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Gold drops over 1% amid rate hike fears ahead of U.S. Inflation data
On Tuesday, gold fell more than 1% to a two-month low. This was due to a wider'market' sell-off. Investors were also pressured by expectations that the U.S. will raise interest rates this year. As of 1:45 pm, spot gold dropped 1.5% to $4264.70 an ounce. ET (1745 GMT) after having fallen more than 2% in the earlier session. Bullion dropped to its lowest price since March 23. U.S. Gold Futures for August Delivery Settled by 1.8% at $4,286.4 "Traders have become a bit nervous about the market... all markets are now in risk-off mode." Bob Haberkorn is a senior market strategist with RJO Futures. He said that the current risk-off has caused a decline in gold. S&P 500 & Nasdaq both fell to new lows of over a month on Tuesday. Haberkorn said that "gold and silver will remain under pressure" until the Fed provides clearer guidance. The focus this week has shifted from last week's positive?jobs numbers to the key inflation data, such as the U.S. Consumer Price Index for May on Wednesday, and the Producer Price Index on Thursday. These are expected to provide more insight into the U.S. monetary policies outlook. The gold price will likely fall even further if the U.S. May inflation data also surprises on the upside, as we expect. The gold price is likely to fall further if the U.S. inflation data for May also surprises on the upside, according to Commerzbank. According to the CME FedWatch tool, traders are estimating a 68% chance that the Fed will raise rates in December. After President Donald Trump's appeal, Iran and Israel announced that they would cease their attacks against each other. The higher crude oil prices can fuel inflation, and this will keep rates high for longer. Gold is often seen as a hedge against inflation, but higher rates can weigh down on the metal. India's sharp rise in gold import duties is "fueling a resurgence of smuggling" that could "exceed 100 tons this year", as "soaring grey-market margins allow smugglers and refiners to undercut each other." Silver spot fell by 4.3%, to $65.23, platinum dropped 2.1%, at $1.717.30, and palladium was down 1.3%, at $1.220.92. (Reporting and editing by Shilpa Majumdar, Jonathan Ananda, and Anushree mukherjee from Bengaluru)
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US EIA warns that oil inventories are headed for multi-decade lows
The U.S. Energy Information Administration reported on Tuesday that oil stockpiles in?the largest economies of the world are heading toward their lowest levels since 2003, as inventories are being drawn down at an unprecedented pace due to lost production from the Iran War. The EIA estimates that total oil inventories within the Organization for Economic Cooperation and Development members will fall to just over 2.3 billion barrels in December. This is based on the current assumption that the marine traffic through the Strait of Hormuz won't return to its pre-conflict level until early 2027. In its Short-Term Energy Outlook monthly report, the EIA said that the OECD's stockpile had 'not been at this low level since 2003 when the EIA started keeping records. The agency stated that the rapid inventory 'drawdown', which is required to compensate for the 11 million barrels per day of lost Middle Eastern production, creates the basis?for an increase in oil prices. Prices have been impacted by recent reports that the U.S., Iran and other countries were close to an agreement on reopening the Strait of Hormuz. This is a crucial waterway which handles 20% of all global oil shipments. As of this writing, an agreement had not yet been reached. The EIA reported that global oil inventories continue to drop to meet demand, while most oil production remains shut down in the region. The EIA expects the price of global benchmark Brent crude to average around $105 per barrel on the spot market in June and in July. This is well above the $91.60 per barrel that was traded in the Tuesday futures market. The agency stated that "because of the magnitude of the drawdown of global inventories we predict that oil prices will continue to be?elevated' until global oil flows are restored and oil inventories are replenished." The EIA stated that high oil prices, reduced fuel availability and government initiatives to conserve oil would cause the global oil demand this year to'reduce for the first time since the pandemic slump of 2020. The EIA now predicts that demand will fall by 1.1 million barrels per day this year, in contrast to its previous forecast of an increase of 200,000 barrels per day. Reporting by Shariq KHan and Scott DiSavino, New York; Editing and proofreading by Mark Porter and Paul Simao
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Data shows that Saudi jet fuel supplies to Europe are higher than before the closure of Hormuz.
Saudi Arabia will deliver more jet-fuel to Europe in this month than when the Strait of Hormuz was open. Data from shipping trackers Kpler and Vortexa shows the significance of Saudi Arabia's increased exports via Red Sea. Kpler data shows that EU and UK imports of jet fuel from Saudi Arabia’s Red Sea Port of Yanbu reached 118,000 barrels a day in the first week of June. This is their highest level since August 2025. Vortexa estimated that the flows were at 140,000 barrels per day. Kpler data indicates that the highest monthly volume this year was?77,000 Bpd in January. Saudi Aramco, the state-owned firm, declined to comment about the "increased jet exports to Europe". By 2025, Europe will receive about 300,000 bpd of jet fuel from the Middle East via the Strait of Hormuz. According to Kpler, Europe's total imported fuel averaged around 550,000 bpd. This includes imports from India and Nigeria, as well as the U.S. Saudi Arabia has increased exports through the Red Sea Port of Yanbu, as the strait is effectively closed due to the Iran War. If sustained, these exports would help 'Europe fill a gap in jet fuel imports and illustrate?how?the?closure of Strait of Hormuz affects global jet fuel flow. In May, Europe increased its jet fuel imports - which averaged around 200 bpd - from the U.S. International Energy Agency said previously that Europe could start to see some shortages of jet fuel in June. However, European airlines have played down fears of a shortage during the summer. (Reporting from Seher Dareen, London; additional reporting by Ahmad Ghaddar. Editing by Alex Lawler & Jason Neely).
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Jio BlackRock to launch ETF in August after $2 billion India fund base
Jio BlackRock Asset Management will launch its first exchange traded funds in India by August. The company hopes to emulate 'BlackRock’s' global success in passive investment in a market that is still developing. In the year following its launch, the joint venture between MukeshAmbani's Jio Financial Services (JFS) and the largest asset manager in world has managed to amass about 180 billion rupees in assets. This was achieved by establishing a solid base of cash, debt index and active equity funds. The plan is to begin with equity-focused ETFs. BlackRock manages approximately $5.1 trillion worth of ETF assets worldwide, which is more than a third of all assets managed by the company. This highlights the importance of this product line for its brand. Jio?BlackRock is currently India's 29th largest asset manager. "ETFs can be a good long-term investment." Retailers are now becoming more interested in ETFs, even though the Indian market is predominantly institutional. We can see by global trends that?ETFs are a popular choice of investment," said Sid Swaminathan. ETF INNOVATION CAN BOOST LIQUIDITY According to the Mutual Fund Industry Association, passive mutual fund assets in India amounted to 15.20 trillion rupees (or about 18.5%) of the industry’s average assets under administration, which totaled 81.94 trillion. Comparatively, equity index funds and ETFs make up about 45.3% (or more) of the long-term mutual and ETF assets held in the U.S. Swaminathan stated that tighter bid-offer margins and more innovative strategy could help improve liquidity and boost participation by retail in Indian ETFs. Within the next few months, the company plans to 'launch products' in GIFT City (Gujarat International Finance Tec-City), India’s low-tax financial centre that competes with centres like Singapore and Dubai. COMPLEX PRODUCTS?PROMPT PIVOT DISTRIBUTOR -LED MODEL Jio BlackRock's more complex products, such as special investment funds or GIFT City, are distributed by Jio BlackRock rather than digitally. This reflects the role that advisers continue to play in selling higher-ticket items. Swaminathan stated that the decision to "prioritise" those launches was partly driven by market conditions. India's Nifty 50 index has fallen 11.1% in 2026 due to foreign outflows and higher oil prices, as well as a slowing of earnings growth. MSCI's Asia-Pacific ex-Japan Index is up 18.2%.
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Markets rise as votes from overseas pour in and the race for Peru tightens up again
The race for Peru's presidency tightened up overnight, with candidates separated by less that 0.1%. Overseas votes are pushing the race to Keiko Fujimori. This is giving markets a boost on Tuesday. The main'stock -index' of Peru jumped more than 7% on Tuesday morning. U.S. listed shares like Buenaventura miner were up 8.2%, Intercorp Financial Services was up 12.9% and the iShares MSCI Peru Global Exposure ETF jumped by 6.7%. The local currency, the sol, was up by 2.45% against the dollar at 3.345. The increase is largely the reversal from a sharp drop on Friday, after leftist Roberto Sanchez, rattled investors and markets with his proposals to revamp Peru’s mining-heavy economic system, rose in the polls. He has advocated reforming the constitution and imposing wealth taxes. Fujimori has taken up the legacy of her authoritarian father, former Peruvian president Alberto Fujimori. He was jailed in connection with mass murders during his presidency. Fujimori was leading in exit polls and early counts, but Sanchez gained more ground as rural votes came in. Sanchez's lead grew to almost 50,000 votes Monday, but has now dropped to 20,000 as overseas votes continue to be counted. Sanchez is currently leading Fujimori with 49.94% to 50.06% with 95.95% votes counted. Alfredo Torres of Ipsos said that although the rural vote still tends to favor Sanchez, a significant part of the votes pending are from outside of the country. This is in favor of Fujimori. A total of?1.67% ballots are flagged for review. The majority of them are from the Lima metro region which is also Fujimori's stronghold. Torres, speaking to a local station, said that "doing the math" it is possible that the numbers now seen could be reversed. Both candidates have called for patience, and that all votes be counted. Peru's ONPE said that a complete count should be completed in July. (Reporting and editing by Alexander Villegas, Marco Aquino)
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Oil and dollar drop, while stocks lose steam
MSCI's global equity gauge retreated from its earlier gains as Wall Street investors waited anxiously for inflation data. The dollar also dropped along with oil prices in hopes of easing Middle East tensions following the ceasefire between Israel and Iran. U.S. Energy Sec. Chris Wright stated on Tuesday that the ship traffic in the Strait of Hormuz, a vital energy conduit, is increasing "very significantly." Israel's Tuesday attack on the historic port of Tyre, in southern Lebanon, killed at least eight people, but the progress towards a Middle East peace still seemed uncertain. Tehran had warned on Monday it would re-engage in hostilities should Israel continue to attack Hezbollah, its Lebanon-based ally. U.S. Treasury rates dipped as traders awaited the consumer inflation report for May, which is due on Wednesday. This will provide a better indication of whether or not price pressures continue to increase. S&P 500 technology's heavyweight sector was unable to hold gains earlier, which put pressure on both the benchmark index and the tech-heavy Nasdaq. Gene Goldman of Cetera pointed out that investors are anxious ahead of economic data, as they worry about elevated inflation fueling worries about the Federal Reserve. Investors are a little cautious as they worry about tomorrow's potential?high inflation numbers. Goldman stated that higher-than-expected inflation brings the Fed into the spotlight as a major risk. The CME Group's FedWatch tool shows that since the release of the stronger-than-expected May jobs report on Friday, traders are increasing bets the Fed will increase rates rather than cut them. According to the tool, the probability of a 25 basis point rate hike by December is now 43.4%, and the bets for a 50 basis point increase have increased from 12% the previous week. Wall Street opened at 11:01 am. The Dow Jones Industrial Average rose 145.62, or 0.29% to 50,931.63, while the S&P 500 dropped 16.64, or 0.22% to 7,389.09, and the Nasdaq composite fell 179.07, or 0.69% to 25,750.59. MSCI's global stock index rose 3.23 points or 0.29% to 1,104.19, after previously rising more than 1%. After paring gains, the pan-European STOXX 600 rose by 0.18%. BORROWING FEES In currency, the dollar index (which measures the greenback in relation to a basket of currencies that includes the?yen, and the Euro) fell by 0.22%, while the euro rose 0.23%, reaching $1.1561. The dollar gained 0.04% against the Japanese yen to 160.23. The yield on the benchmark 10-year U.S. notes dropped 0.2 basis point to 4.548% from 4.55% on Monday, while the 30-year bond yield increased 0.3 basis point to 5.0272%. The yield on the 2-year note, which moves typically in line with Federal Reserve interest rate expectations, dropped 1.7 basis points from Monday's 4.158% to 4.141%. Energy markets saw U.S. crude fall 3.94% to $86.70 a barrel while Brent dropped to $91.11 a barrel, a drop of 3.33% for the day. (Reporting from Sinead carew in New York; Amanda Cooper in London; Wayne Cole in Sydney. Editing by Thomas Derpinghaus & Gareth Jones.
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Sources say that China continues to issue fuel quotas in spite of export controls
Four?trade? sources said that China issued its second batch fuel quotas this year. The total is?18 millions metric tons. Despite existing export restrictions, the overall levels are largely unchanged year on year. China has cut back on outbound shipments since March to protect its domestic oil supply, in light of the protracted conflict in Middle East which is disrupting oil flow. Sources said that out of the total, 13 million tons quotas had been allocated for the export of gasoline, diesel, and jet fuel while 5 millions tons were reserved for marine fuel oil. Sources said that Sinopec, CNPC, and Sinochem received a total of 4,06 million?tons under the "processing" trade category. These quotas will be used primarily for exports to 'Hong Kong, and aviation fuel refueling at Chinese airports. Beijing allocated 19 million tons of the first batch quotas this year in December, while the second batch was 18 million tons last year. The?Commerce ministry of China was not available immediately outside office hours. Two of the four sources stated that the government had also given 8.94 million tons of quotas to six companies under the "general trade" category, but due to the current restrictions, only Sinopec and PetroChina are allowed to export. Estimated exports to ex-Hong Kong buyers, mainly in the Asia-Pacific area, for May and Juni were between 500,000-550,000 tonnes. Two separate sources familiar with the issue said that the government has vetted a list of countries receiving Chinese fuel in the past few months but is easing up on the scrutiny of June shipments. Reporting by Siyi Liu and Trixie Yap; Editing by Alison Williams
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Gold falls on fears of rate hikes ahead of U.S. Inflation data
Prices of gold fell on Tuesday as a result of the broader market sell-off, and rising expectations that interest rates will be raised in the United States this year. Investors are now focusing their attention on key inflation data to be released later this week. As of 11 am, spot gold was down 0.7% at $4,298.75 an ounce. ET (1500 GMT), following a fall of more than 1% in the previous session. U.S. gold futures for August delivery fell 0.9% to $4323.90. "Traders have become a bit nervous about the market. All markets across the board are now in risk-off mode. Bob Haberkorn is a senior market strategist with RJO Futures. He said that the current risk-off has led to a drop in gold. The Nasdaq Composite index, which is a tech-focused index, and the benchmark S&P 500 Index?were both down by 0.9% and 0.4% respectively. Haberkorn continued, "Gold and Silver remain under pressure until we get clearer direction from the Fed." The focus this week has shifted from last week's positive job numbers to the key inflation data, such as the U.S. Consumer Price Index for May on Wednesday and the Producer Price Index on Thursday. These are important indicators of the U.S. monetary policies outlook. If the U.S. Inflation data for May surprise to the upside again on Wednesday, then the gold price will likely fall even further. Commerzbank also said that this could increase the possibility of a recovery in the second half of the year if, as expected, the Fed does not raise interest rates. According to CME FedWatch, traders are pricing in a 70% chance of a Fed rate increase in December. The Middle East is showing signs of a possible peace agreement, which has pushed the oil price lower. This was after Iran and Israel announced that they had stopped their attacks against each other in response to an appeal by U.S. president Donald Trump. The higher crude oil prices can cause?inflation, and therefore keep interest rates high for longer. Gold is often viewed as an inflation hedge. However, higher interest rates can weigh down on this non-yielding material. Silver spot fell by 3.2%, to $65.98 an ounce. Platinum was down 1.1%, at $1.736.08, and palladium dropped 2.5%, at $1.234.93. (Reporting and editing by Shilpa Majumdar, Jonathan Ananda and Anushree mukherjee from Bengaluru)
Spain's power price concerns may get worse throughout peak solar season: Maguire
After a. breakneck growth that raised solar generation by over 200%. considering that 2019, Spain's solar installation rate looks set to slow in. 2024 as traditionally weak power costs mixed with high materials. and labour expenses eat into developers' returns.
The president of Spain's solar photovoltaic. association UNEF stated this week that installed capacity during. the first quarter fell by roughly 26% from the same duration in. 2023, across both domestic and industrial segments.
Fast renewable resource supply development, improvements to energy. efficiencies and contractions to energy use by industry have. helped drag Spain's wholesale power costs down roughly 90% from. their peak in March 2022 to multi-year lows last month - simply as. solar designers have actually included record generation capacity.
Power costs have staged a recovery this month on cuts to. generation from fossil fuels and the prospect of decreased future. solar setups, however might still come under fresh pressure. this summer when the nation's already-installed solar. facilities enter their peak output period.
RATE CUTS
Since hitting an all-time high of around 293 euros per. megawatt hour (MWh) in March of 2022, typical regular monthly wholesale. power costs in Spain stopped by over 90% to strike a multi-year. low of around 14 euros/MWh last month, according to LSEG.
This steep collapse in wholesale power rates made it. increasingly challenging for energy developers to chart a path. to future revenue, specifically provided the large upfront costs. involved in developing new energy projects and rising interest. rates which lifted borrowing expenses.
Slowing orders from property customers - due to lapsing. government subsidies and higher loan and funding costs - then. added to solar developer woes, and assisted set off the downturn. in setups noted by UNEF.
However although Spain's power prices have actually rebounded to over. 30 euros/MWh this month, a fresh push lower can't be eliminated. over the coming summertime.
PEAK PRODUCTION
Spain's solar properties produce more than double the quantity of. power throughout June, July and August as is created throughout winter. months, data from energy think tank Cinder shows.
In 2023, Spain's utility-scale solar possessions produced an. average of 4.85 terawatt hours (TWh) of electrical energy in June,. July and August, compared to an average of less than 2 TWh per. month in November and December that year.
The sharp climb in solar output in turn more than doubled. solar's share of the total generation mix from around 10% in. winter season to around 25% in July and August.
And in spite of the downturn in the pace of new solar. installations, the overall footprint of Spain's solar production. base struck a new high in 2024, and so will produce even greater. volumes of electrical energy this coming summer season.
Certainly, total solar production from photovoltaic assets. operated by energies through May 28 this year is roughly 13%. greater than throughout the same period in 2023, according to LSEG.
And so far in the month of May, solar output is 26.3% up. from the very same month in 2015.
This recommends that Spain's solar energy output over the. coming months will rise to fresh records during peak periods,. potentially exceeding system need requirements throughout spells. of weak intake.
This heavy load of solar power in turn has the prospective to. crowd out alternate power sources and drive Spain's power rates. lower once again, especially if domestic electricity demand stays. relatively flat.
Some of Spain's surplus power can be exported to. neighbouring nations such as France and Portugal, which were. both purchasers of surplus Spanish power earlier this year,. according to energycharts.info.
However, thanks to a recovery in France's atomic power plant. output and predicted output boosts from Portugal's own solar. properties, Spain may have a hard time to find all set buyers for all of its. surplus power this summer.
The unsold surplus may in turn weigh on local and local. power prices, positioning potentially fresh strain on the country's. beleaguered solar asset operators.
<< The viewpoints revealed here are those of the author, a. columnist .>
(source: Reuters)