2024-04-26 11:08

April 26 (Reuters) - The Russian rouble firmed to a one-month high past 92 to the dollar on Friday after the central bank held interest rates at 16%, as expected, and slightly worsened Russia's inflation outlook. By 1048 GMT, the rouble was 0.1% stronger against the dollar at 91.86 , its strongest since March 27. All 26 analysts polled by Reuters this week expect the Bank of Russia to keep interest rates unchanged, with the gradual slowdown of inflation preventing the central bank from easing borrowing costs more quickly. The bank said inflation would return to its 4% target more slowly than previously forecast. The rouble had gained 0.2% to trade at 98.49 versus the euro and shed 0.2% against the yuan to 12.62 . Brent crude oil , a global benchmark for Russia's main export, was up 0.6% at $89.53 a barrel. Russian stock indexes were higher. The dollar-denominated RTS index (.IRTS) New Tab, opens new tab was up 0.2% to 1,180.8 points. The rouble-based MOEX Russian index (.IMOEX) New Tab, opens new tab was 0.1% higher at 3,443.5 points. For Russian equities guide see For Russian treasury bonds see Sign up here. https://www.reuters.com/markets/currencies/russian-rouble-hits-one-month-high-after-central-bank-holds-rates-2024-04-26/

2024-04-26 10:50

Russian central bank holds key interest rate at 16% Inflation to ease more slowly than thought, bank says Central bank now expects year-end inflation above 4% target Labour market tightness continues to increase, bank says This content was produced in Russia where the law restricts coverage of Russian military operations in Ukraine MOSCOW, April 26 (Reuters) - Inflation is set to ease more slowly than previously thought, Russia's central bank said on Friday as it held its key interest rate at 16% for the third meeting running and acknowledged for the first time that inflation may not fall to its 4% target this year. The decision was in line with a Reuters poll of economists, which had forecast that the persistence of inflation, fanned by strong consumer demand and widespread labour shortages, would prevent the central bank from easing borrowing costs more quickly. The bank lifted its inflation forecast to 4.3-4.8% from 4-4.5% previously. "Due to the remaining elevated domestic demand, which outstrips the capabilities to expand supply, inflation will return to the target somewhat more slowly than the Bank of Russia forecast in February," the bank said in a statement. The Bank of Russia had raised rates by 850 basis points in the second half of 2023, including an unscheduled emergency hike in August as the rouble tumbled past 100 to the dollar and the Kremlin called for tighter monetary policy. Inflation, the bank's main area of concern, stood at 7.4% in 2023, compared with 11.9% in 2022. Economists expect it to end 2024 above 5%. Governor Elvira Nabiullina outlined different scenarios the bank has considered, expecting the gap between supply and demand to gradually narrow, bringing inflation close to target by year-end. "If disinflation is too slow, we do not exclude maintaining the current key rate until the end of the year," Nabiullina said, adding that a rate raise was possible if disinflation stops. IMPROVED GDP PROSPECTS The bank updated its macroeconomic forecasts, raising Russia's economic growth prospects to 2.5-3.5% from the previous range of 1-2%. It increased its forecast for the average key rate range in 2024 to 15-16% from 13.5-15.5%. "The big hawkish surprise was the upward revision to its average key policy rate forecast," said Nicholas Far, Emerging Europe Economist at Capital Economics. "That implies the CBR now envisages much less scope for monetary easing in the second half of this year." Russia's economy rebounded sharply last year from a slump in 2022, but the growth relies heavily on state-funded arms and ammunition production and masks other problems. "Labour shortages come as the key constraint on the expansion of output of goods and services," the bank said. "Concurrently, labour market tightness continues to increase." The bank's improved GDP forecast mirrors that of the economy ministry, which now expects economic growth at 2.8% this year, while envisaging a weaker rouble and shrinking current account surplus in the coming years. The ministry's stress scenarios anticipate stalling growth and a diving rouble. The central bank raised its 2024 current account surplus forecast to $50 billion from $42 billion previously. In the first half of 2023, the central bank had cut rates as low as 7.5%, gradually reversing an emergency hike to 20% implemented in February 2022 after Moscow sent its army into Ukraine, triggering sweeping Western sanctions. The bank's next rate-setting meeting is scheduled for June 7. Sign up here. https://www.reuters.com/markets/europe/russian-central-bank-holds-rates-16-raises-inflation-forecast-2024-04-26/

2024-04-26 08:02

SYDNEY, April 26 (Reuters) - The capsizing of a boat carrying childhood vaccines and health workers in Tuvalu underscored the challenges of healthcare in remote Pacific Islands as they battle extreme weather caused by climate change, the U.N children's agency UNICEF said. UNICEF supports Pacific Islands with reliable supply of vaccines, a priority in a region where hospitals can run out of medicine because of remote locations. Extreme weather in low-lying atoll nations such as Tuvalu, which is impacted by climate change and rising sea levels, was also creating health challenges, UNICEF's Pacific health specialist Frances Katonivualiku said. "Health workers took vaccines to one of the remote islands and the boat capsized - the vaccines, health workers, everyone in the water. It is a really challenging situation," she said in a telephone interview from Tuvalu on Wednesday. In the incident last Monday, the health workers were rescued by islanders who took them to shore on the southern island, before they returned to the nation's capital Funafuti, she said. "We don't have many health workers, so it is the same people that will need to recuperate and then go out again," she added. Tuvalu's national election result was delayed in February after lawmakers were unable to travel to Funafuti from outer islands for two weeks because of king tides and extreme weather. Scientists predict Funafuti risks being inundated by 2050 because of climate change. Dr Katonivualiku, who is visiting Tuvalu from Fiji for the immunisation programme, said extreme heat also made it difficult for mothers to bring babies to receive vaccinations during the day, so they had switched to evening clinics. UNICEF had supplied fridges to ensure vaccines are stored at the correct temperature. UNICEF said it had reached a milestone this week of nine Pacific Island nations, including Vanuatu, Samoa, Tonga, Tuvalu, Cook Islands, Nauru, Niue, Tokelau and Kiribati, committing to introduce childhood vaccines for Pneumococcal, Rotavirus, and Human Papillomavirus (HPV) in their national immunisation programmes. "We are seeing a tangible decrease in instances of pneumonia and diarrhoea since we have introduced these new vaccines. It is having an impact on the lives of children because these are the major causes of death in children under five," she said. Sign up here. https://www.reuters.com/world/capsizing-tuvalu-boat-carrying-vaccines-highlights-climate-change-challenges-2024-04-26/

2024-04-26 07:43

April 26 (Reuters) - A U.S. Federal Reserve meeting and Apple and Amazon reporting results will keep investors' focus in the days ahead on the global rates outlook and on tech earnings, while growth and inflation data from Europe and China are also coming out. Here's what to expect in the coming days, from Rae Wee in Singapore, Lewis Krauskopf in New York and Amanda Cooper and Naomi Rovnick in London. 1/ WILL THEY, WON'T THEY? Hints of whether the Fed still expects interest rate cuts at some point this year takes centre-stage for investors at the central bank's meeting that concludes on Wednesday. Rate action is unlikely, but comments from Fed Chair Jerome Powell about the potential for policy easing later in 2024 will be scrutinized. In March, the Fed projected three rate cuts this year but stronger-than-expected inflation reports are casting doubt on whether it will be able to ease policy that much - and that soon. A ratcheting down of rate cut expectations has been a key factor behind the rise in Treasury yields and recent pullback in stocks. Fed futures markets now predict some 35 bps of easing in 2024 down from 150 bps expected at the start of the year. 2/ TECH TALK The last of the "Magnificent Seven" megacaps that drove a fiery stock rally in 2023 to report are Amazon (AMZN.O) New Tab, opens new tab, reporting Tuesday, and Apple (AAPL.O) New Tab, opens new tab, on Thursday. Some of their peers such as Tesla and Facebook parent Meta Platforms have given a mixed performance. Apple shares have lost their lustre in 2024, tumbling over 10%. The iPhone maker is expected to post a decline in first quarter earnings after China smartphone shipments fell 19%. Amazon's cloud computing business will be in focus while investors will be attuned to the online retailing giant's view of consumer spending. Its shares are faring better so far this year, having risen 18% as of Wednesday. Meanwhile, tech regulation is also on the front burner. President Joe Biden just signed legislation that bans TikTok in the United States if Chinese owner ByteDance fails to divest the short video app over the next nine months to a year. 3/ RAY OF HOPE Following last month's upside surprises on manufacturing activity in China, April's readings are set to indicate whether the long-awaited economic recovery is indeed gathering steam. Official figures for China's purchasing managers' index (PMI) are due on Tuesday and the Caixin/S&P Global manufacturing PMI survey is expected shortly afterwards. Upbeat data could revive animal spirits in the world's second largest economy, bringing relief to policymakers who have been trying to shore up growth and bolster investor sentiment. Global investment houses have turned increasingly bullish on Chinese stocks, helping the blue-chip index (.CSI300) New Tab, opens new tab tack on more than 10% from a February trough. But Beijing has lately found itself in a bind over its currency. The yuan is sliding against a perky dollar but is stronger against its major trading partners (.CFSCNYI) New Tab, opens new tab - an unwelcome sign for China's export-reliant economy. 4/ PAVING THE WAY Euro zone inflation and economic growth data due out on Tuesday could strengthen market bets for the European Central Bank to lower its deposit rate from a record 4% in June, although policy makers are not expected to move very fast thereafter. Gross domestic product in the euro zone currency bloc probably expanded by just 0.1% in the first quarter, year-on-year, economists polled by Reuters expect the data to show. April inflation numbers could also convince the ECB it's time to cut, after consumer price growth slowed unexpectedly to 2.4% in March and policymakers signalled that the central bank was willing to move. But with U.S. inflation running hot and the Fed viewed as likely to hold rates high, markets price 60 bps of cuts by the ECB this year as it remains wary of the euro weakening too much against a supercharged dollar. 5/ SELL IN MAY Conventional wisdom has it that May is the ideal point to take profit on equities and lay low until later in the year. "Sell in May and go away" is based on the premise that the best six-month period for stock market returns is November to April, while the leanest is May to October. Over the last 50 years, the S&P 500 (.SPX) New Tab, opens new tab has gained an average of 4.8% between November and April, and just 1.2% between May and October, according to Reuters calculations. However, this pattern fades over a shorter time-frame. Over the last 20 years, the out-performance of November-April over May-October narrows to 1%. Over 10 years, November-April has underperformed May-October by 1 percentage point and over the last five years, it has underperformed by 3 percentage points. It might be time to find words that rhyme with "November". Sign up here. https://www.reuters.com/business/take-five/global-markets-themes-graphic-2024-04-26/

2024-04-26 07:34

FTSE 100 up 0.6%, FTSE 250 adds 0.6% April 26 (Reuters) - The UK's FTSE 100 hit fresh highs on Friday as strong earnings from U.S. tech giants buoyed global sentiment, while cybersecurity firm Darktrace rallied following a buyout deal by private equity firm Thoma Bravo. The blue-chip FTSE 100 (.FTSE) New Tab, opens new tab was up 0.6% as of 0725 GMT, hitting a record-high for the fourth consecutive session. The index is set for its biggest weekly gain in more than seven months. Sentiment in Asian and broader European markets was optimistic after upbeat earnings from Wall Street tech titans Alphabet (GOOGL.O) New Tab, opens new tab and Microsoft (MSFT.O) New Tab, opens new tab. NatWest (NWG.L) New Tab, opens new tab jumped 3.4% to touch a more than one-year-high after the British bank's first-quarter profit fell by a less-than-expected 27%. Anglo American (AAL.L) New Tab, opens new tab slipped 0.8% after it rejected BHP Group's (BHP.AX) New Tab, opens new tab 31.1 billion pound ($38.88 billion) takeover proposal, saying the bid significantly undervalued the London-listed miner and its future prospects. The stock had rallied 16% following BHP's offer on Thursday. BHP's UK-listed stock fell 0.9%. The mip-cap FTSE 250 (.FTMC) New Tab, opens new tab gained 0.6%, with Darktrace (DARK.L) New Tab, opens new tab rallying 16.5% after Thoma Bravo agreed to buy the firm for about $5.32 billion. British consumer sentiment returned to a two-year high this month as households took a more positive view of the economy and their own finances, a long-running survey showed. Sign up here. https://www.reuters.com/world/uk/ftse-100-continues-record-run-darktrace-rallies-buyout-deal-2024-04-26/

2024-04-26 07:13

PARIS, April 26 (Reuters) - French energy giant TotalEnergies (TTEF.PA) New Tab, opens new tab posted a 22% decline in first-quarter earnings versus a year earlier on Friday as higher refining margins only partly offset a steep decline in profits from natural gas. Adjusted net income for the three months to end-March came to $5.1 billion, slightly above the $5 billion in a consensus estimate of analysts forecasts compiled by LSEG. Natural gas prices in Europe have tumbled 45% in the last year due to mild winter weather and easing worries over supplies. Less volatility in the market also eroded trading opportunities, though Total managed to somewhat offset those lower earnings with better margins in refining. Cash flow from operations came to $2.2 billion versus $5.1 billion a year earlier. Hydrocarbon production was roughly stable versus the prior quarter at 2.46 million barrels of oil equivalent per day, as the startup of new liquefied natural gas (LNG) projects Mero 2 in Brazil and Akpo West in Nigeria offset the sale of Canadian oil sands assets in late 2023. The company said it expected natural gas profits to rise again over winter 2024-2025 as demand recovers in Asia and as little new LNG capacity comes online. It estimates a winter gas price of above $11/Mbtu, versus a current European price between $8-10/Mbtu. While refining margins were strong in early 2024, Total said current higher oil prices around $90 per barrel are making refining less profitable going into the second quarter, with the trend likely to continue due to geopolitical tensions and decisions by OPEC+ countries to limit production via quotas. The company also confirmed it plans $2 billion in share buybacks in the second quarter. Sign up here. https://www.reuters.com/business/energy/totalenergies-q1-net-income-falls-22-lower-gas-prices-2024-04-26/