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Modi heads to Canada for G7 summit after concluding visit to Cyprus
Prime Minister Narendra Modi on Monday left for Canada to attend the G7 summit after concluding his visit to Cyprus.
The Ministry of External Affairs (MEA) said Modi's visit to Nicosia, the first by an Indian prime minister in over two decades, strengthened bilateral ties and was important in the larger context of the India–EU strategic partnership and India's growing engagement with the Mediterranean region.
With its strategic location, Cyprus can act as a gateway to Europe and the Mediterranean, Secretary (West) Tanmaya Lal said after the conclusion of the visit. Cyprus takes over the presidency of the Council of the European Union during the first half of next year. This comes at a time when there is strong interest in significantly enhancing the India–EU strategic partnership, Lal said.
The visit was also significant given the territorial dispute between Cyprus and Türkiye, and India's unhappiness with Ankara's support to Islamabad during Operation Sindoor. India supports Cyprus on the Cyprus question, Lal said.
He said Gift City and the Cyprus Stock Exchange are discussing cooperation. Easier cross-border payments through UPI integration are also being explored. Indian shipping firms are exploring opportunities in connectivity and logistics, which have relevance in the context of IMEC (the India–Middle East–Europe Economic Corridor), Lal said.
Cyprus has emerged as one of the top 10 sources of FDI for India, with cumulative FDI inflows at around $15 billion.
During the visit, Cyprus President Christodoulides conferred upon the prime minister the Grand Cross of the Order of Makarios III, the highest honour bestowed by Cyprus on foreign heads of government.
The prime minister gifted a handmade Kashmiri silk carpet to Christodoulides and a silver clutch purse crafted in Andhra Pradesh.
Modi is on a four-day, three-nation tour to Cyprus, Canada and Croatia.
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Mint
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Truce hopes spark rebound
ORLANDO, Florida, June 16 (Reuters) - TRADING DAY Making sense of the forces driving global markets By Jamie McGeever, Markets Columnist Investor sentiment and risk appetite rebounded sharply on Monday as fears around the Israel-Iran conflict subsided, shifting the spotlight away from geopolitical risk and back towards this week's raft of central bank policy meetings. In my column today I look at why the dollar's status as a safe-haven asset in times of heightened geopolitical uncertainty may be fading in a world of 'de-dollarization'. More on that below, but first, a roundup of the main market moves. If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. 1. Iranian state broadcaster hit as Iran urges Trump to make Israel halt war 2. Seeking unity, G7 meets amid escalating Ukraine, Middle East conflicts 3. Tariff 'stacking' adds another headache for U.S. importers 4. Investors shun long-term U.S. bonds as hopes for aggressive Fed rate cuts fade 5. Reuters interview with ECB Vice President de Guindos * Oil slides as much as 4% at one stage on Monday but Brent futures settle only 1.35% lower at $73.23/bbl, suggesting a chunky risk premium remains in the price. Oil spiked 7% on Friday. * Wall Street rebounds strongly, with the S&P 500 back above 6000 points and the Nasdaq gaining 1.4%. * Nvidia shares rise 2% to the highest since January 24, within sight of the record peak of $153.13 from earlier that month. Shares are up almost 70% from the post-'Liberation Day' low. * U.S. Treasury yields rise and the curve bear steepens despite a pretty solid 20-year bond auction. Longer-dated yields up 5 bps. * Gold gives back Friday's gains, sliding more than 1% to $3,386/oz. The dollar rises 0.5% against the yen ahead of the Bank of Japan's rate decision on Tuesday. Truce hopes spark rebound Signs of de-escalation between Israel and Iran - or at least hopes of de-escalation - ensured markets started this week much more positively than they finished last week. Whether that optimism is justified remains to be seen but the rebound was pretty strong, taking Wall Street and world stocks back to within sight of their recent highs. It's a very fluid situation, so investors' relief may be short-lived. Iran has called for U.S. President Donald Trump to get Israel to halt its attacks, but both countries continue to fire missiles at each other. Meanwhile, a U.S. official said Trump will not sign a draft G7 leaders' statement calling for de-escalation of the conflict. Optimism that a truce will be reached appears to be stronger in equity markets than elsewhere. Gold gave back Friday's gains but not before hitting $3,451 an ounce, a level last reached when it clocked a record high on April 17, and in volatile trade oil settled 1.7% lower, having surged more than 7% on Friday. Perhaps equity investors have it right. The oil price has less of a bearing on global growth or asset prices than it used to, and markets have been pretty resilient to Middle East conflicts in recent years, with selloffs proving to be shallow and short-lived. Unless there is a real adverse oil price shock, it will probably be a similar story this time around, although spiking inflation would be problematic for central banks. Economists at Oxford Economics sketch out an extreme scenario where the closure of the Strait of Hormuz pushes oil up to $130 a barrel, which could lift U.S. CPI inflation to almost 6%. Oil is nowhere near that yet though. As Deutsche Bank's Henry Allen notes, perhaps the story of the year is how resilient stock markets have been in the face of myriad large shocks - DeepSeek's emergence casting doubt over U.S. tech valuations; Europe's fiscal regime shift triggering the biggest daily jump in German yields since 1990; the U.S. losing its triple-A credit rating; Trump's tariffs and the S&P 500's fifth-biggest two-day fall since World War Two. And yet here we are, with world stocks at all-time highs. Aside from geopolitics, the focus for investors this week will mostly revolve around central banks. The Bank of Japan will deliver its policy decision on Tuesday, and economists expect it to hold off from raising rates again due to the uncertainty around U.S. tariffs. Later this week we have decisions from Indonesia, Brazil, Switzerland, Sweden, Norway, Britain and the U.S. Federal Reserve. 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It was at a three-and-a-half year low, having depreciated 10% year to date, with sentiment and positioning heavily bearish. Yet a significant geopolitical shock generated barely a knee-jerk bounce. For comparison, the dollar rose more than 2% in both the first week of the 2006 Israel-Lebanon War and in the week following Israel's invasion of Southern Lebanon last year. The dollar's weak response to this latest Middle East conflict supports the narrative that investors are now reassessing their high exposure to dollars, in light of some of the unorthodox policies put forward by U.S. President Donald Trump in recent months. The dollar was down slightly early on Monday, and gold and oil were giving back some of Friday's gains too, as markets regained a foothold at the start of a busy week packed with key central bank meetings. The dollar has historically been one of the best hedges against short-term volatility sparked by geopolitical risk, behind gold and on a par with oil, according to research published last year by Joe Seydl, senior markets economist at JP Morgan Private Bank. Indeed, a Journal of Monetary Economics paper from last year stated plainly, "The dollar is a safe-haven currency and appreciates when global risk goes up," a trend resulting from the "fundamental asymmetry in a global financial system centered around the dollar" built up over the course of several decades. That latter part of that argument hasn't changed. The dollar accounts for almost 60% of the world's $12 trillion FX reserves, with its nearest rival, the euro, accounting for around 20%. Almost two-thirds of global debt is denominated in dollars, and nearly 90% of all FX transactions around the world have the greenback on one side of the trade. That means traders, financial institutions, businesses, consumers and governments still need to be more exposed to dollars than any other currency, even if they question the direction of current U.S. policy. However, the dollar's downside 'structural' risks are growing, analysts at Westpac noted on Sunday, as concern over Washington's fiscal health and policy uncertainty erode the dollar's 'safe-haven identity'. Investors are now looking to hedge their large dollar exposure more than ever. If this dampens their instinctive demand for dollars in periods of sudden geopolitical tension, uncertainty and volatility, then the so-called 'dollar smile' theory could be challenged. This 'smile' is the idea that the dollar appreciates in periods of financial market stress as well as in 'risk on' periods of strong global growth and investor optimism, but sags in between. This idea was first outlined over 20 years ago by then currency analyst and now hedge fund manager Stephen Jen. 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