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US manufacturing production is boosted by motor vehicles and AI; war-related shortages of supplies are looming
The U.S. manufacturing sector posted its biggest increase in 14-months in April. This was driven by the demand for motor vehicles, and?technology products amid a boom in artificial intelligence spending. A survey released by the New York Federal Reserve showed that delivery performance in New York State deteriorated during May. The U.S. and Israel conflict with Iran has caused disruptions in shipping through the Strait of Hormuz. This has led to higher energy prices and global supply chain strains, as well shortages of many goods including consumer products, fertilizers and aluminum. In April, producer prices rose at the fastest rate in four years. The oil prices rose on Friday, after President Donald Trump's comments and Iran’s Foreign Minister's remarks quashed hopes for a deal that would end attacks and seizures of ships around the Strait. Michael Gapen is the chief economist of Morgan Stanley. He said: "Overall, a firmer demand, and a continued increase in output, point to some strength in the manufacturing sector." "However uncertainty about supply and prices puts the outlook for the near term at risk." The Federal Reserve reported that manufacturing output rose 0.6% in April, which is the highest increase since February 2025. This follows a 0.1% rise in March, which was upwardly revised. The Federal Reserve said that economists surveyed by it had predicted that factory production would rebound 0.2% following a 0.1% drop in March. In April, factory production increased 1.3% on an annual basis. The production of motor vehicles and parts jumped by 3.7%. The production of high-tech industries increased by 1.0%, after increasing 0.5% in March. Computers and peripheral equipment boosted output for the second consecutive month, increasing 1.5%. The production of semiconductors, electronic components and other related products increased by 1.0%. Communications equipment increased by 0.6%. AI is being rapidly adopted by businesses, who are investing billions in the process. This helps to support manufacturing, which represents?9.4% (?) of the economy. AI spending was a major contributor to the economy's annualized growth rate of 2.0% in the first quarter. Manufacturing, excluding high-tech industries and motor vehicle production, rose by 0.3% in April following a similar increase in March. Durable goods production jumped 1.2% in the last month. Chemicals production fell by 0.9%. Plastics and rubber production also fell by 0.9%. The production of petroleum and coal-based products increased by 1.0%, for the second consecutive month. Food, beverages and tobacco products also saw an increase in production. The increase in manufacturing could be due to companies placing orders early to avoid possible shortages or higher prices caused by the Middle East conflict. DETERMINING THE PERFORMANCE OF SUPPLIER DELIVERY New York Fed Empire State Manufacturing Survey revealed that its measure of business conditions rose nine points in May to 19,6. This was the highest level for more than four-years. New orders and shipments also increased significantly, both for the second consecutive month. The survey's measurement of delivery time reached a four-year peak, but its gauge of availability of supplies remained negative. This suggested that "delivery times had become much longer and availability of supplies worsened." Stocks in the United States were trading lower, as inflation fears increased. Treasury yields on longer-dated bonds reached their highest level in over a year. Dollar rose in relation to a basket. The financial markets expect that the U.S. Central Bank will keep its overnight benchmark interest rate at 3.50%-3.75 percent until next year, due to the higher oil prices and inflation. The higher interest rates may offset the manufacturing boost from tax cuts. Trump's import tariffs hurt manufacturing last year, but the AI spending spree helped to offset some of that drag. The Fed's report shows that mining output fell 0.1% in April after falling 1.6% in March. Energy production increased by 1.0%, but drilling for oil and gas wells decreased again in March. In the Fed's Beige Book last month, it was noted that "many producers were cautious about increasing drilling because of uncertainty?about the persistance of higher prices." Stephen Brown, Capital Economics' chief North America economist, said: "This second consecutive decline should serve as a reminder to those who think that an increase in U.S. oil production will offset the supply losses from Middle East." Electricity and natural gas production both increased by 1.9%. Utilities production fell by 1.4% in march. After a downwardly revised 0.3% decline in March, the overall industrial production increased by 0.7%. Previously, industrial output was reported to have decreased by 0.5%. In April, it increased by 1.4% compared to the same month last year. Capacity Utilization for the Industrial Sector, which measures how well firms use their resources, increased to 76.1% in March from 75.7%. This is 3.3 points below the average for 1972-2025. The manufacturing sector's operating rate increased by 0.4 percentage points to 75.8%. This is 2.4 points below the long-term average. Reporting by Lucia Mutikani; Editing by Chizu Niyama and Nick Zieminski
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Rwanda's Trinity Metals aims to raise $200 million US dollars in order to increase tin and tungsten production
Rwanda's Trinity Metals plans to list on an international exchange in order to raise between $100 and $200 million as it expands its tin and tungsten mines, and moves forward with what could be one of the top lithium deposits in the world, according to its CEO. The soaring demand for metals known as 3T, which are used in electronic, defence, and energy supply chain, is driving a move toward traceable non-Chinese suppliers, bringing Rwanda's 3T mine belt near the Democratic Republic of Congo into sharper focus. Trinity has consolidated three undercapitalised properties in 2022, the Nyakabingo mine for tungsten, Rutongo's tin operation and Musha's tin-tantalum license. It is also converting many artisanal operations into industrial scale operations. Peter Geleta, the Chief Executive of the company, said that the output has quadrupled. The company is aiming to list on the New York Stock Exchange within the next 12-18 months in order to tap into the growing Western demand for essential minerals. We've decided to list .... New York is our preferred choice due to the appetite and liquidity for critical minerals." Not Affected by the Eastern Congo Conflict Trinity, however, has not been affected by the fighting in eastern Congo, according to Geleta. The company plans to invest $150 million in the next three year's time into processing plants at its mines. This includes a $50-million plant that could be operational by the end of 2027. Trinity's goal is to triple the tin and titanium production in three to five years. This will be achieved by mechanisation?and a new underground development. Geleta stated that strong prices for tungsten are the basis of their strategy, after China, which is responsible for around 85% global supply, curtailed exports and tightened markets. He said that all of his production was sent to the U.S.A., Europe, and Thailand. "We don't sell to China", he added, adding that long-term agreements were already signed with Western buyers. Geleta says that if drilling confirms the lithium deposit, it could be among the top 10 in terms of grade. He said: "We could easily become a multi-billion dollar company in five years if we make the right investments." Maxwell Akalaare Adombila wrote the article. Mark Potter edited the book.
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Gold falls to a one-week low, as yields and the dollar climb. Middle East tensions also fuel inflation.
As U.S. Treasury yields and the dollar rose, gold fell to its 'lowest level in over a week on Friday. Meanwhile, inflation fears due to the Middle East conflict reinforced bets that interest rates would rise. By 9:40 am EDT (1340 GMT), spot gold had fallen 2.6% to $4,527.80 an ounce, its lowest price since May 5. Prices have fallen 4% this week. U.S. Gold Futures for June Delivery fell 3.2% to $4,535 "There were a few reasons for the sell-off in (precious metals). The dollar is strong right now. Edward Meir is an analyst with Marex. Benchmark 10-year U.S. Treasury yields have risen to a nearly one-year-high, increasing the opportunity cost of non-yielding gold. The dollar is set to make its biggest weekly gain in the past two months. This will increase the price of gold priced in greenbacks for foreign buyers. Donald Trump, the U.S. president, said that his patience was running out with Iran and that China had no significant breakthroughs in trade or tangible assistance to end this war. He added, "The Chinese didn't really offer much help to resolve the conflict. And we're now seeing crude oil rise, which reinforces inflation narrative, and has been very negative for metals." Since the U.S. and Israel war against?Iran started, crude?oil has risen by more than 40%. This has led to a global increase in inflation. In times of high inflation, central banks are more likely to raise interest rates. This in turn can reduce the appeal of non-yielding gold. According to CME’s FedWatch Tool, traders have priced in a U.S. rate cut this year but bets on a rise have increased. Spot silver dropped 8.7% to $76.26 an ounce. Platinum fell 4.1% to $1967.35, and palladium was down by 1.9%, at $1,409.75. All three metals are headed for losses this week. Silver had fallen as much as 9% in the previous day and was set to have its worst performance daily since March 3. (Reporting by Ishaan Arora in Bengaluru; Editing by Joe Bavier)
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Venezuela starts giant debt rework, but hurdles remain
Venezuela announced a "comprehensive restructuring of public debt" on Wednesday. However, it still faces significant hurdles in order to complete one of the largest and most complex sovereign reworks ever. Analysts estimate that the total liability could exceed $150 billion once interest accrued, arbitration awards, and other claims are included. Here are some key questions and answers. WHAT DEBTS WILL BE AFFECTED BY THE RESTRUCTURING? The government stated that the aim is to "normalise" its outstanding debt obligations. This includes its international government bonds and PDVSA's bond. The statement is not as clear on other debts. The official debt, which is the multilateral loans that the government has taken out from lenders around the world, will be "addressed by institutional normalisation". However, there are no details on how the debts it has borrowed bilaterally from other countries around the globe will be handled. According to JPMorgan, Venezuela owes around $2 billion to the Inter-American Development Bank as well as the Development Bank of Latin America & the Caribbean. It owes China at least $10 billion bilaterally, with Brazil and Japan being other large creditors. JPMorgan stated that the restructuring of Venezuelan bonds and commercial debt may take a different path - and possibly faster - than its defaulted loans to "official sector" creditors. What are the basic principles of VENEZUELA? Venezuela said the restructuring will be based on four principles: sustainability, comprehensiveness and good faith, transparency and tempo, or speed. Analysts have doubts that Caracas can move quickly enough to ensure the process is thorough and covers all claims, including those from the United States. The 'intent' to restructure the debt has contributed to the sharp rise in bonds this year. Analysts at Citi stated that Venezuela is moving faster than anticipated towards a restructuring. They stressed that, although the process was not imminent, that it was important to have a credible start. What happens next? Venezuela has set an ambitious schedule, promising to deliver a macroeconomic frame and a Debt Sustainability Analysis (DSA) by June. The framework would include economic assumptions and projections, while DSA would evaluate its ability to service the debt and indicate how dramatically?the debt should be restructured. The International Monetary Fund is usually involved in both, and the process can take several months. The IMF's role in the June timeline is not clear. This has caused some concern among investors and analysts who expect the IMF to provide independent, credible assessments. The IMF stated 'on Thursday that it has not been involved in the process to date. Meanwhile, the interim president of Venezuela's Central Bank, Luis Perez said a delegation will travel to Washington to meet with the IMF by the end of the month. When can negotiations begin? Caracas hired Centerview Partners, a financial services company based in the United States. Washington recently granted it a licence allowing it to hire advisers. The licence does not permit Venezuela to negotiate with bondholders or come up with a deal. A group of investors has already established the "Venezuela Creditor Committee" (VCC). AJ Mediratta is a partner at Greylock Capital Management which is a part of the VCC. He said that the committee has been signaling to U.S. officials for over a year that they are ready to engage but Venezuela was not in able to start talks. Analysts believe Washington could act quickly to grant permission for negotiations to begin. (Reporting and editing by Marc Jones, Kirby Donovan, Kirin Strohecker; Johann M Cherian contributed additional reporting).
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Early monsoon rains will hit the southern Indian coast, causing crop planting
The state-run weather service announced on Friday that monsoon rains will hit India's southern coast six days sooner than normal, leading farmers to hope for early plantings of rice, corn and other crops. India Meteorological Department said in a press release that the monsoon will likely arrive over Kerala's southern state on May 26. The margin of error is four days. The'monsoon' usually ends in Kerala by the middle of September. India's $4 trillion economy relies on the monsoon to replenish reservoirs and aquifers, as well as water its farms. India Meteorological Department predicted below-average rains for 2026, the first time since 2013. This raised concerns about farm production and economic growth. India Meteorological Department defines a normal or average rainfall as falling between 96% and 104% of the 50-year average rainfall of 87 cm for a four-month period. (Reporting and editing by Barbara Lewis; Mayank Bhardwaj)
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Watchdogs warn that foreign buyers are fueling the illegal mineral trade in Nigeria.
A joint report by the government and civil society revealed that Nigeria is losing vast amounts of mineral revenue to illegal trading networks, which are dominated by shell companies, foreign buyers, and armed criminals groups. This highlights the extent of illicit activity. The report was produced by Nigeria's extractive industry watchdog NEITI and Africa Network for Environment and Economic Justice with UK government funding. It found that illicit financial flow in the mining sector occurs through commercial manipulation, corrupt officials, and cross-border smuggling. Nigeria's mining industry contributed only 0.72% of GDP in 2023, 0.28% of revenue, and 0.75% % of exports. This is a fraction of the oil and gas sector, which was responsible for 82% of revenues and 29% of exports. The Financial Intelligence Unit of Nigeria has identified illegal mining in Nigeria as a growing threat to national security and the economy. The report alleges that foreign buyers, especially Chinese actors, have a disproportionate impact on pricing, purchasing arrangements, and export channels. They negotiate directly at mine sites. The report alleges that this allows for a'systematic undervaluation, weights and grades manipulation, and informal payments. Shell companies registered under Nigerian laws are often used by foreign companies to conceal ownership. They use local proxy firms to gain access licenses and permits. This practice, according to the report, facilitates money laundering and trade misinvoicing. In areas plagued by banditry or terrorism, an estimated 80% mining in North-West Nigeria will be illegal. This activity is expected to increase between 2022 and 2024. The report highlighted a growing overlap in commercial interests linked to China and local conflicts. It said that the May 2025 conviction of four Chinese nationals in 'Plateau State', each sentenced to 20 years with forfeiture of assets, is an exception. Requests for comments were not immediately responded to by the Ministry of Solid Minerals Development or the Chinese Embassy at Abuja.
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Bond yields rise on inflation fears as global shares fall
Global shares fell on Friday, as investor euphoria about tech stocks was replaced by inflation fears. Bond yields rose and expectations of interest rate hikes in this year were raised. MSCI's main world stocks index fell by 0.35%. Europe's STOXX600 dropped?1.37% after rising the previous two sessions. Nasdaq Futures dropped 1.32%, and S&P500 futures dropped 0.9%. Wall Street had hit new highs after a 4% rise in AI darling Nvidia. The broadest MSCI index of Asia-Pacific stocks outside Japan dropped 2.54%. Japan's Nikkei fell 1.99% following data showing wholesale inflation increased to 4.9% in the month of April, the highest pace in three-years, keeping the Bank of Japan in line to raise interest rates. In the past few days "it has been this relentless rally. "I think that this rally has reached a point of exhaustion," said Tim Graf. He is the managing director at State Street Markets and is responsible for EMEA's macro strategy. He added that the equities market remains supported. He said that if there is anything to cause a reversal, it's the rate market and the possibility that inflation will stay above target. Prices of oil?rose as the uncertainty surrounding a Middle East Peace Deal and the reopening of Strait of Hormuz was in the spotlight. Brent crude futures climbed 2.3% to $108.14 per barrel, on course for a 6.7% gain in a week. Attention has also been focused on Beijing, where U.S. president Donald Trump concluded a state trip. Trump stated that after meeting Chinese President Xi Jinping they both agreed Iran should not have a nuclear weapon. They also agreed to reopening the Strait of Hormuz. "President Trump’s China visit continues and is a welcome respite from the Iran war anxiety. Padhraic G Garvey is the regional head of ING's Americas research. "The front and center issue is delivered inflation which remains troubling for Treasury markets." We continue to maintain a view that yields will be tested on the upside in the coming weeks. YIELDS SPike The global bond market was again under pressure Friday due to the rising inflation risk, fueled by higher oil prices. The yields on German 10-year bonds, the benchmark of the eurozone, increased by more than 7 basis points, to 3,1199%. Meanwhile, Japanese yields reached record highs. The yields on U.S. 2-year notes US2YT=RR increased by 5.8 bps, to 4.0498%. And the yields on 10-year notes US10YT=RR also rose 7.7 bps, to 4.5358%. Both yields are at their highest levels in about a year. A run of weak auctions in this week has highlighted the fragility of the market. Dollar to gain 1.4% a week - most in 2 months - due to 'lack of progress' in Gulf. The strength of the greenback pushed the yen down to 158?per?dollar and traders were on alert for any further interventions from Tokyo. The sterling hit a new low of five weeks and fell 0.3% last session to $1.3360. It had fallen 0.9% the previous day following the resignation by Wes Streeting as health minister, which deepened Britain's political crisis. Reporting by Sophie Kiderlin from London and Stella Qiu from Sydney. (Editing by Sam Holmes Mark Potter and Joe Bavier.
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As rising yields and the dollar sap appeal, gold drops by 2%
Gold fell more than 2% on Friday, as a strong U.S. dollar and surging Treasury yields weakened its appeal. Higher oil prices and continued tensions in Middle East also reinforced expectations for higher interest rates. By 1141 GMT the spot gold price was down by 2.1%, at $4,551.81 an ounce, its lowest level since May 5. Bullion has already lost 3.4% this week. U.S. gold futures for delivery in June fell 2.8% to $4,556.40. Benchmark 10-year U.S. Treasury Yields have risen to a near-year-high, increasing the cost of gold that does not yield. Dollar strength also made greenback-priced gold more expensive for overseas buyers. "Yields are higher and the dollar is stronger on increased inflationary concerns. This is partly due to the Gulf hostilities, but also backed by the PPI and CPI figures released this week," said StoneX analyst Rhona OConnel. Brent crude oil prices rose 7.8% in the past week and hovered above $109 per barrel as the Strait of Hormuz remained largely closed. As manufacturers pass on the costs, higher fuel prices can contribute to inflation. In turn, this forces central banks keep interest rates high, reducing the appeal of non-yielding metals. This week, data on inflation showed that consumers and businesses have begun to feel the effects of war. According to CME's FedWatch Tool, traders have priced in U.S. rate cuts for this year. O'Connell said that "Gold has been wary about the Gulf -war for some time now, and the news from India this week regarding import duties has increased tensions in an already weak market." This week, gold discounts in India reached a new record. The reason was a steep increase in import duties. Ross Norman, an independent analyst, said that the news is awash with uncertainty, which is causing gold prices to rise. Spot silver dropped 6.3%, to $78.26 an ounce. Platinum fell 3.1%, to $1,991.33, while palladium fell 1%, to $1,422.41. All three metals were on track to post weekly losses. (Reporting by Anjana Anil in Bengaluru; Editing by Shreya Biswas)
Sources say that Mexico is considering stopping oil shipments from Cuba due to Trump's retaliation.
Three sources with knowledge of the discussions say that the Mexican government is considering whether it should continue sending oil to Cuba. There are growing concerns within the administration of President Claudia Sheinbaum about the possibility that the United States could retaliate against Mexico for this policy. The policy is vital to the Communist-run Caribbean island. The U.S. blocked oil tankers from Venezuela in December, and President Nicolas Maduro was captured this month. This has halted Venezuelan oil deliveries to Cuba. Mexico is now the sole supplier of energy for the island which suffers from massive blackouts and energy shortages. Mexico's role as a major oil supplier to Cuba also puts 'the U.S.'s southern neighbor in Washington's crosshairs. In a post on Truth Social dated January 11, President Donald Trump said that Cuba was "ready to fall".
Sheinbaum said publicly that Mexico would continue to ship oil to Cuba. He explained that the shipments are part of long-term contracts, and they are considered international aid. Senior Mexican government sources, however, said that the policy was being reviewed internally as Sheinbaum's Cabinet grows increasingly anxious about the possibility of Trump becoming upset by the oil shipments.
Mexico is trying negotiate a revision of the USMCA North American Trade Pact while also convincing Washington that it is doing enough in combating drug cartels, and that U.S. Military action against these groups on Mexican soil is neither welcomed nor necessary.
Sources requested anonymity in order to discuss a sensitive issue. Sources say that the Mexican government is still undecided about its final decision. They have said that a total halt, a reduced amount, or a full continuation are all options.
The Mexican presidency said that the country has "always been in solidarity" with the Cuban people and?added, shipping oil to Cuba as well as a separate agreement for paying for the services provided by Cuban doctors are "sovereign decisions." The Cuban government has not responded to a comment request.
White House official: "As President said, Cuba has failed on its own accord... There will be no more oil or money coming to Cuba from Venezuela and he strongly recommends Cuba make a deal before too late."
CARTELS ATTACKED by LAND ATTACKS
Trump has increased pressure on Mexico in recent weeks. He says that the cartels run the country and that a ground attack against them is imminent. Sheinbaum has stressed repeatedly that any unilateral action by the U.S. Sheinbaum has repeatedly stressed that any unilateral?U.S.
One of the sources said: "There's a growing concern that the United States might take unilateral action against our territory."
Two sources claim that during a telephone call with Sheinbaum last week, Trump asked about the crude and fuel shipments going to Cuba, and?the presence in Mexico of thousands of Cuban physicians. Sheinbaum replied that the shipments were "humanitarian assistance" and that doctors' deals "are in full compliance" to Mexican law, according to sources familiar with this call. The sources said that Trump did not ask Mexico directly to stop the oil deliveries.
Three sources confirmed that officials within Sheinbaum’s government have also been growing increasingly concerned by the increased presence of U.S. Navy Drones in the Gulf of Mexico, since December. Local media reported that flight-tracking data showed at least three U.S. Northrop Grumman Triton MQ-4C drones had flown a dozen times over the Bay of Campeche. They followed the same route as tankers transporting Mexican fuel from Mexico to Cuba.
The same reconnaissance aircraft was spotted in December off the Venezuelan coastline, just days before the U.S. attacked the South American nation.
Sheinbaum led an offensive against the Sinaloa Cartel, and approved three mass transfers of drug kingpins in excess of 100 to?the United States.
Sheinbaum, a senior U.S. official, has stated repeatedly that unilateral U.S. actions on Mexican soil represent a redline.
Sheinbaum stated on Wednesday that "very little crude oil is exported to Cuba. But it's a form solidarity in times of hardship." Sheinbaum said that "that doesn't need to disappear".
CUBA'S MEXICAN OIL FEEDLINE
Trump's campaign of pressure against Cuba began during his first term, when he reversed many historic rapprochements orchestrated by the former Democratic President Barack Obama. It has increased ever since Trump returned to office one year ago.
Secretary of State Marco Rubio is a Cuban-American and has been the driving force behind Trump’s Venezuela policy. He, along with other U.S. officials, also believes that this could weaken Maduro’s Cuban allies. The constraints on Trump's Cuba policy are even more difficult to overcome, considering Havana's regional support and international recognition, the entrenched nature and power of Cuba's security forces and leadership, and its ability to endure decades under the U.S. embargo.
The Caribbean's largest island relies heavily upon fuel imports to meet its electricity, gasoline and aviation fuel needs. U.S. economic sanctions and the deepening crisis in the economy have made it impossible for the Communist government to purchase enough fuel.
Three sources within Sheinbaum’s government said that there is a strong belief in the Sheinbaum’s government that Washington’s strategy to cut off Cuba’s oil supply could lead the country into a humanitarian catastrophe, leading to mass migrations from Cuba to Mexico. Some government officials are pushing for the continuation of fuel supplies on the island, the sources said.
It is unlikely that other oil companies will step up to fill the gap, considering the U.S. military presence and focus in the area. The U.S. seized vessels that were involved in Venezuelan oil trading, vessels that are part of the shadow fleet, which supplies crude from countries that have been sanctioned by the U.S., such as Iran and Russia.
According to data reported by the Mexican state oil company Pemex, between January and September of last year, Mexico exported 17,200 barrels of crude oil per day and 2,000 bpd refined petroleum products worth $400 million to Cuba.
(source: Reuters)