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Russian rouble falls on concerns about oil exports
On Thursday, the Russian rouble fell sharply in relation to the U.S. Dollar and the Chinese yuan due to market worries about future oil revenues after U.S. pressure was applied on India and China. Donald Trump, the U.S. president, said that on October 15, Indian Prime Minister NarendraModi had promised to stop purchasing oil from Russia. He would then try to convince China to do the exact same thing. The rouble fell by 1.7% against the U.S. Dollar in the over-the counter market and by 2% to 11,20 against the Yuan at the Moscow Stock Exchange where the Chinese currency is the most actively traded foreign currency. The rouble strengthened this week to its highest level since July, on the back of a decline in demand for foreign currencies from importers. Fears of a possible future decline in oil revenues led to some profit-taking, which had a direct impact on the thin Russian markets, said a Russian currency trader who declined identification. Another currency dealer stated that "our illiquid market broke", mainly because there was a general feeling of inadequacy about the recent strengthening the rouble. The rouble has not reacted to the news that Trump is to hold a telephone call with Russian president Vladimir Putin on Thursday evening, just a day before he hosts Ukraine's Volodymyr Zelenskiy at the White House. (Reporting and editing by Gareth Jones, Gleb Brynski)
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Peru's new President faces protests that resulted in dozens of injuries and one death
The state ombudsman’s office reported on Thursday that at least one person died and dozens were injured during protests in Peru overnight against President Jose Jeri who took power only days before. The protest, organized by Gen Z, civil groups and transport workers, took place on Wednesday night. It was part of a series against rising crime and corruption that culminated in the dramatic ouster at midnight of the former president Dina Boluarte, last Thursday. Around the country, thousands of protesters gathered. Hundreds clashed with police in front of Congress in Lima. The police fired tear gas, while protesters hurled rocks, fireworks and burning objects. "Everyone must leave!" "Everyone must go!" protesters shouted when they reached Congress, and then tried to tear down the metal barriers protecting it. This led to clashes. The Ombudsman's Office confirmed that a 32-year old man, Fernando Losada was killed in the protest. It said the death will be investigated. The Peruvian prosecutor's said that Losada died after being shot but didn't say who fired. Jeri posted on X that she was sorry for the death and said it would be investigated "objectively". Jeri had earlier claimed that 55 police officers were injured and 20 civilians in the protest. She blamed "delinquents" who "infiltrated peaceful demonstrations to sow confusion." He wrote: "The full force will be on them." The protests on Wednesday were a good indicator of how Jeri’s presidency could end next July, due to elections. Jeri has pledged to put crime at the top of his agenda, but he has been involved in a number scandals, including allegations of corruption and an investigation that has now been shelved for sexual assault. Jeri, 38, has expressed his willingness to work with any investigation into corruption. He has also denied wrongdoing and a number of scandals. Boluarte was met with widespread protests when she took power late in 2022. This led to dozens deaths and a drop in her popularity, which fluctuated between 2% to 4% during the days before her removal. Congress, which Jeri led before becoming president, is also unpopular. It has a one-digit approval rating.
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Kazakhstan freezes fuel and utility prices amid inflation
Kazakhstan's Government announced on Thursday that it would freeze the price of some diesel and petrol as well as suspend utility tariff increases until 2026. This is due to the double-digit inflation rate continuing to increase. In a Telegram statement, the government announced that price freezes for diesel and AI92 gasoline will remain in effect until inflation stabilizes. It also said it would increase funding for the domestic agriculture to help prevent any price increases on what it called "socially important" food products. The government also claimed that it would reduce the tax revenue collected by small businesses, and make affordable mortgages more available. Inflation rates in Kazakhstan, which is a mineral giant and produces around 2% the world's supply of oil, were 12.9% in September. This was significantly higher than those in Russia, Kazakhstan's neighbour and main trading partner, where the prices have risen since the start of the war in Ukraine. Kazakhstan's central banks raised rates last week to an unprecedented 18%. Since the invasion of Ukraine, inflation has also spiked in other Central Asian countries with economies that are closely tied to Russia. The price of LPG soared suddenly in January 2022, causing the worst unrest in Kazakhstan since 1991 when the 20-million population gained independence from the Soviet Union. The fuel price protests that year grew to widespread unrest and hundreds of deaths. Russian troops were deployed to restore order.
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Gold reaches new records as Fed rate-cut betting drives gold to record highs
Gold reached a record-high for the fourth consecutive session on Thursday as investors flocked into the metal of safety due to brewing U.S. China trade tensions, and the U.S. Government shutdown. Bets on interest rates cuts also fueled the momentum. As of 09:10 am, spot gold was up by 0.8% to $4,242.65 an ounce. ET (1310 GMT), after bullion reached a record high earlier of $4,254.61. U.S. Gold Futures for December Delivery were up 1.3% to $4,256.70. Yellow metal is up over 60% in the past year, thanks to geopolitical tensions and aggressive bets on rate cuts, central bank purchases, dedollarisation, and strong ETF flows. The rate-cut scenario heading into 2026, as well as developments surrounding U.S. China will determine the trajectory of gold. "If no deal is made between the U.S. and China, the relationship will continue to deteriorate. That could be what gold needs to break the barrier of $5000/oz," said Zain Vwda. Analyst at MarketPulse. This week, investors have been focused on the U.S.-China Trade Spat. Washington criticised China's increased rare earth export controls on Wednesday as a danger to global supply chains. Traders have priced in a rate cut of 25 basis points by the U.S. Federal Reserve in October and a second in December with probabilities as high as 98% and 95%. Gold that does not yield is usually a good investment in an environment with low interest rates. Vawda stated that short-term gold pullbacks are likely to be temporary as bullish investors use dips to enter positions. HSBC increased its forecast for the average price of gold in 2025 to $3,355 per ounce, citing geopolitical tensions and economic uncertainty, as well as a weaker U.S. Dollar. The ongoing U.S. shutdown has also halted the release of scheduled economic data. A Treasury official warned that the loss in output could be as high as $15 billion per week. Silver spot fell by 0.2%, to $52.96 an ounce. It had hit a record high $53.60 per ounce on Tuesday. The rally in gold was mirrored and the tightness of the spot market supported this decline. Palladium rose 1.8%, to $1,564.00, while platinum was up 0.7% at $1,665.24. (Reporting and editing by Vijay Kishore in Bengaluru, Sherin Elizabethvarghese from Bengaluru)
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HSBC increases average gold price forecasts 2025 and 26
HSBC raised its forecast for the average price of gold in 2025 to $3,355 from $3,215 because of safe-haven demand fueled by geopolitical tensions and economic uncertainty. In a note from October 15, the bank stated that "sentiment is bullish" as it expects rallies to continue into 2026, aided both by buying from the official sector and demand for gold among institutions as a diversifier. HSBC has also increased its forecast for the average 2026 gold price to $3.950 from $3.125. GOLD HITS A NEW RECORD HIGH HSBC reported that the demand for gold is increasing due to mounting fiscal deficits across major economies, including the U.S. Gold has been traditionally viewed as a safe haven during economic and geopolitical instabilities. Its value has increased by over 60% this year and reached a new record of $4,250.89. China accused the U.S. on Thursday of inciting panic over Beijing's controls on rare earths and said Treasury Sec. Scott Bessent made "grossly distortion" remarks about an important Chinese trade negotiator. The Chinese rejected a U.S. request to roll back curbs. HSBC stated that "central bank demand will likely remain high due to geopolitical risk and dollar diversification but lower than peak levels in 2022-23". HSBC stated that a lower rate cut than the Federal Reserve's current projections for this year or next could dampen the rally. Investors have priced in a rate cut of 25 basis points at the Fed meeting this month, and expect another in December. HSBC stated that the gradual decline in global inflation could also dampen jewelry purchases, which are driven by inflationary fears. The bank also maintained its average 2025 price forecasts of palladium and platinum at $1,100 and $1,215, respectively. Reporting by Noel John, Bengaluru. Editing by Mark Potter
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Gold prices spike in India before festivals, causing a surge in gold smuggling
Government and industry officials said that gold smuggling in India had increased ahead of major festivals. This was due to the record high prices and supply shortages. Import taxes on gold have been reduced to 6%, down from 15% in the past year. Customs and Directorate of Revenue Intelligence officials (DRI), however, said that smuggling had increased in the last few weeks. Several attempts to smuggle were foiled at Indian airports. A bullion dealer in Chennai said that smugglers are now able to convert gold quickly and easily, thanks to the strong demand for festival gifts and limited supplies. This month, Indians will celebrate Dhanteras (Diwali) and Diwali (Dhanteras), festivals when purchasing gold is considered auspicious. These are also the busiest days to buy the precious metal. On Thursday, gold prices in India reached a record of 128,395 rupees for 10 grams. This marks a 67% increase so far this season. Smuggling gold at this price is lucrative for grey-market operators. They can make more money by avoiding the 6% import tax and a local sales tax of 3%. "The payoff is super tempting for them," said an unnamed senior bullion trader in Mumbai. The margin for smugglers has fallen to 630,000 rupees a kilogram after the import duties were reduced in July. The bullion dealer stated that investors are now chasing after gold, causing a shortage of supply and driving up premiums. A jeweller in Kolkata said that banks were unable to satisfy the demand for the stock and charged very high prices. This week, Indian dealers quoted a premium. The price of gold can be up to 25 dollars per ounce more than the official domestic prices. This is the highest since at least a decade. The government registered 3,005 gold-smuggling cases in the fiscal year 2024/25 that ended in March. They also seized 2.6 tons of this metal. (Reporting and editing by Alexander Smith; Rajendra Jadhav)
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EU to provide support to countries affected by Carbon Border Levy
The European Union is offering development funding to countries that are affected by its carbon border tax, said the European Commission on Thursday. It was an attempt to calm the concerns of developing economies about the policy. Next year, the EU's Carbon Border Adjustment Mechanism (CBAM), which will be imposed on CO2 emissions from imported goods such as steel and cement, will begin to impose fees. Brazil, South Africa, and India have all criticised the measure, saying it penalizes developing economies. In a document published Thursday that outlines the EU's priority on climate and energy diplomacy the Commission stated it would support countries via "Global Europe", an international development programme funded by the EU budget of 200 billion euros ($233 billion). EU SAYS IT WILL NOT BACKTRACK BUT IS NOT DEAF TO CONCERNS The document stated that "Global Europe intends to maximize its contribution to the decarbonisation and adaption needs of developing countries while CBAM gradually becomes applicable." It said that "this would help ease concerns raised about EU legislation, as well as strengthening partnerships and supporting broader regulatory reforms." The EU Carbon Border Levy could be reduced by helping developing countries reduce emissions and switch to clean energy. Dan Jorgensen, EU energy commissioner, said that the bloc will not remove its climate laws to satisfy trading partners. He said that Brussels was more interested in investing in clean industries which could be beneficial to both sides, such as the production of renewable energy and hydrogen in Africa, which it wants to import. In an interview, Jorgensen said, "To the extent we can help these nations, we'll be very open, both in terms of looking at possible funding arrangements but also in terms of technical assistance." He added, "We are not going to go back on our green transition... But we are not deaf to the worries of partners." The EU document also outlined plans to engage businesses in the bloc's diplomacy on energy and to identify priority clean tech investments overseas, as Europe attempts counter China's dominance of manufacturing green technologies like batteries and solar panel.
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CMC purchases Foley Products at $1.84 Billion in a wave of building products deals
Commercial Metals Company announced on Thursday that it would acquire the concrete supplier Foley Products Co. for $1.84 Billion in cash. Dealmaking is accelerating across the U.S. construction products sector as a result of a drive for scale and local supply chains. The Irving, Texas-based company said that it expected the Foley acquisition to have a positive impact on earnings and cash flows and deliver annual EBITDA synergies between $25 million and $30 million. Dealmaking has increased in the U.S. construction products industry as companies look to scale and local supply chain to offset tariffs. Demand is supported by new housing and repair and renovation. Last week, the roofing-materials firm TopBuild SPI bought rival SPI in exchange for $1 billion cash Earlier this year, Home Depot's unit acquired specialty-building-products distributor GMS for about $4.3 billion in June, while QXO clinched an $11 billion deal for Beacon Roofing Supply in March. CMC reported that it had beaten Wall Street's expectations for its fourth quarter adjusted profit. Earnings of $1.37 per common share compared to the analysts' expectation of $1.36, according data compiled by LSEG. In premarket trading, shares of the company rose 1%. Foley provides precast concrete and concrete pipes used in site infrastructure, such as utility connection, water supply and Stormwater Management. Newnan-based Georgia company operates 18 locations in nine states of the U.S. Southeast. It also has a presence throughout the Central and Western Regions. CMC was advised by Moelis & Company as its financial advisor and Akin, Gump as its legal counsel.
US rate cuts bets continue to drive gold's record-breaking run.
The gold price reached another record on Thursday as investors sought out the safe haven due to U.S. China trade tensions, the U.S. Government shutdown and prospects of rate cuts.
As of 1208 GMT, spot gold was up by 0.8% to $4,242.38 an ounce. Bullion touched a new record high at $4,247.49 earlier, rising for the fifth consecutive session.
U.S. Gold Futures for December Delivery were up 1.4% to $4,258.50.
Gold prices, which are traditionally seen as a safe haven during periods of uncertainty, have risen by 60% in the past year.
This week, investors have been focused on the trade dispute between the two world's largest economies. On Wednesday, U.S. officials criticized China's expansion of export controls on rare earths as a danger to global supply chains.
Investors are turning more to gold because of renewed trade frictions, said Nitesh Sha, commodities strategist with WisdomTree. He added that the gold breakout is also indicative of investor uncertainty over U.S. policies.
Shah said that there is a high probability the metal will remain above $4,200.
The gold rally is driven by several factors including the expectation of interest rate reductions, political and economic uncertainties, central bank purchases, and inflows to gold exchange-traded fund.
A Treasury official stated on Wednesday that the shutdown of the federal government, which has lasted for two weeks, could cost the U.S. economic system as much as 15 billion dollars a week due to lost production.
On the monetary front, traders have priced in a 25-basis-point cut from the U.S. Federal Reserve for October, with another one in December. These are viewed as 98% and 85% chances, respectively.
Gold that does not yield is usually more profitable in an environment with low interest rates.
Aakash Doshi is the head of State Street Investment Management's gold metals strategy.
Gold smuggling has also increased in India, the second largest buyer of precious metals in the world. This is because of record-high prices and shortages.
Silver spot fell by 0.1%, to $53.00 an ounce. It had hit a record high $53.60 per ounce on Tuesday. The rally in gold was mirrored and the tightness of the spot market supported this decline.
Palladium rose 1.7%, to $1,562.23, while platinum climbed 1.1%, to $1673.12. (Reporting and editing by Elaine Hardcastle, Ed Osmond and Anushree Mukerjee from Bengaluru)
(source: Reuters)