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As dollar and yields are easing, gold gains more than 1%.
Gold prices rose over 1% Monday, as the dollar and U.S. bonds yields fell amid uncertainty about trade talks in advance of an August 1 deadline for U.S. countries to reach agreements or face additional tariffs. At 9:52 ET (1350 GMT), spot gold rose 1.2% to $3,390.79 an ounce. U.S. Gold Futures rose 1.3% to $3.402.40. The U.S. Dollar Index was down by 0.4%. This made dollar-denominated Gold more affordable to buyers who use other currencies. Meanwhile, benchmark yields on 10-year U.S. Treasury notes hit a record low. David Meger is director of metals futures at High Ridge Futures. According to EU diplomats, the European Union is looking at a wider range of counter-measures that could be taken against the United States as prospects for a trade agreement acceptable with Washington are fading. According to the CME FedWatch tool, traders have priced in a 63% probability of a rate reduction in September. U.S. Treasury secretary Scott Bessent stated that the Federal Reserve as an institution needed to be examined and whether or not it was successful. Meger says that speculation about a rate cut earlier than expected in the U.S. is increasing, and that speculations around a possible Fed Chair Jerome Powell replacement or reshaping the Fed are adding to market anxiety. Gold is a hedge for uncertainty, and it tends to do well in an environment with low interest rates. China, the largest gold consumer in the world, imported 63 metric tonnes of the precious metal during the month of June, the lowest since January. In June, its imports of the precious metal fell by 6.1% compared to the previous month. Silver spot gained 1.8%, to $38.86 an ounce. Platinum rose 2.2%, to $1,453.17, and palladium rose 3.5%, to $1,284.46. Reporting by Sherin E. Varghese in Bengaluru and Ashitha S. Shivaprasad, Editing by Mark Potter
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New EU Russia curbs could increase Indian oil refiners’ reliance on traders
After the latest round European Union sanctions, Indian private refiners who have used cheap Russian crude in order to boost their margins will need to find ways to work around it and depend more on traders for finding new markets for products. In recent years, refiners like Reliance Industries or Nayara Energy have benefitted from the pressure that sanctions imposed on Russia's crude oil prices due to its invasion in Ukraine. Many of these refiners have exported their refined products to European buyers. In its 18th package against Russia, which was approved on Friday by the European Union, it banned imports from third-country refiners of petroleum products derived from Russian crude, except for a few Western nations. The sanctions also target Nayara Energy (a Russian refinery owned by Rosneft), a major oil company in Russia. The package will be implemented over a six-month period. In the first seven month of this year, LSEG data on ship tracking showed that Reliance was India's biggest buyer of Russian oil products and refined products. It shipped 2.83 million barrels per month of diesel fuel and 1.5 million barrels per month of jet fuel to Europe. This accounted for roughly 30% and 60% respectively of its exports of both products. Nayara Energy exports 4 million barrels of refined products per month including jet fuel, diesel, gasoline, and naphtha, but only jet fuel is typically shipped to European markets. Sources said that under the sanctions, traders will likely play a larger role in the placement of refined products made with Russian crude. They will likely get creative in their routes due to the long transition period. Singapore traders have said that traders will likely swap Indian diesel with Middle East cargoes to export to Europe. The traders said that they may also send Indian cargos to floating storage in the Middle East and West Africa for re-export. They said that Indian refiners could either divert jet fuel cargoes into local markets or ship supplies in Asia. Reliance and Nayara didn't immediately respond to comments. A trader in Asia said that the changes would benefit traders, as they will generate more trade, but be costly to producers and consumers. He added that Europe may be forced to pay more for refined fuel as winter approaches. Nayara condemned in a Monday statement the EU’s “unjust and unilateral” decision to impose sanction on the company. India, on the other hand, said that it did not support "unilateral" sanctions by the EU. Refining sources say that Indian refiners who also purchase Russian crude are less likely to be affected by sanctions, as they sell the majority of their fuel locally, and export it through tenders to buyers mainly in Asia, such as Singapore. Mangalore Refinery and Petrochemicals Ltd, an Indian state refinery, said that the latest sanctions would not affect the diesel exports of the company. LSEG reports that traders have sold some of MRPL’s diesel parcels to the UK in recent months. "We do not directly sell diesel to our end customers." The trader picks it up after a tendering procedure," said M Shyamprasad Kamath, managing director of M Shyamprasad Kamath. He added that he doesn't see any problems with selling refined fuels because of the sanctions. A tender document obtained by revealed that Nayara Energy, in response to the EU sanctions, amended the terms of the naphtha bid issued on Monday, requiring payment in advance.
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Wimbledon expansion plans cleared by UK court following challenge
Wimbledon's plans for expanding the grounds of the oldest and most prestigious Grand Slam Tennis Tournament in the world overcame their first legal hurdle Monday. The London High Court dismissed a challenge by campaigners to the project. Save Wimbledon Park, a campaign group, has taken legal action against the All England Lawn Tennis and Croquet Club. The AELTC wants to triple the size of the main site with a project worth 200 million pounds ($269.6 million). The expansion will feature 39 new courts including an 8,000 seat show court. This could increase the daily capacity from 42,000 people to 50,000 and allow for qualifying rounds to take place on site. Novak Djokovic and local residents have backed the AELTC’s plans to develop an old golf course that it owns. The Greater London Authority approved planning permission last year. However, Save Wimbledon Park claimed at an hearing held this month that GLA did not properly account for restrictions on the redevelopment of the land agreed upon when AELTC’s parent company purchased the freehold golf course in 1993. Save Wimbledon Park was unsuccessful in its challenge of the legality of the planning permission. However, Wimbledon's plans will still have to overcome a second legal hurdle regarding the status of land. This case is scheduled for hearing early next year. AELTC Chair Debbie Jevans expressed her delight at the ruling and said that the club would "now turn its attention to separate legal actions" regarding the former golf course property. Save Wimbledon Park's director Christopher Coombe announced that the group would appeal Monday’s decision. He said it would set a "worrying precedent" for the development of public open space and protected greenbelt.
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Russia-backed Indian refiner condemns EU restrictions, weighs legal options
Nayara Energy, a Russian-backed refiner in India, condemned Monday the European Union sanctions against it and said that it was exploring its legal options to combat the latest "restrictive" measures. The EU approved Friday its 18th package against Russia for its war in Ukraine. This includes sanctions on Nayara Energy - a refinery owned by Rosneft, the Russian oil giant. In a press release, it stated that "Nayara Energy condemns strongly the European Union’s unjustified and unilateral decision to impose restrictions on our company." Rosneft owns 49.13% of Nayara, and a similar amount is held by Kesani Enterprises Co Ltd., a consortium led by Italy's Mareterra Group, and Russian investment group United Capital Partners. Nayara asserted that the EU's latest sanctions were "without legal basis". The company has invested more than 800 billion rupees (about $8 billion) in projects such as petrochemicals, and expanding its retail fuel stations. It said: "We categorically declare that this unilateral action by the European Union rests on baseless claims, and represents an unwarranted extension of authority which ignores international law as well as the sovereignty of India." India has stated that it does not support the "unilateral sanction" of the EU.
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Brazil admits that it is possible there will be no US-Brazil trade deal before August 1
Brazil's Finance Minister said on Monday that his country will not give up on negotiations with the U.S., but acknowledged that it may not be possible to reach a deal by August 1, which is when President Donald Trump’s tariffs of 50% on Brazilian products are set to come into effect. Fernando Haddad, in an interview with CBN radio station, said that Latin America's biggest economy is still waiting for a response from Washington to trade proposals originally submitted in May. Trump announced the steep tariffs in early this month. He cited what he called "a witch hunt" against Jair Bolsonaro - a former Brazilian president who is currently on trial for plotting a coup - and unfair trade practices. Haddad said Brazil has contingency plans for dealing with potential tariffs and that it could redirect more than half of its current U.S. imports to other markets. He warned, "But it would take some time." U.S. officials claim that the threat of tariffs is unjustified because the U.S. has a surplus in trade with Brazil. This includes oil, steel, coffee, aircraft, and orange juice. Trump's decision would have a major impact on companies such as Embraer which has the U.S. market as its primary market. Haddad stated that the Brazilian government might need to support sectors most affected by tariffs but stressed such measures wouldn't necessarily result in higher primary spending. Haddad said on Monday that Brazil will not punish U.S. firms operating in Brazil if the tariffs are implemented as promised. The minister stated that "we cannot pay in kind what we consider unfair." (Reporting and editing by Sharon Singleton and Bernadettebaum; Dale Hudson, Sharon Singleton and Bernardo Caram)
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EU retaliation plans intensify as prospects for a US tariff deal dim
According to EU diplomats, the European Union is looking at a wider range of countermeasures that could be taken against the United States. This comes as the prospects for a trade agreement between Washington and Brussels are fading. Diplomats report that a growing number of EU member states, including Germany are considering the use of wide-ranging anti-coercion measures, which would allow the bloc to target U.S. service providers or restrict access to public procurements in the event of no deal. The European Commission (which negotiates trade deals on behalf of 27 member countries) had seemed to be on track for an agreement where the EU would have still faced a 10% U.S. duty on most of its exported goods, but with some concessions. These hopes seem to have been dashed following President Donald Trump’s threat to impose 30% tariffs by August 1 and the talks between EU Trade Commissar Maros SEFCIOVIC and U.S. counterparts last week in Washington. Sefcovic has stated that a 30% tariff will "practically prevent" transatlantic trade. He delivered a sobering report to EU envoys about the current situation on Friday. The EU diplomats said that the U.S. counterparts came up with different solutions during their meetings, such as a base rate of well over 10%. Each interlocutor had a different idea. One diplomat stated that no one could tell what (Sefcovic), would work with Trump. The chances of the United States reducing or eliminating their 50% tariffs on aluminum and steel, and their 25% tariffs on cars and auto parts are limited. 'NUCLEAR OPTION' Washington also rejected the EU demand for a "standstill", whereby no tariffs will be imposed following a deal. Diplomats claim that Trump cannot be restrained on national security issues, which is the basis for Section 232 investigations into timber, semiconductors and pharmaceuticals. EU diplomats report that the mood among EU member states has shifted, and that they are now more prepared to react - even though a negotiated resolution is their preferred solution. The EU currently has a package of tariffs that are suspended until the 6th of August. It is based on goods from the United States worth 24.5 billion dollars or 21 billion euros. The EU still has to decide on another set of countermeasures for 72 billion euro of U.S. imports. The EU has also been discussing the use of its "anti-coercion instrument" (ACI), which allows it to take retaliatory action against third-country countries who put economic pressure on their member states to alter their policies. If the EU were to focus more on China, this would allow it to target the trade of U.S. financial services and public tenders, where the U.S. enjoys a surplus in trade with the EU. The EU's public procurement is valued at around 2 trillion euro per year. Other possible measures include restricting U.S. investments, limiting protection of intellectual properties rights and imposing restrictions on the sale of U.S. food or chemicals in Europe. France has always backed the ACI. Others have resisted what they see as a nuclear alternative. Trump has threatened to retaliate against other countries who take action against the United States. Ursula von der Leyen, President of the European Commission, said last week that ACI was designed for situations beyond normal. She added: "We're not there yet." It would require a majority of 15 EU countries, which represents 65% of its population, to be able to use it. Diplomats in the EU say that it would only do this if it were confident it could pass it. However, there are signs that support is growing, and Germany is one of those countries who have said it should be taken into consideration. Reporting by Philip Blenkinsop & Andrew Gray. Andrew Heavens, Mark Potter and Andrew Heavens edited the article.
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Les Echos reports that Canada's CDPQ and Amber Infrastructure will invest in Britain's Sizewell C.
The French newspaper Les Echos reported that the Canadian investment fund Caisse de depot et de placement du Quebec will partner with Britain's Amber Infrastructure in order to become Britain's largest private investor in Sizewell C's nuclear project. Unnamed sources told the business paper that if everything went smoothly, final decisions would be taken on Tuesday. Les Echos reported that the two private investors would contribute 25-30% to the project's capital. The cost has risen since the initial announcements. The British government has pledged 17.8 billion pounds for the project, but continues to seek investors. It was reported previously that the U.S. investment fund Brookfield, which is listed on the New York Stock Exchange, would acquire a stake in the plant of over 20% in exchange for funding to develop the plant. British utility Centrica may also have a role. EDF, a French nuclear energy company, will invest around 1.1 billion pound ($1.48 billion) in the project and take a 12.5% share. CDPQ Amber Infrastructure Brookfield and Brookfield have not responded to our requests for comments. EDF and UK government declined comment. Britain wants to build more nuclear power plants in order to improve energy security and meet climate goals. When operational, the Sizewell C nuclear plant in Southeast England is expected to generate enough electricity to power six million homes. ($1 = 0.7419 pound) (reporting by Makini Brice; additional reporting from Forrest Crellin and Susanna Twdale in London and Paris)
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Zambia plans to build a 60,000 barrels-per-day oil refinery on the Copperbelt
The Zambian government announced on Monday that it had signed an agreement paving the way for a crude oil refinery complex and energy facility worth $1.1 billion to be built in Ndola, in the copperbelt region of the country. A government statement stated that the planned facility would process around 60,000 barrels of crude oil per day, supplying enough refined products to meet all of Southern Africa's current fuel needs and possibly allowing future exports to neighboring countries. The statement also added that the project will save millions of dollars in fuel imports annually once it is completed. Construction is expected to begin in the third quarter 2025. The first phase of commercial operation will be planned for 2026. The agreement was signed between Zambia's Industrial Development Corporation (ZIDAC) and Fujian Xiang Xin Corporation from China. A spokesperson for IDC said that the refinery will source crude oil from the Middle East, and it will be imported via the port of Dar es Salaam in Tanzania. The government of Zambia said that the energy complex would include units for fuel production as well as liquefied gas bottling and bitumen production. It will also have a 130 megawatt power plant. Reporting by Chris Mfula. Alexander Winning is the writer. Mark Potter (editing)
Investors ponder Trump tax bill as they watch Asian shares rise and the dollar fluctuate
The dollar remained near its multi-year lows as Asian shares rose and markets awaited the vote on President Donald Trump's tax and spending bill.
The global share markets rose to an intraday high on Monday on the back of trade optimism. However, a marathon Senate debate over a bill that would add approximately $3.3 trillion in debt to the United States weighed down sentiment.
The Nikkei index of Japan's shares fell as much as 1,3%, as the yen rose against the dollar. This was bad for exporters. Gold and oil both advanced for the second session in a row.
The vote on Trump's tax-cutting and spending bill was expected to take place during Tuesday's Asian trading session, but the debate continued over a series of amendments from Republicans and minority Democrats.
Trump wants to see the bill pass before the Independence Day holiday on July 4. Investors are also looking forward to Thursday's key U.S. employment data as global trade negotiators rush to reach agreements before Trump's deadlines.
Ray Attrill is the head of FX Strategy at National Australia Bank.
In a podcast, he said that the payroll data released later in the week would "have a significant impact, I believe, on the sentiment regarding the timing of Fed rate reductions."
The MSCI broadest Asia-Pacific index outside Japan rose 0.4%, with South Korea's Kospi gauge leading the way at 1.1%.
The latest readings of the Bank of Japan’s tankan business sentiment index and a Chinese gauge of manufacturing activity indicate that the largest economies in the area are likely to weather the tariff storm at least for the moment.
Japan's manufacturing sector also grew for the first time since over a month, but a significant drop in demand underscored the difficult trade outlook for Asia’s export-dependent economies.
The Shanghai Composite Index rose 0.2%, while China's blue chip CSI300 Index rose 0.1%.
The dollar fell 0.2% to 143.79 Japanese yen. The dollar was barely changed in relation to the euro and had earlier reached $1.1808 - the lowest since September 2021.
U.S. crude fell 0.5% to $64.80 a barrel, weighed down by expectations that OPEC+ would increase its output in August. Gold spot rose 0.6%, to $3322.62 an ounce.
The Euro Stoxx 50 futures for the entire region rose by 0.1%, while German DAX Futures rose by 0.2%.
(source: Reuters)