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Colombia's Ecopetrol signs new deal with Parex to explore hydrocarbons
Ecopetrol, the state-run energy company in Colombia, announced on Friday that it had signed a new contract with Parex Resources to explore and produce hydrocarbons in the Piedemonte Llanero area. Ecopetrol said in a press release that operations will be conducted in areas covered by existing contracts within the departments of Boyaca e Casanare. DEAL DETAILS * This new agreement is in addition to the five other agreements Ecopetrol and Parex signed in December of 2024 for hydrocarbon exploration in two major Colombian basins. * The agreement includes drilling of the Florena-Huron well which is expected increase the domestic gas supply. The Florena Huron Well is scheduled to be drilled in 2026. Key Context * The five previous agreements projected investments of just under $400 million. Ecopetrol has not provided any further information on the investment associated with the new agreement. * The companies will begin drilling an exploratory well in 2026. This is part of another agreement announced last summer. Ecopetrol intends to invest between $5.85 and $7.18 Billion in 2026. This includes drilling 8 to 10 exploration wells.
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Investors brace themselves for US data as gold prices rise on bets of rate cuts
The gold price rose on Friday as the market increased its bets that interest rates will be cut in the United States. Markets are now focused on inflation data due out next week, ahead of Federal Reserve policy meeting. As of 1208 GMT spot gold was up 0.5% at $4,226.99 an ounce. However, it was still on course for a weekly decline of 0.1%. U.S. Gold Futures for February Delivery edged up 0.3% to $4,257.40 an ounce. Lukman Otunuga is a senior research analyst with FXTM. He said that market bets on the Fed cutting rates next week have kept gold prices somewhat elevated. The data released on Wednesday shows that the private payroll fell by 32,000 during November, which is the largest drop in over two-and-a half years. More than 100 economists surveyed by predict that the Fed will lower its key interest rate at its meeting on December 9-10 by 25 basis points. Gold is a non-yielding asset that tends to be favoured by lower interest rates. Investors will be watching the September PCE inflation numbers due today. This is the last data release before the FOMC meeting next week. Gold prices in India rose to near a record high this week. This slowed down the physical demand, as buyers waited on a correction in price. Demand in China was also relatively low. Despite the volatility of the spot gold price market and its high prices, physical demand for gold in China remained low. Silver increased 1.9% to 58.20 per ounce. This is up 3.2% in one week, after reaching a record of $58.98 an ounce on Wednesday. Otunuga said that silver is on course for a second week of gains thanks to the strong inflows made into exchange-traded fund. Rate cut expectations, as well as a weaker dollar, have also fueled the upward trend. Silver prices have risen by about 101% this year due to a structural shortage, concerns over liquidity and the addition of silver to the U.S. Critical Minerals List. Palladium rose 1.3% to 1,466.70, but the week was expected to be lower. Platinum gained 0.5%, to $1654.06, and was on track for a modest weekly gain. (Reporting Pablo Sinha from Bengaluru, Editing by Elaine Hardcastle & Leroy Leo).
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The season of macro forecasts is upon us.
What Mike Dolan, the ROI team and I are looking forward to reading, watching and listening to this weekend. From the Editor Hello Morning Bid readers! As we enter the final month of 2018, it's time to look at the 2026 market forecasts. It's hard to find U.S. equity bulls but forecasts come with a lot of qualifiers. This is understandable, given the uncertainty surrounding an artificial intelligence boom. AI adoption may really take off in 2019, but according to ROI's editor-at-large Mike Dolan, U.S. growth will likely be constrained by the 150-year trendline of 2%, especially if technology innovation is hampered by supply chain bottlenecks or labor market bottlenecks. The U.S. labour market is as clear as mud. The U.S. private payrolls in November were negative 32,000, which is well below the consensus and represents the largest drop in over two and a quarter years. The number of Americans submitting new claims for unemployment benefits dropped to its lowest level in more than three year. A slice of the consumer delinquency data suggests that the U.S. economy might not be as grim as it seems despite the K-shaped economic model. Moreover, the fears that foreign investors will lose interest in U.S. stock markets may be unfounded. In recent months, the inflow of overseas private sector funds into U.S. stock markets has reaccelerated to record levels. Now the big question is if this trend can continue into next year. In Asia, Japan's 10-year bond yield reached its highest level since 2007, rising over 25 basis points in just four weeks. This was happening as Prime Minister Takaichi sought to calm investor fears about her $137-billion spending plan. The weakened yen is still hovering around 155 per dollar, close to the upper end of its long-term range. Stephen Jen, CEO of Eurizon SLJ, believes that the currency's apparent excessive weakness could be a ticking bomb. In the energy markets, OPEC+ announced that they would maintain production levels through the first three months. The market is complicated by the uncertainty around sanctioned volume. OPEC+'s changes to the oil production quotas could lead to a surge of investments in upstream. In the meantime, Europe prepares to eliminate Russian imports from its gas market by 2027. Gavin Maguire, ROI's energy transition columnist, explains the countries that will be affected. Copper continues to be a hot commodity, but it does not necessarily mean that global manufacturing will increase in line with this trend by 2026. Next week's main event will be the Federal Reserve meeting. Fed-watchers are paying close attention to how many dissents there are, because this could indicate the growing divisions within an organization that has been known for its consensus. But the real story of the Fed is Donald Trump's choice for next chair. Mike Dolan says that if White House advisor Kevin Hassett, as Trump hinted at, is chosen - the markets will be watching his every word. Check out what the ROI team recommends you read, watch, and listen to as we enter the weekend. Stay informed and prepared for the coming week. Please contact me via CLYDE RUSSELL: You do not need to be a chess expert to understand the story of Sarwagya Kushwaha. She is the youngest chess player in history to have earned an official FIDE ranking before the age four. RON BOUSSO is the ROI Energy columnist. A picture speaks a thousand. This is why I suggest you look at the stunning collection of 'top photographs of 2025', which was selected from the over 1.6 million images released to clients in this year. What a year... GAVIN MAGUIRE is the ROI Global Energy Transformation Columnist. This high-def, updated map of U.S. Data Center Infrastructure created by the Chief Cartographer at the newly renamed National Renewable Energy Laboratory(NREL)is a work of art. It really highlights the enormous scale of the activity taking place across the country as transmission lines and server farms get up at running to power the AI revolution: https://docs.nrel.gov/docs/gen/fy26/98020.jpg JAMIE McGEEVER, ROI Markets columnist: AI is experiencing a speculative boom in the U.S. and around the world. Simon Johnson and Piero Novelli, professors of economics, examine Charles Kindleberger’s “Manias, Panics and Crashes” to get a feel for where this might go. The 1978 book raises three important questions that are still relevant today. MIKE DOLAN is the Editor-at-Large for ROI. It's rare to find a podcast about 'r*! This Brookings podcast, which will be released next week in conjunction with the Fed's meeting, shows how recent shocks may have caused this theoretical 'neutral rate' of interest to creep higher after years on decline. JAMIE MCGEEVER is a columnist for ROI Markets. Michael Burry, the author of 'The Big Short,' doesn't do much media other than his often cryptic postings on X – and interviews are rarer still. Fast forward through 6-7 minutes worth of ads and introduction, and you'll find an interview with Michael Lewis on the Against the Rules podcast. ANNA SZYMANSKI is the editor-in-charge of ROI. We have just launched a Morning Bid podcast that will be available both in audio and video. Subscribe to the Morning Bid daily podcast and hear ROI editor-at large Mike Dolan, along with other journalists, discuss the latest news in finance and markets seven days a weeks. Sign up for the newsletter to receive Morning Bid every morning in your email. Subscribe to the Morning Bid newsletter Website You can find us on LinkedIn. The opinions expressed are the authors'. These opinions do not represent the views of News. News is bound by the Trust Principles to maintain integrity, independence and freedom from bias. (By Anna Szymanski)
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ASIA GOLD - India demand falls as prices in India reach record highs; China discounts are widening
Gold prices in India rose to near a record high this week. This slowed physical demand, as buyers waited on a correction in price. Demand in China was also relatively low, despite the volatility and high spot gold prices. This week, Indian dealers offered a discount Discounts of up to $18 per ounce on official domestic prices have been increased by as much as $22. Gold is getting more expensive as the rupee falls, and jewellers find it difficult to decide how much and when to buy, said a Mumbai bullion dealer working for a private bank. On Friday, domestic gold prices were around 127.500 rupees for 10 grams, which is close to the record 132.294 rupees set in October. Even though it is wedding season, the demand for jewellery remains low. The price increase is hard for people to accept," said a jeweller in Kolkata. In India, weddings are the main reason for gold purchases. Bullion is a key part of brides' attire and is a very popular gift. Spot gold reached a record-high of $4,381.20/oz in October and has gained 61 percent so far this season. Brokerages expect the precious metal will break $4,500 by 2026. Bullion prices in China, the world's largest consumer, range from discounts of up to $10 per ounce, to premiums as high as $8 compared to the global benchmark spot rate. According to Ross Norman, an independent analyst, concerns about recent events such as the removal of tax exemptions tend to be short-lived. However, the demand for most products remains low due to the high price. Beijing has cut the value-added taxes for gold bought through the Shanghai Gold Exchange or the Shanghai Futures Exchange. This is expected to increase the cost of jewellery and industrial gold. In Singapore This week, Hong Kong sold gold at a premium of up to $2.50. It traded from a discount of $0.5 to a premium of $2. In Japan (Reporting by Ishaan Arora in Bengaluru and Rajendra Jadhav in Mumbai; Editing by Shalesh Kuber) (Reporting by Ishaan Arora in Bengaluru and Rajendra Jadhav in Mumbai; Editing by Shailesh Kuber)
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India's rate cut and liquidity boost prompt $2.7 billion bond rush
Bankers reported that the central bank of India cut rates and eased monetary policy guidelines on Friday. This led to $2.7 billion in bond issuances from state-owned companies and lenders. The bankers have said that four state-owned firms - REC Housing and Urban Development Corp Power Finance Corp and NTPC – and two state run lenders Indian Bank and Bank of India, will raise an aggregate of 240 Billion Rupees (about $2,7 billion) over the next two week. Reserve Bank of India lowered its key repo by 25 basis points, and left room for further easing. It increased the banking system's liquidity by 16 billion dollars in the next two week. The 10-year yield on government bonds fell by 2-3 basis points, and the 15-to-40-year yields dropped by 7-8 basis points. This increased demand for long-term corporate bond, which had been in short supply. Many long-term investors want to lock in rates and diversify duration due to policy clarity and a stable rate environment. Vineet agrawal, cofounder of Jiraaf - a bond trading site - said that as a result, issuers in the public sector with a good rating are likely to have a strong demand for their bond placements. In the period between January and November, Indian companies raised 10.07 trillion rupees in bonds. The supply of 2025 will also be a record. The bankers who refused to be identified because they were not authorised by the media to speak, stated that PFC would aim to raise 35 Billion Rupees via 15-year bonds. NTPC, on the other hand, could raise 30 Billion rupees using 10-year or fifteen-year papers. HUDCO and REC will likely raise up to 50 billion Rupees each via 10-year deep discount bonds, they stated. Bankers say that Indian Bank and Bank of India both plan to raise 50 billion Rupees via tier II bonds compliant with Basel III. Emails seeking comments from the firms were not answered. The bankers expect that insurance companies will bid heavily for these AAA-rated bonds, given the downward trend of yields. Sachin Bajaj is the executive vice president and chief investor at Axis Max Life Insurance. ($1 = 89.9480 Indian Rupees) (Reporting and editing by Dharamraj Dhutia, Khushi malhotra).
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The head of the agency says that Europe must be on guard against US dominance when it comes to rare earths.
The head of the EU-funded agency that oversees key minerals says, "Europe has taken significant steps to develop its rare earths industry to counter Chinese dominance. But the region must also guard against being overtaken by the United States." Bernd Schaefer is the CEO of EIT RawMaterials. He welcomed Wednesday's publication of a new EU Action Plan to secure crucial raw materials used in electrical cars, wind turbines, and semiconductors. REsourceEU, the plan of the European Commission, includes an investment of 3 billion euros (3.49 billion dollars) in projects to accelerate them and reduce reliance on a single source. Schaefer said in an interview that "it is certainly a step change from the ambition to deliver, but there are still a few things missing." He said that the EU must intensify its negotiations with countries outside of Europe to obtain key minerals. Schaefer said that many memorandums have been signed with international partners in the past few years, but it is just a beginning. "We need to become more deal makers and move away from a prosaic approach and simply talking about everything." He said that Europe must also ensure it doesn't continue to lose important rare earth assets to America. Less Common Metals was recently acquired by USA Rare Earth, and is one of the few firms involved in the key process of turning rare earth oxides to metals and alloys. Schaefer stated that there is a risk of a situation in which the rare earths chain will be pulled into the U.S. at a significant level. "The U.S. might become like a second China in that we would be reliant on magnets imported from another country." ($1 = 0.8584 euro) (Reporting and editing by Andrew Heavens; Eric Onstad)
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Citi raises its outlook, causing copper to reach a record-high and head for a weekly increase
The price of copper reached a new record on Friday, after Citi raised its outlook for the metal. A weaker dollar provided additional support in anticipation of a rate cut expected by the U.S. next week. At 1025 GMT, the benchmark three-month price of copper at the London Metal Exchange had risen 1.4% to $11,609.50 per ton. The metal, which is widely used in construction, manufacturing and power generation, rose earlier by as much as 2.2%, reaching a peak of $11,705. LME copper has gained over 30% since 2025 and is expected to finish the week with a gain of 3.8%. "I believe copper will slowly rise in price. "The funds are now backing it because they see shortages developing," SP Angel analyst John Meyer said, referring a series supply constraints at major mines. Citi expects that copper prices will continue to rise into the early part of next year, and reach an average of $13,000 in second quarter, up $12,000 from its October outlook. Its bull case has also increased to $15,000, from $14,000. Bank of America says that macro-funds will continue to support prices as investors prepare for a soft U.S. economy landing and a growing supply shortage. Meyer stated that such forecasts "help encourage some of the larger funds to invest in copper." It's been gaining momentum for a while now. Citi stated that additional tightness was expected due to U.S. stocks linked to COMEX-LME arbitration. The premium for the LME cash copper contract is still high. Over the next three months, prices have dropped to $35 per ton from $88 on Tuesday, indicating a less urgent need for metal. In China, copper inventories On the Shanghai Futures Exchange, the number of tons traded fell by 9.2% compared to last week. Aluminium fell 0.1%, to $2,902 per ton. Tin dropped 0.8%, to $40,000 Nickel grew 0.2%, while zinc climbed 0.7%, reaching $3,112, after hitting its highest level in nearly a year. Reporting by Tom Daly. Dylan Duan, Lewis Jackson and Dylan Duan contributed to the reporting. Rashmia Aich, Mark Potter and Mark Potter edited the article.
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Gold prices rise on weaker dollar, as investors prepare for US data
The gold price rose on Friday as a result of a weaker dollar and growing speculation on an interest rate reduction in the United States. Markets are now focused on the upcoming U.S. data on inflation ahead of next week's Federal Reserve policy meeting. As of 1017 GMT the spot gold price rose by 0.4%, to $4,225.11 an ounce. However, it was still on course for a weekly drop of 0.1%. U.S. Gold Futures for February Delivery edged up 0.3% to $4,255.90 an ounce. Gold became more affordable to holders of other currencies as the dollar was not far off its five-week low. Lukman Otunuga is a senior research analyst with FXTM. He said that "gold remains somewhat buoyed" by the market's bets on a Fed rate cut next week. Weekly data on Thursday showed that the number of new U.S. applications for unemployment benefits dropped to its lowest level in over three years. More than 100 economists surveyed by predict that the Fed will lower its key interest rate at its meeting on December 9-10 by 25 basis points. Gold is a non-yielding asset that tends to be favoured by lower interest rates. Investors will be watching the September PCE Inflation data, due to be released later today. This data will be the last data release before the FOMC meeting next week. Silver rose by 1.9%, to $58.19 per ounce. This is up 3.1% in the last week, after reaching a record of $58.98 an ounce on Wednesday. Otunuga said that silver is on course for a second week of gains thanks to the strong inflows made into exchange-traded fund. Rate cut expectations, as well as a weaker dollar, have also fueled the upward trend. Silver prices have risen by about 101% this year due to a structural shortage, concerns over liquidity and the addition of silver to the U.S. Critical Minerals List. Palladium rose 1.2% to 1,466.54 and is set to have a modest weekly gain. Platinum, however, was expected to finish the week with a loss. (Reporting Pablo Sinha from Bengaluru, Editing by Elaine Hardcastle).
Japan's Nikkei skids in upbeat Asia; investors eye US inflation data
Japan's Nikkei fell on Friday, wiping away this week's gains despite an otherwise positive Asian performance. Investors are waiting for the U.S. Inflation reading which could influence a deeply divided Federal Reserve.
The European stock market was headed for a flat opening, as both EURO STOXX futures and FTSE Futures were little changed. Nasdaq Futures rose by 0.4%, and S&P500 Futures rose by 0.2%.
In Asia, Nikkei fell by 1.3% as weaker than expected household spending data highlighted the inflation problem. Bets on a rate increase later in the month also grew. The week was expected to be mostly flat.
Early in the morning, the yield on 10-year Japanese Government Bonds hit 1.94%, its highest level since mid-2007. It then dropped to 1.93%.
The benchmark yield is on track to rise by 12.5 basis points this week. This will be the steepest climb in five days since March. However, recent auction results suggest that the low bond prices are attracting buyers.
In previous cycles, such movements would have shook the markets. Instead, demand strengthened," said Nigel Green, chief executive at deVere Group.
"Capital flows have changed, expectations are being challenged, and portfolios built on a permanently cheap yen face a new world."
After Governor Kazuo ueda said on Monday that the central bank will weigh "pros" and "cons" of increasing interest rates, the Bank of Japan's quarter-point rate increase later this month has been priced at 75%.
According to sources, the Japanese government will tolerate a price hike in December.
The dollar fell 0.3% to 154.61 Japanese yen and was still well below its 10-month peak of 157.9.
The MSCI Index of Asia-Pacific Shares outside Japan rose 0.4%, and is expected to gain 1% this week. South Korea, however, managed to rise by 1.4%.
US INFLATION TESTS
The dollar is under pressure on the foreign exchange markets again after stabilizing overnight, following nine consecutive sessions of decline. The dollar index fell 0.1% to 99 on Friday, and was down 0.5% over the past week.
Bets on the Federal Reserve's almost-certainty to reduce interest rates by one quarter point by next Wednesday have contributed to the broad decline in the U.S. dollar.
The markets have priced in a Fed rate reduction at 90%. However, this could be one of the most controversial decisions the central bank has made for years. Five out of 12 voting members publicly stated that they do not want to see rates reduced further.
The U.S. Personal Consumption Expenditures (PCE) Price Index - the Fed’s preferred inflation gauge - will be released later that day. However, this data only covers September. Forecasts call for a 0.2% increase in the core index, which would leave the annual rate at 2.9%.
The U.S. Non-Farm Payrolls Report will not be released Friday. The data on Thursday showed that jobless claims dropped last week. This may have been due to the Thanksgiving Holiday.
Analysts at ANZ said that "Tariffs are preventing inflation from improving this year. However, we remain confident the disinflationary frame is intact."
"This framework includes a softening of the labour market, moderated wage growth, and well-anchored long-term inflation expectations... We believe that the data will support a FOMC rate reduction next week."
Treasury yields fell a bit on Friday, after they had risen the day before. The yields on two-year Treasury bonds fell by 1 basis point, to 3.5206% after rising 5 basis points overnight. The yields on 10-year Treasury bonds also dropped 1 basis point, to 4.098%.
The price of U.S. crude oil fell by 0.3% to $59.46 a barrel, but rose 1.5% for the week. Brent crude futures are expected to finish the week at $63.12 per barrel, a 0.2% decrease.
The spot gold price rose by 0.2%, to $4,216 an ounce. However, it was still down by 0.3% on the week.
(source: Reuters)