2025-09-03 12:32

US sanctions limit Venezuela's access to foreign currency Venezuela uses USDT to buoy currency exchange PDVSA has increased digital currency usage Sept 3 (Reuters) - Venezuela's government is slowly allowing the use of dollar-tied cryptocurrencies in currency exchanges for the private sector, a dozen sources said, as U.S. restrictions on oil exports reduce available foreign currency. Sanctions by the United States, which the Venezuelan government has characterized as "economic war," prevent many business transactions, forcing companies seeking to buy raw materials from abroad to exchange local bolivars for dollars that are generated by the oil trade and foreign card transactions and are injected into exchanges by the central bank. Sign up here. But oil revenue has taken a hit in recent months. Though the United States Treasury Department last month issued a new, restricted license to Chevron (CVX.N) , opens new tab allowing it to export oil after a three-month pause, the license blocks any payments to the government, reducing the quantity of dollars available for exchange. In response, the Venezuelan government has since June allowed the use of more USDT, a digital currency also known as Tether, whose value is pegged to the U.S. dollar and designed to maintain a stable value, according to the private and financial sector sources, who asked to remain anonymous for fear of repercussions. The use of digital currencies helps keep the economy operating amid the sanctions, including domestic production of basic goods such as food. "When one operation closes, others open," said one business person about the use of crypto. Another source estimated the use of crypto will grow. State-run oil company PDVSA has since last year been slowly increasing its digital currency usage and moving sales to USDT, sources told Reuters last year. Tether did not respond to a request for comment, but said last year it respects the U.S. Treasury's list of sanctioned entities. Neither the Ministry of Communications nor the central bank responded to questions, but Vice President Delcy Rodriguez said during an August meeting with business people that "non-traditional mechanisms of management in the exchange market" were being implemented, without providing more details. The sources said a limited number of banks sell the cryptocurrencies, usually USDT, to some businesses in exchange for bolivars. The businesses must have a digital wallet approved by the authorities and receive the value of the transaction there. Businesses are then free to either sell the crypto or use it to pay domestic or international providers. There are no official figures for crypto sales, but local analyst firm Ecoanalitica has estimated that $119 million in cryptocurrencies were sold to the private sector in July. The Venezuelan central bank injected some $2 billion into the currency exchange market in the first seven months of the year, 14% less than during the same period last year, according to estimates by the private and financial sectors. The restrictions on the Chevron license might further reduce the availability of foreign currency, analysts have estimated. Oil exports declined about 10% in July from the previous month, according to vessel tracking data and company documents. "The availability of exchange always has a ceiling," said lawmaker Orlando Camacho, who is close to the ruling party and the head of a guild for medium-sized companies. "The role of companies is also to guarantee foreign exchange through their exports." https://www.reuters.com/business/energy/with-dollars-scarce-venezuela-currency-exchanges-turn-crypto-2025-09-03/

2025-09-03 12:22

UK's Reeves to present her annual budget on November 26 Sticking to fiscal targets likely to require higher taxes Tax hike speculation hurting business confidence LONDON, Sept 3 (Reuters) - Britain's budget rumour mill was already in full swing well before a date was set on Wednesday, with speculation about tax increases posing a further risk to confidence among businesses and households already anxious about inflation and job losses. Media reports have suggested finance minister Rachel Reeves is considering new taxes on home sales, ways to make more people pay income tax, changes to pensions relief and possibly new levies on banks and gambling in her annual budget, now set for November 26. Sign up here. Britain grew faster than any other Group of Seven economy in the first half of 2025, but much of the momentum was driven by higher public spending and a rush by manufacturers to get ahead of U.S. President Donald Trump's import tariffs. The public finances remain weak and analysts say Reeves will have to raise taxes by at least 20 billion pounds ($27 billion) - and possibly double that - to remain on course to hit her own fiscal targets. The Confederation of British Industry has already called on the government not to repeat last year's tax increase on employers and in August linked a fall in confidence, investment and activity among services firms to short-term uncertainty. Last month, the Royal Institution of Chartered Surveyors said talk of new taxes on home sales was causing concern, while some analysts believe a surprise dip in house prices reported this week might be a sign of weakness to come. And wage data firm Brightmine has said private sector employers are unlikely to raise workers' pay settlements from below-inflation levels until the budget picture becomes clearer. Neil Bellamy, consumer insights director at GfK, which publishes Britain's longest-running gauge of consumer confidence, said reports about tax increases were probably having an impact on the public mood. "It's something people are more aware of in terms of how this could impact me directly," he said. High levels of household savings point to consumer caution, while offering the prospect of stronger spending at some point. Deutsche Bank analysts said a new "Fear Index" based on the bank's surveys showed British consumers are more anxious than at any point since the pandemic, due to worries about unemployment, higher inflation and the reports of possible tax increases. For businesses, uncertainty around the budget comes after the shocks of Brexit, COVID-19, the 2022 surge in energy prices and Trump's tariffs. "If they are in a position to be able to invest, they're still hovering over that button," CBI Chief Economist Louise Hellem said. "They feel that if we just wait a couple of weeks or wait a couple of months, it'll all become a bit clearer. And we never seem to quite get to that point." Hellem, who once helped prepare annual budgets as a Treasury official, said the government was showing it wanted to create a longer-term strategy for the economy. It is seeking to streamline the planning system and boost investment - both public and private - in infrastructure. Hellem also welcomed the government's intention to get more people into work, but said last year's tax increase for employers and uncertainty about plans to give workers more rights risked having the opposite effect. BOND MARKETS ARE WATCHING In her first budget last year, Reeves ordered Britain's biggest tax hikes in three decades, with most of the 40 billion pounds of revenue raisers falling on employers. She has said no further tax increases on that scale are planned. Prime Minister Keir Starmer dropped proposals in June for big welfare savings, however, while Britain's fiscal watchdog is expected to lower its economic growth projections, cutting future tax flows. That leaves Reeves with little option other than to raise taxes to keep on track for her fiscal targets - chief among them a pledge to balance day-to-day spending with revenues by the end of the decade - or risk trouble in the bond market. Investors remain hyper-sensitive to Britain's big borrowing needs after the 2022 "mini-budget" crisis under former Prime Minister Liz Truss. This week, 30-year borrowing costs hit their highest since 1998 amid a broader government debt sell-off. The fine margins of error in Reeves' plans for meeting her fiscal rules - which unusually in Britain are assessed twice a year - also raise the risk that similar uncertainty will drag on the economy ahead of future budgets. That prospect has prompted calls for the eventual restoration of more headroom in budget plans, or more root-and-branch changes to the rules. "If you want growth to happen, you want firms that are investing to be sure about what's going to happen over the next few years," Stephen Millard, deputy director for macroeconomics at the National Institute of Economic and Social Research, a think tank, said. But the likelihood of Reeves carving out more headroom in this year's budget is slim because of the political costs of very big tax increases or deep spending cuts, Millard said. Britain's government might also be tempted to follow the lead of European Union countries which in March agreed they could temporarily spend more on defence without breaking the bloc's rules. "If we're back into the same conversation in a year's time, I think there will be some honest conversations about whether the fiscal framework is fit for purpose," Sanjay Raja, Deutsche Bank's chief UK economist, said. ($1 = 0.7402 pounds) https://www.reuters.com/world/uk/uk-budget-speculation-adds-risks-economy-2025-09-03/

2025-09-03 12:14

US Bancorp partners with NYDIG for bitcoin custody service SEC's previous guidance made crypto custody capital-intensive for banks Spot bitcoin ETFs gain popularity, attracting banks' interest in custody services Sept 3 - U.S. Bancorp is restarting its bitcoin custody service after a more than three-year pause, as the Trump administration's pro-crypto posture has encouraged traditional financial institutions to delve deeper into digital assets. U.S. Bank's bitcoin custody program - which the firm first announced it would offer in 2021 - is geared toward institutional investment managers with registered or private funds, and for the first time, bitcoin exchange-traded funds. Crypto firm NYDIG will act as the sub-custodian, meaning NYDIG will provide custody of the underlying asset while U.S. Bank will serve as the client-facing intermediary, the bank said. Sign up here. "Having a bank-owned provider that has that strength and stability and continuity, I think, gives clients a lot of comfort in an evolving part of the market," said Stephen Philipson, head of wealth, corporate, commercial, and institutional banking at U.S. Bank (USB.N) , opens new tab. Bitcoin custody service involves an institution safeguarding bitcoin on behalf of a client. Minnesota-based U.S. Bank's bitcoin custody offerings were jettisoned after the U.S. Securities and Exchange Commission in early 2022 issued an accounting bulletin that made it too capital-intensive for lenders to hold crypto tokens such as bitcoin on behalf of clients. That guidance was repealed earlier this year after U.S. President Donald Trump took office. Since then, a spate of banks has indicated their interest in providing various crypto services to their clients. Citigroup is also exploring custody services for digital assets that back crypto-related investment products, an executive told Reuters last month. Banks have eyed asset managers that issue spot bitcoin ETFs as potential custody clients, particularly as those products have exploded in popularity amid bitcoin's soaring price this year. Roughly a dozen asset managers have launched ETFs tracking the spot price of bitcoin since the SEC authorized such products last January. The largest bitcoin ETF, BlackRock's iShares Bitcoin Trust (IBIT.O) , opens new tab, has more than $80 billion in market capitalization. Crypto exchange Coinbase (COIN.O) , opens new tab dominates the custody business for spot bitcoin ETFs, and has previously said that it serves as the custodian for more than 80% of issuers of crypto ETFs. https://www.reuters.com/sustainability/boards-policy-regulation/us-bancorp-revives-institutional-bitcoin-custody-service-2025-09-03/

2025-09-03 12:02

Focus on US jobs data, due for release on Friday Trump administration to ask Supreme Court for expedited tariff ruling Gold rally may still have room to run in 2025, analysts say Sept 3 (Reuters) - Gold hit another record high on Wednesday, consolidating gains above the $3,500 level on growing expectations of a Federal Reserve rate cut this month and concerns over U.S. tariff policy and the independence of its central bank. Spot gold was up 0.4% at $3,547.27 per ounce as of 1132 GMT, after hitting an all-time high of $3,549.53 earlier in the session. U.S. gold futures for December delivery gained 0.6% to $3,613.30. Sign up here. Adding to market uncertainty and potential trade tensions, U.S. President Donald Trump's administration said it will ask the Supreme Court for an expedited ruling on tariffs that a U.S. appeals court found to be illegal last week. "The tariff issues and roadblock provided by the Supreme Court will be a critical test for Trump, (and) irrespective of the outcome, gold provides a welcome respite from market turbulence for investors," said independent analyst Ross Norman. "Rate cuts are starting to look baked in, but questions are now arising whether there will be further cuts. Lower rates would stimulate economic activity in the U.S. as well as further weaken the dollar... providing a strong tailwind to gold." Trump has been exerting relentless pressure on the Fed to cut interest rates, and publicly discussed firing Fed Chair Jerome Powell. In a sharp escalation, Trump last month attempted to fire Fed Governor Lisa Cook, setting off a critical legal test over the Fed's ability to function without political interference. Rate-cut expectations and worries over the Fed's independence have weighed on the U.S. dollar (.DXY) , opens new tab, which is down more than 9% since the start of the year, making gold less expensive for overseas buyers. Investors are pricing in a 92% chance of a 25 basis-point Fed rate cut at the end of its policy meeting on September 17, according to CME Group's FedWatch tool. Non-yielding gold typically performs well in a low-interest-rate environment. "I do think given the geopolitical risk and Federal Reserve outlook, the gold rally may still have room to run in 2025," said Zain Vawda, analyst at MarketPulse by OANDA. All focus is now on U.S. non-farm payrolls data, due on Friday, for clues on the size of the Fed's potential cut. Analysts see spot gold in a $3,600-$3,900 range in the near to medium term, with potential to test the $4,000 level in 2026 if economic and geopolitical uncertainties persist. Elsewhere, spot silver eased 0.1% to $40.87 per ounce after hitting its highest since September 2011. Platinum gained 0.1% to $1,404.09 and palladium rose 1.7% to $1,153.46. https://www.reuters.com/world/india/gold-adds-record-rally-rate-cut-bets-trade-turmoil-lift-demand-2025-09-03/

2025-09-03 11:59

EU parliament and governments will vote, outcome uncertain French, EU farm lobby, greens have opposed the accord Updated EU-Mexico deal also set to be presented BRUSSELS, Sept 3 (Reuters) - The European Commission is set to present an EU trade accord with South America's Mercosur bloc for approval on Wednesday, hoping to win over the main critics of the deal - France, Poland and European farmers - with promises of safeguards. The European Union and the bloc of Argentina, Brazil, Paraguay and Uruguay reached the free trade agreement last December, some 25 years after negotiations were launched. Sign up here. Now it will be put up for consent in the European Union, requiring a vote in the European Parliament and a qualified majority among EU governments, meaning 15 of 27 members representing 65% of the EU population. Neither is a given. The Commission and proponents such as Germany and Spain say the Mercosur deal offers a way to offset the loss of trade due to tariffs imposed by U.S. President Donald Trump and to reduce reliance on China, notably for critical minerals. France, the EU's largest beef producer, has previously branded the deal "unacceptable", while Poland, another farming heavyweight, has repeatedly expressed its opposition. Hoping to offset their concerns, the Commission will propose a mechanism whereby preferential Mercosur access for sensitive farm products such as beef could be suspended if the imported market share or volumes rose by 10% or prices fell by that amount, a European official said. Polish Prime Minister Donald Tusk said on Wednesday that his country continued to oppose the deal, but no longer had other partners to block it. It was then essential to have such a defence measure in place, he said. The EU executive has said the Mercosur agreement is the largest it has ever agreed in terms of tariff reductions and is a necessary part of the EU's push to diversify trade ties. Since Trump's re-election last November, the EU has gone into overdrive in seeking trade alliances, accelerating talks with India, Indonesia and the United Arab Emirates and deepening ties with existing free trade partners Britain, Canada and Japan. The Commission will also present an updated EU-Mexico agreement, struck in January, on Wednesday. European farmers have repeatedly protested over the Mercosur deal, saying it would lead to cheap imports of South American commodities, notably beef, that do not meet the EU's green and food safety standards. The Commission has denied this is the case. European green groups also oppose the accord. Friends of the Earth has called it a "climate-wrecking" deal. They hope it will be blocked, either in the parliament, where the Greens and far right are critics, or by EU governments. However it now appears that there will not be a large enough group of governments to reject the deal. EU proponents of the deal see Mercosur as a growing market for European cars, machinery and chemicals and a reliable source of critical minerals for its green transition, such as battery metal lithium, for which Europe is now dependent on China. They also point to agricultural benefits, given the deal would offer greater access and lower tariffs for EU cheeses, ham and wine. https://www.reuters.com/world/americas/eu-seeks-win-over-opponents-mercosur-trade-deal-2025-09-03/

2025-09-03 11:32

MAZAR DARA, Afghanistan, Sept 3 (Reuters) - Mir Salam Khan mourns the loss of his wife and three children in Afghanistan’s mountainous eastern province of Kunar, hit by an earthquake of magnitude 6 that crumbled thousands of homes. "We buried them with wooden planks and plastic sheets so the soil would not fall directly on the bodies," said the 65-year-old resident of the village of Mazar Dara. "That was all we could do." Sign up here. The shallow midnight tremor, Afghanistan's deadliest quake in years, killed more than 1,400 people and destroyed more than 5,000 houses, officials of the Taliban administration have said, but harsh weather and rugged terrain have hampered rescue work. Here the dead are usually wrapped in shrouds and placed in graves topped with cement slabs. With supplies scarce and many destroyed homes, however, survivors said they were forced to improvise, with wood and plastic picked out of the wreckage. "We have never witnessed such an earthquake in history," said Yunus Khan, 45, seated amid the rubble of his mud-brick home that traps two of his children, while three more were among the 12 of his family who died. "All belongings were lost, the children were martyred," he added, surrounded by homes with crumbling walls, their wooden beams sticking out of rubble where children sat silently. "It was such a quake that it gave no one a chance," said Khan. "With one jolt, the entire village was destroyed." Most survivors remain stranded among the ruins, burying their dead in graveyards filling with freshly dug plots for children and adults. Aid workers are just reaching the remote hamlets. A single tent, shared by half a dozen families, sagged in the rain as helicopters circled overhead to ferry the wounded to hospital. "Last night it rained and we had no shelter," Yunus said. "Five or six families are in one tent, there are no supplies. Even the bodies lay out in the rain, waiting to be buried." Farmer and livestock owner Namirullah, 30 joined about 50 neighbours in digging through rubble with their bare hands. "The martyrs are still trapped and the injured are so many," said the volunteer from the nearby village of Chapa Dara. "People have abandoned their homes and are living in cornfields and orchards, terrified as aftershocks come every few minutes." The defence ministry said the Afghan air force moved more than 1,900 people in 155 flights over two days, hundreds of wounded among them, as well as delivering 10,000 kg (22,000 lb)of supplies across the region. Hemmed in by mountains where the Indian and Eurasian tectonic plates meet, Afghanistan is no stranger to such devastation. A quake in 2022 killed about 1,000 people, and successive shocks in 2023 flattened villages in Herat. Four smaller tremors rattled the country this year. Each new disaster strikes a nation crippled by poverty, war and shrinking aid, with the United Nations estimating that half the population of more than 40 million needed assistance even before Sunday’s quake. Two days later, Salam was still waiting for the bodies of his son and daughter to be pulled from the ruins of his home. He and his neighbours used shovels and their hands in an effort made painfully slow without earthmoving machinery. "Two of my children are still under the rubble," he said. "We can do nothing." https://www.reuters.com/business/environment/afghan-earthquake-survivors-hunt-loved-ones-pull-planks-rubble-graves-2025-09-03/