Latest News
-
World Bank cuts global growth forecast due to trade tensions
The World Bank lowered its forecast of global growth for 2025 on Tuesday by 0.4 percentage points to 2.3%. It said that increased tariffs and uncertainty were a "significant" headwind for almost all economies. The bank's twice-yearly Global Economic Prospects Report shows that it has lowered its predictions for almost 70% of the world's economies, including the United States and China, Europe, and six emerging markets regions. This is a significant drop from its projections six months earlier, before Donald Trump became president. Trump has upended the global trade system with a series on-again-off-again tariff increases that have raised the effective U.S. Tariff rate from under 3% to its highest level in nearly a century. This has triggered retaliation from China and other countries. The World Bank has cut its forecast for growth as a result Trump's unpredictable trade policies. However, U.S. officials claim that the negative effects will be offset by an increase in investment and yet-to-be-approved tax cuts. The bank did not predict a recession but stated that global economic growth in this year will be the weakest since 2008, outside of a major recession. The bank did not predict a recession, but said that global economic growth this year would be its weakest outside of a recession since 2008. The report predicted that global trade growth would be 1.8% by 2025. This is down from 3.4% last year and a third less than the 5.9% in the 2000s. Forecast is based upon tariffs that were in place as of late may, including the 10% U.S. duty on imports. The forecast excludes the increases announced by Trump on April 9 and then delayed until that date to allow for negotiation. Tariff increases and tight labor markets are expected to keep global inflation at 2.9% by 2025. This is still above the pre-COVID level. The bank stated that "risks to the outlook for the global economy remain firmly to the downside." The bank said that its models indicated that an additional 10-percentage-point increase in U.S. average tariffs on top of the already implemented 10% rate, as well as proportional retaliation from other countries, would reduce the outlook by 0.5 percentage points for 2025. The report stated that such an increase in trade barriers could lead to "global trade stifling in the second half this year...accompanied by a widespread decline in confidence, rising uncertainty and turmoil on financial markets." It said that the risk of global recession was lower than 10%. "FOG ON RUNWAY" This week, top officials from China and the United States will meet in London to try and defuse an ongoing trade dispute. The dispute has expanded from tariffs and restrictions on rare earth minerals to include a global supply-chain shock and slower economic growth. "Uncertainty is a drag on the economy, just like fog on an airport runway." In an interview, Ayhan Kose, World Bank's Deputy Chief Economic Officer said that uncertainty slows down investment and clouds future prospects. He said that there are signs of increased trade dialogue, which could help to dispel any uncertainty. And supply chains were adapting, rather than collapsing, to the new global trade map. He said that global trade could grow by 2.4% in 2026, with artificial intelligence developments also boosting growth. He said, "We believe that the uncertainty will eventually decline." Once the fog lifts, trade may resume, but at a more moderate pace. Kose stated that while the situation could worsen, trade continued and China, India, and other countries were still providing robust growth. He said that many countries were discussing new trade agreements which could be profitable in the future. US GROWTH FORECAST CUT SHARPENLY The World Bank stated that the global outlook has "substantially deteriorated" since January. This is mainly because advanced economies are now expected to grow by only 1.2%, down a half-point, after growing 1.7% in 2024. The U.S. outlook has been lowered from 1.4% to 1.4% by a 0.9-percentage point drop, while the outlook for 2026 was reduced by 0.4-percentage points to 1.6%. The report said that rising trade barriers, "record high uncertainty" and an increase in financial market volatility would weigh on private consumption and trade. The growth estimates for the euro zone and Japan were both reduced by 0.3 percent points to 0.7%. The forecast for 2025 predicted that emerging markets and developing countries would grow by 3.8%, compared to the 4.1% growth in January. The report stated that poor countries would be the worst affected. The report said that by 2027, the per capita GDP of developing economies would be 6% lower than pre-pandemic levels. It could take two decades for these countries to recover the economic losses from the 2020s. Mexico's growth forecast was cut by 1.3 points, to 0.2%, in 2025. The country is heavily dependent on U.S. trade. The World Bank has left its China forecast unchanged, at 4.5%. It said Beijing had the monetary and fiscal room to support and stimulate its economy. (Reporting and editing by Andrea Shalal)
-
Investors watch US-China trade progress to see if it can bring about a change in the dollar and stock prices
As trade talks between China and the United States continued for a second consecutive day, investors had reason to believe that tensions may be easing between the two world's largest economies. U.S. commerce secretary Howard Lutnick stated that discussions between the two parties were going well. President Donald Trump put a positive spin after the Monday session. Lutnick met with Treasury Secretary Scott Bessent, U.S. trade representative Jamie Greer and their Chinese counterparts at the London International Trade Fair. Markets will likely be relieved if the talks progress, given Trump's frequently changing tariff announcements. These have disrupted supply chain and threatened to stymie global growth. The MSCI All-Country World Index, which reflects world stocks, reached near-record highs. Meanwhile, the dollar was stable against a variety of currencies. "While market participants clearly take a half-full outlook on the outlook, both in terms of trade policy and more generally, we do not think this should be interpreted as an opinion that tariffs are going to be completely unwound," Jonas Goltermann said, deputy chief markets analyst at Capital Economics. Goltermann expects U.S. duty on Chinese goods will settle at around 40 percent, while the majority of analysts say that the 10% universal levy on imported products into the United States will remain. Investors were worried about the new proposals by the Swiss government to require the bank to have $26 billion extra in capital. U.S. Stock futures are trading about 0.1% higher. In Tokyo, Finance Minister Katsunobu Kato announced that policymakers are looking into measures to promote the domestic ownership of Japanese Government Bonds. This comes a day following reports that Japan was considering buying back super-long government bond issued in previous years at low interest rates. The yield for the 10-year JGB remained flat at 1.47%. Meanwhile, 30-year yields increased by 1 bp to 2.92% after a decline from a record high of 3.18 % in late May. The dollar was essentially unchanged for the day at 144.5 yen. Meanwhile, the euro rose 0.1% to $1.1428. After weak UK employment figures, the pound fell 0.3% to $1.35. QUALITY, NOT SIZE Investors' confidence in U.S. assets has been eroded by Trump's unpredictable trade policies, and concerns over Washington's increasing debt. The dollar is down more than 8% so far this year. The deficit will remain stable, and the Americans won't be able to blow up their fiscal situation. Samy Chaar is an economist with Lombard Odier. You'll have macropayoffs if you spend and invest on productive investments. You'll develop an industry, strengthen your economy, create jobs. "If you reduce revenues by cutting taxes on people that don't require the money, then they won't consume more or invest more. So the macropayoff is limited," said he. U.S. Treasuries yielded around 4.45% on Monday, down by 3.4 basis points. The impact of tariffs on the price of goods could be revealed by data on U.S. Consumer Inflation for May, due to be released on Wednesday. The report on the producer price index will be published a day after. Kevin Ford, Convera’s FX and macrostrategist, said that the May CPI and PPI figures in the United States will be closely examined for any signs of inflationary pressures. If core CPI continues to be elevated, rate cuts may not occur at the FOMC meeting on June 18. The traders expect that the Fed will leave rates unchanged during its next policy meeting. By December, only 44 bps of easing had been priced in. Brent crude rose 0.5% to $67.30 a barrel on commodity markets due to optimism that the U.S. China talks scheduled for Tuesday could reduce trade tensions. Gold spot rose 0.4%, to $3341 per ounce.
-
Kremlin has said it is ready to deliver bodies of Ukrainian war-dead for "several days"
The Kremlin announced on Tuesday that Russia had been prepared to begin transferring the bodies of Ukraine's dead war soldiers for several days. Trucks containing the initial corpses were parked at the border in refrigerated vehicles, but Kyiv was still working out the details. Both sides agreed on the repatriation of the bodies of soldiers who died in the conflict, during talks held in Istanbul on 2 June. This also led to an agreement for the exchange of prisoners of war. The first day of the conference was Monday The Ukrainian president Volodymyr Zelenskiy accused Moscow of trying to "play some sort of dirty political game and information" in relation to the exchanges. The Russian government has stated that it is willing to receive the remains of any Russian soldiers Kyiv can return. Vladimir Medinsky, a Kremlin adviser, said that on Saturday the Russians had arrived at the exchange point with 1,212 Ukrainian dead troops only to discover no one from Ukraine was willing to accept them. On Saturday, the Ukrainian officials who were responsible for these exchanges failed to respond to an inquiry for comment. When asked about the matter on Tuesday, Kremlin spokesperson Dmitry Peskov stated that Russia was still willing to return the corpses and was in discussions with Kyiv regarding the topic, but did know how many bodies of Russian soldier Ukraine was prepared to give over. "There is still no final agreement." Contact is made and numbers are compared. We hope that this exchange will happen as soon as there's a final agreement," said Peskov. "There's one undisputed fact, and that is that the trailers mentioned earlier have been waiting on the border since several days to be transferred to the Ukrainian side. Everyone knows and sees this fact. Russian state media broadcast images of white trucks with bodies sealed in white bags parked near the border. (Reporting and writing by Dmitry Antonov, Editing by Guy Faulconbridge).
-
South Africa's Telkom resumes dividends, shares jump 7%
Telkom, the South African telecoms firm, reported a 62.3% increase in its full-year earnings on Tuesday. The company also increased its free cash flow. This allowed it to resume dividends after a suspension of four years and even sweeten them with a special payout. The operator of South Africa’s largest fixed-line network, announced in 2020 that it would suspend dividends beginning 2021 for the next three years to save cash for spectrum auctions. After reaching its initial goal, the operator under pressure delayed dividend payments due to challenging market conditions. "This year, our strong performance and successful strategic execution have allowed us to distribute both a regular and special dividend. Telkom announced that the group would return 1.3 billion Rand ($73.28million) to shareholders. Telkom announced a final dividend per share of 163 cents and a special distribution of 98 cents, thanks to the proceeds of Swiftnet's mast and tower division. The operator has also raised its mid-single-digit revenue growth guidance from low-single-digit to mid single-digit. This is a result of its industry-leading revenue growth for mobile services and high fibre connectivity ratio. Telkom shares soared by 7% at 0849 GMT to 42.81 Rands after rising 10% on the opening day. Telkom, which is majority owned by the government and continues to operate, reported a headline profit per share of 467.5 cents for the year ending March 31. The revenue increased by 3.3%, to 43.8 billion Rands, exceeding expectations. This was due to the strong growth of mobile service revenues, which grew 10.2%, as well as fibre-related data revenues, which grew 10%. LSEG surveyed analysts who had predicted revenue of 43.5 billion Rand. Telkom's data and strategy are helping them gain substantial market share, according to SBG analyst Nadim Mohammed. The company's free cash flow increased to 2.8 billion Rand from 424 millions rand due to cost-optimization, revenue improvement and a disposal program. "Cash generation has been the best Telkom has ever seen for a long time." "They also had large assets disposals during the period, and these have also helped to reduce debt on their balance sheet," Peter Takaendesa said. Chief Investment Officer of Mergence Investment Managers.
-
Copper prices fall on the back of uncertainty about trade talks and demand
The copper price fell on Tuesday, as investors avoided the market because of uncertainty over the U.S.-China talks and the impact the trade war will have on economic growth and metals demands. By 1000 GMT, the benchmark three-month copper price on London Metal Exchange had fallen 0.3% to $9,767 a metric ton, after having recovered 20% from its April lows, when it was at its lowest level since November 2023. "There is a lot complacency in the market right now." The volatility of the markets seems to be decreasing, even though there has been no breakthrough in trade negotiations with China," Ole Hansen said. He is head of commodity strategy for Saxo Bank Copenhagen. Tuesday in London, top U.S. officials and Chinese officials are expected to resume their trade negotiations for a second time. They hope to achieve a breakthrough on export controls of rare earths and related goods. The LME registered warehouses saw more copper inventories leave as traders took advantage higher U.S. metal prices in anticipation that U.S. president Donald Trump would impose tariffs after duties were levied against aluminium and steel. LME Copper Stocks Data showed that the eroding of 2,000 more tons, to 120,400 tonnes, occurred on Tuesday. The eroding had already fallen by half in the last three months. U.S. Comex Copper Futures fell 0.8% to $4.89 per lb. This brings the premium of Comex to the LME up to $1,000 per ton. The appetite for the New York market is waning, as the tariff announcement would be a binary one. It's unlikely that you could avoid some fireworks once the news was out. Traders await the results of an investigation Trump ordered on February regarding potential import tariffs for copper. In China, zinc prices on the Shanghai Futures Exchange have weakened for the third trading day. They are now down 1.3% at 21,845 Yuan per ton. This is the lowest price since late April. The Shanghai-based research firm SHMET reported that "China's demand for commodities has been weakening in recent months, and buyers are buying to meet their immediate requirements at lower prices." Other LME metals saw a 0.1% decline in aluminium to $2477 per metric ton. Nickel fell 0.7% to $15310, Zinc dropped 0.1%, lead was down 0.4% at $1978.50 and tin rose 0.1%, to $32,750. Hongmei Li, Singapore Additional Reporting; Vijay Kishore Editing.
-
Kremlin still talks to Ukraine about exchanging dead soldiers
The Kremlin announced on Tuesday that Russia was still willing to return the remains of Ukrainian soldiers who died in the war. It is also in discussions with Kyiv about the matter. Some of the bodies are still inside refrigerator trucks awaiting a transfer. Russia claimed that trucks carrying initially over 1,000 corpses had been parked at an exchange point for Ukraine since Saturday and complained that Kyiv hadn't yet collected them. A similar exchange was agreed upon during the second round of direct talks on peace in Istanbul, June 2. The Kremlin has said that it does not know how many Russian soldiers Ukraine is ready to surrender. (Reporting and writing by Dmitry Antonov, Editing by Andrew Osborn).
-
Taiyo Oil purchases first Russian crude oil in over two years at government request
The Japanese refinery Taiyo Oil said that it had purchased its first Sakhalin Blend from Russia in over two years, at the request of the Japanese government. This was to ensure the stability and reliability of the plant, which also supplies Japan with liquefied gas. Trade data shows that Japan imported its last Russian crude oil in February 2023 after Tokyo and other G7 nations agreed to phase out the imports as a response to Moscow's invasion of Ukraine in 2022. According to Kpler and traders, China is the only importer of Sakhalin Blend since the Biden administration imposed sanctions in January against ice-class tankers used to transport oil from Sakhalin. Sakhalin-2, a complex of islands owned by Gazprom, a Russian company, and Japanese companies, plays a vital role in Japan's energy supply, as it represents 9% its LNG imports. Tokyo asked refiners to consider purchasing Sakhalin Blend crude earlier this year, a byproduct from LNG production, to ensure the project could continue to run smoothly. Sakhalin-2 oil and its byproducts are exempt from U.S. sanctions until June 28, 2025 if they are imported exclusively to Japan. A Taiyo Oil representative told us by phone that, "At request of the Ministry of Economy, Trade and Industry, it was decided to deliver 600,000 barrels of Sakhalin blend crude oil." This decision was taken to ensure that Japan has a stable supply of energy or LNG. LSEG shipping data shows that the Aframax tanker Voyager - which is subject to U.S. sanctions - arrived in Kikuma, Japan, on Monday, and left once it had discharged its cargo. Fuels are handled by an official in the Industry Ministry. A spokesperson for Taiyo Oil said that there is no plan to purchase additional Sakhalin-2 at this time. (Reporting and writing by Yuka Obayashi, Florence Tan, Jan Harvey).
-
World Food Programme warns that some areas south of the capital of Sudan are at risk of famine.
The World Food Programme warned on Tuesday that several areas south of Sudan’s capital Khartoum were at risk of famine. This is due to the fact that the need for food aid in war-ravaged Sudanese region outstripped the resources available. The WFP Country Director for Sudan, Laurent Bukera told journalists in Geneva, via video link, that the level of hunger, destitution, and desperation found was severe. This confirmed the risk of an impending famine. After gaining entry to the capital, the U.N. Food Agency said that it had reached 1 million people in 7 localities of Khartoum. Sudan's war between the army, and the rival Rapid Support Forces (RSF) has caused millions of people to flee their homes and divided the country in two rival zones. The RSF is still firmly embedded in western Sudan. After two years of bloody conflict, the RSF was forced to surrender the capital in late March. The WFP cited Jebel Awlia as an example of where severe hunger is prevalent. Oil and pulses rations have been reduced by the agency in its food distributions because of a $500 million funding gap for emergency food assistance and cash assistance as donor countries reduce their humanitarian funding. Lack of resources prevents the provision of supplements for pregnant women and young children, as well as mothers who are nursing or breastfeeding. Bukera said that without urgent support, we would not be able deliver the food package the Sudanese desperately need. WFP reduced rations to 70% (equivalent to 2100 Kcal/day) in April for areas at risk of starvation. WFP says it currently assists four million people in Sudan. In April 2023, war broke out in Sudan due to a power struggle that erupted between the army (the RSF) and the army. (Reporting and Editing by FriederikeHeine, William Maclean, Olivia Le Poidevin)
Drone hits IAEA lorry on road to Russian-held Zaporizhzhia nuclear plant, company says
A drone hit and seriously damaged an official car of the International Atomic Energy Agency on the roadway to Ukraine's Russianheld Zaporizhzhia nuclear power plant on Tuesday, the agency's head said.
There were no casualties and the teams are safe, Rafael Grossi, director general of the U.N. nuclear guard dog, said in a. video published on X.
Ukrainian President Volodymyr Zelenskiy said the strike was. a purposeful Russian attack that showed Moscow had overall. disregard for worldwide law and institutions. Moscow made no. instant declaration after the occurrence took place.
I condemn in the most firm terms this attack on the IAEA. staff, Grossi stated, adding that the strike happened throughout a. rotation of IAEA personnel keeping track of the plant. We call, as soon as. once again, as we have done it previously, for the utmost restraint.
Grossi said assaulting a nuclear power plant is a no-go and. assaulting those working to prevent a nuclear mishap during the. military dispute is much more inappropriate.
He made no suggestion of who might have been responsible.
A photo posted together with his statement revealed a vehicle. with clear IAEA markings, its rear part severely damaged.
Zelenskiy, also composing on X, said: This attack clearly. demonstrated how Russia deals with anything associated to worldwide. law, international organizations, and safety. The Russians might not. have actually been uninformed of their target; they knew precisely what they. were doing and acted intentionally.
He required a clear and decisive response from the IAEA. and other worldwide bodies.
Russia took the Zaporizhzhia plant, Europe's most significant. nuclear power station, not long after Moscow's 2022 intrusion of its. neighbour. Each side in the 33-month-old war has actually because accused. the other of shelling the plant and endangering nuclear security.
Russia's National Guard, composing on the Telegram messaging. app, made no reference of the incident and said Russian forces had. supervised the staff rotation. Forensic professionals had actually checked. the site for unexploded ordnance it said may have been left. over from Ukrainian shelling.
(source: Reuters)