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Zimbabwe Central Bank tightens policy to limit fuel price increases
Zimbabwe's central banks decided on Tuesday to maintain a?tight?monetary policy?stance, keeping its main lending rate of 35% in order to limit the inflationary effect of fuel prices increases due to the Middle East conflict. In recent months, the annual inflation rate in Southern?Africa has dropped to single digits - for the first time in more than three decades. The central bank was expected to ease its policy soon after the U.S. and Israel war against 'Iran. But now, economists believe it will try to maintain stability following the recent fuel price increases by the energy'regulator. In a press release, it stated that "to limit the second-round effect of fuel price increases...the MPC (Monetary Policy Committee) decided to 'Stay The Course'?of the current monetary policy position." Since September 2024, the bank's policy rate is at?35%. This is part of an effort to?reduce price pressures and boost confidence in a new currency that was launched two years earlier.
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Oil prices are higher, but stocks remain mixed as the war uncertainty continues
The major global stock indexes were mixed Tuesday as oil prices continued their recent sharp gains and concerns remained over the length of 'the Israeli-U.S. War on Iran. The dollar recovered lost ground and U.S. Treasury rates pushed higher. The stock market rose on Monday, after U.S. president Donald Trump announced that he had ordered his military to delay strikes against Iranian nuclear power plants due to "productive discussions" with Tehran. Iran has denied any talks with the United States. Prices of oil rose on Tuesday. U.S. crude oil gained 3.63%, reaching $91.33 per barrel. Brent increased to $98.54. Oil prices are expected to remain high as the Strait of Hormuz is closed and only a fifth of the world’s oil and gas liquefied through it can be shipped. Oliver Pursche is senior vice president at Wealthspire Advisors. He said, "We're seeing some negative sentiment creeping back into the markets today." Investors are mainly focused on oil price, but I think the greater risk is commodity inflation, especially related to agriculture. That could have a?more profound and longer-term effect than oil prices. He also said that "there is still a great deal of confusion and lack clarity regarding Iran, how long military operations will last, and what the implications are for oil and the global trade." This is the main driver." The S&P 500's largest percentage decliners were communication services and technology. The Dow Jones Industrial Average grew 145.83, or 0.30 %, to 46.348.12, the S&P 500 gained 5.77, or 0.09 %, to 6,586.74, and the Nasdaq Composite dropped 70.12, or 0.32% to 21,877.14. The MSCI index of global stocks rose by 4.46 points or 0.45% to 989.37. The pan-European STOXX?600 index grew by 0.54%. Data released on Tuesday showed that the euro zone's private sector growth almost stalled in this month due to a rise in inflation expectations and delivery times. This is a further indication of the tangible impact the war between the U.S., Israel, and Iran has had on the region. He said that the risk of inflation from the war in Iran escalating was "strong enough" to convince him to support keeping interest rates at current levels instead of cutting them. Market expectations were shifting towards a rise in borrowing costs. The yield on the benchmark 10-year U.S. notes increased 3.4 basis points from 4.34% to 4.37%.
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Smithfield Foods reports record quarterly earnings, but flags Middle East cost pressures
Smithfield Foods beat analysts' estimates for the fourth quarter results on Tuesday, thanks to strong?demand. It also said that the Middle East conflict will?raise fuel, corn, and packaging costs. Shares of the?U.S. Pork processors jumped by 5% on the morning market after issuing a positive annual profit and sales forecast. Mark Hall, CFO of the company, said that while input costs are expected to remain high by historical standards they will be lower in 2025. The company has increased prices to offset the rising costs of raw materials. It has also seen an increase in demand as more consumers cook at home due to tighter budgets. Smithfield anticipates that total annual sales will increase by low single-digits compared to analysts' expectations of 1.26%. It also expects an annual adjusted operating income between $1,33 billion and $1.4 billion, compared to the $1.34 billion profit recorded in fiscal year 2025. The outlook takes into account several risks. These include the Middle East conflict which could increase the cost of fuel, petroleum-based products such as packaging and corn prices, as well as raising oil markets. They cautioned, however, that the full impact has yet to be determined. LSEG data shows that the company's quarterly sales increased 7%, to $4.23bn, compared to analysts' expectations of $4.14bn, a result of higher market prices. The packaged?meat?sales?rose by 4.3% from the same quarter last year. Smithfield's major revenue-generating division is this segment. Fresh pork sales increased by 2.1%. The Virginia-based firm?said that it expects pork to "well positioned" as an affordable, healthy option for consumers this year. Analysts had expected 68 cents a share. The company reported a quarterly adjusted 'profit from continuing operations' of 83 cents a share.
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US to launch pilot surveys on energy consumption by data centers
The U.S. Department of Energy’s information arm will launch a pilot survey on Wednesday to gauge the energy consumption of 'the country's' data centers. Silicon Valley has invested hundreds of billions in expanding energy-intensive data centres across the U.S. but it is unclear how much power the sector consumes. Americans are worried about the impact of artificial intelligence on their utility bills. Tech giants have been exploring using coal, natural gas and nuclear power to power their data centres. Tristan Abbey, the head of the Energy Information Administration (EIA), said this at the CERAWeek Conference in Houston. EIA will start the surveys in three States before expanding them to other states. Virginia, which has the largest concentration of data centres in the world, is among the three states. Washington State and Texas are also included. Abbey said that the initial survey questions will cover whether or not data centers use backup power supplies and, if they do, what type of fuels are used. Abbey explained that "ultimately we will have a patchwork quilt of?lots?of different things we know and be able launch a mainstay type survey." The EIA began a survey in?2024 of cryptocurrency mining operations. These are a new type of datacenter, and were surveyed using emergency authorities. Two crypto-mining firms sued, claiming the survey was invasive and rushed. Abbey, who assumed her position in September of last year, explained that this pilot survey would be conducted gradually. (Reporting and editing by David Gaffen in New York, Laila Kearney from New York)
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Investors focus on Middle East developments as gold prices remain stable
The price of gold held steady Tuesday, after hitting a four-month low the previous session. Markets assessed developments in 'the Middle East' and their impact on inflation and interest rates. By 11:00 a.m., spot gold had not changed much from $4,408.77 an ounce. ET (1500 GMT) after it hit its lowest level of $4,097.99 in November on Monday. U.S. gold futures for April delivery steadied at $4,409.30. Bart Melek is global head of commodity strategies at TD Securities. He said: "If energy prices continue to rise and the war continues, it's not good news for gold." He added, "Gold is going to be under pressure in the second quarter. But I think that by the end of the year, gold's outlook should look very good, because we hope by then, central banks such as the Fed will enjoy more freedom and we may see rates and the dollar drop." Bullion, once considered "a safe haven" and an inflation hedge, is no longer attractive in high-rate environments, as it pays no interest. The Pakistani prime minister stated on Tuesday that he would be willing to host talks to end the war between the United States, Iran and other countries. This comes a day after U.S. president Donald Trump backed off his threats to attack Iranian power plants in the wake of what he termed "productive" discussions. The war 'effectively halted the shipments of around a fifth of world oil and natural gas through Strait of Hormuz. This has increased energy prices and fuelled inflation fears. The major central banks have also stated that they are prepared to take action if prices rise a lot more due to the war. The recent price drop is just as likely to be an overreaction, as was the massive increase at the start of this year. The pendulum for gold has "swung" from extremes, according to analysts at Commerzbank. Spot gold has fallen by more than 16% from its peak of $5,594.82 on January 29, and is down about 21% since the U.S. - Israeli war against Iran began on February 28, Silver spot rose by 1.1%, to $69.86. Platinum gained 0.7%, to $1.894.60, while palladium fell 1.3%, to $1.414.75. (Reporting and editing by Sahal Muhammad and Diti Pjara in Bengaluru)
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Ukraine steel production capacity down 81% from 2014 when Russian offensive began, says union
The national steelmakers union reported on Tuesday that Ukraine's nominal capacity for steel production has dropped to 8 million tons per year, from 42,5 million tons before Russia's occupation of eastern Ukrainian regions in '2013. The majority of these steel mills were either destroyed or occupied by Russia during the war. Ukraine exports mainly consist of steel and metallurgical products, along with?iron ores and agricultural commodities. According to a Ukrainian GMK Center report, "due to the continuing hostilities, rising fuel prices, and electricity shortages, the monthly steel production in 2026 will be 'unlikely' to exceed 600,000. In the first two months of this year, the union reported that Ukrainian steel production fell 13.2% compared to the previous year. Ukraine, once a major?steel exporter and producer, reported a 70.7% decline in 'output' to 6.3 millions tons by 2022. The output fell to 6,000,000 tons in '2023, 7.58,000,000 tons in '2024, and 7.41,000,000 tons in '2025. This?month, the largest remaining steelworks in Ukraine, ArcelorMittal Kryvyi Rih announced that it would shut?two rollingmills, citing an energy crisis brought on by Russian strikes, and the costs of European Union requirements for environmental protection. (Reporting from Pavel Polityuk).
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Russia abandons plan to reduce oil price budget rule in this year
Vladimir Kolychev, the deputy finance minister, was quoted as saying that Russia had halted its plans to lower the oil price threshold for adding money to a reserve fund. He suggested recent price increases are already boosting the fund. Russia had already signaled that it would lower the oil cut-off prices, the level at which additional oil revenues are paid to a fund from which government deficits can be covered. But that was before the Iran War sent oil prices skyrocketing. "The issue is not being considered for the current fiscal year." The Ministry of Finance has no such proposals. Russian news agencies reported that Kolychev said, "At the moment, we are discussing changes for next year and beyond." The cut-off is $59 per barrel. This is well below the current market level of around $100 per barrel. It means that reserves are being replenished with no policy changes. The comments made on Tuesday confirm an earlier report that said the government would delay lowering the price cut-off. On February 25, just three days before war began, Finance Minister Anton Siluanov announced that changes would be made to the cut-off prices within two weeks. Kolychev stated that the adjustment was still required in the medium-term. He said that the threshold should 'correspond to a level of reserves, and when reserves are low be set at lower levels of a range of scenarios. As of March 1, the liquid assets of the fund stood at $52 billion. Many analysts had warned that the fund would be drained within a year. Kolychev has also denied that there will be any cuts to the budget for this year, adding that the government is always striving to spend as efficiently as possible. (Reporting by Darya Korsunskaya. Gleb Brynski wrote the article. Alison Williams, Mark Potter and Mark Potter (editing)
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Investors placed $500 million in bets on the oil price before Trump's tweet about delaying Iran attack
Only 15 minutes before the U.S. The market plunged after President Donald Trump announced that the attacks on Iran's infrastructure would be delayed by five days. Trump's Truth Social post at 1105 GMT Monday, which gave Iran a deadline of Monday to reopen Strait of Hormuz and face the "obliteration" of its power plants, triggered a massive selloff of oil and natural gases. Brent crude dropped as much as 15 percent in just a few minutes after Trump said constructive talks were underway between Washington and Tehran. This prompted investors to price-in the possibility of deescalation, which could free up the millions of barrels currently clogged in the Gulf. LSEG data show that traders bet on 5,100 Brent and WTI futures worth over $500 million between 1049 and1050 GMT. Data also shows that selling dominated the volume in the minute when these contracts were exchanged. It was impossible to determine who traded oil. 13 MILLION BARRELS OF OIL TRANSACTIONS IN 60 SECONDS, AT 1105 GMT Brent futures volume spiked by 2,000 lots at this point, a much larger increase than earlier in the day. The volume was dwarfed, however, by the subsequent post from Trump. In 60 seconds, at 1105 GMT, over 13,000 lots Brent and WTI futures were traded, which is equivalent to 13,000,000 barrels of crude oil. Brent crude fell from $112 to about $99 before pre-announcement trading took place. WTI dropped from $99 to around $86 prior to Trump posting. Intercontinental Exchange (where Brent crude is traded) and CME Group (which owns NYMEX, where WTI is traded) did not respond immediately to requests for comments. The U.S. Securities and Exchange Commission refused to comment. White House did not respond either to a comment request. Commodity Futures Trading Commission did not respond to a request for comment immediately. OIL PRICES?UP MORE THEN 40%?FROM PRE CONFLICT LEVELS Despite the fact that a fifth or more of the daily supply in the Middle East has been cut off due to the war, the prices are still higher than when the conflict began late February. The trading volume and volatility has exploded. In the three years prior to the war on average, around 300,000 Brent crude futures were traded daily. The daily volume has reached record highs of over 1 million lots, which is equal to one billion barrels?of oil. Brent oil is currently trading at just under $104 because of the uncertainty over the impact on the global economy and the status negotiations. Iran has denied that it is in talks with the U.S.
Copper drops after Iran denies talks for ending war and attacks Israel
London copper fell on Tuesday after Iran denied holding talks with the U.S. about ending the Middle East war and launched new missile attacks against Israel.
In official open outcry, the benchmark three-month copper price on London Metal Exchange fell 1.6% to $11,974 per metric tonne.
Metal prices rose 2% after U.S. president Donald Trump said that he had "very productive" talks with Tehran, and had postponed the threatened strikes on Iranian energy infrastructure.
EwaManthey, ING commodities strategist, said: "Copper has eased today following yesterday's rebound as geopolitical confidence faded."
The rise in oil prices and the strengthening dollar have added pressure to industrial metals, as central banks are less likely to be able to reduce rates, and higher fuel costs will stifle global growth.
Citi expects the price of copper to drop to $11,000 per ton over the next three month, down from $14,000.
The bank stated that "we expect industrial metals will grind lower as long as the Hormuz Strait is closed. Investors discount Fed rate reductions and cyclical expectations of growth and continue to de-risk risk assets."
Copper stocks on the LME are at an elevated level
On Monday, another 11,800 tonnes of imports were recorded. More than half of these entered LME's warehouses in Kaohsiung
The spread between the LME cash copper contract and three-month forward
Manthey said that renewed buying interest in the top consumer China, where copper exchange stocks fell by?5.2% on last week's trading day, "helps to limit the downside".
Aluminum was the only base metal that rose, increasing 0.6% to $3.217 per ton, on concerns about supplies from Gulf smelters.
Lead fell 0.5%, zinc 0.8%, nickel 0.6%, and tin 0.1%. (Reporting and editing by Janane Vekatraman; Additional reporting by Dylan Duan, Lewis Jackson and Jan Harvey;
(source: Reuters)