate, reversing the rise in consumption. This could then weigh on prices next year, just when inflation is seen dipping below target, raising the risk that firms will change their pricing and wage-setting, thus entrenching anaemic price growth. The Fed's looming rate cuts are meanwhile likely to help the euro firm against the dollar, putting downward pressure on prices. A fresh bout of political chaos in Paris, which has pushed French bond yields sharply higher, is another headache for the euro zone's central bank. It has tools to intervene, but only for an "unwarranted and disorderly" rise in borrowing costs, which economists say is clearly not the case now, given France's high debt and feeble economic growth. https://www.reuters.com/markets/europe/ecb-holds-rates-unchanged-offers-no-clues-about-next-move-2025-09-10/
