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Shanghai copper falls to a new low after Fed rate cut
Shanghai copper futures fell for the third consecutive session on Thursday after a 25 basis-point rate cut from the U.S. Federal Reserve, and a higher supply of the top consumer China. In line with expectations, the U.S. Central Bank cut its benchmark interest rate on Wednesday by a quarter-point. At its October and December meetings, the Fed indicated that it would also make further cuts. The traders closed long positions in order to take profits from bets on the rate drop. This wave of profit taking continued even after the rate decrease, which weighed on the prices of red metals used in construction and power. As of 0238 GMT, the most traded copper contract on Shanghai Futures Exchange fell below the psychologically important level of 80,000 Yuan ($11252.23) for a metric ton. The price was down by 1.05%, to 79.870 yuan per ton. Earlier in the session, the contract reached its lowest level since September 10, at 79.690 yuan. The benchmark three-month copper price on the London Metal Exchange fell 0.25% to $9,971.5 per tonne after hitting its lowest level in a week at $9925 on Wednesday. ANZ analysts also said that the higher metals production in China weighed on the sentiment in a recent note. China's refined output of copper in August increased 15% on an annual basis, reaching a near-record high level. SHFE aluminium fell by 1.05%. Nickel dropped by 0.29%. Tin declined 1.04%. Zinc shed 1.1%. Lead added 0.26%. Aluminium, nickel, lead, tin, and zinc all fell in the LME.
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Powell's comments and Fed meeting have led to a strengthening of the dollar, lowering gold.
Gold prices continued to decline on Thursday, while the dollar strengthened after the U.S. Federal Reserve, as anticipated, cut interest rates a quarter percentage point and used a measured tone on future policy easing. As of 0156 GMT spot gold fell 0.2%, to $3,654.29 an ounce. It had hit a record-high of $3,707.40 per ounce on Wednesday. U.S. Gold Futures for December Delivery fell 0.8% to $3.690. Edward Meir, Marex analyst, said that the Fed's general message was a little hawkish on interest rates. They didn't endorse lower rates with enthusiasm. "As a consequence, we saw the Dollar firm up after Fed meeting and Treasury rates also moved upwards... I believe that in the short-term, we may be a little overbought and could possibly retrace further to the $3600 mark. Gold is now more expensive for holders of other currencies due to the dollar's 0.2% rise. The Fed cut rates by 25 basis point on Wednesday, and said it would continue to lower borrowing costs throughout the remainder of this year. Fed Chair Jerome Powell described the policy as a risk management cut in response the weakening of the labour market. The central bank is currently in a situation where it has to "meet by meeting" in order to determine the future interest rate outlook. The SPDR Gold Trust is the largest gold-backed ETF in the world. Its holdings dropped 0.44% on Wednesday to 975.66 tons from 979.95 on Tuesday. The gold price has risen by 39% this year after a 27% increase in 2024. This is due to expectations of monetary policy ease by the Fed and lingering geopolitical conflicts, as well as strong central bank purchases. The price of palladium remained unchanged at $1,153.87. Platinum rose 0.4% to 1,366.75 per ounce and silver fell 0.3% to $41.53 an ounce. (Reporting and editing by Rashmi aich in Bengaluru, Brijesh patel from Bengaluru)
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Investors assess Fed's outlook after rate cut and are cautious about stocks, the dollar
The global stock markets rose on Thursday, after the Federal Reserve lowered interest rates. However, investors were cautious after the world's largest central bank indicated a measured approach towards further monetary policy ease. U.S. equity contracts advanced by 0.3% after an uneven session overnight on Wall Street. Shares in Korea and Taiwan, which opened around 0.7% higher, led the gains in Asia. Japan's Nikkei 225 tacked on 0.3%. The MSCI broadest Asia-Pacific share index outside Japan edged down 0.1% as the declines in Australian markets and New Zealand weighed on this benchmark. The global stock market fell on Wednesday, after reaching a record-high in response to the Fed's quarter-point rate cut. It also indicated that it would continue to lower borrowing costs throughout the remainder of the year. In his post-meeting remarks, Fed Chair Jerome Powell temperated the more aggressive expectations of easing in the markets. He said that Wednesday's action was a risk management cut, and the central bank did not have to act quickly on rates. ANZ analysts wrote in a report that the decision made and the tone of the press briefing were both balanced and restrained. They weren't at all dovish. Investors were sceptical about Powell's projections of higher inflation and stronger U.S. growth. These doubts fueled the U.S. trade overnight. The S&P 500, and Nasdaq Composite closed down. Only Stephen Miran, the new Fed Governor who joined on Tuesday, was against a 50-bp increase. The currency markets are also indecisive. After the rate announcement, the U.S. Dollar Index fell to its lowest level since February 2022. It was 96.224. However, it recovered to 97.074 to end the day higher. After a knee-jerk response to the Fed's announcement, the euro remained at $1.1821. It had previously reached its highest level since June 2021 of $1.19185. Sterling is flat at $1.3626 after briefly reaching its highest level since July 2, at $1.3726, on Wednesday. It is expected that the Bank of England will announce its own policy later on Thursday and keep rates at 4%. According to CME Group’s FedWatch tool, traders are pricing in an 87.7% probability of another 25 bp cut during the Fed's October meeting, up from a 74.3% likelihood a day before. Shane Oliver is the chief economist at AMP and head of investment strategies in Sydney. He said that while "the Fed continues to signal more rate cuts", it still expects a good growth. This is a combination which is positive for share markets. He added, "I think the gains are going to be limited as the markets already rallied in anticipation of Fed rate cuts and therefore they're due for a pause or a near-term corrective." Bank of Canada reduced its key rate on Wednesday by 25 basis points to a low of 2,5%, a level not seen in three years. This was the first time in six months that the Bank had cut the rate. The Bank said it would cut the rate again if the risks to the economy grew in the coming months. S&P/NZX50 dropped 0.6% in New Zealand after data revealed a worse than expected economic contraction for the second quarter. The kiwi currency fell 0.6% against the dollar. The Australian market did not fare much better. It fell 0.8%, led by a drop of up to 13.6% in the shares of gas producer Santos after a consortium headed by Abu Dhabi’s ADNOC canceled its $18,7 billion bid, claiming that commercial terms couldn't be agreed. The yield on the benchmark 10-year Treasury note rose to 4.0872% on the bond market from its U.S. closing of 4.076% Wednesday. The yield on the two-year bond, which increases with traders' expectation of higher Fed fund rates, increased a bit to 3.5552%. Gold prices increased 0.3%, to $3670.19 an ounce. This is a recovery from the dip that occurred after Wednesday's record high. Brent crude oil prices remained steady at $67.95 a barrel.
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Oil prices barely changed after Fed rate reduction
The oil prices were not much changed Thursday, after the U.S. Central Bank lowered its main interest rate. This was widely expected. However, an indication that more rate reductions will be made before the end of the year raised the possibility of a surge in demand due to falling borrowing costs. Brent crude futures fell 8 cents or 0.12% to $67.87 per barrel at 0042 GMT. U.S. West Texas Intermediate Futures were down by 10 cents or 0.16% at $63.95. Federal Reserve policymakers responded in part to the signs of weakness on the job market by cutting their policy rate by one quarter of a percent point. They also said they would continue to lower borrowing costs throughout the rest of this year. Low borrowing costs usually boost oil demand. Claudio Galimberti is the chief economist at Rystad and the global director of the market analysis. He said that the Fed's decision to continue cutting rates indicates the Fed believes the risk of inflation to the economy is higher than the risk of unemployment. "For Brent, in particular,... the cuts and the two expected to be made by the end of the calendar year will be a positive factor that will counter the negative OPEC+ strategy of unwinding," he added, referring the increased oil supply coming from the Organization of the Petroleum Exporting Countries (OPEC) and its allies. The Energy Information Administration reported that the U.S. crude stockpiles declined sharply on the demand side last week, as net imports plunged to a new record low, while exports rose to a nearly two-year high. The world's largest oil consumer was concerned about the demand for distillate, and prices were pushed up by a 4 million barrel increase in stockpiles, as opposed to 1 million barrels expected by the market. JP Morgan stated in a note to clients that the global average oil demand was 104.4 million barrels of crude per day through September 17. This represents an increase from last year of 0.520 million barrels. The demand for oil has been up by 0.8 million barrels per day (mpd) so far this year, which is just a little bit less than the 0.83 mbd that was projected by JP Morgan. JP Morgan stated that "While flight volume in the U.S., China, and Latin America is easing, as summer travel season ends, activity continues to grow in Europe, Middle East and Latin America." (Reporting and editing by Christopher Cushing; Katya Golubkova)
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Mariah Carey's floating concert brings star power to Amazon ahead of COP30
On Wednesday night, less than two months before Belem welcomes heads of state to the U.N. Climate Summit COP30 in the Brazilian city, pop star Mariah Carey performed with a cast local artists at a floating concert for the Amazon rainforest. The concert was part of the two-day "Amazon Live Today and Forever" event, organized by Rock World. The company that organizes the music festivals Rock in Rio and The Town. Carey, 56 years old, was able to captivate more than 70,000 Sao Paulo fans on Saturday when she appeared at The Town. Fans watched from another location as the singer performed on a stage that resembled an enormous waterlily floating on the Guama River for a half-hour on Wednesday. "We are here tonight to raise awareness about the protection of the rainforest." Let's start with something tropical," she said, before singing "Sugar Sweet", the first song of the evening. Carey made her sixth visit to Brazil after performing in Sao Paulo last year and Rio de Janeiro the previous year. The Amazon concert was broadcast on Brazilian TV, and it was preceded by a showcase of Amazon-born female performers. Belem, Brazil, will host COP30 in November. This event, the first U.N. Climate Summit to be held within the Amazon, will bring together business leaders, climate activists, and foreign leaders. (Reporting and writing by Wagner Santana, Fernando Cardoso, Jamie Freed).
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Three police officers killed, two injured in Pennsylvania; suspect shot
Officials said that three law enforcement officers died and two were critically injured in Pennsylvania, following a confrontation on Wednesday with a shooter who was fatally wounded by police. State police commissioner Colonel Christopher Paris stated that the shooting occurred in Codorus Township in York County, in the southeast part of Pennsylvania, as the officers returned to the site where they had previously conducted some police work. He told reporters hours later that "they were there to follow-up on an investigation which began yesterday." He refused to provide any further details, other than to describe the investigation as being "domestic." Three officers were killed and two other officers were injured by gunfire. They were transported to a hospital nearby, where their conditions were listed as critical but stable. One local media outlet claimed that the officers were trying to execute a search warrant at the time of the shooting. Paris reported that the police shot and killed the shooter. The shooter was not identified publicly and the authorities refused to reveal immediately which law enforcement agency the officers were from. Governor Josh Shapiro, who visited the hospital to pay his respects to fallen officers, stated, "This is a tragic and devastating event for York County as well as the Commonwealth of Pennsylvania." He asked for prayer for the families of those who died. He said: "It is important that you know how proud these families are of the loved ones who wore uniforms to keep us safe." Shapiro acknowledged that he received a phone call from U.S. attorney general Pam Bondi, who offered whatever federal assistance was needed. Reporting by Steve Gorman and Christian Martinez. Editing by Bhargav Asharya and Sam Holmes.
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Report says India's CO2 emissions from the power sector have fallen for the second time in four decades.
India's carbon emissions from the power sector decreased by 1% in the first half 2025, primarily due to the addition of clean energy and a lower demand for electricity, according to a report. This is only the second decline in almost 50 years. According to an analysis of Carbon Brief by the Centre for Research on Energy and Clean Air, the fall in electricity demand was primarily due to record additions of clean-energy capacity and unusually warm weather. The Helsinki-based think-tank attributed 65% to the decline in fossil-fuel generation, 20% to a faster expansion of clean-energy, and 15% to increased hydropower output. This analysis is based upon official data collected by different government agencies and ministries on fuel consumption, production of industrial goods and electricity generation. CREA reported that India added 25.1 gigawatts of non-fossil power in the period January-June, a 69% increase from the previous record. This is enough to produce nearly 50 terawatt-hours (TWh), annually. Hydropower production increased as a result of lower temperatures and rain between March and may, which was 42% higher than normal. CREA reported that fossil fuel generation dropped by 29TWh while total electricity generation increased by 9TWh. The growth in oil demand also slowed, which contributed to the overall emissions decline. However, steel and cement emissions rose dramatically due to government infrastructure spending. CREA stated that India's emissions from the power sector could reach a peak before 2030, if the clean energy growth continues and if demand stays within projections. CREA said that the sector had historically accounted half of India's growth in emissions. The country is looking at adding 500 GW of renewable energy by 2030. (Reporting and editing by Yagnoseni das, Sethuraman N R and Janane Venkatraman).
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Exxon suspends European plastic recycling plans due to draft EU regulations
ExxonMobil has halted 100 million euros (118.4 millions) in investment in European Plastic Recycling due to draft EU rules that define the recycled content of a final product. Two projects are being developed by the U.S. energy company to recycle chemicals at its existing plants in Rotterdam, and Antwerp. The project will process 80,000 tons of plastic waste annually. In an interview, Jack Williams, Senior Vice-President of ExxonMobil, said that the two projects were now halted due to the EU draft rules which he claimed discriminated against existing petrochemicals facilities versus standalone installations. "Everything is going according to plan." He said, "We've received local support." "We are interested in making these investments." "The only thing that stands between us and this project is EU Policy." A draft law is being considered to determine the amount of recycled material based on both the mass of waste entering the system and that of the output. ExxonMobil has stated that it favors simpler standalone technologies, where the path to production from plastic waste is more clear. It penalises complex integrated facilities which feed fossil feedstocks. Williams stated that based on the proposed law, the facilities of its company would receive less than half the credit due. A public consultation on the draft ended one month ago. Exxon shares the view of industry groups and companies including Finland's Neste. By 2030, the EU has set targets for plastic recycling. For example, plastic bottles must contain 30% recycled material. According to the industry, it is necessary to combine mechanical recycling which reprocesses plastic waste without altering its chemical structure with chemical recycling. This can be done by reducing complex plastics into their basic chemical components. Williams said that while U.S. tariffs on imports weren't a major problem for his company, EU regulations were. He specifically called on the EU to repeal Corporate Sustainability Due Diligence (CSDDD), which requires large companies to verify if their supply chain uses forced labour or causes environmental damage. Williams claimed that the rules were complex, expensive, bureaucratic and in some cases impossible to achieve. They also applied outside of the EU. The EU has already loosened the rules and delayed their implementation. (1 dollar = 0.8447 euro) (Reporting and editing by Ed Osmond, Philip Blenkinsop)
Germany's election: polls, parties, and policy debates
Germany will hold an immediate national election on February 23 after the collapse of Chancellor Olaf Scholz’s three-way alliance.
The main political parties, their polling positions, and key policy issues are listed below:
Parties
Germany has two "big-tent", centrist parties: Scholz’s centre-left Social Democrats and the opposition Conservatives, an alliance between the Christian Democrats (CDU), and their Bavarian counterpart party, the Christian Social Union CSU.
In recent years, smaller parties like the Greens or Alternative for Germany (AfD), a far-right party, have gained ground.
All four parties, the SPD, Greens, Conservatives and AfD, have candidates running for chancellor.
According to polls, the Free Democrats (FDP), Linke (a far-left party) and Sahra Wagenknecht Alliance are also running. However, they are at risk of not reaching the 5% threshold for entering parliament.
According to the INSA survey released on February 1, the conservatives are leading the nationwide polls and have reached 30%. The AfD is at 22%.
Scholz' SPD has fallen to third place from first in the election of 2021. The Greens are on 12%, and the BSW is on 6%. Both the FDP and Linke poll at 4%
Analysts believe that polls can change quickly as voters have become less loyal. The conservatives were unable to maintain their lead in the election campaign of 2021. They fell from the frontrunners to the runner-up in a matter of months.
Friedrich Merz is a conservative leader who is prone to gaffes. He can also be quick to anger.
What are the key issues?
Ukraine
The mainstream parties in Germany are all for helping Ukraine to repel Russia's full scale invasion. However, the AfD/BSW wants to stop weapons deliveries to Kyiv as well as a return to good relations with Moscow.
Scholz and the SPD, however, have struck a more conservative tone recently, highlighting the importance of diplomacy, than the Greens, FDP and the Conservatives who all support the delivery of long-range Taurus rockets from Germany to Kyiv.
Reviving the Economy
Scholz proposes to encourage private investment and modernise infrastructure by creating a 100 billion euro fund that is off budget. Scholz' SPD plans to give businesses a 10% direct tax rebate on their equipment purchases.
Robert Habeck, a Green Party member, has called, as Scholz did, for reforms to the constitutionally-enshrined debt break in Germany, allowing for increased public spending.
Merz also indicated some openness towards a moderate reformation of the debt brake, but in his party's platform he pledged to keep it. Both the AfD (the Alternative for Germany) and the FDP (the Free Democratic Party) are staunch defenders against the public borrowing limit.
In the CDU/CSU manifesto, they have proposed a wide range of financial reliefs for citizens and companies, including tax reductions on income and corporations, as well as lower electricity rates. The CDU/CSU have not stated how they would finance these.
The AfD is calling for Germany to abandon the euro and reintroduce its own currency, the Deutsche Mark. It also wants the country to leave the EU.
- Migration
The public's concern over migration and security has been exacerbated by a series of violent attacks in Germany that are linked to foreign suspects. This has led to political parties demanding stricter immigration measures.
Merz broke a taboo by sponsoring a bill in support of the AfD after the latest attack on January 22. This was a break from the previous policy against working with the far right party.
He failed to get a majority of his own deputies to back the bill.
The conservative CDU, in general, has taken a more strict stance against immigration over the past few years. They have called for the deportation of asylum seekers, as well as limits on family reunions and naturalisations for refugees.
AfD, the anti-Islam and anti-migration party, has called for border closures and to deny asylum seekers their right to family reunion. AfD senior members went further with their comments, and attended discussions between far-right activists on the deportation of millions of people from foreign countries including German citizens.
The SPD has a tougher stance on immigration, enforcing more strict border controls and increasing deportations.
The Greens, on the other hand, maintain an open policy in terms of asylum, and promote initiatives such as state-sponsored sea rescues, simplifying processes for family reunion and enhancing integration.
- Energy
The high energy prices in Germany remain a major challenge for both households and businesses. They are also a key topic during the election campaign.
CDU, SPD, and Greens all agree that renewable energy can be expanded to reduce costs, but they differ in their financing strategies: The CDU proposes using higher revenues from CO2 certificates to lower network charges, while SPD and Greens favor debt-financed subsidies. The CDU, AfD and SPD also suggest a return of nuclear power. This idea is rejected by SPD and Greens.
The AfD is against all renewable energy subsidies. It advocates unrestricted operation of coal-fired plants and the elimination of CO2 pricing in order to reduce consumer costs and improve energy security.
Relations with Trump
Germany is especially sensitive about the question of how to deal with the new administration led by Donald Trump who has already hinted at increased tariffs and reduced support for Europe. The U.S. is still Germany's main export market and security ally.
Scholz, the SPD candidate, has strongly reacted to Trump's remarks on Greenland, Canada and other countries. Merz, the conservative candidate, warned him against lecturing Trump, focusing instead on areas of potential cooperation, such as a possible EU-U.S. Trade Deal or joint China Strategy.
Habeck, a Greens member, warned that the EU should stand united and engage in talks with Trump's administration as a trade conflict will harm both sides.
All the major parties are sceptical about Trump's demands that European countries increase their defence spending to 5%. This is because Germany will struggle to maintain 2% of its economic output after the special fund for military purposes runs out. Habeck has, however, already proposed a 3.5% increase.
AfD is the German party which has shown the most support for the Trump administration. Elon Musk was a frequent endorser of the AfD and spoke on X to Alice Weidel, the party's candidate for chancellor. Reporting by Sarah Marsh and Maria Martinez. Editing by Alexandra Hudson and Mark Heinrich.
(source: Reuters)