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Financial Times - April 7
These are the most popular stories from the Financial Times. These stories have not been verified and we cannot vouch their accuracy. Headlines - UK auto industry gets tariff relief by lowering EV targets - Britain will relax rules for hedge funds and smaller private equity firms UK will scrap or merge even more quangos as part of anti-regulation drive - US closes on crucial minerals deal with DR Congo View the full article After President Donald Trump's 25% tariff on global auto sector exports to the U.S., the British government has lowered its targets for electric cars, and lowered punitive penalties, to support the domestic automotive industry. The British Government plans to introduce a lighter regulatory system for smaller groups in order to encourage more investment. UK Cabinet Office Minister Pat McFadden wrote to Whitehall departments to demand they justify the existence and purpose of each quango that is currently being used to outsource decisions. The aim is to close unnecessary agencies and bring responsibility for making decisions back to Whitehall. The United States is close to a deal that will see American companies gain more control over critical mineral assets, in exchange for greater support for the struggling Kinshasa Government. (Compiled Bengaluru Newsroom)
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China metals fall after trade war retaliation, copper hits over 3-month low
The price of base metals in China plunged sharply on the first day of this week as fears about a possible recession grew due to an escalating trade war. Copper prices fell to a three-month low. As of 0138 GMT on the Shanghai Futures Exchange, the most traded copper contract dropped 7%, to 73640 yuan a metric ton, its lowest level since January 3, over three months ago. The London Metal Exchange's benchmark copper for three months fell 1.9% to $8614.5 per metric tonne. China, the world's largest consumer of metals, retaliated on Friday by imposing additional tariffs of 34% on all U.S. products from April 10 after U.S. President Donald Trump imposed 34% on most Chinese items as part his sweeping tariff program. We expected a steep drop in China commodity prices today, as China's markets were closed on Friday. This coincided with a significant decline in LME base-metals. Base metals traders said that some even reached their lowest limits immediately after trading started. A second trader stated, "The retaliatory trade tariffs make us worried about a trade war that will hinder economic growth worldwide." SHFE aluminium fell 4.5% to 19.515 yuan per ton. Zinc fell 4.2% to 22195 yuan. Lead fell 2.4% at 16,810, nickel fell 6.7% to 120370 yuan. Tin fell 6.5% at 273,680. Other metals include LME aluminium, which fell by 0.3%, to $2.372.5 per ton. Lead also dropped 0.3%, to $1.901, while zinc slid by 0.8%, to $2.639; tin, down 2.2%, at $34,615, and nickel, down 0.1%, at $14.775 per ton.
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Trump compares tariffs with'medicine' after Asian markets erupt
U.S. president Donald Trump said that foreign governments will have to pay a "lot of money" in order to lift the sweeping tariffs he called "medicine." This has caused further turmoil on global financial markets. Asian stocks suffered steep losses on Monday morning. U.S. futures markets opened with sharply lower prices as investors expressed concerns about Trump's tariffs, which they feared could lead to higher costs, a weaker economy, a drop in confidence, and even triggering a global economic recession. Trump told reporters on Air Force One that he wasn't concerned about the losses of trillions of dollars from stock markets all over the world. "I don’t want anything to fall. "But sometimes you need to take medicine to cure something," he said, as he returned after a golf weekend in Florida. Trump claimed he spoke to leaders in Europe and Asia on the weekend. They hope to convince Trump to lower tariffs by up to 50%, which are due to come into effect this week. They are at the table. "They want to talk, but they won't talk until we pay them a lot of cash on an annual basis," Trump said. Trump's announcement of tariffs last week shocked economies around the globe, prompting retaliatory measures from China. Fears were raised about a global recession and trade war. Investors and politicians have been trying to figure out whether Trump's tariffs will be permanent or just a tactic used to get concessions from countries. Trump's economic advisors tried to present the tariffs on Sunday morning talk shows as a clever repositioning by the U.S. within the global trading order. Treasury Secretary Scott Bessent stated that more than fifty nations have begun negotiations with the U.S. following last Wednesday's announcement. Bessent told NBC News' Meet the Press that "he's created maximum lever for himself". Howard Lutnick, Commerce Secretary at CBS News, said that the tariffs will remain in effect "for days and even weeks." Kevin Hassett, White House economist, sought to calm concerns that tariffs were part a strategy designed to pressure the U.S. Federal Reserve into lowering interest rates. He said there would not be any "political coercion". JPMorgan's economists estimate that tariffs will cause the U.S. Gross Domestic Product to decline by 0.3% in the full year, compared to an earlier estimate of growth of 1.3%. They also predict the unemployment rate will rise from its current 4.2%, to 5.3%. Bill Ackman is a billionaire fund manager who has endorsed Trump for president. He said that Trump had lost the confidence of many business leaders, and warned him of a "economic nuclear Winter" if he didn't take pause. Tariff negotiations began on Saturday when U.S. Customs agents started collecting Trump's 10% unilateral tariff on all imports. The "reciprocal tariff" rates will increase to 11% to 50 % on certain countries on Wednesday, at 12:01 am EDT (4:01 am GMT). Several governments have indicated a willingness for engagement with the U.S. in order to avoid duties. Taiwan's president Lai Ching Te on Sunday offered no tariffs as a basis for discussions with the U.S. He pledged to remove trade barriers, and said Taiwanese firms would increase their U.S. investment. Benjamin Netanyahu, the Israeli Prime Minister, said that he will seek to have a reprieve on a 17% tax on Israel's products during his meeting with Trump scheduled for Monday. A government official in India said that the country did not intend to retaliate for a 26% tax and that talks with the U.S. were underway over a potential deal. Giorgia Melons, a Trump ally in Italy, pledged to protect businesses from the planned 20% tariffs on EU goods. Italian wine producers and U.S. Importers said that business has already slowed down and they fear further damage.
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The oil price plunges amid fears of a global trade war triggering recession
The oil prices fell more than 3% Monday, extending the losses of last week, as trade tensions between China and the United States escalated, stoking fears that a recession would lower demand for crude. Brent futures fell $2.28 or 3.5% to $63.30 a bar at 0049 GMT. U.S. West Texas Intermediate Crude futures dropped $2.20 or 3.6% to $59.79. Both benchmarks reached their lowest levels since April 2021 at the session low. Oil fell 7% on the Friday after China increased tariffs on U.S. products, intensifying a trade conflict that has caused investors to price in an increased probability of recession. Brent has lost 10.9% over the last week while WTI is down 10.6%. Satoru Yushida is a commodity analyst at Rakuten Securities. He said that the primary reason for the decline was the fear of tariffs affecting the global economy. He added that retaliatory duties from other countries will also be a factor to watch. Yoshida said that WTI might fall to $50 or even $55 if the stock market continues to decline. China announced on Friday that it would add additional tariffs of 34% to American goods in response to U.S. president Donald Trump's tariffs. This confirms investor fears of a full-blown trade war and the risk of recession for the global economy. Oil prices could be affected by Trump's new tariffs on imports of refined products, oil and gas. The policies could also stoke inflation and slow the economic growth. Jerome Powell, Federal Reserve chair, said that Trump's tariffs were "larger than anticipated" and the economic fallout will likely be higher inflation and slower development. Over the weekend, OPEC+ ministers emphasized the need to fully comply with oil production targets and asked overproducers submit plans to compensate for pumping excessive amounts of oil by April 15. (Reporting and editing by Nick Zieminski, Sonali Paul, and Yuka Obayashi)
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Nikkei reports that Toyota will increase the number of EV models from 15 to 1 million and target production by 2027.
Toyota plans to develop 15 electric car models on its own before 2027, and will aim to produce 1 million vehicles a year at that time, according the Nikkei paper on Sunday. Toyota refused to comment on the matter, stating that the information had not been announced by the company. Nikkei reported that Toyota produces only five EVs, all of which are developed by itself, and are manufactured in Japan and China. The Nikkei said that expanding production to the United States and Thailand can reduce delivery times and help mitigate tariff and exchange rate risks. Business daily Nikkei reported that among the 15 EV models, some are from Lexus, its luxury brand. Nikkei said that Toyota expects to make about 800,000 vehicles in 2026. This is a drop of nearly 50% compared to its original plan. Toyota previously stated that it planned to sell 1.5 millions EVs annually by 2026, and 3.5 Million by 2030. The numbers were referred to as benchmarks rather than targets. It sold nearly 140,000 EVs worldwide in 2024. This is an increase of about a third compared to the previous year. These EVs accounted for less that 2% of the company's total global sales, which exceeded 10 million.
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Oil prices continue to fall amid fears of a global trade war slowing the economy
On Monday, oil prices dropped more than 3%, continuing losses from the week before, amid growing fears that a global economic slowdown and weakening of oil demand could be caused by a trade war, after China's retaliation to U.S. president Donald Trump's tariffs. Brent futures fell $2.1, or 3.2 %, to $63.48 a bar at 2227 GMT. U.S. West Texas Intermediate Crude futures dropped $2.14 or 3.5 % to $59.85. Both benchmarks fell 7% on the Friday, reaching their lowest levels in more than three years. This was due to China increasing tariffs on U.S. products. The trade war has accelerated and investors have priced in a greater probability of recession. China responded to Trump's new tariffs by announcing on Friday that it would add an additional 34% levies on American goods. This confirms investor fears of a full-blown trade war and the risk of recession in the global economy. JPMorgan, the investment bank, now predicts that there will be a global recession by the end of this year. This is up from its previous estimate of 40%. (Reporting and editing by Nick Zieminski.)
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Palestinian officials: Israeli settler shoots dead Palestinian teenager who has U.S. citizenship
A Palestinian teenager who had U.S. passport was shot dead by an Israeli settler on Sunday in Turmus Ayya in the West Bank. The tensions are continuing to rise amid a surge of settler violence, and daily confrontations between Israelis and Palestinians in the occupied territories. Adeeb lafi, the mayor of Turmus Ayya said that Omar Mohammad Rabea was killed along with two other teens by an Israeli settler near the entrance to Turmus Ayya. Two of them were taken by ambulance to nearby medical centers and then hospital. Lafi reported that the army detained a third boy who was 14 and had U.S. Citizenship. Lafi said that the army declared Rabea dead later and still holds his body. The Palestinian Health Ministry confirmed his death and said he had been killed by "occupational forces." The Israeli army has not yet responded to the report. Since the Gaza War began in October 2023, settler violence in the West Bank has increased, including incursions in occupied territory, raids on Bedouin villages, and encampments. The European Union and the former U.S. Administration under President Joe Biden imposed restrictions on violent Israeli settlers. However, the White House under Donald Trump has removed these sanctions. Reporting by Ali Sawafta; writing by Hatem Mahar; editing by Chizu Nomiyama
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Kentucky reports 2 deaths after flooding, but there have been more than a dozen recent deaths in other US regions
Kentucky Governor Andy Beshear announced on Sunday that over 500 roads in the state were closed due to dangerous storms and flooding, which also killed more than a dozen other people in the U.S. South & Midwest in the last week. "Kentucky is experiencing record flooding in our state with more than 500 road closures. The rivers haven't crested yet, so there is still a day or more of rising water. Beshear told social media platform X that "we've lost two of our citizens." Police in Frankfort, Kentucky said that a 9 year-old boy was killed in Kentucky when he was drowned by floodwaters while walking to his bus stop. Beshear said on Sunday that water was scarce in Frankfort and many homes had been evacuated. He also announced Monday's closure of state offices. In the last week, a deadly spring storm caused tornadoes to erupt and torrential rains to fall in an area stretching from Texas up through Ohio. Tennessee's local health department reported 10 deaths during this time period. Local media reported that in addition to the Kentucky governor's two deaths, there were two deaths in Missouri, and one death each in Arkansas and Indiana. Climate Central, a nonprofit organization that studies weather patterns, says climate change will bring heavier rain and floods to most of the U.S. The upper Midwest and Ohio River Valley are the most affected regions. Reporting by Kanishka Sing in Washington, editing by Chizu Nomiayama
Pakistan not likely to purchase area LNG in summertime despite simmering heat
Pakistan is not likely to purchase melted gas (LNG) cargoes on the spot market until at least the start of winter in November due to oversupply and high rates, its petroleum minister informed .
Extreme temperature levels across Asia have pushed nations to look for more freights of LNG to resolve greater power need, driving spot prices to their greatest since mid-December. Asia spot LNG last traded at $12.00 per million British thermal units (mmBtu). on Friday. << LNG-AS >
However, LNG need in the second largest south Asian LNG. purchaser was subordinate to supplies, the minister told ,. despite heatwaves baking the country of 300 million people with. temperatures rising to a near-record.
The concern of getting more LNG when we can't sell the. quantity of LNG that we currently are obtaining from our long-term. contracts, it does not apply, Musadik Masood Malik, Pakistan's. petroleum minister, told in an interview.
Annual power usage in Pakistan, which gets over a 3rd of its. electrical energy from gas, is expected to fall consecutively. for the first time in 16 years, due to greater tariffs curbing. household consumption.
Poor and middle class families are still feeling the. impact of the International Monetary Fund's (IMF) bailout of. Pakistan in 2015, which contributed to greater list prices. A. series of power tariff walkings over 12 months was a key part of. the IMF program which ended in April.
Industrial demand has likewise stayed tepid due to a cloudy. economic outlook.
Pakistan, which last purchased a spot LNG cargo in late 2023,. cancelled its spot LNG tender for delivery in January. Malik. associated the cancellation to oversupply, including that there. were not a lot of customers at current LNG area costs.
Malik said Pakistan was eager to embrace more renewable resource. to cut its import expense and exposure to geopolitical shocks. The. country suffered widespread power blackouts due to its failure. to purchase costly LNG after rates rose due to Russia's. invasion of Ukraine.
Any nation that is importing $15-18 billion of fuel, how. can it be sustainable when the overall exports are south of $30. billion? So we need to move away from the imported aspects such. as LNG, he stated.
Pakistan was likewise attempting to gain access to cheaper natural. gas by constructing a pipeline with Iran, but watched out for sanctions,. he stated.
We generally are trying to work out the service whereby we. can have access to less costly gas, but in a way which. does not invoke any sanctions on Pakistan. It all depends on. legal analyses, he said.
From our viewpoint, we don't want to get into lawsuits. and we do not wish to get sanctioned..
(source: Reuters)