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Copper falls on firm dollar, Trump's tariffs plan
Copper costs fell on Tuesday, weighed down by a stronger U.S. dollar and U.S. Presidentelect Donald Trump's pledge to impose more tariffs on Chinese products. Three-month copper on the London Metal Exchange (LME). was down 0.4% at $9,010.50 per metric ton by 0442 GMT,. while the most-traded January copper agreement on the Shanghai. Futures Exchange (SHFE) alleviated 0.1% to 73,900 yuan. ($ 10,187.48) a lot. On Monday, Trump vowed an additional 10% tariff on goods. from China and a 25% tariff on all products from Mexico and. Canada from his very first day in office. China accounts for around half of the world's metals. intake and manufactures most of the world's items. The proposed tariffs will likely hurt economic development and. disrupt trade circulations, which might eventually reduce the. intake of metals. The strategy pressed the dollar higher versus major currencies,. making greenback-priced metals more pricey to holders of. other currencies. A broker said the fall in metals prices was minimal since. the market had actually already reacted to the tariffs plan after Trump. won the White House on Nov. 5 and as some traders were anticipating. higher tariffs on China. China's peak demand season, which covers from November to. December, has likewise avoided an additional decrease in copper rates,. with SHFE stocks falling and import premiums rising to a. one-month high of $53 a lot . LME copper is likewise supported around the $9,000 rate level,. the broker said. On Tuesday, LME aluminium fell 0.5% to $2,638 a heap,. nickel eased 0.1% to $16,195, zinc rose 0.6% to. $ 3,037.50, lead was down 0.6% at $2,017.50 and tin. edged up 0.2% at $29,040. SHFE aluminium rose 0.2% to 20,570 yuan a heap,. nickel climbed 1.1% to 128,460 yuan, zinc. climbed 1.8% to 25,250 yuan, lead sophisticated 0.3% to. 17,220 yuan, while tin was almost flat at 242,780 yuan. For the top stories in metals and other news, click. or
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Vulcan in talks with producers to licence lithium technology
Australialisted Vulcan Energy is in talks with lithium companies to licence its filtering technology, tapping a brand-new profits source as the firm commercialises its renewableenergy job in Germany, the CEO stated on Tuesday. Vulcan started producing lithium hydroxide previously this month from its Rhine Valley operations utilizing adsorption direct lithium extraction (A-DLE) - utilizing geothermal heat to extract lithium from brine deposits. DLE is expected to reshape the lithium market by speeding the production procedure of the metal used in EV batteries and electronic devices to hours or days, compared with months or longer. Vulcan has signed up with the ranks of companies like Eramet , and Exxon Mobil aiming to make the innovation commonplace. We are talking with all sorts, including designers and manufacturers. If you have a four-to-five-year window to get into production, you need to act now, CEO Cris Moreno informed Reuters. There's also manufacturers out there that are trying to get an additional 1-2% of performance. Moreno said such performance gains represent a great deal of money for large manufacturers. Vulcan is in the last of finalising a 1.4 billion euro ($ 1.47 billion) funding package to develop a business center in Landau that is set to start production in 2027. Its lithium hydroxide is going to clients like Stellantis for quality screening in the meantime. The lithium and energy producer anticipates to finalise commitment letters on the 40% financial obligation part of its financing by Christmas and secure strategic equity by the very first quarter of next year. It was awarded 100 million euros in financing from Germany this month for the project, whose geothermal heat will help decarbonise the Landau district.
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Indian federal government to revamp infrastructure loan provider IFCI, sources state
India will revamp operations of nonbank lending institution IFCI Ltd by shutting its lending operations following capital constraints and converting it into a facilities advisory firm, 2 government sources informed Reuters on Tuesday. IFCI, introduced in 1949 right after the country's. self-reliance, was asked to stop fresh lending in 2021-22 after. bad loans soared, depleting the lending institution's capital and liquidity. Indian federal government owns almost 72% of IFCI. The federal financing ministry and IFCI did not right away. respond to a request for remark. The sources stayed confidential. as they were not authorised to speak to the media. The revamp comes as the South Asian country is rapidly. buying its facilities sector, increasing its costs. more than 3 times in five years to 11.11 trillion rupees. ($ 131.89 billion) for 2024/25. Based on the strategy, IFCI will not resume lending, instead. broadening the scope of its infrastructure advisory service to. include assessment for state federal governments infrastructure and. green projects, the very first source said. They included that the federal government wants the company to. duplicate the project advisory practices of SBI Capital Markets,. the financial investment banking arm of State Bank of India, the country's. largest lender by possessions. The federal government plans to instill 5 billion rupees into IFCI. this year, and any more capital infusion will be to guarantee. there are no defaults in repayment dedications of IFCI, the 2. sources said. IFCI's shares fell 0.8% on the day. They closed 11.3% greater. on Monday, after the board approved its merger with its. subsidiary StockHolding Corp. of India on Friday, based on the. suggestion of the federal financing ministry. The stock has actually gained 121% so far this year, compared to a. 10% rise in the benchmark Nifty 50. The revival plan likewise includes monetising IFCI's realty. properties and renting its workplace, one of the sources added. The non-bank loan provider made 427 million rupees through rental. earnings and earned a profit of 1.3 billion rupees in financial 2024.
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Uncertainty Surrounds Guyana Gas Development
Doubts are growing over Guyana's pick of a little-known U.S. startup to craft and develop projects to monetize its vast untapped natural gas resources that could cost up to $30 billion. Year-old Fulcrum LNG faces financing hurdles that could derail its selection. Ultimately, the South American nation may end up relying on a consortium led by Exxon Mobil, which controls all the production in the new energy hotspot. So far the top U.S. oil producerhas focused on oil.Guyana has been pressing Exxon to come up with a plan to convert its about 16 trillion cubic feet of gas reserves into valuable exports such as liquefied natural gas (LNG), or relinquish areas where gas has been discovered so they can be developed by others.When Fulcrum was chosen in June, its founder and former Exxon executive Jesus Bronchalo said on LinkedIn he was "delighted and honored" to be selected "to design, finance, construct and operate the required gas infrastructure."Since then, Fulcrum has not identified any financial backers, casting doubt over its ability to pull off the work, and leading government officials to now describe its selection as tentative. "No project has been awarded to anyone. We're in an exploratory phase," Guyana's Vice President Bharrat Jagdeo told Reuters last month. That is a change from the ministry of finance's description of the awarding of the contract as among its economic achievements this year. Guyana's president, who announced the award, said an agreement, that may or may not include Exxon, was expected next year.Meanwhile, the opposition People's National Congress party is skeptical about the award. Fulcrum LNG "lacks requisite experience and a demonstrated ability to raise the type of multi-billion dollar finances required," said Elson Low, an economist and advisor to the PNC.FULCRUM'S LEVERAGEGuyana picked Nevada-registered Fulcrum LNG, which it said offered "the most comprehensive and technically sound proposal," among the 17 bidders, including China's third-largest oil firm CNOOC, U.S. gas pipeline giant Energy Transfer, and the No. 4 U.S. LNG exporter Venture Global LNG.Ira Joseph, an LNG market expert and senior researcher at Columbia University's Center on Global Energy Policy, said it would be "very difficult" for a startup to raise the financing for a multi-billion-dollar infrastructure project. "Why isn't Exxon building the LNG plant itself? It is very hard to raise that kind of money to make a project work, (Guyana) would have to bring in one of the big players like TotalEnergies or Shell," Joseph said. Besides pairing with U.S. oil service Baker Hughes and construction contractor McDermott , Fulcrum's proposal would include financing from the U.S. Export-Import Bank and the participation of private equity firms and an environmental partner, the government said.The U.S. Export-Import Bank and McDermott did not reply to requests for comment, and Baker Hughes referred questions to Fulcrum. Bronchalo, who is Fulcrum's CEO, secretary, treasurer, director and president, and the only other person associated with the company, the technical director, did not respond to requests for information.Exxon's consortium with Hess and CNOOC has discovered more than 11 billion barrels of oil off Guyana's Caribbean coast since 2015, and produced 500 million barrels of crude from its Stabroek block since 2019, turning the tiny country overnight into a significant global oil producer. So far, Exxon's only planned use for the gas is a small gas-to-power project.The project to develop gas independently was conceived as a way for Guyana to create a new revenue stream apart from the oil, which is entirely exported. Gas would develop the country’s manufacturing and food sectors and help make it a regional energy powerhouse.Last year, the country's take from royalties and fees was $1.6 billion, compared with $6.33 billion in profit that went to the consortium. Exxon's Guyana country manager Alistair Routledge told Reuters the company would make a decision on tapping newer discoveries containing mostly gas by mid-2025. Fulcrum "may have better data and more knowledge than the government to push Exxon in that direction," said Guyana's vice president. Jagdeo said Guyana wants Fulcrum to work with Exxon, but would push forward with or without it. If, however, Exxon does not act on the discoveries or auction the acreage to others willing to develop the gas, Guyana could claw back some offshore land, he said.(Reuters)
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Base metals mostly fall on firm dollar, Trump's tariffs plan
Costs of base metals were mostly down on Tuesday, weighed by a more powerful dollar and U.S. Presidentelect Donald Trump's pledge to levy more tariffs on Chinese products. Three-month copper on the London Metal Exchange (LME). fell 0.5% to $9,000 per metric heap by 0216 GMT, while. the most-traded January copper agreement on the Shanghai Futures. Exchange (SHFE) alleviated 0.2% to 73,810 yuan ($ 10,174.66). a lot. On Monday, Trump promised an extra 10% tariff on goods. from China and a 25% tariff on all products from Mexico and. Canada from his first day in workplace. China accounts for around half of the world's metals. consumption and makes most of the world's items. Trump's proposed tariffs will likely harm financial growth. and interfere with trade circulations, which might eventually moisten metals. consumption. The tariffs prepare likewise pressed the dollar higher versus major. currencies, making greenback-priced metals more pricey to. holders of other currencies. However, supporting copper cost is China's peak demand. season in November and December, evidenced by falling SHFE. stocks and enhancing imports premium. Yangshan copper premium rose to a one-week. high of $53 a ton. The LME money copper contract was trading at a discount of. $ 113 a lot to the three-month agreement , the smallest. discount rate since Aug. 19, suggesting tightening up near-term. supplies. LME aluminium fell 0.8% to $2,630.50 a lot, nickel. decreased 0.5% to $16,125, zinc decreased 0.2% to. $ 3,014.50, lead was down 0.7% at $2,014.50 and tin. shed 0.5% to $28,840. SHFE aluminium increased 0.1% to 20,550 yuan a ton,. nickel climbed 0.8% to 128,140 yuan, zinc. climbed 1.2% to 25,100 yuan, lead was nearly flat at. 17,160 yuan and tin fell 0.1% to 242,430 yuan. For the leading stories in metals and other news, click. or
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Gold costs hold consistent after Trump's tariff pledge
Gold prices held steady on Tuesday after a 3% drop in the previous session, supported by increased safehaven demand following Presidentelect Donald Trump's. pledge to impose tariffs on all imports from Canada, Mexico and. China. Area gold was steady at $2,625.48 per ounce, since. 0259 GMT, after hitting its lowest considering that Nov. 18 earlier in the. session. U.S. gold futures edged 0.3% higher to $2,625.80. Despite the extended sell-off yesterday, gold is holding up. reasonably well, which recommends some safe-haven need, stated. said Matt Simpson, senior analyst at City Index, adding we. could see more turbulence ahead, particularly with Trump back in. focus. Trump pledged substantial tariffs on Canada, Mexico, and China--. running the risk of trade wars. Gold is typically thought about a safe-haven investment. during durations of financial and geopolitical unpredictability,. consisting of trade wars and other disputes. On The Other Hand, Federal Reserve Bank of Minneapolis President. Neel Kashkari, generally on the hawkish end of the U.S. main. bank's policy spectrum, stated he is open to cutting rates again. next month. According to the CME Group's FedWatch Tool, markets. currently estimate a 55.9% chance of a 25-basis-point U.S. Federal Reserve rate cut in December. Traders will keep a close eye on U.S. consumer self-confidence. information and the minutes from the Fed's November conference later. today, along with the first modification of GDP and core PCE figures. are set to be released later this week. I expect gold to sell a narrow variety in the short-term,. with a slight upward drift, Simpson included. On the geopolitical front, U.S. President Joe Biden and. French President Emmanuel Macron are set to announce a ceasefire. in Lebanon between Hezbollah and Israel, according to four. senior Lebanese sources. Spot silver was flat at $30.29 per ounce, platinum. shed 0.2% to $937.05 and palladium was up 0.3% at. $ 975.65.
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Iron ore edges higher on firmer steel output, but Trump tariff pledge weighs on market
Iron ore futures ticked up on Tuesday for a 2nd straight session, buoyed by stronger international steel production, although U.S. Presidentelect Donald Trump's pledge to implement brand-new tariffs when he takes workplace minimal gains. The most-traded January iron ore contract on China's Dalian Product Exchange (DCE) traded 0.77% higher at 786.5 yuan ($ 108.41) a metric ton, as of 0240 GMT. The benchmark December iron ore on the Singapore Exchange was 0.19% higher at $102.8 a load. The World Steel Association revised its production information upwards on Monday to show global crude steel output in October increased 1% from a year previously, compared with a 0.4% gain reported last Friday. In China, the world's top producer and customer of the metal, unrefined steel production climbed up 2.9% last month, newest information revealed. On the other hand, Trump promised an additional 10% tariff on all Chinese products until Beijing stops the circulation of illegal drugs into the United States. China, the world's second-largest economy, is now in a much more vulnerable position given the country's prolonged residential or commercial property recession, financial obligation threats and weak domestic demand. Neither the United States nor China would win a trade war sparked by Trump's tariffs, the Chinese Embassy in Washington stated on Monday. Iron ore markets stay extremely focused on upcoming Chinese conferences, including the Politburo meeting scheduled for early December and the Central Economic Work Conference arranged for mid-December, Westpac analysts stated in a note. China still deals with really extreme structural headwinds to development, however at the very least, financial and financial policy settings are now more clearly injecting significant support, Westpac said in a separate note. Other steelmaking ingredients on the DCE were blended, with coking coal down 0.7% and coke up 0.44%. The majority of steel criteria on the Shanghai Futures Exchange edged higher. Rebar acquired about 0.4%, hot-rolled coil rose practically 0.3%, wire rod reinforced about 1.2%, while stainless steel lost nearly 0.7%.
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Dollar jumps, stocks retreat after Trump vows tariffs
The dollar rallied dramatically on Tuesday after U.S. Presidentelect Donald Trump pledged tariffs on all imports from Canada and Mexico, and extra tariffs on China. Stocks declined, giving back some of the robust gains of the previous session, when they were buoyed by the nomination of fund manager Scott Bessent as Treasury Secretary, considered by investors as a voice for Wall Street in Washington. Bessent's visit had likewise caused a sharp fall in U.S. yields as investors scooped up Treasury bonds, sending out the dollar moving in the previous session. It's almost as if Trump wants to advise markets who is in control, after nominating Scott Bessent as Treasury Sec - a man markets anticipated to cool Trump's potency, stated Matt Simpson, senior market analyst at City Index. With the Canadian dollar increasing versus the Mexican peso, markets are presuming this will hit Mexico the hardest. The dollar jumped 1.6% to 20.6000 Mexican pesos as of 0213 GMT on Tuesday, and climbed 1% to C$ 1.4132. It reinforced 0.2% to 7.2628 yuan in offshore trading , after earlier reaching the highest given that late July at 7.2730 yuan. Australia's risk-sensitive dollar - which also tends to show the outlook for top trading partner China - slumped 0.5% to $0.6474, after earlier dipping to $0.64335 for the first time given that Aug. 5. It was just last month that Trump said that 'one of the most beautiful word in the dictionary is tariff', so there actually must not have actually been a surprise in Trump's objective, just in the timing of the remarks, stated Sean Callow, a senior FX expert at ITC Markets. The fall in trade-sensitive currencies makes sense, and should continue near term. Japan's Nikkei dropped 1.2%, giving back the majority of Monday's gains, as financiers pondered the risks of tariffs on the country's lots of heavyweight exports, especially car manufacturers. Toyota moved 2% and Nissan toppled 4%. Australia's stock criteria reduced 0.46%, a day after increasing to a record high. Taiwan's share index lost 0.8%. However, Hong Kong's Hang Seng added 0.6%, and mainland blue chips increased 0.2%, reversing earlier declines. Trump stated that on his very first day in office he would impose a. 25% tariff on all products from Mexico and Canada, and an. additional 10% tariff on items from China, mentioning issues over. unlawful immigration and the trade of illicit drugs. Trump has previously vowed to end China's. most-favored-nation trading status and slap tariffs on Chinese. imports in excess of 60%. It's certainly a shock to the marketplace and weighing on. Chinese assets, especially the export sectors, stated Gary Ng,. senior economist at Natixis. However compared to what he troubled Canada and Mexico,. the magnitude (of the Chinese tariff) is not that huge, so. investors might still wish to see what are the follow ups and. when/if the 60% promised will actually come through. U.S. S&P 500 futures pointed 0.1% lower following a. 0.3% gain in the cash index overnight. Pan-European STOXX 50 futures dropped 1%. The euro slipped 0.4% to $1.0459. Sterling. lost 0.34% to $1.2527. At the same time, the dollar edged down 0.1% to 154.04. yen, after at first reinforcing following Trump's. tariff remarks. The dollar-yen set tends to track long-lasting U.S. Treasury yields, which ticked up about 2 basis. indicate 4.2809% in Tokyo, but following a 15 basis-point slide. on Monday. Gold succumbed to the dollar's strength, dipping to a. one-week low of $2,604.99. Bitcoin increased 1% to $94,610, finding its feet. following a pullback from recently's record high at $99,830. The token has actually taken advantage of speculation of a much easier regulatory. environment for cryptocurrencies under Trump. Oil rates extended decreases from the previous session as. investors analyzed a prospective ceasefire in between Israel and. Hezbollah. Brent crude futures fell 0.38% to $72.73 a. barrel, while U.S. West Texas Intermediate unrefined futures. were at $68.62 a barrel, down 0.46%. Both criteria settled. down $2 per barrel on Monday.
G20 says non-banks should have more cash on hand to deal with margin increases
The G20 financial watchdog said that "non-banks", such as insurance companies, hedge funds and family offices, should have enough cash on hand and prepare contingency plans to deal with a spike in collateral used for derivatives positions.
Nearly half of the global financial system is made up of non-banks. In the latest indication of how closely the sector will be scrutinised, regulators are keen to prevent a situation where central banks have to inject liquidity to the markets to assist funds of all types.
After Britain announced unfunded taxes in September 2022 and the "slash for cash" of March 2020, when the COVID-19 Pandemic was raging, money market funds were left struggling to meet margin calls.
Financial Stability Board (FSB), said that the collapse of Archegos family office in March 2021, and the extreme volatility of commodities following the Russian invasion of Ukraine also demonstrated how some nonbanks were not prepared to deal with surges in margin call.
The FSB identified governance and liquidity risk management weaknesses as the key reasons for some market participants' inadequate liquidity readiness for margin and collateral call, it said in a document containing policy recommendations.
These include integrating the ability to deal with collateral spikes into a nonbank's governance and management of liquidity risk.
The FSB stated that non-banks must have contingency plans in place to meet additional liquidity requirements and should also conduct liquidity stress tests so as to identify any strains. The FSB said that non-banks must also have enough cash, and liquid assets readily available. These can be sold in order to raise money even when markets are stressed.
The FSB is a group of treasury officials and central bankers from G20 member countries that sets policy measures.
The current rules are often unclear or patchy, and the measures are meant to strengthen them. This is in contrast to the defined liquidity requirements that banks face, which have also been questioned since several regional banks collapsed last year.
The FSB stated that there are no specific rules relating to margins and collateral calls in the solvency rules of insurers, such as those from Britain and Europe.
The liquidity risk for leveraged hedge funds is minimal.
The FSB has said that commodity traders are not subject to the exact same liquidity requirements as banks. This is a sign that the net of non-banks is expanding. (Reporting and editing by Huw Simao; Reporting by Huw jones)
(source: Reuters)