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Kast is sworn in to be the president of Chile in the biggest right-wing change in decades
On 'Wednesday', Jose Antonio Kast became the president of Chile, marking the sharpest rightward shift in years. Voters were alarmed by the rising level of insecurity and backed the broader conservative movement that has been sweeping Latin America. The regional presidents, including Argentina's Javier Milei and Ecuador's Daniel Noboa, Paraguay’s Santiago Pena and Spain's King Felipe traveled to Chile for the ceremony of the transfer of power in Valparaiso where Congress is located. Kast succeeds left-wing president Gabriel Boric to whom he lost 2021?election. At a time when Chileans worry about the rising crime rate and the economy. The shooting of a police officer in Puerto Varas, in southern Chile, earlier that day, which left him brain-dead, highlighted Kast's security concerns and led him to send Trinidad Steinert as his new minister for security to the city after the ceremony. "There will be a before and after." Kast said to reporters that whoever attacks a police officer attacks Chile when asked about the earlier shooting. We're going find them, try them and use the full force the law. Kast promised to crack down on crime and migration while boosting the economy through deregulation, cuts in spending and market-friendly policies. Chile is the largest copper producer in the world. Kast was elected at a time when the economy was booming, but now he takes over as the Iran War rattles global markets. The transitional period saw tensions rise between the new and old administrations over the increased pressures from the U.S. regarding a proposed Chinese underwater cable project. "(Kast will) have to manage a challenging international geopolitical environment," said Guillermo Holzmann a 'political analyst' from the University of Valparaiso. He noted economic risks from Iran war, U.S. security strategy in the area and China's impact in 'Latin America. "These decisions require sophisticated diplomacy as well as strategic long- and medium-term vision." Kast will have to deal with a divided Congress, which could hinder his agenda, which he has vowed?to achieve quickly. Nicholas Watson, Teneo's managing director, said that "a barrage" of initiatives are expected in the next three month. (Reporting and editing by Aidan Lewis; Cassandra Garrison, Alistair Bell and Aidan Lewis)
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US consumer inflation is stable before the Iran conflict increases oil prices
U.S. consumer price rose modestly in February, as rents continued to increase at a steady pace. However, households had to pay more for gas and groceries. And higher costs will be in store due to the escalating Middle East war. The Labor Department's Consumer Price Index Report on Wednesday also showed that inflation was muted in the month prior to the U.S.-Israeli strikes against Iran. Tehran retaliated against the attacks that took place at the end of February and has subsequently pushed up oil prices. AAA data showed that gasoline prices had risen by 20% since the start of the war, to $3.58 a gallon. Gasoline prices had been increasing in anticipation of hostilities in Middle East. The Federal Reserve is expected to hold interest rates at the same level next week, according to economists. Ellen Zentner is the chief economist at Morgan Stanley Wealth Management. She said that a steady inflation rate would be welcome on any day. But, with geopolitical unrest and soaring oil prices, this data may not have the same weight, either in the markets or among the Fed. Bureau of Labor Statistics of the Labor Department reported that Consumer Price Index increased 0.3% in February after increasing 0.2% in January. CPI increased by 2.4% in the 12-month period ending February. This is the same as the increase of January, and reflects the removal of high readings from last year. The CPI increase was in line with expectations. In order to achieve its inflation target of 2%, the U.S. Central Bank tracks Personal Consumption Spending price indexes. After a similar increase in January, the rise in CPI was reflected in a 0.2% rise in owners' equivalent rental of primary residence. The primary rents rose by 0.1%. This is the lowest gain since January 20,21. Economists argued, however, that the October inflation data was not collected due to last year's shutdown of government, which caused rents to be distorted. In normal times, this would not be a problem, said Gregory Daco, chief economics at EY-Parthenon. "These are not normal times. The data should be interpreted in light of the distortions caused by the government shutdown, the unprecedented volatility in trade policy, and the record swings in oil prices linked to the Middle East conflict." Daco estimates that the 43-day record shutdown last year caused CPI inflation to understate by approximately 0.3-0.4 percent points. After two consecutive months of declining gasoline prices, the price increased by 0.8%. The price of oil soared to well over $100 per barrel in the first part of this week before falling back. On Wednesday, oil prices recovered as traders questioned whether the International Energy Agency proposal to release record amounts of reserves would be able to offset any potential supply shocks caused by the Iran War. Economists expected gasoline prices to reach $4 per gallon in the near future. Electricity prices, though they eased monthly, jumped by 4.8% compared to a year earlier due to the strong demand for artificial intelligence from data centers. Last month, prices for household gas soared by 3.1%. Prices for gas piped to households rose 10.9% on an annual basis. Last month, food prices increased by 0.4%. This was largely due to a 3.7% increase in the price of chewing gum and candy. Fruit and vegetable costs increased by 1.4% while non-alcoholic beverages went up 0.8%. Prices for dairy products and other related items dropped by 0.6%, while cereals and baked goods fell by 0.2%. Prices of food are 3.1% more expensive than they were a year earlier. RISE IN FOOD AND GASOLINE PRICE IS IMPACTING CONSUMERS The Trump administration highlighted the moderate increases in CPI as an indication of a cooling of overall inflation. A White House spokesperson posted on social media that "the nation will see even greater economic progress" once the disruptions caused by war are over. The rising food and gasoline prices pose a risk to Trump's Republican Party as they prepare for the November midterm elections. The Wall Street stock market was mixed. Dollar rose against a basket currency. The yields on U.S. Treasury bonds were higher. The CPI increased as well, despite the staggered, but continued pass-through of Trump's sweeping Tariffs. Trump imposed them under a law intended for national emergencies, that has since been ruled unconstitutional by the U.S. Supreme Court. The Institute for Supply Management's surveys show that input costs have been steadily rising. Trump responded to the Supreme Court ruling by imposing an initial 10% global tariff. He said that this would increase to 15%. The CPI rose 0.3% in January, but gained only 0.2% when the volatile energy and food components are excluded. Core CPI inflation was slowed by the third consecutive monthly decrease in motor vehicle prices as well as a smaller increase in rental rates. The cost of furniture and household operations increased by 0.3%, while apparel prices rose 1.3%. This is due to the import duty pass-through. Healthcare costs rose 0.5%. Hospital services increased by 0.6%, while prices for physician's services rose 0.3%. ?Prescription prices, however, fell 0.2%. Hotel and motel room prices rose by 1.1%. The cost of airline tickets increased by 1.4%, and it is possible that they will rise even more as jet fuel prices are likely to increase due to the war. The core CPI rose 2.5% in the 12 months to February after increasing by the same margin of 2.5% in January. This also reflects favorable base effects. The tame core CPI readings are unlikely to translate into modest core PCE inflation gains for February, according to economists. This is because different weightings and unexpectedly strong service prices in January's Producer Price Index report may have contributed. The delayed January?PCE data, due this Friday, is expected to show an increase in core inflation. The PCE data for February will be released on 9 April. The core PCE is expected to increase by 0.5% in January and 0.4% in February, according to economists. James McCann is a senior economist at Edward Jones, who specializes in investment strategy. He said that another setback in inflation will likely make the central banks more cautious about further interest rate reductions. The Fed could still cut rates this year but the story is increasingly looking like it will be in late 2026 based on inflation expectations.
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Official: Gulf trio reviews sovereign investments to offset Iran War Impact
Gulf officials said that three Gulf states were reviewing the way they invest trillions of dollars from their sovereign wealth funds to offset the losses caused by the U.S. and Israeli war against Iran. The official who spoke on condition of anonymity because the matter was sensitive and without naming the states, explained that these reviews could include reversing investment pledges, divesting and re-evaluating global sponsorship deals. The top four economies of the Gulf Cooperation Council are Saudi Arabia, Qatar and Kuwait. Three of the four largest economies in the GCC will be assessing current and future investments and sponsorships to see if the situation lasts. The official said that "a review of their investment strategies for sovereign wealth funds has already begun." The official said that the talks were between representatives from the government and not the funds, and that the assessments were not coordinated. In only 12 days, this conflict has dealt a serious economic blow to some of the Gulf's biggest economies. It has crippled aviation, tourism, port and logistics networks while also cutting off key commercial arteries. Five Trillion Dollars in Wealth The UAE has said that it will stick to its investment plan. The UAE has adopted economic strategies which are forward-looking and enhance the UAE's ability to absorb geopolitical or economic pressures. In a press release. "In this respect, there are no changes to the investment plans or economic priorities for long-term." A Saudi source said that due to the current geopolitical environment, the Public Investment Fund of the Kingdom is expected to not revise its 'long-term investments plans. The Saudi Arabian finance ministry did not respond to a request for comment. Qatar's Finance Ministry has not responded to our request for a comment. Kuwait's Ministry of Economic Affairs and Investment was unable comment. Analysts say a fiscal shock could lead to a review of the way the $5 trillion in sovereign wealth funds in the region is used. But the official's remarks show that this process has already begun. The official stated that "once the war is over, we'll see the balance sheet and then figure out how best to cover losses." Analysts at JPMorgan cut their growth predictions for non-oil industries by 1.2 percentage point for GCC countries and 2.3 points for the UAE. This was the most drastic revision in the group. JPMorgan analysts warn that, while the hydrocarbon industry could recover depending on the length of the conflict in the coming year, there will be some lasting damage to the non-hydrocarbon activities and this could affect the diversification plans for the region. WIDE REACH and BIG COMMITMENT Gulf States have tried to diversify their economies but oil and Gas revenues still anchor the public finances which are very different in strength throughout the region. Kuwait's KIA, Qatar's QIA, the UAE's ADIA, Saudi Arabia's PIF and the UAE's Mubadala are among the largest sovereign funds in the world, with assets that have been built over decades of investment at home and abroad. Officials said that the reassessment includes global assets, not just U.S. assets. The United States is already one of most popular destinations for Gulf sovereign funds, with governments having pledged trillions in future investments since President Donald Trump's return to the White House. Gulf sovereign investors, beyond the U.S.?pledge are evaluating whether the conflict will slow down or change the shape of global sponsorship and investment deals. The size of the overseas pledges, sponsorships and funding is enormous. The?UAE, for instance, agreed to invest as much as $50 billion in Canada last year. Meanwhile, QIA, backed by Qatari Diar, signed a landmark coastal development worth $30 billion on an undeveloped stretch of Egypt's Mediterranean coast. Qatar Airways is sponsoring Formula 1 motorsports until 2027. Mubadala has been a major title sponsor of multiple?ATP tennis and WTA events. PIF became an official partner for this year's FIFA World Cup. SLOWING NEW COMMITMENTS Analysts predict that these positions will not be released immediately. However, they said the direction and pace of capital investments could change. The first reaction should not be to sell off global assets. "Before unwinding any overseas assets, they will evaluate the potential impact, and whether there is a value-add in redirecting this capital locally," said Jahangir Aka founder of London's Aka & Associates. Aka said, "For the time being, the 'Gulf Investments' global investments provide resilience as a diverter, and it is unlikely that you will see a?significant reduction in these assets, as they continue to produce income for governments at home." Aka explained that "you may instead see a slower pace in new commitments, and defer money to overseas countries until there is more clarity about any structural impact the current conflict." Reporting by Andrew Mills, Rachna uppal, Federico Maccioni, and Hadeel al Sayegh, in Doha; Additional reporting by Ahmed Hagagy. Writing by Federico Maccioni, Andrew Mills, and Andrew Mills. Editing by Mahal Dahan, ElisaMartinuzzi, Anousha Sakowi, and Alexander Smith.
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Sources say that Mercuria will withdraw almost 100,000 tonnes of aluminum from the LME due to disruptions in Middle East supply.
According to three sources, the commodity trader Mercuria intends to remove large volumes of aluminum from LME storage facilities, as the closure of the Strait of Hormuz has 'frozen' Middle East shipments, and put further pressure on supplies in Europe, and the United States. Around 9% of global primary aluminium is produced in the Middle East. Since last week, the U.S. and Israeli war on Iran has closed the Strait of Hormuz. Mercuria, a Swiss company, cancelled or designated for delivery on Monday nearly 100,000 tons?of aluminium in LME-approved Port Klang warehouses. The sources who are familiar with the issue said. Mercuria declined to comment. Aluminium Bahrain, Emirates Global Aluminium and Qatalum are among the Middle East's aluminium producers. Alba, the company that operates one of the largest smelters in the world, declared force majeure last week and warned customers about delays to shipments as Qatalum began to shut down. Slow Process to Restart Production To avoid damaging aluminium pots, smelters must reduce production gradually. After pots have cooled down, the process of restarting is slow, and metal will remain off the market for several months. The sources said that Mercuria will need to use the aluminum in LME storage to meet its obligations to customers across Europe and the U.S. where aluminium is in short supply for transport, construction, and packaging. Since the start of the war, the physical market premium that aluminium buyers in the United States or Europe pay -- around $3450 per ton - has risen. The duty-paid aluminum premium in Europe is around $420 per ton. This is the highest it has been since September 2022, when consumers stopped purchasing?Russian Aluminium after Russia invaded Ukraine. The Midwest premium in the United States is at record levels, with a price of around $1.09 per lb, or $2,400 per tonne. On Tuesday, the number of canceled?warrants - title documents that confer ownership - was 177,325. This is up from 9% in February, before the Middle East turmoil began. (Reporting and editing by Bernadette B. Baum; Additional reporting by Polina D. Devitt, Tom Daly)
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South African union vows fight job cuts after energy deal
The National Union of Mineworkers of South Africa vowed on Wednesday to fight against 'planned job cuts' at the ferrochromes smelter, Samacor. This could affect up to 2,400 workers despite an electricity price cut of more than 50% intended to prevent job losses. Eskom, the state-owned electricity provider, announced the price reduction for Samancor's and Glencore’s joint venture with Merafe Resources in late December after the distressed companies agreed to put off planned job cuts while negotiating with Eskom. The smelters are facing increasing competition from Chinese manufacturers, which has caused their electricity costs to increase tenfold. Samancor, on the other hand, has resumed its procedures for laying off workers. The Glencore-Merafe JV, meanwhile, said that it had delayed its own job reductions until March 31. The union stated that the move was a "devastating blow" to its members, especially after NUM had fought for a lower electricity tariff to ensure the sustainability of the company. The union added that it would continue to fight this issue and explore every avenue to save our members' jobs. South Africa's labour law requires companies to consult with unions before cutting jobs. Samancor announced that it will begin talks with unions who represent workers across its operations within the next few weeks. Samancor responded to a question by saying that while the tariff reductions address immediate pressures on electricity costs, the terms and conditions underlying the tariff continue to threaten the long-term viability for the ferrochrome sector. The company has not disclosed any details about these conditions. Samancor stated that the proposed layoffs would affect approximately 2,400 workers?during the company's corporate and smelting offices. According to the government, only 11 of South Africa's total 66 smelters operate due to high electric costs. South Africa, the most advanced economy in Africa and the largest chrome ore producer in the world, has lost its position as the leading global processor of ferrochrome. Smelters that require a lot of energy combine iron and chromium to make ferrochrome. This is used primarily in the steel industry.
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Europol's operation against illegal waste trade leads to arrests of more than 330 people
Europol announced on Wednesday that more than 330?people?were arrested in 70?countries as part of a crackdown against organised crime 'networks' accused of?trafficking illicit waste?in Europe and exporting them to Africa, Asia, and Latin America. The authorities seized 127.149 metric tonnes of waste and 602 tons of polluting agents, along with 75 tons?of plant protection chemicals and 2.3 tons?of mercury, as well as nearly?10 millions euros ($11.6 million) of cash and bank account. Officials said that the seized 'waste' could have generated illicit profits of at least 31 million euros. The Guardia Civil of Spain, which was involved in the operation and co-led it, has said that illegal waste trafficking is a worldwide problem. It operates through parallel criminal networks. It said: "These criminal 'networks' not only fraudulently handle urban and industrial waste but also systematically resort to document fraud and forgery to move hazardous materials causing negative impacts on the environment and risk to public health." The Spanish police announced last year that they had arrested an Italian gang suspected of smuggling?more than 40,000 tons of untreated urban waste from Italy into Spain. $1 = 0.8627 Euros (Reporting and editing by Charlie Devereux, Alex Richardson).
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India is prepared for unprecedented demand for coal power in the summer
The 'Coal Ministry' said that India had enough coal to meet what was expected to be a 'unprecedented spike in demand over the summer months. This comes after the gas supply disruptions caused bythe U.S./Israeli war against Iran. In a statement, the Ministry of Energy said that the total coal supply in the country was 210 million tons. This would be enough to?fuel consumption for 88 days. South Asia still depends on coal to generate three-fourths?of its electricity, despite a record-breaking increase in renewable energy production. India is expected to increase its coal power use in order to meet summer demand, after the Middle East conflict has affected the country's natural gas supplies, mostly from Qatar. According to the ministry, coal stocks in the country's power stations were 54.05 millions tons, which would be enough to last about 24 days at the current consumption rate. Coal India produces three quarters of India's production and had a record-breaking 121.4 million tons in its pithead stock as of March 9. The statement said that "Coal production, supply and consumption continue to be higher than the consumption in the fiscal year ending March 31". India's increased domestic production also led it to increase the blending of domestic coal into power plants that were designed to operate with imported coal. Reporting by Sethuraman NR and Tanvi Mehta; Editing and YPrajesh by Andrei Khalip
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OPEC confirms large Saudi oil production increase ahead of Iran War, but holds forecasts steady
OPEC announced?on?? Wednesday that Saudi Arabia increased its oil production sharply in February, ahead of U.S. & Israeli attacks on Iran. It also maintained its forecasts regarding a relatively strong growth in global oil demand this year. Sources familiar with the plan stated in February that Saudi Arabia increased output and exports in preparation for a possible U.S. strike against Iran, which could disrupt Middle?East supply. The attack occurred on February 28, and the ensuing conflict caused oil exports to be disrupted, production to stop and prices to soar. In a report published on OPEC's website, Saudi Arabia informed the group that its February supply was 10,111 million barrels of oil per day. Meanwhile, OPEC reported that production reached 10.882 millions bpd. The Saudi Arabian kingdom reported a January production of 10,10 million barrels per day. Saudi Arabia has intervened on the oil markets for years, either adding barrels when there are disruptions in supply or reducing output when oversupply is detected. Sources said that the February increase echoed last year's contingency plan, when they moved more oil into storage. OPEC, citing secondary source, also reported that the output of OPEC+ (which includes the Organization of the Petroleum Exporting Countries and other producers like Russia) averaged 42.72 mbpd during February, an increase of 445,000 bpd over January. The "supply to market" is usually the sum of exports, domestic refineries and power plants plus oil that has been shifted into storage. Saudi Arabia's supply to the market in February stayed close to?OPEC+ quota despite production being well above target. OPEC has not changed its prediction that the world's oil demand will increase by 1,38 million bpd - this year. Its estimate of 2026 demand remains higher than other analysts, including those at the International Energy Agency. In the report, OPEC stated that it was too early to tell if the current geopolitical developments would have any impact on economic growth. The OPEC+ agreement to maintain output targets for the first three months of the year was not a factor in the?Saudi Arabian and OPEC increase in February. The next forecast update from the IEA is due Thursday. Alex Lawler is the reporter. (Editing by Louise Heavens, Mark Potter and Mark Potter).
Sources say that Russia is preparing a 10% cut in 'non sensitive' spending by 2026.
Sources say that the Russian government may cut?10% of all "non sensitive" expenditures in the budget for this year. However, the final decision depends on the'sustainability' of the rise in oil prices triggered by the war with Iran. Russia faces a double blow as the war in Ukraine enters its fifth year. It is experiencing a drop in budget revenues due to energy sales, and an economic slowdown that affects other tax revenue streams. To prevent the fund from being depleted, the government plans to transfer more money to it. This measure may be accompanied with a cut in expenditure. The Finance Ministry informed the agencies that distribute budget funds of the need to reduce spending. "They are sitting around, 'thinking about what to cut,'" said one source who spoke under condition of anonymity because of the sensitive nature of the situation.
CUTTING WON'T be 'ACROSS the Board'
Two of the four government sources who have access to Finance Ministry communications mentioned the 10% cut, while the two other sources said that the reduction is being discussed, but without specifying the number.
The Finance Ministry did not reply to a comment request from.
The sources said the cuts will not be across the board and will spare politically-sensitive military spending as well ?as socially-sensitive spending, such as salaries to public sector workers or welfare payouts. This is done by reducing non-essential expenditures. Construction or road repairs will be put on hold. Another source stated that these projects are likely to face cuts.
The average Russian has been affected by the rising price of goods, but not by the economic slowdown caused by high interest rates. Neither have cuts to government spending led to mass layoffs. Western sanctions are making the economic situation worse, as they hurt Russia's energy sales around the world.
Russia's budget revenue from energy fell by half in the first two month of 2026 while total revenues dropped by 11%. Russia, who had to increase the estimate of its budget deficit twice last year, is planning a deficit in 2026 of 1.6%.
WAITING FOR OIL PRICES TO CHANGE After the U.S., Israel and Iran attacks and the closing of the Strait of Hormuz, the situation changed dramatically. Oil prices skyrocketed and demand for Russian oil increased. The U.S. considered lifting sanctions against Russia.
Third source: 'The oil price increase will not be sustainable on the long-term and the current budget situation demands spending cuts regardless short-term fluctuations in oil prices. Sources stressed that no decision had been made yet. The sources said that no decision had been made on the amount of spending cuts.
In February, Russian President Vladimir Putin met with his government at the Kremlin in a meeting that lasted for many hours, according to Prime Minister Mikhail Mishustin. After?this meeting, Finance Minister Anton Siluanov announced that the government would lower the so-called "cutoff" price for oil, which is currently $59 and above which energy revenue flows into the reserve fund. This will bring it in line.
The average price of Russian crude oil calculated for taxation was 24 percent below the "cut off" price in February. This meant that the government needed to use the National Wealth Fund to cover its deficit. Reporting by Gleb Brynski, Writing by Guy Faulconbridge, and Editing by Sharon Singleton.
(source: Reuters)