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Bond yields rise on inflation fears, while global shares fall
Investor euphoria about technology stocks was replaced by inflation fears and traders increased bets on the Federal Reserve raising interest rates in this year. The U.S. president Donald Trump left China Friday without any major breakthroughs in trade or tangible help from Beijing for ending the Iran War. After two sets of high April inflation readings were released this week, there are now concerns over 'inflationary pressures. S&P 500, Nasdaq and Dow Jones fell after reaching record closing levels on the strength of artificial intelligence technology stocks during the previous two sessions. The market has realised that it was way ahead of itself. The market didn't pay enough attention to the economic and bond markets. "It was caught in this momentum AI trade", said Kenny Polcari. Chief market strategist at Slatestone Wealth. The market has finally listened to what the bond markets and economic data are telling it. The inflation rate is still high and could rise in the coming months. REVERSING EQUITIES Wall Street saw the Dow Jones Industrial Average fall 537.29, or 1.07 percent, to 49.526.17. The S&P 500 dropped 92.74, or 1.24 percent, to 7,408.50, and the Nasdaq Composite declined 410.08, or 1.54% to 26,225.15. The S&P 500 still recorded its?seventh consecutive weekly gain. This is its longest winning streak in the last 20 years. The Nasdaq, Dow and S&P 500 all fell this week. The MSCI index of global stocks fell by 17.06 points or 1.53% to 1,099.00. The?pan-European STOXX 600 Index finished earlier down by 1.48%. MSCI's broadest Asia-Pacific index outside Japan dropped 2.5%, while Japan's Nikkei fell 1.99%. Data showed that wholesale inflation in April accelerated to 4.9%, the highest rate in three years. This data kept the Bank of Japan committed to raising rates. The Kospi index in South Korea fell by more than 6 percent on Friday, after an impressive run of gains over the past few months. The index is still up by 77.8% for the year. GOVERNMENT BONDS YIELDS A SPIKE Treasury yields on U.S. government bonds? climbed to their highest level in a full year, as rising?oil costs added to concerns that energy disruptions in Middle East might add to inflation. The yield on the benchmark 10-year U.S. notes increased 13.8 basis point to 4,597% from 4.459% at late Thursday, while the 30-year bond rate rose 10.9 basis to 5.122%. The yield on the 2-year bond, which is usually in line with expectations of interest rates for the Federal Reserve (Fed), rose by 8.7 basis points, to 4,079% from 3.992% at late Thursday. The dollar has risen for the fifth day in a row, putting it on course for its largest weekly gain since two months. Inflationary pressures have driven bets that the Fed will raise rates this year. According to CME Group’s FedWatch tool which shows a 9.9% probability that rates will be 50 basis points higher at year end, traders were betting last week on a 38.8% chance for a 25 basis-point rate hike. A week earlier, the odds were less than 14 percent. Kevin Warsh will replace Jerome Powell as Fed chair on Friday. Trump nominated the incoming Fed Chair, who was under pressure from Powell to lower interest rates. The market will test Kevin Warsh. "They're going press him to find out what he truly stands for," Polcari stated. The dollar index (which measures the greenback versus a basket including the yen,?the Euro, and the yen) rose by 0.33%, to 99.28. Meanwhile, the euro fell 0.38%, to $1.1624. The dollar gained 0.25% against the Japanese yen to 158.74. Sterling has fallen for the fifth day in a row and reached its lowest level in over five weeks. The last time it was down 0.61%, at $1.3318, after a 0.9% drop on Thursday. The ruling Labour Party in Britain said that it would allow Greater Manchester Mayor Andy Burnham to return to Parliament, as a first step towards a potential challenge to Keir starmer's leadership. Steve Reed, British Housing Minister, urged Labour Party legislators to support Starmer. He said that no one who was vying to succeed him had shown sufficient support. Oil prices rose on concerns about supply after Abbas Araqchi, Iran's Foreign Minister, said that Iran had "no faith" in Washington and was only interested in negotiations if Washington was serious. Trump stated that he had 'run out of patience' with Iran, and that he agreed with Chinese leader Xi Jinping that Iran could not have a nuclear bomb and that the Strait of Hormuz must be reopened. U.S. crude oil settled at $105.42 per barrel, an increase of 4.2% or $4.25. Brent reached $109.26, an increase of 3.35% or $3.54. Gold fell to its lowest level in more than a week, under pressure from rising Treasury yields and the dollar as well as bets on higher interest rates. Spot gold dropped 2.35% to $4.540.11 per ounce. U.S. Gold Futures dropped 3.29% to $4,542.30 an ounce. Reporting by Sinead Culp and Stephen Culp, in New York; Sophie Kiderlin, in London, and Stella Qiu, in Sydney. Editing by Sam Holmes and Mark Potter, Joe Bavier and Barbara Lewis, and David Gregorio.
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Thoma Bravo is reportedly interested in selling a stake in Command Alkon.
Thoma Bravo may sell its stake in construction software maker Command Alkon as it tries to maximize returns on software that is seen to be more resistant to broader AI disruption risk, according to four sources familiar with the matter. Thoma Bravo is working with Evercore's investment bankers to sell its 55 percent stake in Command Alkon. Other private equity firms have expressed interest in the last few weeks. Sources who spoke on condition of anonymity about the private discussions said that Command Alkon could be valued at over $1.5 billion. Thoma Bravo refused to comment while Heidelberg Materials Evercore and Command Alkon did not respond to requests for comments. Sources said that Heidelberg Materials, as the largest customer of Command Alkon will retain its stake in the company. This makes the sale of Thoma Bravo’s equity less appealing to private equity buyers who prefer to take full control of assets when doing leveraged buyouts. According to two people familiar with company financials, Command Alkon will generate more than $230 million of revenue this year and $92 millions in earnings before taxes, depreciation and amortization (EBITDA). It is also expected to grow revenues by 11% between 2027 and 2028. Thoma Bravo wants a valuation of between $1.5 billion to $1.75 billion. Thoma Bravo bought Command?Alkon for $1.7 billion in 2020, and then sold a 45-percent stake to Heidelberg the following year. Thoma Bravo has recently completed a deal to sell a stake in Command Alkon, a construction software company. Construction management software maker HCSS announced last month that it would merge with the Build &Construct segment of Germany’s Nemetschek Group,?with Thoma Bravo retaining a?minority?stake? in the combined business. The industry-specific software has been deemed more resistant to AI disruption than the broader software categories. These have recently seen a selloff which has affected valuations in the entire sector. (Reporting and editing by Echo Wang, Chizu Nomiyama, and Milana Vinn from New York)
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Due to high fuel prices and mandates, US oil refiners are finally able to profit from biofuels.
U.S. refiners have finally started to make money from renewable fuels. They had been squeezed for years by government mandates on biofuels. The U.S. and Israeli 'war on Iran' has also led to a rise in diesel prices. The U.S. Environmental Protection Agency (EPA) mandated in late March that refiners mix record volumes of biofuels into gasoline and diesel for this year and the next. The plan calls for a 60% increase of the use of renewable diesel and biodiesel, as well as a requirement that gasoline be mixed with 15 billion gallons ethanol each year. These mandates have forced U.S. refiners into increasing biofuels production, which has revived profits at a moment when global diesel supply remains tight. The move follows a period of decline when the demand for renewable fuels fell short. Oversupply also impacted margins, and producers had to absorb the blow after rapid growth five years ago. Valero is the largest biofuel producer in the country. Its renewable diesel business saw a profit of $139 million in the first quarter, compared to a loss of $141 million in the same time period last year. The profits for the ethanol division more than quadrupled. Biofuel mandates have been described by company executives as a "pretty powerful tailwind." Refiner HF Sinclair also saw a positive change in its renewable diesel results. It posted a $133-million profit, compared to a loss of $17-million a year ago. Phillips 66, a major independent refiner, has dramatically reduced its losses in the renewable fuels sector. Brian Mandell said that the company's renewable-diesel plants were running at capacity during an analyst conference call last month. He said investors should expect to see a "substantial" difference in the performance of the renewable segment compared to a year earlier. WINDFALL UNEXPECTED John Deal, managing Director of Capital Markets at Post Oak Group, explained that the new biofuel mandates have effectively set a ceiling on demand for biomass-based 'diesel. New rules help refiners get a higher price for Renewable Identification Numbers. Refiners that blend more biofuels than required can sell credits to other refiners who lack the capacity to blend sufficient biofuel themselves. Rand Taylor, CEO Fuel Ox Inc., a supplier to refinery industries of fuel additives, stated that the new mandates would bring a multi-year level of certainty as well as stronger RINs. The RIN credits can be divided into two types: D4 credits (for biodiesel or renewable diesel) and D6 credits (for corn-based ethanol). According to LSEG, the prices of these credits rose by more than 80% in 2018. They now cost over $2 per credit. "We have waited through hard times. Franklin Myers, CEO of HF Sinclair, told investors in a recent investor meeting: "Let's harvest these good days." Uncertainty about the future Although a stronger demand for renewable energy and favorable policy signals has encouraged refiners to?churn out more product, it is unclear if this will encourage producers to invest capital in expanding production capacity. Due to the poor market conditions, Chevron will shut down two biodiesel plants in the Midwest of the United States by?2024. Vertex Energy stopped renewable diesel production in its Mobile, Alabama refinery the same year to switch back to fossil fuels. A strong demand for soybean oil by biofuel producers, as well as a slower soy crushing rate due to spring maintenance, could push soybean prices up. Traders and analysts have said that higher prices and a shortage of soybean oil could discourage the production of biodiesel. Diesel prices spiked during Iran's war. This could lead some refiners?to increase conventional diesel production instead. Diesel prices have risen by 46% during the war, and because supplies are tight, conventional diesel offers a better return in the short-term than renewable diesel, according to Arif Gasilov. Geoff Moody is the senior vice president for government relations and policy of American Fuel and Petrochemical Manufacturers. (Reporting from Nicole Jao in New York and Siddharth Cavale; editing by David Gregorio).
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Gold falls to a one-week low, as yields and the dollar climb. Middle East tensions also fuel inflation.
Gold dropped to a'more than a week low on 'Friday as U.S. Treasury Yields?and -the- dollar rose, and inflation fears due to the U.S./Israel war against Iran reinforced bets on higher interest rates. Gold spot was down 2.3% to $4,555.63 an ounce at 1:19 pm EDT (1719 GMT), after it had hit its lowest price since May 4, earlier in the day. Prices have fallen 2.5% so far this week. U.S. Gold Futures for June Delivery fell 2.7% to $4,560.20. "There were a few reasons for the sell-off in (precious metals). The dollar is strong right now. Not only are we seeing a rise in the?U.S. We're also seeing not just a?U.S. Benchmark 10-year U.S. Treasury Yields have risen to a near-one-year high. This has increased the opportunity cost of non-yielding gold. Dollar was set to make its biggest weekly gain in two months. This makes gold priced in greenbacks more expensive for foreign buyers. Donald Trump, the U.S. president, said that his patience was running out with Iran and that China had no significant breakthroughs in trade or tangible assistance to end this war. He added that "the Chinese didn't really offer much help to resolve the conflict and we are seeing crude oil move up, which reinforces inflation narrative, and this has been very bearish on the metals." Since the U.S. and Israel war against Iran began, crude oil prices have risen by more than 40%. This has led to higher global inflation. In times of high inflation, central banks are more likely to raise interest rates. This reduces the appeal of non-yielding gold. According to CME's FedWatch Tool, traders have priced in interest rate?cuts by the U.S. this year. Bets on a hike are up. Spot silver dropped 8.2%, to $76.68 an ounce. Platinum fell 3.7%, to $1,979.95. Palladium was down 1.6%, at $1,413.50. All three metals were heading for losses this week. StoneX analyst Rhona O’Connell stated that silver was "overbought" and needed to be corrected. Silver had fallen as much as 9% in the previous session and was set to have its worst day since March 3. (Reporting and editing by Joe Bavier in Bengaluru, Nick Zieminski and Ishaan arora from Bengaluru)
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US Government planning drastic Colorado River water reductions due to drought and overuse
According to a senior Arizona official, the U.S. government has proposed a plan to share water on the Colorado River, which is currently suffering from a drought. This new plan could reduce up to 40% of current supplies to Arizona and California. The federal government intervened last week to address severe water shortages. A 20-year-old agreement expiring this summer and the talks between the seven states who share the Colorado River at an impasse led to the proposal of a new plan. Buschatzke, a representative of the Arizona water stakeholders, told a gathering of Arizona water stakeholders that the U.S. Bureau of Reclamation had proposed a 10-year plan to reduce water consumption by as much as 3 million acre feet a year in order to maintain levels of water in Lake Mead, Lake Powell and other severely depleted river reservoirs. The U.S. Bureau of Reclamation proposed a 10-year plan in which Arizona, California and Nevada could potentially cut water use by up to 3 million acre feet?per year to maintain water levels in Lake Mead and Lake Powell, the river's severely depleted reservoirs. Buschatzke told a meeting?of Arizona water stakeholders on Wednesday. Nearly twice the cuts as before The'maximum federal cuts', which are reviewed every two-years based on water levels and would be nearly double as large as an offer made by these three lower basin states in May to reduce their water usage by 1.6 millions acre-feet each year. The Bureau of Reclamation, in a statement about its proposal without giving any further details, said: "Given that there is uncertainty and risk facing the Basin these elements are intended to provide stability, while also allowing flexibility for consensus-based suggestions to be incorporated as they evolve." Buschatzke stated that the federal plan will be implemented either under the existing Colorado River law, or through agreements between the states. He said that federal officials indicated water cuts between the three states in the lower basin would be based?on?the?priority of?the law of the river. This law, the Colorado River Compact of 1922, gives California priority in water use. Buschatzke called the proposed federal cuts "sobering." "That's Arizona and us," said Buschatzke. He was referring to the water flow on the Central Arizona Project. This canal transports Colorado River Water to central and Southern Arizona. Under the federal plan, water?releases would range between 5 and 12 million acre-feet annually from Powell and Mead. These reservoirs serve seven states. Buschatzke said, "I believe we all understand that it will be at the lower end of the range unless Mother Nature does her job." Rod Nickel edited the report by Andrew Hay, New Mexico.
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Gold falls to a one-week low, as yields and the dollar climb. Middle East tensions also fuel inflation.
As U.S. Treasury yields and the dollar rose, gold fell to its lowest level in more than a week. Meanwhile, inflation fears due to the Middle East conflict reinforced bets on higher interest rates. By 11:40 am EDT (1540 GMT), spot gold had fallen 2.3% to $4,541.91 an ounce. This was its lowest price since May 4. So far, prices are down 3.7% this week. U.S. gold futures for June delivery fell 3.2% to $4,535 "There were a few reasons for the selloff in (precious) metals. The dollar is strong today. Edward Meir is an analyst with Marex. The yields on benchmark 10-year U.S. Treasury bonds rose to near a one-year-high, increasing the opportunity cost of non-yielding gold. Dollar was on track for its highest weekly gain in the past two months, making gold priced in greenbacks more expensive for foreign buyers. Donald Trump, the U.S. president, said that his patience was running out with Iran and that China had no significant breakthroughs in trade or tangible assistance to end this war. He added that "the Chinese didn't really offer much help to resolve the conflict and we are seeing crude oil moving up,?which reinforces inflation narrative, and this has been very bearish on the metals." Since the U.S. and Israel?war against Iran began, crude oil prices have risen by more than 40%. This has led to higher global inflation. In times of high inflation, central banks are more likely to raise interest rates. This reduces the appeal of non-yielding gold. According to CME's FedWatch Tool, traders have priced in interest rate?cuts by the U.S. this year. Bets on a hike are up. Spot silver dropped 8.6%, to $76.27 an ounce. Platinum fell 3.9%, to $1976.54, while palladium dropped 1.7%, to $1412,11. Spot silver fell 8.6% to $76.27 per ounce, platinum lost 3.9% to $1,976.54 and palladium was down 1.7% at $1.412.11. StoneX analyst Rhona o'Connell stated that silver was?overbought, and needed correction. Silver had fallen as much as 9% in the previous session and was set to have its worst day since February 12. (Reporting and editing by Joe Bavier in Bengaluru, Nick Zieminski and Ishaan arora from Bengaluru)
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Bond yields rise on inflation fears as global shares fall
Investor euphoria about tech stocks was replaced by inflation fears on Friday, and traders bet more that the Federal Reserve would raise interest rates in 2018. U.S. president Donald Trump left China Friday with no significant breakthroughs in trade, or any tangible help from Beijing to end Iran's war. Oil prices rose again on Friday due to uncertainty over a Middle East?deal. This was in addition to the concerns raised by two high-inflation readings earlier this week. S&P 500, Nasdaq and other major stock markets fell on Friday following two sessions of record-breaking gains on artificial intelligence technology stocks. The market has realised that it was way ahead of itself. The market didn't pay enough attention to the economic and bond markets. "It was caught in this momentum AI trade," Kenny Polcari said, chief market analyst at Slatestone Wealth. The market has finally listened to what the economic data and bond market are telling them. The inflation rate is likely to rise in the coming months. FALLS ON THE WALL STREET At 10:52 a.m. (1450 GMT), on Wall Street, the Dow Jones Industrial Average dropped?432.76 or 0.86% to 49,630.70. The S&P 500 declined 75.90 or 1.01% to 7,425.34 while the Nasdaq Composite was down 387.22 or 1.45% to 26,249.36. The MSCI index of global stocks fell by 15.80 points or 1.42% to?1,100.26. The pan-European STOXX 600 fell by 1.56%. MSCI's broadest Asia-Pacific share index outside Japan dropped 2.54%, and Japan's Nikkei fell 1.99%. The Kospi index in South Korea fell by more than 6 percent on Friday, after recent gains. The index is still up by 77.8% for the year. GOVERNMENT BANK?YIELDS SKYROCKET In government bonds, yields on longer-dated U.S. Treasury bonds climbed to their highest levels in over a year. This was due to rising oil prices and fears of inflation from ongoing energy disruptions across the Middle East. Demand for U.S. Treasuries was already affected by inflation concerns. This week, demand was low at auctions. The yield on the benchmark 10-year note in the United States rose by 11.6 basis point to 4.576% from 4.459% at late Thursday, while that of the 30-year bond rose by 10.1 basis points. The yield on the 2-year bond, which is usually in line with expectations of interest rates for the Federal Reserve (Fed), rose by 8.3 basis points, to 4,075% from 3.992%, late Thursday. The dollar gained in value, putting it on course for its largest weekly gain in over two months as bets were placed on a Fed interest rate hike. According to CME Group’s FedWatch tool traders were betting last on a 38% chance that a 25 basis-point rate hike would occur by the end of this year, compared with less than 14% a week earlier. Kevin Warsh will replace Jerome Powell as Fed Chairman on Friday. Trump nominated the incoming Fed Chair, who is expected to be Kevin Warsh. Trump has been 'pressuring Powell to lower interest rates. Kevin Warsh will be put to the test by the market. "They're going press him to find out what he truly stands for," Polcari stated. The dollar index, a measure of the U.S. Dollar against a basket including the yen and the euro, rose by 0.32%, to 99.26. However, the euro fell by 0.39%, to $1.1623. The dollar gained 0.24% against the Japanese yen to 158.73. The sterling fell to a new five-week low on its fifth consecutive day of losses. It was last down by 0.43%, at $1.3341. The pound fell 0.9% Thursday after the resignation of Wes Streeting as health minister, deepening Britain’s political crisis. Steve Reed, British housing Minister, urged Labour Party legislators to "get behind" Prime Minister Keir starmer on Friday. Reed said that no one was willing to challenge him. On the energy market, U.S. Crude?rose by 3.7%, to $104.91, and Brent rose by 3.34% to $109.27 a barrel. Gold fell to its lowest level in more than a week, under pressure from rising Treasury yields and the dollar. Spot gold dropped 2.21%, to $4,46.93 per ounce. U.S. Gold Futures dropped 3.29% to $4,524.30 an ounce. Reporting by Sinead carew in New York and Sophie Kiderlin, London. Stella Qiu, Sydney. Sam Holmes, Mark Potter Joe Bavier, Barbara Lewis and Barbara Lewis edited the article.
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US manufacturing production is boosted by motor vehicles and AI; war-related shortages of supplies are looming
The U.S. manufacturing sector posted its biggest increase in 14-months in April. This was driven by the demand for motor vehicles, and?technology products amid a boom in artificial intelligence spending. A survey released by the New York Federal Reserve showed that delivery performance in New York State deteriorated during May. The U.S. and Israel conflict with Iran has caused disruptions in shipping through the Strait of Hormuz. This has led to higher energy prices and global supply chain strains, as well shortages of many goods including consumer products, fertilizers and aluminum. In April, producer prices rose at the fastest rate in four years. The oil prices rose on Friday, after President Donald Trump's comments and Iran’s Foreign Minister's remarks quashed hopes for a deal that would end attacks and seizures of ships around the Strait. Michael Gapen is the chief economist of Morgan Stanley. He said: "Overall, a firmer demand, and a continued increase in output, point to some strength in the manufacturing sector." "However uncertainty about supply and prices puts the outlook for the near term at risk." The Federal Reserve reported that manufacturing output rose 0.6% in April, which is the highest increase since February 2025. This follows a 0.1% rise in March, which was upwardly revised. The Federal Reserve said that economists surveyed by it had predicted that factory production would rebound 0.2% following a 0.1% drop in March. In April, factory production increased 1.3% on an annual basis. The production of motor vehicles and parts jumped by 3.7%. The production of high-tech industries increased by 1.0%, after increasing 0.5% in March. Computers and peripheral equipment boosted output for the second consecutive month, increasing 1.5%. The production of semiconductors, electronic components and other related products increased by 1.0%. Communications equipment increased by 0.6%. AI is being rapidly adopted by businesses, who are investing billions in the process. This helps to support manufacturing, which represents?9.4% (?) of the economy. AI spending was a major contributor to the economy's annualized growth rate of 2.0% in the first quarter. Manufacturing, excluding high-tech industries and motor vehicle production, rose by 0.3% in April following a similar increase in March. Durable goods production jumped 1.2% in the last month. Chemicals production fell by 0.9%. Plastics and rubber production also fell by 0.9%. The production of petroleum and coal-based products increased by 1.0%, for the second consecutive month. Food, beverages and tobacco products also saw an increase in production. The increase in manufacturing could be due to companies placing orders early to avoid possible shortages or higher prices caused by the Middle East conflict. DETERMINING THE PERFORMANCE OF SUPPLIER DELIVERY New York Fed Empire State Manufacturing Survey revealed that its measure of business conditions rose nine points in May to 19,6. This was the highest level for more than four-years. New orders and shipments also increased significantly, both for the second consecutive month. The survey's measurement of delivery time reached a four-year peak, but its gauge of availability of supplies remained negative. This suggested that "delivery times had become much longer and availability of supplies worsened." Stocks in the United States were trading lower, as inflation fears increased. Treasury yields on longer-dated bonds reached their highest level in over a year. Dollar rose in relation to a basket. The financial markets expect that the U.S. Central Bank will keep its overnight benchmark interest rate at 3.50%-3.75 percent until next year, due to the higher oil prices and inflation. The higher interest rates may offset the manufacturing boost from tax cuts. Trump's import tariffs hurt manufacturing last year, but the AI spending spree helped to offset some of that drag. The Fed's report shows that mining output fell 0.1% in April after falling 1.6% in March. Energy production increased by 1.0%, but drilling for oil and gas wells decreased again in March. In the Fed's Beige Book last month, it was noted that "many producers were cautious about increasing drilling because of uncertainty?about the persistance of higher prices." Stephen Brown, Capital Economics' chief North America economist, said: "This second consecutive decline should serve as a reminder to those who think that an increase in U.S. oil production will offset the supply losses from Middle East." Electricity and natural gas production both increased by 1.9%. Utilities production fell by 1.4% in march. After a downwardly revised 0.3% decline in March, the overall industrial production increased by 0.7%. Previously, industrial output was reported to have decreased by 0.5%. In April, it increased by 1.4% compared to the same month last year. Capacity Utilization for the Industrial Sector, which measures how well firms use their resources, increased to 76.1% in March from 75.7%. This is 3.3 points below the average for 1972-2025. The manufacturing sector's operating rate increased by 0.4 percentage points to 75.8%. This is 2.4 points below the long-term average. Reporting by Lucia Mutikani; Editing by Chizu Niyama and Nick Zieminski
Cubans are frightened by the US's plans to indict Raul Cuba
The U.S. plan to indict Cuba's former 'leader Raul Castro for the downing humanitarian planes 20 years ago increased tensions in the island Friday. This comes as the country is struggling with its worst crisis in decades due to severe fuel shortages. Indicting the '94-year old'revolutionary icon' would be a major step in the Trump administrations pressure campaign on Cuba. The Trump administration has been describing the communist government of Cuba as corrupt and incompetent, while pushing for change.
Cuba has not yet commented directly on the threat to indict, but Bruno Rodriguez, Cuba's Foreign Minister, expressed his defiance Friday. Rodriguez told a meeting of BRICS Foreign Ministers that Cuba is continuing to develop its socialist system despite the embargo and sanctions imposed by the United States.
Cubans interviewed in Havana said that an indictment could only go backwards on negotiations with the U.S. and further deepen the diplomatic crisis between both nations. Sonia Torres 59, Havana schoolteacher, said that a prosecution against Raul Castro who oversaw the military for decades and served as president between 2008-2018 was an insult to Cuban pride in a time of crisis.
She said, "Cubans should always move forward." "If they want to prosecute Raul, then we will defend Cuba using sticks and stones if necessary." Tensions between neighboring countries go back to Fidel Cuba's communist revolution of 1959. Castro formed an alliance with the Soviet Union and then seized U.S. citizen-owned businesses and properties. This stoked decades of tensions between both?nations. Since January, the Trump administration has been laying siege to Cuba, enforcing de facto fuel blocks, issuing military threats and increasing sanctions which have forced foreign companies - such as Canadian miner Sherritt International to flee.
Peter Kornbluh said that an indictment of Castro would be a "watershed moment" in negotiations. He said it would represent the "diplomatic endpoint". Kornbluh stated that this was an ultimatum. It's now or never. The indictment has provided a legal fig leaf for military operations that aim to capture or assassinate Raul Castro. The United States used criminal charges against foreign politicians to justify military action in the past. Trump also threatened that Cuba would be "next" after his administration captured Venezuelan leader Nicolas Maduro by his government in January.
His government called it a "law-enforcement operation" in order to bring Maduro to New York and face criminal charges. Although he has no formal government position, the younger Castro is still seen as the most influential?leader of Cuba and a symbol of its revolution.
Brothers to the Rescue
The U.S. Department of Justice said that a potential Castro indictment relates back to the 1996 shooting down of two planes operated?by the humanitarian group Brothers to the Rescue.
Cuba defended its attack at the time as a legitimate defence of its airspace. But the U.S. later supported the U.S. view, concluding that the shooting down took place in international waters.
Fidel Castro claimed that Cuba's military acted on "standing instructions" to shoot down planes entering Cuban airspace. He claimed that his brother Raul, the then-defense?minister of Cuba, had not given a specific command to shoot down the planes.
Havana resident Eliecer Diaz, 45 said that then as now Cuba had to defend its self against U.S. aggression. Eliecer Diaz (45), a Havana resident, said: "That is an invasion... You have to defend yourselves." "If they're now considering prosecuting (Raul Cuba), I think this is wrong."
(source: Reuters)