2024-03-14 12:50
BRUSSELS, March 14 (Reuters) - Azerbaijan, host of this year's U.N. climate change talks, hopes to upgrade its emissions reduction target in time for the event, the incoming president of the COP29 summit said on Thursday. Azerbaijan's economy relies on oil and gas, and its existing target - to cut greenhouse gas emissions 35% by 2030 and 40% by 2050 versus 1990 levels - is far short of the net zero level scientists say the world must reach by 2050 to avoid the worst impacts of climate change. Mukhtar Babayev, minister of ecology and natural resources, said his former Soviet nation had started preparations to consider updating its national climate change commitment (NDC). "It is not only a chance for Azerbaijan, but all other countries to prepare and announce the upgraded NDCs in Baku in November this year," Babayev told a Financial Times conference in London in a recorded interview. Babayev, who previously spent two decades at Azerbaijan's state-owed oil and gas firm, did not specify what the amended target would be. His appointment has faced criticism from campaigners and some climate scientists, for continuing a trend of those with deep ties to the oil and gas industry leading the world’s negotiations to combat climate change. TEST OF RESOLVE The November meeting in Baku will test governments' appetite to fight climate change after a bumper year of elections from the EU and U.S. to India and South Africa. In Azerbaijan, oil and gas account for 91% of exports, according to U.S. data , opens new tab for 2022. Babayev said Azerbaijan was committed to expand green energy sources to a 30% share of the mix by 2030. The country is rich in untapped wind and solar resources, but today its energy is nearly entirely produced from fossil fuels. He said he had begun talks with financial institutions, banks, campaigners and the private sector to lay groundwork for a consensus at the summit on raising more finance to help developing nations with the energy transition. COP29 serves as the deadline for countries to agree a new global climate finance goal to help poorer nations cope with worsening climate change. Last year’s COP28 climate summit in the United Arab Emirates was led by Sultan Al-Jaber, head of the country’s state-owned oil firm. That summit yielded the first global agreement to transition away from fossil fuels but fell short of the full phase-out more than 100 countries including the EU, U.S. and climate-vulnerable small island states had sought. Make sense of the latest ESG trends affecting companies and governments with the Reuters Sustainable Switch newsletter. Sign up here. https://www.reuters.com/business/environment/cop29-host-azerbaijan-plans-upgrade-climate-target-2024-03-14/
2024-03-14 12:20
West sanctioned Russian diamond imports over Ukraine war Antwerp diamond dealers criticise implementation of ban Say they fear loss of competitive advantage Belgian city has been diamond trade hub for centuries Belgian official says disruptions are now easing LONDON/BRUSSELS, March 14 (Reuters) - Antwerp's diamond dealers are facing long and expensive delays in their imports of the precious stones due to an EU ban on Russian-origin diamonds that came into effect on March 1, a letter seen by Reuters showed. The letter, dated March 13, said the disruptions would further erode the competitive advantage of the centuries-old Antwerp diamond trade. It was addressed to Belgium's main diamond industry group, Antwerp World Diamond Centre (AWDC), and requested a review of the new procedures. "While we fully support the decisions taken by Belgium, the European Union, and the G7 nations, in regards to the sanctions of January 1st 2024, the implementation of the measures to enforce the sanction has adversely affected all of our operations," said the letter, signed by over 100 local firms. "The intention was to prevent the flow of diamonds from sanctioned states, but the reality we face is the severe disruption of our supply chains, and alienation from the rest of the global trade." A Belgian government official said the delays were a temporary blip that were now easing. The EU and Group of Seven (G7) countries agreed to ban direct imports of Russian diamonds to their markets as of Jan. 1 and before phasing in a full ban on Russian-origin stones via third countries from March 1 because of Moscow's war in Ukraine. Russia's state-run Alrosa, among the world's top diamond producers, was also sanctioned by the EU. DIAMOND HUB Antwerp remains the world's biggest diamond hub though 90% of stones are now polished in India. Belgium pushed hard for the G7 to adopt a version of its proposed plan in an effort to prevent Antwerp from losing even more business after major Western jewellers began eschewing Russian stones. Diamond dealers said their shipments have been held up for over a week at customs even if the gems were coming straight from African producers. The Belgian government official said pending shipments would now be processed within 24 hours. "The indirect ban coincided with the Hong Kong Diamond Fair which is an annual peak period... This, in combination with the expected teething problems caused some initial delay in processing of shipments during the first days," he said. Diamond dealers say they expect more problems when the additional tracing requirements take effect from September. "We see the procedures will cause Antwerp to further lose competitive advantage... rather than deal a meaningful blow to any sanctioned products," the letter said. "The current trajectory threatens the existence of Antwerp's diamond industry, a heritage of six centuries." The head of the AWDC, Ari Epstein, said the group would soon present the new measures, adding it was "acutely aware of the challenges and disruptions this timing may have caused". "Let me be unequivocally clear: the violation of sanctions is criminal in nature and not taken lightly by governments or our organization. Our commitment to compliance... is unwavering and absolute," Epstein said in a statement. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/commodities/russian-diamond-ban-creates-costly-delays-antwerp-diamond-dealers-say-2024-03-14/
2024-03-14 12:08
Markets believe mid-year US rate cut is possible - analyst US producer price index due at 1230 GMT Silver eased off more than three-month high March 14 (Reuters) - Gold edged lower on Thursday as the dollar and Treasury yields held firm ahead of a slew of U.S. economic data due later in the day, which could offer more clarity on the timing of the Federal Reserve's first interest rate cut this year. Spot gold fell 0.3% to $2,166.80 per ounce as of 1147 GMT. Bullion had hit a record peak of $2,194.99 on March 8. U.S. gold futures also dipped 0.4% to $2,172.30. The dollar held steady against its rivals, making gold less attractive for other currency holders, while benchmark U.S. 10-year notes yields rose to a more than one-week high. "Market participants still believe that a mid-year U.S. rate cut is possible, keeping gold supported. Guess the next driver is the upcoming FOMC meeting and any change in the dot plots," said UBS analyst Giovanni Staunovo. The Fed is expected to hold rates steady at its policy meeting next week, but the focus will be on the "dot plot" projections. The U.S. central bank in its December meeting pencilled three-quarter-point rate cuts for 2024. "In the near term, gold prices are likely to stay volatile, but we retain a modestly positive outlook, targeting $2,250/oz by the end of the year, supported by rate cuts starting mid-year and higher investment demand," Staunovo added. Traders continue to bet on interest rate cuts in June, pricing in about 66% chance compared to 72% before the CPI data, according to the CME Group's FedWatch Tool , opens new tab. Low interest rates help gold as they reduce the opportunity cost of holding the non-yielding bullion. Investor focus is on the U.S. producer price index, retail sales and weekly jobless claims data, which are due at 1230 GMT. Spot platinum fell 0.1% to $937.45 per ounce, palladium rose 1.1% to $1,070.99. Silver slipped 0.2% to $25.00, after hitting a more than three-month high earlier in the session. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/commodities/gold-prices-tepid-traders-seek-more-us-data-2024-03-14/
2024-03-14 12:00
LITTLETON, Colorado, March 14 (Reuters) - Brazil's electricity producers have reduced their reliance on the country's mammoth system of hydro dams by sharply increasing output from solar and wind farms since 2018, data from energy think tank Ember shows. The share of electricity generated by hydro sources has dropped from 74% in 2018 to 67% in 2023, while solar and wind sites have increased their combined share of Brazil's electricity generation pie from 9% to 22% over the same period. Power firms have also sharply cut use of coal and natural gas-fired power plants for electricity since 2018, driving the share of fossil fuels in Brazil's electricity generation mix to a record low 7.6% last year. As output from both hydro and renewables facilities hit new highs in 2023, Brazil's power producers were also able to expand total clean electricity generation a record last year - cementing the country's status as a global clean power leader. HYDRO FOUNDATION Despite the steady decline in overall power share, hydro dams remain the pillar of Brazil's electricity system. For the opening two months of 2024, hydro dams accounted for roughly 71% of total electricity output. That share is down from 74% at the start of 2023, but hydro is clearly the main engine of the country's power sector. However, power producers have aggressively expanded the footprint of other clean generation sources, with combined generation capacity from solar and wind farms expanding by 180% from 2018 to 2022. That renewables expansion compared with 5.1% growth in hydro capacity over the same period, and revealed a clear push by Brazilian power firms to diversify the country's power source base. Utilities also expanded generation capacity from coal and natural gas plants from 2018 to 2022 (by 12.4% and 36.5% respectively). But with total fossil fuel generation capacity under 15% of the total, it is clear that Brazilian power firms remain overwhelmingly focused on using clean sources of power to provide the majority of the country's electricity. GROWTH PATH Brazilian utilities have plans for the further expansion of clean generation sources, with 10.8 gigawatts (GW) of solar capacity, 4.9 GW of wind capacity, 1.15 GW of biomass capacity and 1.5 GW of hydro capacity slotted for addition in 2024, according to Brazil's power regulator Aneel. Some of those project plans have encountered delays so far this year due to a mix of construction, legal and permitting issues, as well as wrangling over power purchase agreements, Aneel has reported. But given the strong backing by the central government for further expansions to clean power, and the heavy investment from private and public firms in accelerating the build out of Brazil's power grids, it is likely that total growth in Brazilian clean power output will continue in 2024 and beyond. And with renewable capacity growth set to sharply exceed that of all other forms of electricity generation, the country's power system looks set to become both cleaner and more resilient as that capacity comes online - ensuring Brazil will remain a stand out clean energy powerhouse. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/commodities/brazil-diversifies-clean-power-sources-away-hydro-2024-03-14/
2024-03-14 11:54
LONDON, March 14 (Reuters) - The conviction of Tom Hayes, the first trader jailed worldwide for Libor interest rate rigging, should be overturned because it is not illegal to take commercial interests into account when setting rates, his lawyer told a London court on Thursday. Hayes, a former star Citigroup (C.N) , opens new tab and UBS (UBSG.S) , opens new tab trader, was convicted in 2015 of conspiracy to defraud by manipulating the London interbank offered rate (Libor), once used to price trillions of financial products globally. The former yen-derivatives trader, now 44, was sentenced to 14 years in jail, one of the toughest sentences imposed for white collar crime in Britain, reduced on appeal to 11 years. Hayes, who was released from jail in 2021 on licence, is fighting to clear his name at London's Court of Appeal after a referral by the Criminal Cases Review Commission, which reviews potential miscarriages of justice. His case is being heard alongside that of Carlo Palombo, a former Barclays (BARC.L) , opens new tab trader convicted in 2019 of skewing Libor's euro equivalent Euribor. They were given the chance to appeal after a U.S. court in 2022 acquitted two former Deutsche Bank (DBKGn.DE) , opens new tab traders, ruling there was no prohibition on banks considering their trading position when submitting Libor rates. The case will be keenly watched by other traders, some of whom attended the hearing on Thursday and have hired lawyers to look into the possibility of bringing their own appeals. Hayes' lawyer Adrian Darbishire said the judge at Hayes' trial wrongly told the jury there was an "absolute legal prohibition on commercial considerations" when setting Libor rates. Libor "was set by people who had an interest in its answer, everyone understood that", Darbishire added. The case hinges on the definition of global benchmark rates such as Libor and whether banks could influence numbers to benefit trading books if rates still reflected an honest assessment of the cost of cost of borrowing between banks. Hayes maintained during his trial that the levels he requested fell within a permissible range – and that his conduct was common at the time and condoned by bosses. The Serious Fraud Office (SFO), however, is opposing the appeals, saying Hayes' and Palombo's convictions are safe and that the 2022 U.S. ruling is irrelevant to their cases. The agency, which prosecuted 19 over benchmark rigging and secured nine convictions, argues Libor rates set for commercial purposes were intended to prejudice the rights of counterparties and deliberately disregarded how the benchmark should be set. "The fact that an American court came to a different determination ... is irrelevant to the fairness of the appellant's trial and the safety of his conviction," its lawyers said in court filings. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. https://www.reuters.com/world/uk/conviction-libor-trader-hayes-should-be-overturned-lawyer-tells-uk-court-2024-03-14/
2024-03-14 11:32
US retail sales rebound in Feb; weekly jobless claims fall Gasoline, food boost US producer prices in February NEW YORK, March 14 (Reuters) - U.S. stocks dropped on Thursday, with chipmaker stocks extending losses for a second day, and as a jump in producer prices left investors wondering if the Federal Reserve might wait longer than expected to cut interest rates. Data showed U.S. producer prices increased more than expected in February as the cost of goods like gasoline and food surged. Rate-sensitive utilities (.SPLRCU) , opens new tab and real estate (.SPLRCR) , opens new tab were the day's weakest sectors, with real estate down 1.6% and utilities off 0.8%. The Fed is expected to leave rates unchanged at its policy meeting next week. The market has trimmed the odds of a cut of at least 25 basis points at its June meeting to 62.9%, CME's FedWatch Tool showed, down from 81.7% a week ago. "If we take inflation as a whole, we've had relatively hot inflation readings the last two months now, yet the market has kind of powered higher," said Tony Welch, chief investment officer of SignatureFD. "Fed policy may not be as loose as the market wanted it to be this year, but the prospect of further tightening still remains a low probability." Nvidia (NVDA.O) , opens new tab shares fell 3.2%, while an index of semiconductors (.SOX) , opens new tab was down 1.8%. The index is down 3.5% for the week so far, with investors taking profits after recent sharp gains. The Dow Jones Industrial Average (.DJI) , opens new tab fell 137.66 points, or 0.35%, to 38,905.66. The S&P 500 (.SPX) , opens new tab lost 14.83 points, or 0.29%, at 5,150.48 and the Nasdaq Composite (.IXIC) , opens new tab dropped 49.24 points, or 0.3%, to 16,128.53. The S&P 500 remains up about 8% for the year to date. The small cap Russell 2000 (.RUT) , opens new tab fell 2% on the day, underperforming the broader market. "There's nervousness about the market being very extended with a relatively narrow breath. You can see the anxiety from the hotter PPI expressed in the Russell index of small and midcap names," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles. Other data showed U.S. retail sales rebounded in February, rising 0.6%, but less than the 0.8% advance expected. Shares of Robinhood Markets (HOOD.O) , opens new tab rose 5.2% after the trading app operator said its assets under custody rose 16% in February. Volume on U.S. exchanges was 13.1 billion shares, compared with the 12.1 billion average for the full session over the last 20 trading days. Declining issues outnumbered advancers on the NYSE by a 3.77-to-1 ratio; on Nasdaq, a 3.08-to-1 ratio favored decliners. The S&P 500 posted 39 new 52-week highs and no new lows; the Nasdaq Composite recorded 57 new highs and 186 new lows. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/us/futures-rise-run-up-inflation-figures-retail-sales-data-2024-03-14/
