2024-08-06 15:49

Aug 6 (Reuters) - The Biden administration said on Tuesday it is investing $2.2 billion to revamp the nation's power grid to protect it against growing threats of extreme weather events. The U.S. government has been working to overhaul the country's electric transmission system, which is under pressure from extreme weather conditions, as well as a growing number of power-hungry data centers. The upgrades to the grid will add nearly 13 gigawatts (GW) of capacity, and will also allow for increased manufacturing, more data centers, and improved transmission of renewable power, the Department of Energy said in a statement. The funding will support eight projects across 18 states. "The first half of 2024 has already broken records for the hottest days in Earth's history, and as extreme weather continues to hit every part of the country, we must act with urgency to strengthen our aging grid," U.S. Secretary of Energy Jennifer M. Granholm said in a statement. Sign up here. https://www.reuters.com/business/energy/us-invest-22-bln-nations-power-grid-2024-08-06/

2024-08-06 14:03

OTTAWA, Aug 6 (Reuters) - Canada recorded a surprise trade surplus of C$638 million ($461 million) in June, data showed on Tuesday, mainly led by a jump in shipments of crude oil from the recently expanded Trans Mountain Pipeline. A surge in exports of gold also boosted exports and, together with energy products shipments, helped exports overtake imports for the first time in four months, Statistics Canada said. Analysts polled by Reuters had forecast a C$1.84 billion trade deficit. May's trade deficit was revised down to C$1.61 billion from a preliminary C$1.93 billion deficit. Total exports jumped 5.5% in June, led by crude oil and gold exports, while imports were up 1.9%, driven by cars and light trucks, data showed. By volume, exports rose 3.8% in June, while imports increased by 1.3%. After 12 years and C$34 billion in costs, Canada in May commissioned the Trans Mountain Pipeline expansion project (TMX), which unlocked the Asia-Pacific market for local crude oil producers. "They are shipping more through the Trans Mountain pipeline into Asia-Pacific, which is really positive," said Prince Owusu, senior economist with Export Development Canada. Exports of energy products, which account for over a fifth of all exports from Canada, rose 11.7%. While this was aided by higher prices, Statscan said the increased volume of crude exports was the biggest contributor to the overall increase. Exports of metal and non-metallic products, which contribute over a 10th of total exports, rose 11.8%, led largely by exports of unwrought gold. The Bank of Canada lowered its benchmark interest rate for a second straight month in July and indicated its focus was shifting to boosting the economy. Financial markets have fully priced in a 25-basis-point cut in the central bank's key policy rate at its September meeting and expect similar cuts at its October and December meetings. The Canadian dollar pared losses after the data, trading marginally down 0.04% at 1.3829 to the U.S. dollar, or 72.26 U.S. cents. The rise in total imports was led by motor vehicles and parts as well as consumer goods. An 8.2% rise to a record C$6.8 billion in imports of passenger cars and light trucks drove the motor vehicles and parts category in June. Exports to the United States, by far Canada's largest trading partner, rose for a third consecutive month and outpaced the growth in imports in June, leading to Canada's trade surplus with its neighbor widening to the highest level since November 2023. ($1 = 1.3840 Canadian dollars) Sign up here. https://www.reuters.com/markets/oil-gold-exports-help-canada-swing-surprise-trade-surplus-june-2024-08-06/

2024-08-06 12:57

BENGALURU, Aug 6 (Reuters) - The U.S. dollar will claw back some of its recent losses over the coming three months on expectations financial markets have again gone too far in pricing in too many Federal Reserve interest rate cuts this year, a Reuters poll of foreign exchange strategists found. After rising about 5% for the year, the greenback (.DXY) , opens new tab lost more than half its gains against a basket of major currencies in recent weeks amid sluggish U.S. economic data fuelling expectations of multiple Fed rate cuts, starting in September. Much of those losses came following weaker-than-expected jobs data on Friday, which encouraged financial markets to project around 120 basis points worth of rate cuts in total from the three remaining Fed meetings this year, compared with 50 basis points just a few weeks ago. Several major banks, including primary dealers who deal directly with the Fed, followed suit in predicting more rate reductions than expected earlier. Yet with policymakers pushing back against speculation that recent weakness in economic data would translate into recession, markets may yet again be forced to temper their rate cut expectations. FX strategists in the monthly Reuters poll, conducted from Aug. 1-6 through recent market turmoil, predicted the euro , currently about $1.10, would fall about 1.4% to $1.08 by end-October, before rising to current levels in six months and then to $1.11 in a year. "Our strong dollar argument has certainly taken a big hit in terms of confidence, but is its strength truly over? That's not our call," said Paul Mackel, global head of FX at HSBC. "Our recession indicators are not flashing red. And even if the U.S. economy loses momentum, that usually spells bad news for other economies. The dollar does better in that environment." "Are markets getting carried away? Naturally, I'd say yes, but it's difficult to stand in front of that speeding train in the very short term because this type of overreaction can persist," Mackel added. "You need to be very careful when volatility is this high and you're not used to it coming back so quickly." MAJOR CUTBACK The Japanese yen , which started its latest upward march against the U.S. dollar after the Bank of Japan raised its overnight call rate to 0.25% on July 31 and announced a major cutback in its asset purchases going forward, hit a seven-month high of 141.7/$ on Aug. 5. It will hold on to its recent gains to trade at 144/$ in a year, the survey showed. Some FX analysts, however, attributed much of those gains to traders unwinding large volumes of carry trades - where investors borrow from economies with low rates to fund investments in higher-yielding assets elsewhere - which sent the Nikkei stock market index down more than 12% on Monday and then back up over 10% on Tuesday. The latest positioning data from the Commodity Futures Trading Commission (CFTC) before recent market volatility also showed speculators had slightly increased their net long bets on the U.S. dollar. Forecasters in previous Reuters polls, who for years have held on to their expectations of a weakening dollar, were split when asked if it was more likely the dollar would trade stronger or weaker than they predicted for the remainder of the year. A slight majority, 32 of 62, said stronger, while 30 said weaker. "Setting recent developments aside for a minute, we're generally in the soft-landing camp and think once the U.S. economy starts to recouple with the rest of the world's economies, we'll see the dollar's outperformance and more importantly, its overvaluation, start to normalize a bit going forward," said Alex Cohen, FX strategist at Bank of America. (For other stories from the August Reuters foreign exchange poll click here) Sign up here. https://www.reuters.com/markets/currencies/dollar-poised-comeback-recent-weakness-just-hiccup-2024-08-06/

2024-08-06 12:22

Aug 6 (Reuters) - Britain's competition watchdog said on Tuesday it has provisionally approved the deal for T&L Sugars to buy Tereos UK & Ireland's retail sugar business. T&L Sugars, which refines and distributes packaged sugar across supermarkets in the UK, bought Tereos' consumer facing operations in the UK and a distribution facility in West Yorkshire in November 2023. The Competition and Markets Authority (CMA) referred the deal to an in-depth probe in March after the regulator found that the transaction could result in higher sugar prices for UK shoppers. "We have provisionally found that the most likely outcome is that Tereos' UK retail business would have closed, absent the deal with TLS and on this basis we have provisionally decided to approve the merger," the CMA said on Tuesday. The regulator added that a closure of Tereos' UK retail business would also result in a loss of competition without the merger. T&L Sugars was sold by food ingredients maker Tate & Lyle (TATE.L) , opens new tab in 2010 to U.S.-based cane sugar refiner ASR Group. Sign up here. https://www.reuters.com/markets/deals/uk-regulator-provisionally-clears-tl-sugars-tereos-deal-2024-08-06/

2024-08-06 12:13

SAO PAULO, Aug 6 (Reuters) - Brazil's central bank won't hesitate to raise interest rates if necessary to bring inflation down to its target, minutes from its July 30-31 policy meeting showed on Tuesday. The monetary authority called for greater "vigilance" as inflation expectations have shown further de-anchoring, and policymakers left the door open for a potential rate hike ahead, although they said they were not committed to a policy strategy. Brazil's central bank last week kept interest rates unchanged at 10.50% for a second consecutive meeting, as expected, flagging worsening inflation expectations and recent market swings. The decision was unanimous. The rate-setting committee, known as Copom, said it "unanimously believes that the current stage is of even greater caution and of diligent monitoring of inflation conditioning factors," according to the minutes. "Copom unanimously reinforced that it will not hesitate to raise the interest rate to ensure inflation convergence to the target if it deems it appropriate." Following publication of the minutes, the real strengthened 1% against the dollar and Brazil interest rate futures now price in a 62% chance of a 25-basis-point rate hike at Copom's next meeting in September, up from 43% on Monday . "The minutes came in a lot more hawkish than the policy statement," said BNP Paribas economist Laiz Carvalho. "The central bank is effectively saying that it could hike rates, and I think the most important thing is that it is unanimous." Inflation projections in Latin America's largest economy have been climbing and now stand at 4.12% for 2024 in the central bank's weekly survey of economists. Estimates for 2025 and 2026 are currently at 3.98% and 3.60%, respectively, also above the bank's 3% target. Sticky services inflation pushed up consumer prices more than forecast in the month to mid-July, recent data from statistics agency IBGE showed. "Various measures of underlying inflation are above the inflation target in recent releases," the central bank said. Copom said that market doubts about the Brazilian government's ability to meet its goal of eliminating its primary deficit this year have had significant impact on asset prices and inflation expectations. The real has plunged nearly 15% so far in 2024, pressured by concerns about domestic public finances and a strong U.S. dollar. According to the central bank, the recent exchange rate moves could have "significant" inflationary impacts. Copom reinforced that the lack of commitment to fiscal discipline has the potential to raise Brazil's neutral interest rate, with "harmful impacts on the power of monetary policy and, consequently, on the cost of disinflation." Meanwhile, economic and labor market indicators continue to show more strength than expected, making the process of inflation convergence to the target more challenging, the policymakers added. Sign up here. https://www.reuters.com/markets/rates-bonds/brazil-central-bank-will-raise-rates-if-needed-minutes-show-2024-08-06/

2024-08-06 12:05

ROME, Aug 6 (Reuters) - Italy on Tuesday appointed a special commissioner to tackle the spread of the blue crab, an aggressive species that is preying on local clams and threatening a lucrative part of national food production. Originally from the western Atlantic, blue crabs have proliferated in several locations around the Italian coast, particularly in the Po river delta in the north, where attempts to curb numbers with large fishing campaigns have had little success. Experts say the blue crabs probably arrived in Italy via shipping bilge water, but it is unclear why they are multiplying so fast or whether there could be a link to climate change. "The blue crab has compromised some economic activities. But it risks above all to damage the whole sea ecosystem," Agriculture Minister Francesco Lollobrigida told a news conference, where he announced the appointment of commissioner Enrico Caterino. Agriculture lobby group Coldiretti - which also represents the fishing industry - said in a statement the blue crab had so far caused around 100 million euros ($109 million) of damage, wiping out clam production in the northern Veneto and Emilia Romagna regions. Italy is Europe's biggest producer of clams, and the third largest in the world behind China and South Korea, according to U.N. data from 2021. It is also home to "spaghetti alle vongole" (spaghetti with clams), a classic of Italian cuisine. The government of Prime Minister Giorgia Meloni last year earmarked some 2.9 million euros ($3.2 million) to help businesses damaged by the blue crab. "It is a catastrophe. We are at zero production. We are only catching crabs," said Paolo Mancin, head of the Fishermen's Cooperative of the Polesine, part of the Po delta. Environment Minister Gilberto Pichetto Fratin voiced concerns that the predator may spill over to other parts of Italy from the eastern Adriatic Sea, whose waters have touched above average temperatures in recent weeks. "Our aim is to reduce (the blue crabs) presence in the Adriatic and avoid a massive spread to other areas," the minister told reporters, without saying what kind of measures could be taken to tackle the invasive species. ($1 = 0.9166 euros) Sign up here. https://www.reuters.com/business/environment/italy-appoints-commissioner-tackle-spread-blue-crab-2024-08-06/