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Indonesia reduces the validity of mining quotas by one year
Indonesia announced on Tuesday that it has shortened the validity period of the mining production quotas from three years to one year as of October 3. The government is seeking to control output levels in order to support prices for commodities such as coal and nickel. Mining Minister Bahlil lahadalia had announced the move in July. The ministry stated that quotas issued in 2026 and 2027 will still be valid, but miners must reapply to receive quotas. It added that RKAB proposals - documents used by companies to request the amount of gold they can mine in a given period - should be submitted every year between October 1st and November 15th. The coal miners association APBI expressed its hope that the short time remaining for RKAB approval and submission for 2026 will not affect miners operations. Gita Mahyarani, executive director of APBI, said: "This is closely linked to the certainty in business sustainability from investment to contract fulfilment." According to the new rules miners must also provide proof of their ability to pay for the rehabilitating the land after mining. State media Antara reported that the ministry suspended 190 mining licenses last month after companies failed their obligations to repair mine-damaged land and comply with production quotas. (Reporting and editing by John Mair, Edwina Gibbs and Bernadette Cristina Munthe)
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Gold reaches record high due to broader uncertainty and rate-cut bets
The gold price reached another record on Tuesday, driven by a strong investment demand in the face of broader geopolitical uncertainty and economic instability. Expectations for further U.S. rate cuts also helped. Gold spot held steady at $3.956.02 an ounce as of 0745 GMT after reaching a high of $3.977.19 earlier. U.S. Gold futures for delivery in December were unchanged at $3,972.20. Ole Hansen is the head of commodity strategy for Saxo Bank. He said that strong ETF demand, driven by FOMO and eroding confidence in traditional safe-havens, remains key. The White House backed off President Donald Trump on Monday from his claim that the shutdown was causing layoffs in the government, but warned that there could be job losses as the shutdown enters its seventh day. The shutdown has delayed the release of important economic indicators. This forces investors to rely upon secondary data, which is not government-issued, to determine the timing and magnitude of Fed rate reductions. The markets continue to price a 25 basis point cut for this month's meeting, and a reduction of a similar size in December. Gold that does not yield is a good investment in low-interest rate environments and economic uncertainty. The gold price has increased by 51% this year, thanks to strong central bank purchases, increased demand for exchange-traded products backed by gold, and a weaker US dollar. Retail investors are also becoming more interested in the metal, as they seek to protect themselves from rising geopolitical and trade tensions. "I see gold rising to $4,300/oz in the next six months." Michael Langford is chief investment officer of Scorpion Minerals. He said that the USD will continue to depreciate, and this is good for the gold price. Goldman Sachs raised its December 2026 gold price forecast to $4.900 per ounce, up from $4.300. Data from the People's Bank of China revealed that China's central banks added gold to their reserves for the 11th consecutive month in September. On Tuesday, currency and bond market volatility in Japan and France continued to grip the markets. Other than that, silver spot was down by 0.9% to $48.11 an ounce. Platinum fell 1%, while palladium remained at $1,317.50. (Reporting from Anmol Choubey, Bengaluru. Editing by Kate Mayberry.)
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The dollar is under pressure as copper prices rise due to supply problems
The copper price rose on Tuesday due to concerns about supply from the top producers Chile and Indonesia. However, a stronger U.S. Dollar kept gains in check. The London Metal Exchange reported that the price of three-month copper rose by 0.3%, to $10.679.50 per ton at 0717 GMT. The metal reached its highest level since May 2024 on Monday before easing. Freeport Miner said that five workers who had been missing following a mudflow disaster at the Grasberg Copper and Gold Mine in Indonesia, last month, have now been found dead. Fawad Rasaqzada is a market analyst for City Index and FOREX.com. He said that the tragic incident, coupled with tightness in other major copper producing sites, had pushed prices down. The traders are confident that the near-term supply constraint could offset this. Grasberg, the second largest copper mine in the world, accounts for 3% global concentrate production. Supply concerns will likely persist in this year, given the operational suspensions at Grasberg and disruptions at Kamoa Kakula mine in the Democratic Republic of Congo, as well as El Teniente in Chile. Analysts have estimated that disruptions in the copper industry could lead to a loss of 591,00 tons of output between September 2025 through 2026. This has led Goldman Sachs Citi and Bank of America, among others, to increase their price predictions. Indonesia's Mining Ministry issued a new regulation on Tuesday that reduces the validity period of mining production quotas from three to one year. The move is intended to give the government greater control over the output levels, and to support commodity prices. After an accident on July 31, the copper production in Chile fell by 9.9% compared to last year. The dollar index continued to gain against its competitors, despite the gains being capped. A stronger dollar makes greenback-denominated assets more expensive for holders of other currencies. Other London metals include aluminium, which fell by 0.4% to $2.714 per ton. Nickel was down 0.2% at $15,450. Lead remained flat at $2.004.5. Tin lost 0.3%, to $36,615. Zinc dropped 0.2%, to $3,001.50. Golden Week, which runs from 1-8 October, is a time when Chinese markets will be closed. Click here to see the latest news in metals, and other topics. (Reporting and editing by Sumana Naandy and Subhranshu Shu in Bengaluru).
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Schools in boats are keeping learning afloat on the floodplains of Bangladesh
Solar-powered "floating school" in flood-prone areas of Bangladesh ensures children don't miss class when rising water cuts off roads and villages. Safikul, a 10-year-old boy, is one of the victims. He waits each morning on the edge his flooded village of Bhangura in western Bangladesh for the solar powered classroom that sails straight to his door. His home is located in Chalan Beel, an expansive 26 square kilometres (10 sq miles) of wetland. Seasonal floods can often submerge villages and cut off roads. Education floats for Islam, and hundreds of children. The initiative was launched by architect Mohammed Rezwan in 2002 using $500 from his scholarship fund. It has now grown to a national model operated by the non profit Shidhulai Swanirvar Sangstha. More than 100 boats now serve as libraries, schools, and clinics. This project has educated more than 22,000 students, and it won a UNESCO Confucius Prize for Literacy for its work this year. Around two dozen boats are used as classrooms in Chalan Beel. They visit riverside villages on six days of the week. The school boats, made from local wood, are equipped with blackboards, bookshelves, and benches. Solar panels provide electricity for computers and lights. Madhusudan Karmaker is a senior manager with SSS. "Right away, we have 2240 pupils enrolled into 26 boat schools," he said. "More than 22,500 students graduated to date, and these boats doubled as shelters during severe flooding." Many other NGOs are using similar models to work on the wetland areas of the country. Three shifts of three hours are held each day. Teachers use narrow waterways for collecting students and teaching Bengali, mathematics, or general knowledge. Sufia, a parent waiting by the riverbank to see her son Islam return, said: "We never got the chance to learn." "But this boat allows my children to dream of a brighter future." Sakhina Khatun, a teacher with SSS who has worked for more than a decade, says that similar floating school projects have inspired projects in other countries such as Nigeria, Cambodia and the Philippines. She said, "These schools don't close, not even in floods." "That is what makes them so special." Rezwan, the founder of the organization and a World Fellow from Yale University, stated: "I've not had much in my life, nor do these children." Giving them access to education and healthcare, as well as seeing this replicated across the globe - that's what motivates me. (Reporting from Sam Jahan in Bhangura, and Ruma in Dhaka. Editing by Neil Fullick.)
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Sumitomo Metal predicts that the global nickel market will remain in surplus by 2026
Sumitomo Metal Mining, Japan's largest nickel smelter, said Tuesday that the global nickel market will remain in surplus for a third straight year next year because of Indonesia's continuing production growth. SMM's half-year outlook for the market projected a surplus of 256,000 metric tonnes in 2026. This is slightly less than 263,000 tons this past year. The production of low grade nickel pig iron in Indonesia is expected to increase 4.1%, to 1.76 millions tons. The nickel pig iron produced in Indonesia is expected to increase by 10.3% between 2025 and 2025. SMM predicts that global nickel demand will grow by 2.4% annually to 3.52 millions tons in 2026. This is due to the steady consumption of stainless steel, and supply is expected to rise by 2.0% to 3,78 million tonnes. Shirou Imai told reporters that the forecast does not assume a significant impact of U.S. Tariffs on Demand, as this has only been a limited effect in 2018. Imai stated that the growth of demand for batteries is expected to remain modest. Nickel is used primarily in stainless steel but also in the lithium-ion battery that powers electric vehicles (EVs). However, demand growth has slowed as lithium-iron-phosphate (LFP) batteries, which are cheaper and contain no nickel or cobalt, gain market share, accounting for two-thirds of EV sales in China in 2023, according to the International Energy Agency. SMM, a supplier of cathode material for Panasonic lithium-ion battery used in Tesla electric vehicles, anticipates that the global demand for nickel for batteries will rise to 470,000 tonnes next year. This is only a 10,000 ton increase from 2025. Imai stated that "China is restricting the export of LFP technology, which will increase demand for conventional EV batteries with nickel." Yuka Obayashi reported.
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Indonesia concludes search for victims after boarding school collapse. 61 dead
Indonesian rescuers finished their search for victims under the rubble in East Java province on Tuesday after recovering more than 60 corpses, according to disaster authorities. Last week, the small town Sidoarjo was engulfed in grief and confusion after the Al Khoziny School collapsed on hundreds of people - mostly teenagers - while they were praying. Most escaped. In a statement the disaster mitigation agency announced that all 61 bodies in the building had been located, along with seven body parts police are trying identify. The search was halted for the worst disaster of the year, which it called. Mohammad Syafii is the chief of the Search and Rescue Agency. After authorities removed the debris, he said, "Operations due the collapsed structure at the Al Khoziny School... are now officially closed." Budi Irawan is the deputy chief of the agency. The rescuers used cranes and excavators to lift huge chunks of concrete. As they dug through the tunnels, rescuers shouted names of those presumed still alive. Al Khoziny, also known as a pesantren in Arabic, is one of over 42,000 schools of this type across the country. Only 50 have building permits, according to the Public Works Ministry. It was impossible to determine if Al Khoziny possessed a permit or contact school authorities. Media reported that Sidoarjo Chief Subandi said last week the school allegedly did not have a permit. (Reporting and editing by Clarence Fernandez; Stanley Widianto)
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Morning bid Europe-Deepening darkness in Paris
Rae Wee gives us a look at what the European and global markets will be like tomorrow. France is once again in a deep political crisis, with five different prime ministers having been in office in just 21 months. This is not good news for investors looking to invest in Paris. The markets will probably face another day of turmoil on Tuesday following the shock resignation of Prime Minister Sebastien lecornu. This came only hours after Lecornu announced his cabinet, making this the shortest-lived French government in modern history. Lecornu has been asked by French President Emmanuel Macron to have last-ditch discussions with other political parties in order to find a way out of this crisis. However, the damage is already done. The French OAT futures fell slightly during the Asian session, after bonds plunged on Monday. Attention will be focused on the Paris CAC 40 when the markets open in the afternoon. BCA Research, a research firm, has said that French bonds are uninvestable. Rating agencies have issued new warnings regarding France's sovereign debt score. France has the highest budget deficit within the Eurozone, almost twice the European Union preferred limit of 3%. Since Macron's reelection in 2020, the nation's finances have been vulnerable and political instability has increased, due to the lack of a majority party or group in parliament. The Nikkei soared to yet another record on Tuesday in Japan. Meanwhile, the yen and Japanese government bonds (JGBs) remained weak. Investors were bracing for an increase in spending, as well as a looser monetary policy, under Sanae Taichi, who will be the next premier of the country. Takaichi has been favored by the majority of the ruling coalition, which holds the most seats in the parliament. As usual, the slide in the Japanese yen attracted the attention of the authorities. Japanese Finance Minister Katsunobu Kato stated on Tuesday that his government would be on guard for volatile currency movements. The auction of 30-year JGBs on Tuesday was closely watched and seen as a test to see if investors were ready for the expected expansion in Japan's spending and monetary policy. This eased concerns that investors would be reluctant to buy long-dated bonds due to the uncertainty of fiscal policy. JGBs recovered some of their losses after the auction, and yields fell. The following are key developments that may influence the markets on Tuesday. French Politics Bowman, Bostic and Kashkari, Fed officials, speak
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Oil extends gains on smaller-than-expected OPEC+ output hike
Oil prices extended gains on Tuesday as a smaller-than-expected November output hike by OPEC+ helped to ease some fears of a growing supply glut. Brent crude futures rose 23 cents or 0.35% to $65.70 per barrel at 0356 GMT. U.S. West Texas Intermediate Crude climbed 21 cents or 0.34% to $61.90. The previous session saw both contracts settle more than 1% above the previous one after the Organization of the Petroleum Exporting Countries, Russia and other smaller producers - also known as OPEC+ – decided to increase their collective oil production from November by 137,000 barrels a day. Analysts at ING said that this move contrasted with market expectations of a more aggressive reintroduction. It was a sign the group is still cautious about increasing their production share on the global oil markets, despite predictions of a surplus of supply in the fourth and next years. Anh Pham is a senior analyst with LSEG. She said that Brent had dropped by $5 per barrel in the previous week due to expectations for a bigger supply boost. This mild rebound therefore seems reasonable. He added, "For the moment, the market appears to be able to accommodate the additional volume and we have not yet seen a change into contango on the front curve." OPEC+ increased its oil production targets by over 2.7 million bpd in this year. This is equivalent to around 2.5% of the global demand. The geopolitical situation has kept prices in check, as the conflict between Russia and Ukraine is affecting energy assets and creating an uncertainty about Russian crude oil supply. Two industry sources reported on Monday that the Russian Kirishi oil refining plant halted CDU-6's most productive distillation after a drone attack on October 4 and a subsequent fire. The unit is expected to recover in about a month. Despite the increase in oil production by both OPEC+ members and non-OPEC+ members, oil prices are still under pressure. Analysts said that any slowdown in the demand caused by weak economic growth due to U.S. tariffs would likely exacerbate this surplus.
Trump's tariffs cause a global stock and dollar crash
The dollar, oil and world stocks all fell on Thursday after Donald Trump's new U.S. tariffs sparked widespread fears of global recession. Investors sought safe havens like the yen and bonds.
The new 10% baseline tariff on imported products, plus the additional eye-watering'reciprocal tariffs' on dozens countries Trump claimed had unfair trade barriers left traders rattled.
Brussels and other capitals expressed outrage over the new reciprocal 20% levy imposed on the EU 27-country bloc.
Wall Street futures fell 3% before what was expected to a be turbulent U.S. start later. The dollar's 2% drop had it on track for its worst day since November 2022.
Tokyo's worst week since nearly two years was in Asia, where the tariffs were most severe. Tokyo dropped by 2.7%.
JPMorgan analysts said that the tariffs are "significantly higher" than what was expected in the worst-case scenario.
Fitch, a credit rating agency, warned that they would be a game-changer for the U.S. economy and global economies. Deutsche Bank said it was a moment "once in a life time" which could knock 1%-1.5% of U.S. economic growth this year.
Olu Sonola, a Fitch analyst, said that "many countries are likely to end up in recession." If this tariff rate is maintained for a long time, you can forget about most forecasts.
The rush for ultra-safe government securities that guarantee income has driven U.S. Treasury rates down to around 4%. Germany's 10-year rate, the European benchmark, fell by 8.5 basis points to 2.64%.
The new import taxes will be the highest in a century in the largest economy in the world. In the event that they trigger recessions, it is likely that central banks will cut interest rates around the globe. This benefits bonds.
S&P 500 futures and Nasdaq were both down more than 3% before what was expected to a treacherous Wall Street start.
Apple has been marked down by 6.5% due to the tariffs on China, the country where most of Apple's production is based. Amazon.com dropped over 5% and Microsoft was down 1.8%, while AI poster-child Nvidia fell 3.5%.
As worries have grown, trillions of dollars have been wiped from the 'Magnificent Seven" tech giants in just one year.
CHINA FOCUS
Trump's tariffs have impacted Asia especially hard.
China received a tariff of 34%, Japan 24%, South Korea 25 % and Vietnam 46%. In response, Vietnamese stocks fell 6.7% and Nike Adidas Puma all heavily rely on Vietnamese and other Asian producers.
Investors sold exposure to global growth as the risk-sensitive Australian dollar fell.
Brent, which is a proxy of economic activity, fell as much as 4% in London, pushing it back below $72 per barrel. It's on track to have its worst day this year.
The gold price reached a record-high of $3,160 per ounce but then slowed down. Meanwhile, the Japanese yen rose more than 1.5 percent to reach 147.01 dollars as traders sought safety outside of the U.S. Dollar.
The Swiss Franc, another safe haven currency, reached its highest level in four month as the euro soared 2% to $1.10.00
Adam Hetts is the global head of portfolio management and multi-assets at Janus Henderson Investors. He said that eye-watering tariffs applied on a country by country basis are a "negotiation strategy" which will keep the markets on edge indefinitely.
China held its currency fairly steady. The yuan dropped only 0.4%, despite tariffs on Chinese exports exceeding 50% and the impact to Vietnam, which was seen as closing down a popular route to work around the tariffs.
The Chinese economy is large and there's a hope that Beijing will support Hong Kong and Shanghai stocks. Losses in Hong Kong were limited to 1.5%, and Shanghai losses to 0.5%.
George Saravelos, strategist at Deutsche Bank, said that China should be the main focus of attention in the coming days.
He asked: "Will China wait for trade talks... or will it absorb this shock?," "Or will China try to 'export the shock'... via devaluation of yuan?"
(source: Reuters)