2024-06-17 09:23

LONDON, June 17 (Reuters) - The pound eased modestly on Monday, ahead of a policy meeting by the Bank of England this week at which the central bank is not expected to cut interest rates, but might telegraph the likely timing of the first drop. Political turmoil in France last week rattled risk appetite and sent investors fleeing from French assets and the euro which fell 0.6% against sterling last week . By Monday, the euro had recovered some stability, rising 0.1% against the pound to 84.46 pence. Against the dollar, the pound has fared less well, falling 0.6% last week, in its largest weekly slide in two months. Sterling was last down 0.1% at $1.2674. Recent data has shown inflation in the United States is not slowing as quickly as many had anticipated, while the Federal Reserve has said it sees only one rate cut this year. Meanwhile, UK headline consumer inflation is falling towards the BoE's 2% target and markets are increasingly convinced the central bank, which meets on Thursday, will deliver two cuts this year, with close to a 90% chance of rates dropping to 4.75% by December. The UK consumer price index (CPI) is due on Wednesday and is expected to show the headline rate rose by 2.0% in May, compared with April's 2.3% increase. Much of that drop is a function of household energy bills falling sharply, and BoE policymakers are far more focussed on wage growth and service-sector inflation. Data last week showed British wages picked up more quickly than forecast. This week's CPI report is expected to show services CPI rose at an annual rate of 5.6% in May, from April's 5.9%. "Wednesday/Thursday this week should deliver a double-header of negative news for the pound. Here, UK May services CPI should drop sharply on Wednesday and be followed up a day later with tweaks to the BoE policy statement which hint at an August rate cut," ING strategist Chris Turner said. Sign up here. https://www.reuters.com/markets/currencies/sterling-eases-ahead-boe-rate-decision-this-week-2024-06-17/

2024-06-17 08:25

LONDON, June 17 (Reuters) - The European Central Bank is confident that inflation will fall back to its 2% target next year despite some "noisy" inflation along the way, the ECB's chief economist Philip Lane said on Monday. "There's a lot, a fair amount of confidence about the destination in the second half of next year," Lane told Reuters. "So we do have to interpret the incoming data carefully, but to differentiate the noise and the signal." Lane was talking at Reuters NEXT Newsmaker interview at the London Stock Exchange. Sign up here. https://www.reuters.com/markets/europe/ecbs-lane-confident-hitting-inflation-goal-despite-noisy-data-2024-06-17/

2024-06-17 06:53

Brent, WTI rise by nearly $2/barrel to highest since April OPEC+, IEA, EIA forecast higher demand in months ahead Investors repurchased some petroleum contracts last week China manufacturing investments rose in first five months NEW YORK, June 17 (Reuters) - Oil prices surged nearly $2 a barrel on Monday to their highest settlement levels in over a month, adding to last week's gains as investors grew more optimistic on the demand outlook. U.S. West Texas Intermediate crude futures gained by $1.88, or 2.4%, to settle at $80.33 a barrel, the highest since the end of April. Global benchmark Brent crude gained $1.63, or 2%, to $84.25 a barrel, also the highest since April. Last week, both benchmarks posted their first weekly gain in four weeks after reports from the OPEC+ producer group, the International Energy Agency and U.S. Energy Information Administration raised confidence that oil demand will improve in the second half of the year and help inventories draw down. Reassurances from OPEC+ that a plan to raise supplies from the fourth quarter of this year could be paused or reversed based on market conditions also helped prices firm. That plan, unveiled after the group's meeting on June 2, had led to a sharp selloff in prices. "The outlook for strong fuel demand into the coming quarter and Saudi reassurance about the October hike being subject to prevailing conditions and added focus on quota breakers to bring production down and into line all seems to be supporting," said Ole Hansen of Saxo Bank. Investors last week repurchased some of the petroleum they had sold the week before, data from the Commodity Futures Trading Commission showed on Friday. "Those funds who thought we were heading into a production battle, had their concerns quickly assuaged when OPEC+ members went on a PR campaign to assure the world their changes to production would be market dependent," said Alex Hodes, oil analyst at brokerage firm StoneX. Economic data from China also supported hopes of stronger oil demand from the top importer, Hodes said. Manufacturing investment in China in the first five months of this year showed robust growth of 9.6%, government data showed on Monday. Other data was mixed, however, with industrial output lagging expectations. Oil prices have also been supported by a rising geopolitical risk premium, AEGIS Hedging analysts noted on Monday. Concerns of a wider Middle East war lingered after the Israeli military said on Sunday that intensified cross-border fire from Lebanon's Hezbollah movement into Israel could trigger serious escalation. Sign up here. https://www.reuters.com/business/energy/oil-prices-inch-down-weaker-us-consumer-demand-ahead-china-data-2024-06-17/

2024-06-17 06:26

BEIJING, June 17 (Reuters) - Torrential rain and landslides in China's coastal provinces of Guangdong and Fujian have killed nine people and left 17 missing, state media and local authorities said on Monday. In Guangdong, five people were killed, 15 missing and 13 trapped as of Monday, local emergency management authorities said. Sishui, a town in the province, logged 369.3 millimetres of precipitation in 24 hours. The deluge prompted officials to raise emergency response levels, and dispatch helicopters to evacuate and deliver supplies to those affected. Four people died and two went missing in neighbouring Fujian due to rainstorms that the provincial meteorological bureau classified as an "extreme event", state broadcaster CCTV reported. Downpours in Fujian's Wuping county since Sunday afternoon had caused 378 homes to collapse and prompted authorities to launch an emergency flood response. Over the past few days, heavy rains have inundated the province, breaking a historical record in Wuping county. Economic losses in the county totalled 415 million yuan ($57.19 million), state media reported. Many parts of southern China have been impacted by rains over the past few days, prompting several localities to issue flood warnings and advisories. In Jiangxi province, the average rainfall was 24 mm between from 8 a.m. Sunday and 8 a.m. Monday, with 288 weather stations in 56 counties recording considerable precipitation, state media said. In Chongqing, torrential rains caused water levels of five rivers to rise by 1 to 3 meters, according to CCTV. ($1 = 7.2559 Chinese yuan renminbi) Sign up here. https://www.reuters.com/world/china/four-killed-landslides-heavy-rain-lashes-chinas-fujian-2024-06-17/

2024-06-17 06:07

LONDON/BRUSSELS June 17 (Reuters) - British wind and solar farms exporting power to continental Europe could face CO2 fees from 2026 - even though they don't produce any emissions - unless the UK and European Union can agree changes around the EU's carbon border tax. The charges, set out in a little-noticed clause of the CO2 levy law, could hit revenues of renewable energy projects in the UK, add to already-high EU power prices and even lead to higher emissions, industry sources and analysts told Reuters. "It's a problem on both sides," said Adam Berman, deputy director of industry group Energy UK. "(It) disincentivises clean power in the UK at the moment in which we're trying to ramp up provision of clean power, and it's going to increase (power) prices in northern Europe." The Carbon Border Adjustment Mechanism (CBAM) will impose a CO2 emissions fee on imports to the EU of steel, cement, aluminium, fertilisers, electricity and hydrogen, unless the exporting nation has equal CO2 pricing policies. Under its current design, the CO2 fee for power would be calculated using a default value based on average and historic power generation emissions. The British energy industry says that will unfairly penalise renewables. "It is an issue that we are conscious of and one that we have raised, that the UK has raised, with the EU," Catherine Stewart, the UK Treasury's deputy director for trade policy, told an event in Brussels last month. A European Commission spokesperson said it would continue talks with all countries, including the UK, on the design of the carbon levy before finalising its application from 2026. The extra cost of the charge could make it uneconomic to export excess clean power from Britain to Europe at certain times when demand is weaker, renewables generation is high, and power prices are low, analysts said. Analysis from Aurora Energy Research, shared with Reuters, showed as much as 3 gigawatt hours (GWh) of renewable power generation, enough to power up to 2,000 homes a year, could be curtailed by 2030 if the fee proves a disincentive to exporters. "You are adding a tax on exporting, so this essentially reduces the profit margin every time you want to export," said Pranav Menon, GB Power & Renewables Lead at Aurora. In 2030, the carbon border fee could knock 5% off the price British renewable projects can earn for their power, Aurora said. Reduced access to cheap British electricity could increase wholesale power prices by up to 4% in markets like Ireland and Northern Ireland's Integrated Electricity Market which import a lot of power from the UK, the Aurora analysis showed. If European countries boost coal and gas power generation to make up the shortfall, CO2 emissions could even rise - by as much as 13 million tonnes a year, equivalent to emissions of 8 million cars, an earlier analysis by AFRY suggested. A European Commission spokesperson said renewable power exports will be able to avoid the CO2 fee if they can comply with certain criteria and prove their origin. But industry figures say that could be tough. "Most of the electricity (across interconnectors) is traded anonymously ... so it's almost impossible to demonstrate what that carbon content is," said Pieter-Jan Marsboom, products and services manager at UK-Belgian power interconnector Nemo Link. UK ELECTION British and EU diplomats have quietly begun discussing the issue, but the highly political nature of any post-Brexit deals between the two means no progress is expected before the UK general election on July 4. Some industry groups are already in talks with the Labour Party, which polls suggest is on course to comfortably win the election, in the hope that it would push in government for a deal with Brussels on the CO2 levy. The Labour Party did not respond to requests for comment. One option would be to link the EU and UK carbon markets, exempting UK power producers from the tax. "The best way to deal with the (CBAM), and to stop the UK exporters paying a tax to the EU that could otherwise go into the UK budget, would be by having (carbon market) linking," said UK power generator SSE'S Group Head of Policy and Advocacy Alistair McGirr. So far, neither Brussels nor London has jumped at that idea. Former UK climate change minister Graham Stuart told Reuters in March that the two sides could examine the possibility of linking under their post-Brexit Trade and Cooperation Agreement. The European Commission spokesperson said the bloc is open to linking its carbon market with others, but this "must stem from a mutual wish from both parties". "This remains to be explored," the spokesperson said. Sign up here. https://www.reuters.com/sustainability/climate-energy/industry-fears-eu-carbon-border-tax-will-penalise-british-green-energy-2024-06-17/

2024-06-17 06:06

15 dead after freight train rams into passenger train Accident blamed on freight driver disregarding signal Incident reflects government negligence, opposition leader says KOLKATA, June 17 (Reuters) - A freight train smashed into the rear of a stationary passenger train in India's West Bengal state on Monday, killing at least 15 people and injuring dozens, police said, in an accident that railway authorities blamed on driver error. Media showed images of the pile-up, with containers from the goods train strewn nearby, and one carriage left nearly vertical after the accident, which comes just over a year after a signalling error caused one of India's worst rail crashes. Fifteen bodies were pulled from the mangled carriages, Abhishek Roy, a senior police official in the eastern state's district of Darjeeling, the site of the accident, told Reuters. Fifty-four people were injured and rescue teams from the police and national disaster response force were working to clear debris from the derailed carriages, Roy added. The goods train hit the Kanchanjunga Express travelling to Kolkata, the capital of West Bengal, from the northeastern state of Tripura, driving three carriages of the passenger train off the rails. It was not immediately clear how many passengers were on board at the time. Rescuers used iron rods and ropes to work free one carriage of the passenger train that had been swept upwards to lodge on the roof of the freight train by the impact of the collision. The dead included the driver of the freight train and a guard on the passenger train, Jaya Varma Sinha, the head of the railway board that runs the countrywide network, told reporters. The accident happened after the driver of the freight train disregarded a signal, Sinha added. Rescue work has been completed, Sinha said, and authorities are working to restore traffic, with the damage less extensive than initially feared. "The guard's compartment in the passenger train was badly damaged," she added. "There were two parcel vans attached ahead of it which reduced the extent of damage to passengers." Nearby residents heard a loud crash and saw the pile-up upon going to investigate, several told the ANI news agency, in which Reuters has a minority stake. Prime Minister Narendra Modi offered condolences on the loss of life and said Railway Minister Ashwini Vaishnaw was on his way to the site. About 288 people died a year ago in the neighbouring state of Odisha, in India's worst rail crash in more than two decades, caused by a signal failure. Opposition parties criticised Modi's government for its record on rail safety. "The increase in railway accidents in the last 10 years is a direct result of the mismanagement and negligence of the Modi government, which results in loss of lives and property of passengers on a daily basis," Modi's main opponent and Congress party leader Rahul Gandhi said in a post on X. Sign up here. https://www.reuters.com/world/india/passenger-train-hit-by-goods-train-indias-west-bengal-state-chief-minister-says-2024-06-17/