2024-07-18 07:50
MUMBAI, July 18 (Reuters) - The Indian rupee was nearly unchanged on Thursday as dollar demand from local oil companies offset positive cues from a decline in U.S. bond yields and on broad weakness in the dollar. The rupee was at 83.5925 against the U.S. dollar as of 10:45 a.m. IST compared with its close of 83.5825 on Tuesday. Indian financial markets were closed on Wednesday for a local holiday. The dollar index was up 0.1% after falling to its lowest in four months on Wednesday, pressured by growing hopes of Fed rate cuts and a rise in the Japanese yen on speculation of intervention by the country's authorities. Most Asian currencies were slightly weaker on Thursday with the Indonesian rupiah down 0.3% and leading losses. The Indian rupee held its ground when Asian currencies were under pressure earlier in the month so it's unlikely to follow gains in the broad Asia pack either, a foreign exchange trader at a private bank said. The yen has recovered from the 38-year low hit on July 3 and the offshore Chinese yuan has also risen from its lowest levels since November. The trader pointed out that dollar demand from local oil companies and other importers has limited gains in the rupee over recent trading sessions. Meanwhile, dollar-rupee forward premiums rose. The 1-year implied yield touched a 5-month peak of 1.75%, lifted by growing expectations that the Federal Reserve will begin to ease policy rates from September. The Fed is "getting closer" to a point where it can start cutting interest rates, New York Fed President John Williams said in an interview published on Wednesday. Growing expectations of rate cuts by the Fed have weighed on the dollar and U.S. bond yields. "Rupee, expectedly, is underperforming amid broad dollar weakness," FX advisory firm IFA Global said in a note. The currency is likely to trade in a tight 83.40-83.65 range, the note said. Sign up here. https://www.reuters.com/markets/currencies/rupee-flat-dollar-bids-oil-firms-cap-gains-amid-us-bond-yield-dip-2024-07-18/
2024-07-18 07:47
July 18 (Reuters) - The Suez Canal's annual revenue dropped by almost a quarter in its latest financial year as some shippers switched to alternative routes to avoid attacks by Iran-aligned Houthis in the Red Sea. Osama Rabie, the head of the Egyptian canal's authority said on Thursday revenues fell to $7.2 billion in its 2023-24 financial year from $9.4 billion the year before. Since November, the Houthis have been attacking commercial vessels in the Red Sea and Indian Ocean to show support for Palestinian militant group Hamas in its fight against Israel. Rabie said the number of ships using the canal fell to 20,148 in 2023-24 from 25,911 the year before. The Suez Canal is a key source of foreign currency for Egypt, and authorities have been trying to boost its revenues in recent years, including via an expansion in 2015. Sign up here. https://www.reuters.com/business/autos-transportation/suez-canal-revenue-drops-some-shippers-shun-red-sea-2024-07-18/
2024-07-18 07:45
NEW DELHI, July 18 (Reuters) - India is likely to cut the floor price for basmati rice exports and replace the 20% export tax on parboiled rice with a fixed duty on overseas shipments, government sources said, as rice inventories in the country jumped a record high. The world's biggest rice exporter imposed various curbs on exports in 2023 and continued them in 2024 in an effort to keep local prices in check ahead of the general elections held in April-May. New Delhi is expected to lower the basmati rice's minimum export price (MEP) to $800-$850 a metric ton, down from $950 a ton, to boost shipments, said the sources, who didn't wish to be identified as they are not authorised to talk to media. Lowering the MEP would help India retain its market share against Pakistan, which exported a record amount of rice this year due to New Delhi's export curbs. India and Pakistan are the leading exporters of basmati rice. New Delhi exports more than 4 million metric tons of basmati - the premium long-grain variety famed for its aroma - to countries such as Iran, Iraq, Yemen, Saudi Arabia, the United Arab Emirates and the United States. New Delhi is also expected to drop the 20% export tax on parboiled rice and introduce a minimum export tax to stop under-invoicing of shipments, the sources said. The government was examining possibilities of easing rice export curb, including resuming white rice exports, Reuters reported last month. Worried over expectations of lower output due to the El Nino weather pattern, India banned overseas shipments of non-basmati white rice varieties in July 2023 and imposed curbs on other grades. "With rice supplies significantly exceeding local demand, it's crucial to reduce stockpiles to prevent spoilage. The most effective solution is to lift export restrictions," said B.V. Krishna Rao, president of the Rice Exporters Association (REA). The country's rice stocks at state warehouses have jumped to 48.51 million metric tons as of July 1, the highest ever for the month and nearly 19% more than last year, according to the Food Corporation of India. New Delhi would also review the export ban on non-basmati white rice after assessing the progress of rice planting, the sources said. Farmers have so far planted 11.6 million hectares with rice paddy during the current planting, up 20.7% on the same period last year. Sign up here. https://www.reuters.com/markets/commodities/india-plans-ease-rice-export-curbs-stocks-surge-record-sources-say-2024-07-18/
2024-07-18 07:45
LONDON, July 18 (Reuters) - The pound dipped on Thursday, but still headed for a fourth weekly gain versus the dollar, after another round of UK data fed into the view that the Bank of England may not have as much scope to cut rates at its August meeting. Official UK data showed average weekly earnings excluding bonuses - a key gauge of inflation pressure for the BoE - grew by 5.7% in the three months to the end of May compared with a year earlier, in line with median forecasts. Sterling was last 0.1% lower at $1.2995, having traded at a session high of $1.30125 right before the wage growth numbers. "The slight decline in wage growth will be welcome to the Bank of England, after the disappointing services inflation yesterday. There is still some key data to come before the August Monetary Policy Report but the decision is very finely balanced,” Hetal Mehta, head of economic research at St. James’s Place, said. On Wednesday, the monthly consumer price report showed service-sector inflation, another of the BoE's areas of concern, held at 5.7%, while headline inflation remained at 2%. Economic growth is also picking up. A report on July 11 showed total British gross domestic product increased by 0.4% in May, after zero growth in April, above forecasts for a rise of 0.2%. Futures markets are attaching a 40% chance of a quarter-point cut to 5.0% when the BoE meets on Aug. 1, down from 50% at the start of the week and from 60% at the start of July. The pound crossed the $1.30 mark for the first time since July last year on Wednesday and is up 2.1% so far this year against the dollar, making it the best-performing major currency of 2024, after last year's 5.3% rise. In 2023, sterling lost out on the top spot to the Swiss franc , which gained 9%. But that currency has been under relentless pressure this year, losing 5% in value. Much of the pound's strength has been driven by a weakening in the dollar, as investors have priced in the prospect of a drop in U.S. interest rates that could materialise as early as September. Over the coming six months, traders are betting on UK rates dropping to around 4.60%, compared with an estimate of 4.25-4.75% in the United States and above the projected 4.55% in New Zealand, currently home to the highest rates across the G10. Viewed through the lens of the euro , sterling's muscle is evident. The pound has risen 3% in 2024 against the euro to its strongest in nearly two years. On Thursday, euro/sterling was flat at 84.12 pence. For now, sterling looks set to remain in a fairly tight trading range, analysts said. "Sterling has overcome $1.30 and so far trades at one-year highs at $1.3045. Further up beckons the 18 July 2023 peak at $1.3126," IG technical analyst Axel Rudolph said. Sign up here. https://www.reuters.com/world/uk/sterling-dips-uk-wage-data-muddles-boe-outlook-2024-07-18/
2024-07-18 07:19
MADRID, July 17 (Reuters) - Spain will suffer its first heatwave of the summer starting on Thursday, the meteorology service AEMET said, as the government kicked off on Wednesday a heat risk awareness campaign for people working mostly outside. After the Iberian Peninsula saw cooler than usual weather so far this summer, AEMET expects temperatures to exceed 38 degrees Celsius in most of the country on Thursday, reaching as much as 42-44 C in the southern Guadalquivir Valley. The peak of this episode will be on Friday, when most areas will warm up to 40 C. AEMET has issued a heatwave warning for a large part of Spain, including the Balearic islands in the Mediterranean. The National Institute for Safety and Health at Work launched the campaign "With sun it's time for caution" on Wednesday to address the risks such as heat stroke and solar radiation. AEMET's orange-level severe heat alert in parts of the country will also trigger a ban on some outdoor working in the afternoon under a government decree approved last year to cope with more and more frequent heatwaves as a result of fossil fuel-driven climate change. The measure affects outdoors working such as street cleaning and agriculture. "There are people who are highly affected by such high temperatures, by exposure over many hours and no proper hydration... so my main advice is don’t underestimate them because the body is not prepared to withstand those conditions too long," AEMET spokesperson Luis Banon told Reuters. The heatwave is expected to last until Saturday although heat could persist until the middle of next week and will be accompanied by haze coming from Africa, which often exacerbates health problems during heat episodes. In Madrid, where thermometers registered 36 C on Wednesday, people tried to cool off at parks and fountains. "I cope by using a fan if I'm in the street, and if not, by going to places like a shopping centre, or somewhere where it's cooler," retired Madrid resident Angela de la Vega told Reuters. Sign up here. https://www.reuters.com/world/europe/spain-warns-workers-heat-risks-summers-first-heatwave-looms-2024-07-17/
2024-07-18 06:58
Gold hit an all-time high of $2,483.60 on Wednesday Gold to surpass fresh record in H2 2024, LBMA review shows Fed's Barkin says disinflation seems to be broadening July 18 (Reuters) - Gold prices firmed on Thursday to hover near a record peak hit in the previous session, as traders ramped up bets of an earlier start to interest-rate cuts by the U.S. Federal Reserve, constraining gains in the dollar and Treasury yields. Spot gold was up 0.3% at $2,464.90 per ounce as of 1155 GMT, having hit an all-time high of $2,483.60 on Wednesday. U.S. gold futures also climbed 0.3% to $2,468.20. "Gold continues to shine on growing speculation around lower U.S. interest rates this year. Recent dovish comments by Fed officials, complemented with a broadly weaker dollar and subdued Treasury yields have sweetened appetite for the precious metal," said FXTM senior research analyst Lukman Otunuga. Further signs of the U.S. labour markets cooling and more dovish remarks by Fed officials could keep this upside momentum alive, opening doors to fresh all-time highs, Otunuga added. Fed Governor Christopher Waller and New York Fed President John Williams both noted the shortening horizon toward looser monetary policy. Separately, Richmond Fed President Thomas Barkin said he was "very encouraged" on broadening declines in inflation. Lower rates increase the appeal of non-yielding bullion. Gold price will continue to trade higher during the second half of 2024, analysts said in a brief review conducted by LBMA. According to the World Gold Council, global physically backed gold exchange-traded funds recorded their second consecutive month of inflows in June. However, "the surge in (gold) price has stifled the physical markets in south and southeast Asia, with buying evaporating and some selling coming back. This is not unusual and the buyers will return once they have acclimatised to the new range," said StoneX analyst Rhona O'Connell in a note. Over the next six to 12 months, Citi expects gold to rise $2,700-$3,000 per ounce and silver to climb $38 per ounce. Spot silver rose 0.3% to $30.39 per ounce, platinum firmed 0.2% to $996.22 and palladium lost 0.1% to $950.50. Sign up here. https://www.reuters.com/markets/commodities/gold-shines-rising-fed-rate-cut-outlook-2024-07-18/
