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Gold drops as Middle East tensions continue to keep oil prices high. Fed meeting is in focus
On Tuesday, gold fell to a near four-week low, due to persistent inflation fears after U.S. President Donald 'Trump' appeared unsatisfied by Iran's most recent proposal to end war. Investors were also awaiting the Federal Reserve's meeting on monetary policy this week. Gold spot dropped 1.7%, to $4,600.61 an ounce as of 1:42 pm EDT (1742 GMT), having hit its lowest level in April 2. U.S. Gold Futures closed 1.8% lower at $4,608.40. It's rekindled pessimism in the Middle East about peace. "The strait is closed because the Trump administration has rejected Iran's most recent offer," said Peter Grant. Gold has fallen to a four-week low as a result. A U.S. official stated that Trump was not happy with the latest Iranian proposal to resolve the 'war.' This has dampened hopes for a solution to the conflict which has caused disruptions in energy supplies, increased inflation, and killed thousands. The price of oil rose after the UAE announced it would leave OPEC+ and the Strait of Hormuz, as stalled attempts to end the Iran War kept Middle East supplies constrained. The rise in crude oil prices increases the risk of interest rate hikes. Gold is often seen as a hedge to inflation. However, the high interest rates have a negative impact on its appeal. Investors expect that the Fed will hold interest rates steady at its two-day meeting ending on Wednesday. Investors will also closely monitor Jerome Powell, the Fed chair's remarks. Investors will also be watching for other central bank decisions, such as those of the European Central Bank, the Bank of England, and the Bank of Canada. Hong Kong Census and Statistics Department data revealed on Tuesday that China, the top gold consumer in the world, imported 47.866 tons of gold from Hong Kong in March, up from 46.249 tonnes in February. Silver spot fell by 2.7%, to $73.43, platinum dropped 1.5%, to $1,953.32, and palladium declined 0.8%, to $1,465.42. (Reporting and editing by Keith Weir in Bengaluru, Leroy Leo, Shailesh Kumar and Ishaan Aroo)
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Italy PM: May extend the excise duty reduction, seeking EU budget leeway to energy
Giorgia Meloni, the Italian Prime Minister, said that Italy could extend its reduction in fuel excise duty beyond May 1, as part of an effort to help families and businesses cope with rising energy prices. Meloni, after a cabinet session, told reporters that "we?are assessing another?extension.?This might be shorter than previous ones." The Prime Minister also stated that her government has set aside nearly 1 billion Euros ($1.17 billion), to extend and strengthen some tax incentives designed to encourage employers of staff to hire. Italy has spent?around 700 million Euros to reduce excise duty on petrol and diesel for just under 40 days, until May 1. Meloni stated that the new reduction under discussion may have a greater effect on diesel than petrol. Italy, which is heavily dependent on imported oil and gas, is especially vulnerable to disruptions in supply caused by the U.S./Israeli war with Iran. Meloni called on the European Commission to "loosen" its rules to allow member countries to reduce their energy costs through budget flexibility, which is currently reserved almost exclusively for defense and security expenditures. She said that if you asked her what the cost of defence and security was, she would say "energy" as a part of it. In a clause known as the 'National Escape Clause' (NEC), the EU allows member states to exceed their budget deficit limit in order to increase defence spending or in cases of exceptional economic hardship. The budget flexibility for defence spending is available between 2025-2028. However, an increase in the deficit must not be greater than 1.5% of the national output each year. Last year, Italy planned to increase their defence spending by 0.15 percent of GDP in 2026 and 2027. Meloni, who said the 0.15% rise would amount to 3.7 billion euro, stressed that limiting energy prices is a "top-priority" for her government.
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Barrick appoints top executives to North American IPO
Tim Cribb, the chief operating officer, will be Wessel Hamman, the chief financial officer, of the new Barrick Mining company, which will hold the North American assets before its U.S. IPO. Both executives are insiders of the company. The Toronto Stock Exchange shares of Barrick Mining fell 3.3%, to C$53.63. This was in line with the gold price. The IPO update for its North American unit follows a year of corporate reorganization, which included the departure of former CEO Mark Bristow and a division of Barrick's business. Mark Hill was appointed to lead the planned listing of the stock market expected to be finished by the end this year. The company's goal is to increase the value and operational focus of North American Barrick. In 2025, the company produced approximately 2 million ounces gold. Barrick investors, who have a portfolio of assets spanning Papua New Guinea, Argentina and beyond, are looking for greater value at a time when gold prices are high. The miner announced plans to reduce its exposure to high-risk areas and said earlier this month that it was reviewing operations at Reko diq in Pakistan because of the current security risks. Barrick has also stated that they have been meeting with Newmont to improve the performance of Nevada Gold Mines, and will adhere to all commitments. Newmont reported in February that it had sent Barrick a default notification about NGM's poor performance. North American Barrick’s IPO was one of the most anticipated public listings this year in mining. Some analysts, however, said that Barrick’s announcement could indicate a delay in launching its IPO. Martin Pradier is a gold analyst at Veritas. He said, "My impression was that they seemed to be pushing back the IPO." Pradier suggested that it could be due to the fact that they are trying to resolve issues with Newmont and need time. Barrick has said that it is also in discussions with Newmont about the ownership of the Fourmile Gold Project. North American Barrick's NGM complex will include Carlin Cortez and Turquoise Ridge operations, which is the largest gold-producing area in the world. The project will also include the undeveloped Fourmile Gold Project located right next to NGM as well as the Pueblo Viejo Mine in the Dominican Republic. North American Barrick will likely have its primary listing located in New York and a secondary one at Toronto. Reporting by Vallari Shrivastava, Toronto, and Divyarajagopal, Bengaluru; Editing by Shailesh Kuber, Louise Heavens Alexander Smith, Tomasz J. Janowski
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After storms and blackouts, Portugal launches a $26.5 billion plan for resilience
The government of Portugal announced on Tuesday a $26.5 billion investment program that will be implemented over a period of nine years. This programme is aimed at mitigating various risks, including climate change and power outages. The plan was developed after severe storms in central Portugal in January/February caused damage estimated at 5.3 billion euro and a devastating power outage exactly one year earlier in Spain and Portugal. The initiative named Portugal Transformation, Recovery and Resilience aims to strengthen the infrastructure, institutions, businesses, and homes against threats related to climate change, energy security and cyberattacks. The state will fund 37% of it, while private funding accounts for 34% and European funds cover 19%. Luis Montenegro, the Prime Minister, presented the plan and said that Portugal was "hit hard by extreme weather events in recent years --?droughts heavy rains, flooding, and fires -- occurring with increasing destructive power year after year". He said, "The time for action is now... we need to strengthen our country's resilience to be better prepared in the future." "Our goal is a more resilient recovery, protecting people, businesses, territory and infrastructure to better withstand risks." He highlighted an investment plan of 4 billion Euros?into electricity and gas grids, storage energy and new hydroelectric dams. The programme will seek to?expand the role of market-based instruments and insurance in managing climate-related risk. The funds allocated for the rebuilding of homes, factories, and critical infrastructure will be used in the short-term. The government has not estimated the cost of the worst blackout in history that struck?Spain? and Portugal? a year ago. However, Portugal's Industry Association AIP believes it could have resulted in losses to Portuguese businesses of over 2 billion euros.
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Official data shows that Guinean bauxite production has increased by 25% in the face of export restrictions.
Official data released on Tuesday showed that Guinea's bauxite production grew by 25% in the first quarter of 2026. This was largely due to Chinese demand. The government is planning export restrictions to protect smaller producers and boost prices. Guinea is the largest exporter in the world of bauxite - a major feedstock for aluminum - and has experienced a strong growth rate. In 2025, Guinea's bauxite output reached 183 million tons. Mines Minister Bouna Sylla told ? In March, Mines Minister Bouna Sylla told? Guinea exports more than 70% of its bauxite to China. This makes the West African country a key player in Beijing's aluminium production chain. Guinean bauxite exported reached 60.9 million tonnes between January and March of this year. This is up by 25.3% compared to 48.6 millions tons during the same period in 2013. According to data, quarterly exports were primarily driven by Chinese-linked companies, despite Beijing’s weak aluminum exports. Societe Miniere de Boke, or SMB, led the way with 18 million tonnes. China's Chalco state-owned company shipped 8 million tons. The data also showed that China's Hongqiao controlled AGB2A/SDM and CBG, as well as AMC, were major contributors. Guinea's Mines Chamber did not respond immediately to a request for comment. GUINEA BAUXITE PRICE ARE AT A FOUR YEAR LOW According to Anthony Everiss of consultancy CRU, Guinean bauxite free-onboard prices are at their lowest level since March 2022. They range from $32 to $38 per ton. He said that although shipments have been strong in April, CRU expects the growth of bauxite to be sharply reduced later on - 2026 - as the government takes steps to limit exports. CRU expects that the government's export restrictions will also?slow down production growth in 2026, along with?seasonal disruptions and high fuel costs? by some miners. Everiss said that Guinea could use tax changes in addition to export caps to encourage miners to invest in rail, ports, and domestic refinery capacity.
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US fuel prices at 4 year high due to Iran war disruption and refinery outages
The average U.S. gas price has risen to its highest level in almost four years. It is up more than 40% since the U.S. and Israel attacked Iran at the end February, according data from the American Automobile Association. AAA data shows that prices at the pumps were around $4.18 per gallon on February 2, up 11 cents in one month and $1.19 since late February. If crude oil prices rise further, gasoline prices may increase even more. Brent crude futures gained 16% last week and U.S. West Texas Intermediate gained 13%, as supply concerns grew. Prices of oil had taken a breather earlier in the month as hopes of reopening of the Strait of Hormuz were high. GasBuddy analyst Patrick De Haan said that refinery problems and scheduled maintenance will keep prices high for Midwest consumers. BP's 440,000-barrel-per-day oil refinery in Whiting, Indiana over the weekend experienced a brief power outage that caused one ?of its processing units to be shut down. Phillips 66's ?356,000-barrel-per-day Wood ?River refinery in Illinois took its crude oil unit and some other parts of ?the refinery offline at the end of February ?for a 45-day maintenance period. Marathon Petroleum's 253,000 bpd Robinson Refinery in Illinois began scheduled maintenance?mid-March. Units are expected to remain offline?until mid-May. De Haan stated that retailers in the Great Lakes Region could raise prices as soon as today.
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South Africa reduces fuel taxes to offset Iran War Impact
South Africa said on Tuesday it would extend the fuel tax cut 'for two more months' to cushion the impact of the iran war on household budgets. However, the relief will end after this period and the country will recoup lost revenue through other means. According to the?International Energy Agency, the U.S. and Israeli war on Iran has led to the largest oil supply disruptions in history. This has hurt countries like South Africa, which import most of their fuel, as global energy prices are rising. The government announced a reduction of one month in the general fuel tax for April in late March. It has now extended this?relief? into May and early June. In April the levy for petrol and diesel was lowered?by $3.1809 per litre. For May, it will be reduced by 3 rand for petrol, and 3.93 for diesel. The finance and petroleum ministry announced in a statement that the relief would be halved to 1.50 rand per litre of petrol and to 1.96 rand per litre of diesel. They said the measure was intended to 'address concerns about higher inflation and the negative impact on economic growth. The 'government' reiterated that the fuel tax reductions would not impact the fiscal framework of the 2026 budget, as the foregone tax amounting to 17.2 billion rand ($1.04billion) would be funded by a combination higher than expected revenue and underspending. South Africa's Central Bank flagged fuel-driven risks of inflationary risk?at its meeting on monetary policy?in march and has said since that market implied interest rate expectations indicate scope for two 25-basis point hikes this year.
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GM raises its profit forecast, but flags the expected tariff refund
General Motors announced on Tuesday that its core profit for the first quarter rose by 22%. The company also raised its earnings forecasts for the full year, boosted by a strong U.S. auto market and an anticipated tariff refund. The U.S.'s largest automaker, based on?sales, comfortably beat analysts profit estimates as it navigated a rapidly changing geopolitical backdrop and regulatory environment that is reshaping industry. U.S. tariffs and higher energy costs related to the Iran War are weighing down on results. However, margins are being lifted by President Trump's looser fuel economy and pollution rules. Despite higher gas prices, pickup-truck sales, which are a major profit driver, remain strong. GM, however, warned that the inflation caused by the war would continue pressure the business. Mary Barra, CEO of the company, said that she was "mostly watching" what happened with the Iranian conflict. She cited rising costs for commodities and logistics. The company said that it had diverted 7,500 SUVs planned for shipment from the Middle East due to the conflict. CORE PROFIT BEAT GM's earnings before interest and tax of $4.3 billion or $3.70 a share beat the analysts' estimates?of $2.62 according to LSEG. In morning trading, shares fell by around 2%. Detroit's automaker increased its profit forecast for 2026 by $500 million. This is the same amount that it expects to recover as a result of refunds related to a U.S. The Supreme Court ruled that some tariffs imposed by the Trump administration were invalidated. The company now expects a core profit for the full year of between $13.5 billion and $15.5 billion. The expected refund has lowered the estimate from $3 billion to $4 million to $2.5 billion or $3.5 billion. GM's profit forecast is higher despite rising costs. The company now estimates that inflation in raw materials, computer chip prices, and logistics will cut earnings by $1.5 to $2 billion, or $500 million, compared to what it predicted late last year. LOWER SALES BUT HIGHER MARGINS The net income for the quarter fell by 6% compared to the same period last year, to $2.6 billion. This was mainly due to a $1.1billion charge to settle claims from suppliers regarding slowing electric vehicle programs. Revenues of $43.6 billion were down by less than 1%. The American consumer has continued to buy cars despite the economic uncertainty caused by tariffs, rising gas prices, and a shaky employment market. On an earnings call, CFO Paul Jacobson stated that "we haven't yet seen any material change in demand or mix." JPMorgan analyst Ryan Brinkman stated that GM deserves credit for increasing its profit forecast despite the "significant uncertainty and volatilities." In North America, GM is the biggest money-maker. Its profit margin increased to 10.1%, from 8.8% a?year earlier. This was despite lower vehicle shipments and a 10% drop in sales during the first 'quarter. The decline in sales was partly due to a comparison with the first three months of 2025 when U.S. consumers bought new cars ahead of tariff-related price increases. Even though U.S. gas prices soared to over $4 per gallon, pickup-truck sales were strong in March. Jacobson told CNBC dealership traffic was steady in both March and April. GM says that lower warranty costs, a softer U.S. tailpipe emission rule and a stronger price helped offset the weaker sales. The average U.S. vehicle price increased by about 3% in the third quarter to $52,000. The EV business continues to be a loss-maker, so pulling back on it also helped boost results by several hundreds of millions. GM anticipates a boost of $1 billion this year by reducing EV losses. GM reported $165 million in equity income for China, where it is restructuring. This compares to $45 million a year ago. The core profit for its international business, excluding China, was $123 million. This is up from $30 millions. GM, like many of its rivals has reduced EV production due to a weaker market following the pro-fossil fuel U.S. policy introduced last year. In the last three months of 2016, EV sales dropped by 43%. In addition to its first-quarter charge, GM recorded $7.6 billion of writedowns for its EV program last year.
US consumer confidence improves unexpectedly, but gasoline prices are still a concern
U.S. consumer sentiment unexpectedly increased in April, amid a rally of share prices after a ceasefire was declared in the war with Iran. Also, improved perceptions about the labor market helped to ease the financial concerns of households for the time being.
Despite the confidence reaching a four-month-high, the survey by the Conference Board revealed that 'higher gasoline costs resulting from the U.S. - Israel conflict with Iran' remain a cause of?concern for consumers.
The number of vacations planned over the next six-month period and the percentage of people who intend to drive their holiday destination was the lowest it has been since April 2020 when the country was battling the COVID-19 pandemic's first wave.
The stock market was boosted by the two-week ceasefire that President Donald Trump extended indefinitely last week. Economists dismissed the increase in confidence as temporary and noted that it was still well below the levels of January 2025 when Trump returned to his White House, imposing sweeping tariffs against imports. The Middle East conflict has also disrupted the flow and movement of goods beyond oil. They expected this to affect the labor market in some way or another during the year.
Oren Klachkin is a financial markets economist with Nationwide Financial. He said: "We do not expect to see a significant rebound in consumer sentiments on the horizon." "A reassuring job market will only offer'modest comfort' in the face high energy prices. These will modestly creep into other areas of inflation."
The Conference Board reported that its consumer confidence index rose 0.6 points to 92.8 in this month. The economists polled had predicted that the index would ease to 89.0. The survey's preliminary results were collected from April 1 to April 22. The survey's results were in stark contrast to the University of Michigan Surveys of Consumers which showed last week that its Consumer Sentiment Index had fallen to a "record low" in April.
The University of Michigan Survey is more sensitive to perceptions of inflation, while the Conference Board Survey can focus more on the labor markets," said Gisela Yong, an economist at Citigroup.
The most optimistic consumers were those who identify as Republicans, while the confidence of Independents fell and that of Democrats improved. Conference Board Chief economist Dana Peterson stated that "consumers wrote-in responses about factors affecting the economic continued to be pessimistic in April."
The median 12-month expectations of consumers have slipped to 5.1% from 5.2% last month. Federal Reserve officials began a two day policy meeting on February and were expected on Wednesday to keep the U.S. Central Bank's benchmark interest rate for overnight loans in the range of 3.50%-3.75%.
Wall Street's stocks were mixed. The dollar's value against a basket was not much changed. The yields on U.S. Treasury bonds were higher.
Tax Refunds Offer Cushions
The large tax refunds that were given this year helped to cushion the increase in gasoline prices. The average national retail price of gasoline is over $4 per gallon. The national average retail price is?over $4 a gallon.
The percentage of consumers planning to purchase a vehicle in the next six-month period was at its highest level for nearly one and a half years. The number of people who wanted to buy a home increased, probably due to a moderated growth in house prices and lower mortgage rates compared to last year.
Separate data from the Federal Housing Finance Agency shows that single-family home prices rose 1.7% over the past 12 months, after rising 1.8% in January.
Despite the fact that more consumers plan to buy a home, they seem less interested in buying household appliances such as televisions, refrigerators, and washing machines. The higher tariffs and prices are likely to be the cause.
Many people did not take a vacation this month, as the percentage dropped to its lowest level in a year. This month, the outlook for the labor market was positive. The percentage of consumers who perceive employment as "hard to obtain" has decreased, while the percentage saying that jobs are "plentiful", remained unchanged.
The so-called labor?differential of the survey, which is based on data collected from respondents on their views about whether jobs are "plentiful" or "hard to come by", rose from 6.1% to 7.5% in March.
This measure is correlated to the monthly unemployment report from the Labor Department. The unemployment rate decreased to 4.3% from 4.4% in the previous month. Still, economists expect the labor market to continue to soften in 2019.
Grace Zwemmer is an American economist with Oxford Economics. She said that the U.S.-Iran conflict could weaken the labor force by reducing the hiring of firms. This is because they are more uncertain about future oil prices and the economic outlook. Reporting by Lucia Mutikani; Editing and proofreading by Chizu Nomiyama, Andrea Ricci
(source: Reuters)