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INDIA BONDS - India 10-year yield registers largest weekly increase since RBI's surprise rise in May 2022
The Indian government bond market plunged Friday, ending a week-long loss, as New Delhi’s fuel excise tax?cut clouded fiscal outlook and intensified oil-driven anxieties. This also drove the yield on the 10-year note to its largest weekly increase in almost four years. The benchmark 6.48% bond yield for 2035 ended the session at 6.9419%. This is the highest 10-year bond yield since July 25, 2024. It closed at 6.8750% the previous day. Bond yields are inversely related to bond prices. The yield increased by 20 basis points for the week. This is the largest move since the week ending?May 6,2022 when the central banks began its aggressive rate-hiking cycle with an unexpected?rate hike in between scheduled policy meeting. New Delhi has reduced its special excise duties on petrol and diesel as the Middle East conflict continues to choke supplies, causing fuel prices to remain volatile. An official from the government said that the move will cost the government $739.33 million per fortnight. Analysts estimate the fiscal impact to be between 1.5 trillion and 1.75 trillion rupees in fiscal year 2027. The Brent crude oil price is hovering around $110 a barrel after briefly falling below $100 earlier this week. The rising oil price is bad for India. It's the third largest crude importer in the world. It could cause inflation to rise and increase India's deficit on its current account. If oil continues to rise, the crude basket assumed in RBI's October policy of $70 per barrel would undergo a major revision. Alok Sharma, the head of treasury for?ICBC in Mumbai, said that higher crude oil prices will eventually affect inflation baskets. States sold nearly one trillion rupees worth of debt during the past week due to waning investor demand. India's overnight swap rates (OIS) saw a large reversal in recent received positions. The key swap rates rose to multi-year heights. The?two-year OIS closed at 6.2750%, while the one-year OIS ended at 6.04%. The liquid five-year swap rate ended at 6.6350%. The one-year swap rate has risen by 56 basis points this month. Meanwhile, the two-year OIS rate and the five-year OIS rate have risen by 69 and 65 basis points respectively. $1 = 94.6800 Indian Rupees (Reporting and editing by Rashmi Dhutia, Sonia Cheema, Ronojojo Mazumdar).
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Congo and China strengthen mining ties while US pushes rival mineral pact
The Congolese government announced that the Democratic Republic of Congo and China had signed an agreement to enhance cooperation in the mining sector of 'the African nation.' Global powers are jockeying for influence in this strategically significant minerals powerhouse. Congo is the largest producer of cobalt in the world and has vast reserves of lithium, copper, coltan, and other battery metals. Chinese mining companies, led by top cobalt miners CMOC, Zijin and Huayou, already dominate the sector. Beijing is Congo's largest bilateral creditor. Kinshasa is also a target for the United States and other countries looking to obtain the minerals required for the manufacturing of electric vehicles and the energy shift. Promotion of local processing, duty-free access As of May 1, Congo's exports will be eligible for duty-free access in China under an initiative that covers 53 African countries. According to a statement released late Thursday by the Congolese Government, the new agreement outlines cooperation in geological data sharing and investment protection, as well as the promotion of local processing raw materials. It also includes a monitoring system to ensure that projects are compliant with Congolese laws and implemented in an environment of stability and transparency. The statement stated that China will give priority to a flagship iron ore mining project in the northeastern Congo known as MIFOR. COURTED by the US and China, Congo hedges its bets Joshua Walker, of NYU’s Congo Research Group, said that the U.S. would certainly be aware of this new agreement. It is a clear riposte against Washington. The Trump administration has signed a strategic partnership in December with Congo to increase?Western investments, redirect its minerals supplies and reduce China’s dominance of critical minerals mining and processing. The Congo has since "shared" a list with the U.S. of its priority assets, but the government has stated that it will seek out other partners if Washington fails to deliver on the agreement. Walker pointed out that the deal between Congo and the U.S. The deal is more comprehensive and binding. It involves trading security support in eastern Congo where Kinshasa, a government backed by Rwanda, has been fighting a long-running conflict with Rwandan-backed fighters for mining access. The Congolese government is not taking sides as Beijing and Washington compete for global resources. Instead, it is attempting to capitalize on the vast mineral reserves in the country. Walker stated that "the DRC is clearly trying to hedge their bets." (Reporting and editing by Ange Adihe Kazongo, Maxwell Akalaare Adombila, Rob Corey-Boulet & Joe Bavier).
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Stocks continue to fall as Trump's extension of the Trump-Pence fails to calm markets
The global stock markets fell again on Friday following a?U.S. Donald Trump's decision to extend a?deadline to Iran for reopening the?Strait?of Hormuz did not calm down oil prices or government bond yields. Trump's decision to postpone the deadline after which he said Iran would face attacks on its infrastructure came shortly after Wall Street closed out the biggest one-day drop since the beginning of the war on Thursday. The markets appeared to be sceptical of the possibility of a deal between the two parties, as?oil price rose again on Friday, and government bonds fell. The pan-European STOXX 600 fell 1.4%, after falling 1.1% on Thursday. Germany's DAX was 1.7% lower. MSCI's index for Asian shares, excluding Japan, fell by 0.7% overnight. MARKETS SLAM OFF TRUMP'S DELAY Futures in the U.S. S&P 500 lost earlier gains, and was last down by 0.5% after falling 1.7% the previous session. The Nasdaq composite, which is a tech-focused index, fell 2.4% on Friday. This puts the index at a loss of nearly 11% since its record high close in October. Nasdaq Futures last fell 0.7%. The?Wall Street Journal's report that?Trump considered sending more troops raised concerns about the war escalating to a ground-based conflict. There was also no guarantee that the Strait of Hormuz, through which 20% of the world's energy flows, would be opened to shipping anytime soon. A senior Iranian official called the U.S. plan to end this conflict "unfair" and "one-sided". Matt Britzman is a senior equity analyst at Hargreaves Lansdown. He said that words alone were not enough to change the mood. "Tangible proof of progress is needed." Brent crude oil, a global benchmark, increased?2.6%, to $110.90 per barrel. Global Bond Yields Surge Investors were concerned about a possible inflationary shock which could force central banks into raising interest rates. As prices drop, yields also rise. The 10-year U.S. Treasury rate, which is used to set borrowing costs in other countries, increased by more than four basis points, reaching a high of?4.464%. This was its highest level since last July. Money markets see roughly 70% chances that the U.S. Federal Reserve will raise rates this year. This is a dramatic change from late February, when traders bet?on two rate cuts in 2026. Germany's 10-year yield has risen to its highest level in 2011 with more than 3,1%. The U.S. Dollar Index, which tracks currency performance against six peers, increased 0.2%, marking the fourth consecutive session of gains.
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Severstal, a Russian steelmaker, will cut its investment by half as the demand for its products falls
MOSCOW, 27 March - Severstal is one of Russia's four largest steelmakers and plans to reduce investment by a fifth?and labour by 5% by 2026. This is due to a falling?demand? for steel in the face of an economic recession. The demand for metals in Russia's major industries - construction, energy, automobile and machinery manufacturing - is decreasing as businesses halt investment because of high interest rates to curb inflation. Metals production has been affected by Western sanctions and drones from Ukraine. "The industry's situation is getting more difficult." The demand for steel in Russia has dropped 31% since 2024. This has led to a sharp decrease in capacity utilization among our clients, and a drop in prices. He said that the company intends to reduce labour costs by freezing hiring and replacing contractors with internal personnel. Severstal reported that its plant in the city?Cherepovets (about 360 km north of Moscow) was?hit by a Ukrainian drone attack Friday. These attacks, which used to be primarily targeted at the energy and defence sectors, are now spreading into other industries. Evgeny Vinogradov is CEO of Severstal’s Russian Steel Division. He said that the plant was operating normally after the drone attack overnight. "All units were in operation and there were no major damages," he added. (Reporting and writing by Anastasia Lyrchikova, Editing by Mark Trevelyan).
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Stocks continue to fall as Trump's extension of the Trump-Pence fails to calm markets
The global stock markets dropped again on Friday, after U.S. president?Donald Trump extended a deadline to Iran for it to reopen the Strait of Hormuz. This did not calm down oil prices or government bond yields. Trump's decision to postpone the deadline came after Wall Street closed its biggest one-day drop since the beginning of the war on Thursday. Oil prices rose again on Friday, and government bonds fell. The markets appeared to be sceptical that a deal could be reached between the two parties. After a 1.1% decline on Thursday, the pan-European STOXX 600 Index fell?0.7% at opening trade. Overnight, MSCI's Asian share index excluding Japan dropped 0.6%. MARKETS STRUGGLING OFF TRUMP DELEGATION Futures for the U.S. S&P500 gave up gains earlier and were flat at the last session, after falling 1.7% the previous day. The Nasdaq composite, which is a tech-focused index, fell 2.4% on Thursday. This means that the index has fallen nearly 11% since its record-high closing in late October. Nasdaq Futures were also flat. The Wall Street Journal's report that Trump is considering sending more troops has added to the concern that the war could escalate into a ground-based conflict. There is also no certainty that shipping will soon be allowed through the Strait of Hormuz, which typically carries 20% of the world's energy. On Thursday, an Iranian official called the U.S. plan to end this conflict "unfair and one-sided". Matt Britzman is a senior equity analyst at Hargreaves Lansdown. He said that words alone were not enough to change the mood. The need for tangible evidence of progress. Brent crude oil rose by around 2%, to $110 per barrel. Global Bond Yields Surge Investors grappled with the possibility of inflationary shocks that could force central bankers to increase interest rates. As prices drop, yields also rise. The 10-year U.S. Treasury yield, which sets the global tone for borrowing rates, has risen 4 basis points to 4,456%. This is its highest level since last July. Money markets see roughly 70% chances that the U.S. Federal Reserve will raise rates this year. This is a "sharp" change from February, when traders were betting on two rate cuts in 2026. The yield on Germany's 10-year bond rose to its highest since 2011 of more than 3.1%. The U.S. Dollar Index, which measures the currency's performance against six other currencies, gained 0.1%, marking a fourth consecutive session of gains.
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Taiwan freezes its electricity rates in order to maintain price stability and industrial competitiveness
Taiwan won't raise electricity prices at this time despite the increase in energy prices caused by the Middle East war, according to the Economy Ministry. This will help to maintain price stability and industrial competitiveness. The government has been heavily subsidising energy to limit the impact on consumers of the rising energy prices caused by the Middle East war. The ministry released a statement saying that "in light of the 'risks' arising from the escalating conflict and the changes in international tariffs and to maintain industrial competitiveness and stabilize consumer prices, the committee decided to not adjust electricity rates at this time." Taiwan is a major supplier of advanced semiconductors that power the AI megatrend. The Ministry's Electricity Price Review Committee meets every end of March and September for discussions on rates for the state-owned utility Taipower. Taiwan had to look at alternative sources of crude oil and LNG, including in the United States, since the beginning of the war, given its heavy dependence on Middle East. Taiwan has 'also re-examined the use of nuclear energy, after closing the last station in the south of the island last year. In a separate statement, Taipower announced on Friday that it had submitted a proposal for the reopening of this plant to the Nuclear Safety Commission. It added that, 'even if this plan is approved the plant will not be back in operation immediately as safety inspections can take up to 2 years. (Reporting and editing by PhilippaFletcher; Ben Blanchard, Jeanny Kao)
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Oil shock causes record-breaking flight of foreign investors from Indian assets, causing rupee to plummet
The rupee is in a tailspin as foreign?investors pull out at record rates from Indian bonds and equities. This is due to the Iran War-driven rise?in oil price, which has sparked a flurry of 'worries about a possible increase?in inflation. Since the beginning of the war on February 28, foreign investors have sold an estimated $12.14 billion in Indian shares, marking the largest monthly outflow ever recorded. The net bond sales of foreign portfolio investors under the Fully Accessible Route, or FAR, reached 152 billion rupees (1.6 billion dollars), the highest amount since the category was first introduced six years back. The?rupee has fallen to new all-time lows due to these outflows and risk-off sentiment. The local currency dropped 0.9% on Friday to 94.7875. It has fallen about 4.2% since war began. This is compounding the losses of?foreigners and has likely hastened their exit from Indian assets. India faces increased macro-risks as a result of the war against Iran. The conflict has been ongoing for nearly a month. India imports between 85-90% its crude oil, making it vulnerable to rising oil prices. The rupee's volatility and Indian equity prices are expected to rise as a result of the?worries. Economists have revised up their inflation forecasts. They've also downgraded growth estimates and included a steeper depreciation of the rupee in their "baseline". The escalation of the Middle East has brought energy risks to the forefront of India's macro outlook, with the oil?price, the rupee, and the current accounts now closely?intertwined. ", said Krishna Bhimavarapu. APAC Economist, State Street Investment Management. Since the war, hedging costs for rupee depreciation also increased. The increased volatility expectations and this have eroded foreign investor's interest in Indian bonds and stocks.
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Sources say Asian refiners are switching from Dubai to Brent for US crude pricing
Three sources in the refining industry said that Asian refiners have begun to price U.S. crude oil purchases against the global benchmark ICE Brent rather than Dubai after Middle East benchmark ICE Dubai spiked to'record levels' this month. One of the traders said that the move could result in a reduction in liquidity on the Middle East benchmark derivatives market, as traders switch hedges to ICE Brent. Asian buyers have just started booking U.S. cargoes to be delivered in July,?he said. He added that Japanese refiner Taiyo Oil purchased 2 million barrels. Light crude was offered via a tender for delivery in July at a price of $19 a bar above ICE Brent. The Japanese refiner, who typically purchases WTI crude at prices pegged to Dubai, declined comment. The same source reported that other Japanese refiners had also purchased U.S. Crude priced against ICE Brent in place of Dubai. The source said that details of these deals could not be immediately revealed as they were done in private negotiations. Dubai's oil price soared to a record high of $169.75 per barrel last week, surpassing Brent. The Middle East now supplies the most expensive crude in the world. This is because S&P Global Platts?excluded?three of five crude grades? in anticipation of a long-term disruption in shipping through the Strait of Hormuz. Dubai prices have been supported by the strong demand of TotalEnergies, a French company. Traders said that due to the volatility of the market, Asian refiners requested the top?exporter Saudi Aramco switch its 'benchmark' from Platts Dubai to ICE Brent. Outside of office hours, it was not possible to reach Saudi Aramco for a comment.
Russia will auction off its seized stakes in UGC gold producer next month
Rosimushchestvo, the federal agency for property management, said that a seized?stake? in Russian gold producer Uzhuralzoloto? (UGC?) could be sold at auction next month.
The agency stated that the preparations for auction were in progress. The state owns 67.2% in the company, which at current market prices is worth $1.3billion.
A Russian court ruled in July 2025 that Konstantin Strukov's?majority share?, which he had previously owned, should be transferred to?the state.
This was part of an 'wider pattern' of 'nationalisations, of assets owned by Russian companies or fledgling Western firms. The Moscow law firm NSP estimated last year that the authorities confiscated private assets valued at $50 billion since the beginning of the conflict in Ukraine.
Last October, the central bank stated that the state violated the rights of minority shareholders by failing to make a 'buyout offer' as required by law following the seizure. After the sale, the new owner is expected to make a 'buyout offer.
The auction was originally scheduled to happen 'last year, but it was delayed as gold prices rose and the state wanted a higher stake price.
(source: Reuters)