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Data dampens hopes for policy easing as stocks fall and yields rise
Investors worried that the Federal Reserve would be more cautious in cutting interest rates after Thursday's surprising strong economic data. U.S. Treasury rates rose after the Bureau of Economic Analysis of the Commerce Department said that the U.S. economic growth was faster than initially thought in the second-quarter, thanks to a drop in imports and an increase in consumer spending. The second quarter gross domestic products increased at a rate of 3.8% annualized, compared to initial reports that it would be 3.3%. New orders for U.S. manufactured capital goods increased unexpectedly in August. However, a decline in the shipments of those goods suggests a modest pace of growth of business expenditure on equipment in this quarter. The Labor Department reported on Thursday that new claims for unemployment benefits dropped by 14,000, to 218,000 seasonally-adjusted for the week ending September 20. The economists polled had predicted 235,000 claims for this latest week. Matt Stucky is the chief portfolio manager of equities for Northwestern Mutual Wealth Management Company. He said, "If you want to continue fueling equities higher and wider than what we have seen in the past couple of years, then you need the Fed to ease and ease materially until 2026." Austan Goolsbee, the president of the Fed Bank of Chicago, said on Thursday that he supports the interest rate cut last week because the labor markets are cooling. However, he is not keen to do much more policy easing as long as inflation is moving in the wrong direction and is above the target. Stephen Miran, the Fed governor, said in Fox Business' Mornings with Maria that high interest rates are making the U.S. more susceptible to shocks. This is due to unfounded concerns about inflation among Federal Reserve policymakers. Mary Daly, president of the San Francisco Federal Reserve Bank, said that she "fully supports" the Fed's decision to reduce its policy rate by a quarter point last week. She also expects more reductions in the future. She said that it was difficult to predict the timing of these cuts. After the data and commentary, Wall Street indexes fell to their lowest levels in a week. At 02:41 pm, the Dow Jones Industrial Average dropped 146.95, or 0.32 percent, to 45,975.28, while the S&P500 fell 32.12, or 0.48 percent, to 6,605.85. The Nasdaq Composite also fell 114.50, or 0.51 percent, to 22,383.34. MSCI's global stock index fell 6.30 points or 0.64% to 973.11, after reaching its lowest level since Sept. 11. Investors focused on the Fed's comments. Earlier, the pan-European STOXX 600 Index closed down by 0.66%. It had touched its lowest level since September 5. Med-tech stocks were under pressure following news that the U.S. opened new import-related investigations. In government bonds, U.S. Treasury yields rose on Thursday following stronger-than-expected second-quarter economic data that could strengthen the case for a rates pause from the Fed at its October meeting. Molly Brooks is the U.S. Rates Strategist at TD Securities. She said that the rise in yields on two-year and 10-year Treasury notes was more a reaction to the surprise of the GDP. "But I still think that markets are biased towards a future slowdown of data." The yield on the benchmark 10-year note rose by 3 basis points, to 4.178% from 4.147% at late Wednesday. Meanwhile, the 30-year bond's yield dropped 0.4 basis point to 4.7536%. The yield on the 2-year bond, which moves typically in line with expectations of interest rates for the Federal Reserve (Federal Reserve), rose by 6.7 basis points, to 3.666% from 3.598%. The dollar rose against the euro and the yen, on the back of signs that the U.S. economic growth was faster than expected in the second quarter. This could have a restraining effect on Fed rate easing. The dollar index (which measures the greenback in relation to a basket of currencies, including the yen, euro and others) rose by 0.72%, reaching 98.54. The euro fell 0.71% to $1.1654, and the dollar gained 0.64% against the Japanese yen. The pound fell 0.83%, to $1.3332. The dollar gained 0.67% against the Swiss Franc after the Swiss National Bank kept interest rates at zero Thursday, its first pause in the past 2023. The oil price recovered earlier losses and settled near the seven-week high of Wednesday, while economic data dampened optimism about rate cuts. Brent crude closed at $69.42 a barrel, an increase of 0.16% or 11 cents for the day. U.S. Crude settled at $64.98 per barrel down by 0.02% or 1 cent. Gold, the safe-haven asset, recovered from its early session losses but was still well below Wednesday's high. Spot gold increased by 0.56%, to $3756.93 per ounce. U.S. Gold Futures rose 0.06%, to $3.734.20 per ounce. Bitcoin, the most popular cryptocurrency, fell by 3.47%, to $109 656.05, after reaching its lowest level since September.
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Niger wants to build nuclear reactors with Russia
Ousmane Abarchi, the mining minister of Niger, said that Niger is interested in building two nuclear reactors with a combined power of 2,000 megawatts. Abarchi stated that Niger also proposed to work with Russia on developing uranium resources in the west African nation. He said, via a translator, at a Moscow nuclear forum: "Please let's jointly develop our uranium reserves." Alexei Likhachev, the Rosatom chief, described the proposals as being "extremely intriguing". Niger is one of a number of African nations with whom Russia has developed close ties. This includes in the security area. According to the World Nuclear Association (WNA), Niger will be the eighth largest producer in terms of uranium mined by 2024. Abarchi stated that the nuclear plants proposed would be developed by the U.N. nuclear watchdog International Atomic Energy Agency. "Yes, this is important to us. "This is important for the entire African region," he said. Egypt is currently building reactors to replace the South African nuclear power plant. Other countries, such as Ghana, Algeria and Ethiopia, Kenya, Morocco Nigeria, Rwanda, Sudan, have also proposed building nuclear power plants. (Reporting from Anastasia Lyurchikova in Moscow, writing by Mark Trevelyan and editing by Ed Osmond.
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Russia expects to see an increase in vehicle scrappage fees despite a drop in sales
A document reviewed by shows that the Russian government expects its budget revenue from scrapping fees to increase sharply in this year and the next, despite a steep decline in vehicle sales. The draft budget forecasts scrappage fees revenues of nearly 1.65 trillion Russian roubles (19.71 billion dollars), an increase of 46.7% over the 1.12 trillion roubles expected for 2025. Government has collected only a fraction of this total so far in 2018, at 267 billion Rubels, as of 23 September. However, the government said that future revenue growth will be driven both by an annual indexation of fee rates and a recovery of vehicle production. The Russian Finance Ministry said that revenues from car scrappage will be well below budgeted levels for this year. As a result, state funding may not be available to support some industrial development programs. Analysts and automakers predict that car sales will fall by a quarter around 2025, following a market recovery of two years which began in 2023. The sales in the first eight-months of this year are already down by 23% compared to last year, at 773,264 vehicles. Some Russian automakers have switched to a four day work week due to poor demand. Scrappage fees are imposed on both domestic and imported vehicles. The amount varies depending on the type of vehicle. The Russian industry ministry proposed a new method for calculating scrappage fees starting in November. This could result in further price increases on some expensive cars. As compensation, Russian automakers receive state subsidies. This has led to a rise in car prices and a shrinking of the market.
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Zelenskiy seeks to expand Ukraine's drone sector by wooing US companies
His office reported that President Volodymyr Zelenskiy discussed Ukraine's plans for boosting drone exports and expanding tech partnerships with the top management from a number of U.S. companies. Since the Russian invasion of Ukraine in February 2022 all weapons produced on the Ukrainian production lines are diverted for national defence. "Our country is home to a strong drone industry, and over 300 technology companies." Zelenskiy stated that he believes this will be a new direction in our economy and business in the future. He added, "I believe this year we will only open exports of new technologies to countries we can count on." Zelenskiy's office reported that Zelenskiy had met with representatives of Amazon, Bank of America and Chemours. He also met with Fairfax, GE Vernova. Jacobs, JPMorgan Chase. Lazard. Logistics Plus. Marsh McLennan. TechMet. Westhouse. Some of these companies are already operating or investing in Ukraine. Zelenskiy stated that Kyiv is ready to expand new areas for partnership and investment. UKRAINE'S Drone Output Soars During the war, Ukraine's domestic weapon production and drone output have risen dramatically. Hundreds of companies have manufactured millions of drones which have been tested in the battlefield. Zelenskiy stated that Ukraine plans to establish export platforms throughout the United States, Europe and the Middle East. Kyiv, which is trying to rebuild its economy after the war, has been offering potential investment opportunities to American companies. Ukraine and U.S. International Development Finance Corporation have launched a joint investment fund of $150 million as part of Kyiv’s mineral deal with Washington that was first signed in April. According to Ukrainian officials, Prime Minister Yulia Syrydenko plans to visit the United States by the end of this month for more in-depth talks with U.S. companies. (Reporting and editing by Yuliia Dysa, Olena Harma; Hugh Lawson).
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Investors watch key inflation report as gold pares gains after weekly jobless claims decline
Gold lost ground on Thursday as U.S. jobless claims declined unexpectedly. Investors waited for key inflation data which could influence the Federal Reserve’s next interest rate decisions. As of 9:33 am, spot gold was up by 0.1%, at $3,741.88 an ounce. ET (1333 GMT), after a rise of up to 0.5% in the earlier session. On Tuesday, prices reached a new record of $3.790.82. U.S. Gold Futures for December Delivery rose by 0.1% to $3.771.60. Last week, the number of Americans who applied for unemployment benefits dropped. However, due to a slow pace of hiring on the job market, it has become less vibrant. The U.S. economic growth was faster than originally thought during the second quarter. Peter Grant, senior metals analyst at Zaner Metals, said that "Jobless Claims came in at 218,000 against expectations of 235,000. This slightly hawkish print may temper some expectations (rate)easing, but not enough to change the overall trend." The biggest risk to gold in the short term is a PCE reading that is higher than expected. If inflation surprises to the upside, this could boost the dollar temporarily and weigh down on gold. According to a poll, Friday's Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation measurement, will show an increase of 0.3% for August compared to last month and 2.7% compared to this time last year. According to CME FedWatch, the markets currently expect a Fed rate reduction in October. This is down from 90% prior to the release of jobs data. Mary Daly, the president of San Francisco Fed Bank, reiterated that she "fully supports" last week's rate cut by 25 basis points and indicated her openness to further reductions. Fed Chair Jerome Powell, on the other hand, maintained a cautious stance Tuesday. In an environment of low interest rates, safe-haven bullion is likely to flourish. (Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Leroy Leo) (Reporting from Sherin Elizabeth Varighese, Bengaluru. Editing by Leroy Leo.)
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Poland: EU's proposed 19th Package of Russia Sanctions closes LPG Loophole
The 19th package against Russia for its full-scale invasion in Ukraine will close the loophole that allowed Russia to bypass an EU import ban on liquefied petrol gas (LPG), said Polish energy minister, Thursday. The 12th package of sanctions, which was to be implemented in 2024, excluded certain types of LPG such as butane or isobutane. These are primarily used as feedstocks for the production of other petrochemicals. Other types of LPG mainly are used for heating and cars. Prior to the imposition of sanctions, Poland was the biggest importer Russian LPG. The Polish Liquefied Gas Organization's (POGP) data showed that while Sweden was the largest supplier of LNG in Poland during the first half 2025, Russian imports were down but not eliminated. POGP data revealed that the remaining Russian imports were butane and Isobutane fractions with a purity greater than 95%. These fractions are also used in aerosol production. The addition of butane as part of the sanctions will eliminate the possibility that it can be imported from Russia or Belarus to create a mixture of liquefied petrol gas, closing a loophole within the current ban on LPG imports," said Polish Energy Minister Milosz Motyka in a press release.
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China's net gold imports through Hong Kong in August fell 39% compared to July
Hong Kong Census and Statistics Department figures released on Thursday show that China's net imports of gold via Hong Kong fell by 39.11% in August compared to July. Why it's important China is the largest gold buyer in the world. Its buying activities can have a significant impact on global gold markets. Hong Kong's data might not be a complete view of Chinese gold purchases as it is also imported through Shanghai and Beijing. By the Numbers The net imports from Hong Kong into China in August were 26.746 tons compared to the 43.923 tons imported via Hong Kong in July. China's total imports of gold via Hong Kong fell by 29.85% in August from 58.296 tonnes in July. Customs data released on Saturday showed that China's gold imports fell by 3.4% in August compared to July. Last week, dealers in China's top gold-consuming country offered discounts of between $21 and $36 per ounce compared to global benchmark spot prices The previous week, gold prices ranged between $17 and $24, a significant increase from the previous $7-$24. China's central banks added gold to their reserves in August, continuing purchases for a 10th consecutive month, according to official data. The spot gold price hit a new record of $3,790.82 this past week. KEY QUOTE According to StoneX analyst Rhona OConnel, the drop in net imports through Hong Kong was caused by the "continued stress" in the economy that has a negative impact on jewellery demand. She also noted that the price difference between platinum and gold jewellery had led to a partial shift in favour of platinum jewellery. The World Platinum Investment Council has predicted that global demand for platinum jewellery will increase by 11%, to 2.2 millions troy ounces by 2025. O'Connell stated that "the weakness in offtake" has caused Shanghai gold prices to drop to a significant discount compared to prices offshore. (Reporting and editing by David Goodman in Bengaluru, Kirby Donovan.)
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Barclays reports that nature loss could reduce mining and power earnings by up to a quarter
Barclays warned that company earnings could drop by up to 25% in five years as a result of nature degradation. This is due to rising input costs, operational disruptions caused by policy changes, and worsening conditions. Barclays Bank conducted an exploratory stress testing on a portfolio mining and power companies. According to the results, transitional risks such as higher water costs, stricter pollution control and the expansion protected areas along with droughts, flooding and increased water prices pose a greater risk for operations. Barclays analysed around 9,000 facilities for power generation from 40 European clients and 250 mines in operation linked to 30 mining companies. Both sectors experienced significant earnings declines during the past five years. Mining earnings fell by around a quarter due to transition risks. The impact on power companies was about 10%. This is mainly because of physical risks, such as floods and droughts. These are more severe when landscapes have been degraded. Barclays stated that the rapid loss of biodiversity, and degradation of ecosystems are now widely recognized as systemic risk. Marie Freier is Barclays Group Head of Sustainability. She said: "These risks are increasing materializing across our client's operations." Despite the fact that nature is responsible for over half of the global GDP, attempts to quantify its benefits, from pollination to food production to water supply are still in their infancy. Barclays says that financial risks associated with its work are not well understood. The bank developed its own method for calculating financial risks related to nature across large portfolios using the Taskforce on Nature Related Financial Disclosures LEAP framework. A team of experts in technical risk, nature and environmental issues from across the banks spent an entire year analysing client impacts and dependencies. This included land use, air pollution, and water usage. Barclays' nature work will also help identify funding opportunities, as the estimated biodiversity financing gap is $700 billion per year.
Petrobras failed a part of the test required to get a license to drill at Foz do Amazonas
Petrobras failed a part of the test required to get a drilling license in the Foz do Amazonas Basin, Brazil's Environmental Agency wrote in its report made public on Wednesday.
The agency Ibama said that Petrobras had passed the broad test. However, the technical report required the firm to resubmit their animal-rescue plans, listing this as a step necessary for its bids to drill in an ecologically sensitive area.
Ibama wrote that the plan "is not capable of ensuring adequate actions for animal care."
Petrobras and Ibama didn't immediately respond to requests for comments. Petrobras had previously stated that it would submit the emergency response plan again by Friday.
Petrobras' high-ranking executive said that despite the obstacle, the granting the license was "inevitable" and asked not to be identified in order to discuss sensitive issues.
Petrobras considers the area where it plans to drill off the coast of Amapa in the Amazonian State as its most promising oil frontier. It shares geology with Exxon Mobil's nearby Guyana fields, which are developing large fields.
According to the report, Petrobras had to move toys in place of animals at night in order to meet a deadline of 24 hours to get them to a vet center.
A Petrobras boat got tangled up in a net of fishing during the trip. Another time, a boat got stuck on a sandbank. Ibama said that there was also a close call with another vessel.
Ibama's staffers noted that pilots of aircraft lacked the proper safety equipment to protect themselves from toxic substances that can vaporize when animals are contaminated with oil.
(source: Reuters)