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Gold drops over 1% amid rate hike fears ahead of U.S. Inflation data
On Tuesday, gold fell more than 1% to a two-month low. This was due to a wider'market' sell-off. Investors were also pressured by expectations that the U.S. will raise interest rates this year. As of 1:45 pm, spot gold dropped 1.5% to $4264.70 an ounce. ET (1745 GMT) after having fallen more than 2% in the earlier session. Bullion dropped to its lowest price since March 23. U.S. Gold Futures for August Delivery Settled by 1.8% at $4,286.4 "Traders have become a bit nervous about the market... all markets are now in risk-off mode." Bob Haberkorn is a senior market strategist with RJO Futures. He said that the current risk-off has caused a decline in gold. S&P 500 & Nasdaq both fell to new lows of over a month on Tuesday. Haberkorn said that "gold and silver will remain under pressure" until the Fed provides clearer guidance. The focus this week has shifted from last week's positive?jobs numbers to the key inflation data, such as the U.S. Consumer Price Index for May on Wednesday, and the Producer Price Index on Thursday. These are expected to provide more insight into the U.S. monetary policies outlook. The gold price will likely fall even further if the U.S. May inflation data also surprises on the upside, as we expect. The gold price is likely to fall further if the U.S. inflation data for May also surprises on the upside, according to Commerzbank. According to the CME FedWatch tool, traders are estimating a 68% chance that the Fed will raise rates in December. After President Donald Trump's appeal, Iran and Israel announced that they would cease their attacks against each other. The higher crude oil prices can fuel inflation, and this will keep rates high for longer. Gold is often seen as a hedge against inflation, but higher rates can weigh down on the metal. India's sharp rise in gold import duties is "fueling a resurgence of smuggling" that could "exceed 100 tons this year", as "soaring grey-market margins allow smugglers and refiners to undercut each other." Silver spot fell by 4.3%, to $65.23, platinum dropped 2.1%, at $1.717.30, and palladium was down 1.3%, at $1.220.92. (Reporting and editing by Shilpa Majumdar, Jonathan Ananda, and Anushree mukherjee from Bengaluru)
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US EIA warns that oil inventories are headed for multi-decade lows
The U.S. Energy Information Administration reported on Tuesday that oil stockpiles in?the largest economies of the world are heading toward their lowest levels since 2003, as inventories are being drawn down at an unprecedented pace due to lost production from the Iran War. The EIA estimates that total oil inventories within the Organization for Economic Cooperation and Development members will fall to just over 2.3 billion barrels in December. This is based on the current assumption that the marine traffic through the Strait of Hormuz won't return to its pre-conflict level until early 2027. In its Short-Term Energy Outlook monthly report, the EIA said that the OECD's stockpile had 'not been at this low level since 2003 when the EIA started keeping records. The agency stated that the rapid inventory 'drawdown', which is required to compensate for the 11 million barrels per day of lost Middle Eastern production, creates the basis?for an increase in oil prices. Prices have been impacted by recent reports that the U.S., Iran and other countries were close to an agreement on reopening the Strait of Hormuz. This is a crucial waterway which handles 20% of all global oil shipments. As of this writing, an agreement had not yet been reached. The EIA reported that global oil inventories continue to drop to meet demand, while most oil production remains shut down in the region. The EIA expects the price of global benchmark Brent crude to average around $105 per barrel on the spot market in June and in July. This is well above the $91.60 per barrel that was traded in the Tuesday futures market. The agency stated that "because of the magnitude of the drawdown of global inventories we predict that oil prices will continue to be?elevated' until global oil flows are restored and oil inventories are replenished." The EIA stated that high oil prices, reduced fuel availability and government initiatives to conserve oil would cause the global oil demand this year to'reduce for the first time since the pandemic slump of 2020. The EIA now predicts that demand will fall by 1.1 million barrels per day this year, in contrast to its previous forecast of an increase of 200,000 barrels per day. Reporting by Shariq KHan and Scott DiSavino, New York; Editing and proofreading by Mark Porter and Paul Simao
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Data shows that Saudi jet fuel supplies to Europe are higher than before the closure of Hormuz.
Saudi Arabia will deliver more jet-fuel to Europe in this month than when the Strait of Hormuz was open. Data from shipping trackers Kpler and Vortexa shows the significance of Saudi Arabia's increased exports via Red Sea. Kpler data shows that EU and UK imports of jet fuel from Saudi Arabia’s Red Sea Port of Yanbu reached 118,000 barrels a day in the first week of June. This is their highest level since August 2025. Vortexa estimated that the flows were at 140,000 barrels per day. Kpler data indicates that the highest monthly volume this year was?77,000 Bpd in January. Saudi Aramco, the state-owned firm, declined to comment about the "increased jet exports to Europe". By 2025, Europe will receive about 300,000 bpd of jet fuel from the Middle East via the Strait of Hormuz. According to Kpler, Europe's total imported fuel averaged around 550,000 bpd. This includes imports from India and Nigeria, as well as the U.S. Saudi Arabia has increased exports through the Red Sea Port of Yanbu, as the strait is effectively closed due to the Iran War. If sustained, these exports would help 'Europe fill a gap in jet fuel imports and illustrate?how?the?closure of Strait of Hormuz affects global jet fuel flow. In May, Europe increased its jet fuel imports - which averaged around 200 bpd - from the U.S. International Energy Agency said previously that Europe could start to see some shortages of jet fuel in June. However, European airlines have played down fears of a shortage during the summer. (Reporting from Seher Dareen, London; additional reporting by Ahmad Ghaddar. Editing by Alex Lawler & Jason Neely).
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Jio BlackRock to launch ETF in August after $2 billion India fund base
Jio BlackRock Asset Management will launch its first exchange traded funds in India by August. The company hopes to emulate 'BlackRock’s' global success in passive investment in a market that is still developing. In the year following its launch, the joint venture between MukeshAmbani's Jio Financial Services (JFS) and the largest asset manager in world has managed to amass about 180 billion rupees in assets. This was achieved by establishing a solid base of cash, debt index and active equity funds. The plan is to begin with equity-focused ETFs. BlackRock manages approximately $5.1 trillion worth of ETF assets worldwide, which is more than a third of all assets managed by the company. This highlights the importance of this product line for its brand. Jio?BlackRock is currently India's 29th largest asset manager. "ETFs can be a good long-term investment." Retailers are now becoming more interested in ETFs, even though the Indian market is predominantly institutional. We can see by global trends that?ETFs are a popular choice of investment," said Sid Swaminathan. ETF INNOVATION CAN BOOST LIQUIDITY According to the Mutual Fund Industry Association, passive mutual fund assets in India amounted to 15.20 trillion rupees (or about 18.5%) of the industry’s average assets under administration, which totaled 81.94 trillion. Comparatively, equity index funds and ETFs make up about 45.3% (or more) of the long-term mutual and ETF assets held in the U.S. Swaminathan stated that tighter bid-offer margins and more innovative strategy could help improve liquidity and boost participation by retail in Indian ETFs. Within the next few months, the company plans to 'launch products' in GIFT City (Gujarat International Finance Tec-City), India’s low-tax financial centre that competes with centres like Singapore and Dubai. COMPLEX PRODUCTS?PROMPT PIVOT DISTRIBUTOR -LED MODEL Jio BlackRock's more complex products, such as special investment funds or GIFT City, are distributed by Jio BlackRock rather than digitally. This reflects the role that advisers continue to play in selling higher-ticket items. Swaminathan stated that the decision to "prioritise" those launches was partly driven by market conditions. India's Nifty 50 index has fallen 11.1% in 2026 due to foreign outflows and higher oil prices, as well as a slowing of earnings growth. MSCI's Asia-Pacific ex-Japan Index is up 18.2%.
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Markets rise as votes from overseas pour in and the race for Peru tightens up again
The race for Peru's presidency tightened up overnight, with candidates separated by less that 0.1%. Overseas votes are pushing the race to Keiko Fujimori. This is giving markets a boost on Tuesday. The main'stock -index' of Peru jumped more than 7% on Tuesday morning. U.S. listed shares like Buenaventura miner were up 8.2%, Intercorp Financial Services was up 12.9% and the iShares MSCI Peru Global Exposure ETF jumped by 6.7%. The local currency, the sol, was up by 2.45% against the dollar at 3.345. The increase is largely the reversal from a sharp drop on Friday, after leftist Roberto Sanchez, rattled investors and markets with his proposals to revamp Peru’s mining-heavy economic system, rose in the polls. He has advocated reforming the constitution and imposing wealth taxes. Fujimori has taken up the legacy of her authoritarian father, former Peruvian president Alberto Fujimori. He was jailed in connection with mass murders during his presidency. Fujimori was leading in exit polls and early counts, but Sanchez gained more ground as rural votes came in. Sanchez's lead grew to almost 50,000 votes Monday, but has now dropped to 20,000 as overseas votes continue to be counted. Sanchez is currently leading Fujimori with 49.94% to 50.06% with 95.95% votes counted. Alfredo Torres of Ipsos said that although the rural vote still tends to favor Sanchez, a significant part of the votes pending are from outside of the country. This is in favor of Fujimori. A total of?1.67% ballots are flagged for review. The majority of them are from the Lima metro region which is also Fujimori's stronghold. Torres, speaking to a local station, said that "doing the math" it is possible that the numbers now seen could be reversed. Both candidates have called for patience, and that all votes be counted. Peru's ONPE said that a complete count should be completed in July. (Reporting and editing by Alexander Villegas, Marco Aquino)
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Oil and dollar drop, while stocks lose steam
MSCI's global equity gauge retreated from its earlier gains as Wall Street investors waited anxiously for inflation data. The dollar also dropped along with oil prices in hopes of easing Middle East tensions following the ceasefire between Israel and Iran. U.S. Energy Sec. Chris Wright stated on Tuesday that the ship traffic in the Strait of Hormuz, a vital energy conduit, is increasing "very significantly." Israel's Tuesday attack on the historic port of Tyre, in southern Lebanon, killed at least eight people, but the progress towards a Middle East peace still seemed uncertain. Tehran had warned on Monday it would re-engage in hostilities should Israel continue to attack Hezbollah, its Lebanon-based ally. U.S. Treasury rates dipped as traders awaited the consumer inflation report for May, which is due on Wednesday. This will provide a better indication of whether or not price pressures continue to increase. S&P 500 technology's heavyweight sector was unable to hold gains earlier, which put pressure on both the benchmark index and the tech-heavy Nasdaq. Gene Goldman of Cetera pointed out that investors are anxious ahead of economic data, as they worry about elevated inflation fueling worries about the Federal Reserve. Investors are a little cautious as they worry about tomorrow's potential?high inflation numbers. Goldman stated that higher-than-expected inflation brings the Fed into the spotlight as a major risk. The CME Group's FedWatch tool shows that since the release of the stronger-than-expected May jobs report on Friday, traders are increasing bets the Fed will increase rates rather than cut them. According to the tool, the probability of a 25 basis point rate hike by December is now 43.4%, and the bets for a 50 basis point increase have increased from 12% the previous week. Wall Street opened at 11:01 am. The Dow Jones Industrial Average rose 145.62, or 0.29% to 50,931.63, while the S&P 500 dropped 16.64, or 0.22% to 7,389.09, and the Nasdaq composite fell 179.07, or 0.69% to 25,750.59. MSCI's global stock index rose 3.23 points or 0.29% to 1,104.19, after previously rising more than 1%. After paring gains, the pan-European STOXX 600 rose by 0.18%. BORROWING FEES In currency, the dollar index (which measures the greenback in relation to a basket of currencies that includes the?yen, and the Euro) fell by 0.22%, while the euro rose 0.23%, reaching $1.1561. The dollar gained 0.04% against the Japanese yen to 160.23. The yield on the benchmark 10-year U.S. notes dropped 0.2 basis point to 4.548% from 4.55% on Monday, while the 30-year bond yield increased 0.3 basis point to 5.0272%. The yield on the 2-year note, which moves typically in line with Federal Reserve interest rate expectations, dropped 1.7 basis points from Monday's 4.158% to 4.141%. Energy markets saw U.S. crude fall 3.94% to $86.70 a barrel while Brent dropped to $91.11 a barrel, a drop of 3.33% for the day. (Reporting from Sinead carew in New York; Amanda Cooper in London; Wayne Cole in Sydney. Editing by Thomas Derpinghaus & Gareth Jones.
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Sources say that China continues to issue fuel quotas in spite of export controls
Four?trade? sources said that China issued its second batch fuel quotas this year. The total is?18 millions metric tons. Despite existing export restrictions, the overall levels are largely unchanged year on year. China has cut back on outbound shipments since March to protect its domestic oil supply, in light of the protracted conflict in Middle East which is disrupting oil flow. Sources said that out of the total, 13 million tons quotas had been allocated for the export of gasoline, diesel, and jet fuel while 5 millions tons were reserved for marine fuel oil. Sources said that Sinopec, CNPC, and Sinochem received a total of 4,06 million?tons under the "processing" trade category. These quotas will be used primarily for exports to 'Hong Kong, and aviation fuel refueling at Chinese airports. Beijing allocated 19 million tons of the first batch quotas this year in December, while the second batch was 18 million tons last year. The?Commerce ministry of China was not available immediately outside office hours. Two of the four sources stated that the government had also given 8.94 million tons of quotas to six companies under the "general trade" category, but due to the current restrictions, only Sinopec and PetroChina are allowed to export. Estimated exports to ex-Hong Kong buyers, mainly in the Asia-Pacific area, for May and Juni were between 500,000-550,000 tonnes. Two separate sources familiar with the issue said that the government has vetted a list of countries receiving Chinese fuel in the past few months but is easing up on the scrutiny of June shipments. Reporting by Siyi Liu and Trixie Yap; Editing by Alison Williams
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Gold falls on fears of rate hikes ahead of U.S. Inflation data
Prices of gold fell on Tuesday as a result of the broader market sell-off, and rising expectations that interest rates will be raised in the United States this year. Investors are now focusing their attention on key inflation data to be released later this week. As of 11 am, spot gold was down 0.7% at $4,298.75 an ounce. ET (1500 GMT), following a fall of more than 1% in the previous session. U.S. gold futures for August delivery fell 0.9% to $4323.90. "Traders have become a bit nervous about the market. All markets across the board are now in risk-off mode. Bob Haberkorn is a senior market strategist with RJO Futures. He said that the current risk-off has led to a drop in gold. The Nasdaq Composite index, which is a tech-focused index, and the benchmark S&P 500 Index?were both down by 0.9% and 0.4% respectively. Haberkorn continued, "Gold and Silver remain under pressure until we get clearer direction from the Fed." The focus this week has shifted from last week's positive job numbers to the key inflation data, such as the U.S. Consumer Price Index for May on Wednesday and the Producer Price Index on Thursday. These are important indicators of the U.S. monetary policies outlook. If the U.S. Inflation data for May surprise to the upside again on Wednesday, then the gold price will likely fall even further. Commerzbank also said that this could increase the possibility of a recovery in the second half of the year if, as expected, the Fed does not raise interest rates. According to CME FedWatch, traders are pricing in a 70% chance of a Fed rate increase in December. The Middle East is showing signs of a possible peace agreement, which has pushed the oil price lower. This was after Iran and Israel announced that they had stopped their attacks against each other in response to an appeal by U.S. president Donald Trump. The higher crude oil prices can cause?inflation, and therefore keep interest rates high for longer. Gold is often viewed as an inflation hedge. However, higher interest rates can weigh down on this non-yielding material. Silver spot fell by 3.2%, to $65.98 an ounce. Platinum was down 1.1%, at $1.736.08, and palladium dropped 2.5%, at $1.234.93. (Reporting and editing by Shilpa Majumdar, Jonathan Ananda and Anushree mukherjee from Bengaluru)
Post-COVID, China is back in Africa and doubling down on minerals
China's. flagship financial cooperation program is recuperating after a. lull during the international pandemic, with Africa a primary focus,. according to a analysis of loaning, financial investment and trade. information.
Chinese leaders have been citing the billions of dollars. devoted to brand-new building and construction jobs and record two-way trade. as proof of their commitment to assist with the continent's. modernisation and foster win-win cooperation.
But the information exposes a more intricate relationship, one that. is still mostly extractive and has actually up until now failed to live up to. a few of Beijing's rhetoric about the Belt and Roadway Initiative,. President Xi Jinping's method to develop a facilities. network connecting China to the world.
While new Chinese investment in Africa increased 114% last. year, according to the Griffith Asia Institute at Australia's. Griffith University, it was greatly focused on minerals. necessary to the international energy transition and China's plans to. revive its own flagging economy.
Those minerals and oil likewise controlled trade. As efforts. falter to improve other imports from Africa, including. agricultural items and made products, the continent's. trade deficit with China has ballooned.
Chinese sovereign loaning, once the main source of funding. for Africa's infrastructure, is at its least expensive level in 2. years. And public-private collaborations (PPPs), which China has. touted as its new favored financial investment lorry internationally, have. yet to gain traction in Africa.
The result is a more one-sided relationship than China. states it wants, one that is dominated by imports of Africa's raw. products and that some analysts argue contains echoes of. colonial-era Europe's economic relations with the continent.
This is something late-19th century Britain would. identify, stated Eric Olander, co-founder of the China-Global. South Project site and podcast.
China rejects such assertions.
Africa has the right, capability and knowledge to establish its. external relations and pick its partners, China's foreign. ministry wrote in action to ' concerns.
China's useful assistance for Africa's course of. modernisation in accordance with its own characteristics has. been welcomed by an increasing number of African countries.
A PIVOT WITH CAPACITY?
China's engagement in Africa, a focus of the Belt and Roadway. Effort (BRI), proliferated in the 2 years before the. COVID-19 pandemic. Chinese business constructed ports, hydropower. plants and railways throughout the continent, financed generally. through sovereign loans. Annual financing dedications peaked at. $ 28.4 billion in 2016, according to the Global China Effort. at Boston University.
However numerous tasks proved unprofitable. As some federal governments. had a hard time to pay back loans, China cut lending. COVID-19 then. pressed it to turn inward, and Chinese building tasks in. Africa fell.
A rebound in sovereign lending is not expected.
Policymakers in Beijing have actually instead been pressing Chinese. business to take equity stakes and run infrastructure they. construct for foreign governments. The goal, China experts say, is. to assist companies win higher-value contracts and, by giving them. skin in the game, guarantee the tasks are financially feasible.
Providing to Unique Function Vehicles (SPVs), possibly the most. typical methods of PPP facilities financial investment, has actually been growing. as a percentage of China's overseas loans, according to figures. shared solely with by AidData, a research study centre at. U.S. university William & & Mary.
The $668-million Nairobi Expressway, a public-private. collaboration developed and run by the state-owned China Roadway and. Bridge Corporation (CRBC), could be evidence of concept for the. model in Africa. Since it opened in August 2022, the toll road. has actually been enabling commuters to speed above the Kenyan capital's. notorious traffic snarls, beating profits and use targets.
Day-to-day average use in March was currently 57,000 vehicles,. surpassing a 2049 target of around 55,000 set by CRBC in a 2019. presentation on the job's financial viability seen by. .
However couple of business are following CRBC's example in Africa. While worldwide some 45% of Chinese non-emergency lending was to. SPVs from 2018 to 2021, the most current year for which AidData. figures are offered, the figure was only 27% for Africa.
Analysts point to a variety of likely reasons, consisting of a. lack of legal structures for PPPs in many African countries and. the view among some Chinese companies - many of them relative. newbies to PPPs - that African markets are dangerous.
China's foreign ministry did not straight attend to a request. for discuss the lower SPV figures for Africa. But it said the. federal government motivates Chinese business to actively establish new. modes of cooperation such as PPPs to bring more personal. financial investment to Africa.
GROWING ENGAGEMENT
The Griffith Asia Institute put China's overall engagement in. Africa - a mix of construction contracts and financial investment. commitments - at $21.7 billion in 2015, making it the biggest. regional recipient.
Information from the American Enterprise Institute, a. Washington-based think tank, showed financial investments hitting nearly. $ 11 billion in 2023, the highest level considering that it started tracking. Chinese financial activity in Africa in 2005.
Some $7.8 billion of that went to mining, like Botswana's. Khoemacau copper mine, which China's MMG Ltd purchased for $1.9. billion, and cobalt and lithium mines in countries including. Namibia, Zambia and Zimbabwe.
The hunt for important minerals is driving facilities. building and construction too. In January, for example, Chinese business. pledged up to $7 billion in facilities financial investment under a. modification of their copper and cobalt joint venture arrangement with. Democratic Republic of Congo.
Western and Gulf powers are also racing to lead the world's. energy shift, with the United States and European. federal governments backing the Lobito Passage, a rail link to bring. metals from Zambia and Congo to Africa's Atlantic coast.
African leaders have actually struggled, nevertheless, to raise financing. for some other priority projects.
In spite of the success of the Nairobi Expressway, for instance,. deal with several Kenyan roadways stalled when the federal government ran out. of cash to pay the Chinese construction companies.
During a visit to Beijing last October, President William. Ruto requested for a $1 billion loan to finish the jobs.
A Chinese foreign ministry spokesman, Wang Wenbin, stated. conversations about the demand were ongoing. Kenya's finance. ministry did not react to an ask for comment.
The last phase of a train line intended to traverse Kenya. from its main port to the border with Uganda has been in similar. limbo since Chinese financing dried up in 2019. Uganda cancelled. the contract for its portion of the line in 2022, after Chinese. backers pulled out.
When inquired about the decline in loaning for African. facilities, Chinese authorities indicate a pivot to trade and. investment, arguing that BRI-generated trade increases Africa's. wealth and development.
Two-way trade reached a record $282 billion in 2015,. according to Chinese customs information. But at the very same time, the. value of Africa's exports to China fell 7%, mainly due to a. decrease in oil rates, and its trade deficit expanded 46%.
Chinese officials have actually sought to lighten the issues of. some African leaders.
At a summit in Johannesburg last August, Xi stated Beijing. would introduce efforts to support the continent's. manufacturing and agricultural modernisation - sectors African. policymakers consider key to closing trade spaces, diversifying. their economies and developing jobs.
China has likewise vowed to increase farming imports from. Africa.
Such efforts, for now, are coming up short.
With among Africa's largest trade deficits to China, Kenya. has actually been pushing to increase access to the world's. second-largest consumer market, just recently acquiring it for avocados. and seafood. But cumbersome health and health policies suggest. Chinese customers remain out of reach for lots of producers.
The Chinese market is a new one, stated Ernest Muthomi, CEO. of the Avocado Society of Kenya. It was a challenge due to the fact that you. need to set up the devices for fumigation.
Of 20 billion shillings ($ 150.94 million) worth of avocados. exported in 2015, simply 10% went to China.
In general, Kenyan exports to China tipped over 15% to $228. million, Chinese customizeds data showed, as a decrease in titanium. production led to a drop in shipments of the metal - a key. export to China.
But Chinese produced items kept coming.
That's not sustainable, stated Francis Mangeni, an advisor at. the Secretariat of the African Continental Free Trade Area.
Unless African countries can include value to their exports. through increased processing and production, he stated, we are. simply exporting raw minerals to fuel their economy.
(source: Reuters)