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Business Recorder
13 hours ago
- Business
- Business Recorder
Indian rupee sticks to losing run as outflows, tariff worries sustain pressure
MUMBAI: The Indian rupee weakened for a fifth straight session on Tuesday, pressured by likely outflows from domestic equities and growing concerns over an imminent deadline to secure trade deals with the United States. The rupee closed at 86.3675 against the U.S. dollar, down 0.1% on the day. The rupee has fallen around 0.6% over its five-day losing streak, weighed by a modest rebound in the dollar index, foreign portfolio outflows, and concerns over the economic fallout from U.S. President Donald Trump's ongoing trade war. Equity markets in Asia and Europe were mostly lower on Tuesday, while Wall Street futures were flat after the S&P 500 and Nasdaq hit record highs in the previous session. Regional currencies were trading mixed and India's benchmark equity indexes, the BSE Sensex and Nifty 50 closed a tad lower. While markets have shown a relatively muted reaction to the latest trade salvos from the White House in July, analysts said the complacency may start to fade as the deadline for trade deals draws closer. Indian rupee weakens slightly, broad dollar softness cushions pressure 'Markets' defiant approach to tariff news will be tested in the coming days as the risk of no trade deals before the 1 August deadline rises,' ING said in a note. The prospects of an interim trade deal between India and the United States before the deadline have dimmed, as talks remain deadlocked over tariff cuts on key agricultural and dairy products, Reuters reported earlier on Tuesday. In the absence of a trade deal, Indian exports would be subject to a 26% tariff. The European Union, meanwhile, is preparing possible countermeasures against the U.S. as prospects for an acceptable trade agreement fade, per EU diplomats.
Reuters
a day ago
- Business
- Reuters
South Korea economy likely returned to growth in Q2: Reuters poll
BENGALURU, July 22 (Reuters) - South Korea's economy likely returned to growth last quarter, supported by a modest rebound in exports and a gradual recovery in domestic demand, a Reuters poll of economists found. After contracting 0.2% in the January-March period due to sluggish consumption and weak exports, Asia's fourth-largest economy grew a seasonally adjusted 0.5% in the April-June quarter, according to the median forecast of 22 economists. If realised, growth would align with the Bank of Korea's projection, opens new tab made in May. On a year-on-year basis, gross domestic product (GDP) was forecast to have expanded 0.4% in the second quarter, following zero growth in the first three months of the year, based on the median estimate from 23 economists polled July 15-21. "South Korea's second-quarter GDP is expected to rebound modestly," said Min Joo Kang, economist at ING. "Consumption showed signs of recovery, but a more meaningful improvement is likely in the third quarter, once the government's consumption voucher programme takes effect. To cushion the economy against weak domestic demand and the potential fallout from U.S. tariffs, the government approved a supplementary budget of 13.8 trillion won ($9.9 billion) in May, followed by a larger 31.8 trillion won package in early July that includes giving all local citizens spending vouchers. Exports rose 4.3% in June after a 1.3% decline in May, driven by strong global demand for semiconductors. However, exports to the United States fell for a third consecutive month, slipping 0.5%, while shipments to China dropped 2.7%, marking the second straight monthly decline. "Although exports have been volatile they posted a gain, supported by strong orders for semiconductors, vessels and pharmaceutical goods," Kang added. "Construction, however, likely remained a drag on overall growth." South Korea, currently in trade negotiations with Washington, risks facing a 25% tariff on its exports to the United States if no deal is reached before the August 1 deadline. Industry Minister Kim Jung-kwan said on Monday talks were in a "critical phase" with a wide range of outcomes still possible. "The South Korean government is working very hard to secure a deal, but whether the deal comes before August 1 is highly uncertain," said Stephen Lee, chief economist at Meritz Securities. "If the two countries are willing to link everything to the deal - from reducing nontariff barriers, buying more U.S. produced goods, our involvement in Alaska projects and defense spending - the negotiations would need more time." Earlier this month the Bank of Korea held interest rates steady, but a majority of board members signaled the likelihood of a rate cut within the next three months, citing 'significant' economic uncertainty stemming from potential U.S. tariffs. A separate Reuters poll showed economists have lowered their 2025 growth forecast to 0.9%, down from 1.3% projected in April, bringing it in line with the BOK's latest estimate of 0.8%. ($1 = 1,387.8 won)
New Straits Times
a day ago
- Business
- New Straits Times
Oil slips as little impact seen from EU sanctions on Russia
HOUSTON: Oil prices settled slightly lower on Monday as the latest European sanctions on Russian oil were expected to have minimal impact on supplies, but losses were curbed by investors weighing a potential drop in diesel supplies. Brent crude futures settled down US$0.07, or zero point one per cent, to US$69.21 a barrel. US West Texas Intermediate crude settled down US$0.14, or zero point two per cent, to US$67.20. The European Union approved on Friday the 18th package of sanctions against Russia over its war in Ukraine, which also targeted India's Nayara Energy, an exporter of oil products refined from Russian crude. "The market right now thinks that supply will still make it to market in one way, shape or another. There is not too much concern," said John Kilduff, a partner at Again Capital in New York. Kremlin spokesperson Dmitry Peskov said on Friday that Russia had built up a certain immunity to Western sanctions. The EU sanctions followed US President Donald Trump's threats last week to impose sanctions on buyers of Russian exports unless Russia agrees to a peace deal within 50 days. ING analysts said the part of the package likely to have an effect is the EU import ban on refined products processed from Russian oil in third countries, though ING said that could prove difficult to monitor and enforce. Curbing some of crude's losses during afternoon trade on Monday were investor concerns around diesel supplies resulting from the sanctions package, analysts said. "As the day has gone on, the diesel crack spread started to firm quite a bit, suggesting that the market cannot ignore the fact that any disruptions in Russian oil supply could tighten supplies of diesel and that seems to be giving us a bit of support today," said Phil Flynn, senior analyst with Price Futures Group. Low-sulphur gasoil futures' premium to Brent crude closed on Monday at US$26.31, up around three per cent, marking its highest close since February 2024. "We have a bit of room for error on the crude side, barrels can be shuffled around a bit, but it is harder to shuffle around tight supplies of diesel," Flynn added. Iran, another sanctioned oil producer, is due to hold nuclear talks with Britain, France and Germany in Istanbul on Friday, an Iranian Foreign Ministry spokesperson said on Monday. That follows warnings by the three European countries that a failure to resume negotiations would lead to international sanctions being reimposed on Iran. In the United States, the number of operating oil rigs fell by two to 422 last week, the lowest total since September 2021, Baker Hughes said on Friday. "Oil-focused drilling is expected to remain at subdued levels through the balance of the year," StoneX analyst Alex Hodes said in a note on Monday. "We aren't anywhere close to prices that merit a significant pullback in investment though," Hodes added. US tariffs on EU imports are set to kick in on Aug 1, though US Commerce Secretary Howard Lutnick said on Sunday he was confident the United States could secure a trade deal with the bloc. US tariffs are potentially negative for oil demand and economic activity, Again Capital's Kilduff said.
Business Times
a day ago
- Business
- Business Times
Oil slips as little impact seen from EU sanctions on Russia
[HOUSTON] Oil prices settled slightly lower on Monday as the latest European sanctions on Russian oil were expected to have minimal impact on supplies, but losses were curbed by investors weighing a potential drop in diesel supplies. Brent crude futures settled down 7 cents, or 0.1 per cent, to US$69.21 a barrel. US West Texas Intermediate crude settled down 14 cents, or 0.2 per cent, to US$67.20. The European Union approved on Friday the eighteenth package of sanctions against Russia over its war in Ukraine, which also targeted India's Nayara Energy, an exporter of oil products refined from Russian crude. 'The market right now thinks that supply will still make it to market in one way, shape or another. There is not too much concern,' said John Kilduff, a partner at Again Capital in New York. Kremlin spokesperson Dmitry Peskov said on Friday that Russia had built up a certain immunity to Western sanctions. The EU sanctions followed US President Donald Trump's threats last week to impose sanctions on buyers of Russian exports unless Russia agrees to a peace deal within 50 days. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up ING analysts said the part of the package likely to have an effect is the EU import ban on refined products processed from Russian oil in third countries, though ING said that could prove difficult to monitor and enforce. Curbing some of crude's losses during afternoon trade on Monday were investor concerns around diesel supplies resulting from the sanctions package, analysts said. 'As the day has gone on, the diesel crack spread started to firm quite a bit, suggesting that the market cannot ignore the fact that any disruptions in Russian oil supply could tighten supplies of diesel and that seems to be giving us a bit of support today,' said Phil Flynn, senior analyst with Price Futures Group. Low-sulphur gasoil futures' premium to Brent crude closed on Monday at US$26.31, up around 3 per cent, and marking its highest close since February 2024. 'We have a bit of room for error on the crude side, barrels can be shuffled around a bit, but it is harder to shuffle around tight supplies of diesel,' Flynn added. Iran, another sanctioned oil producer, is due to hold nuclear talks with Britain, France and Germany in Istanbul on Friday, an Iranian Foreign Ministry spokesperson said on Monday. That follows warnings by the three European countries that a failure to resume negotiations would lead to international sanctions being reimposed on Iran. In the United States, the number of operating oil rigs fell by two to 422 last week, the lowest total since September 2021, Baker Hughes said on Friday. 'Oil-focused drilling is expected to remain at subdued levels through the balance of the year,' StoneX analyst Alex Hodes said in a note on Monday. 'We aren't anywhere close to prices that merit a significant pullback in investment though,' Hodes added. US tariffs on EU imports are set to kick in on Aug 1, though US Commerce Secretary Howard Lutnick said on Sunday he was confident the United States could secure a trade deal with the bloc. US tariffs are potentially negative for oil demand and economic activity, Again Capital's Kilduff said. Some support may come from oil inventory data if it shows tight supply, said IG market analyst Tony Sycamore. REUTERS
Reuters
a day ago
- Business
- Reuters
Oil slips as little impact seen from EU sanctions on Russian crude
HOUSTON, July 21 (Reuters) - Oil prices fell on Monday as the latest European sanctions on Russian oil were expected to have minimal impact on supplies, but losses were curbed by investors weighing a potential drop in diesel supplies. Brent crude futures dropped 19 cents, or 0.3%, to $69.09 a barrel by 1:45 p.m. EDT (1745 GMT), while U.S. West Texas Intermediate crude slipped by 11 cents, or 0.2%, to $67.23. The European Union approved on Friday the 18th package of sanctions against Russia over itswar in Ukraine, which also targeted India's Nayara Energy, an exporter of oil products refined from Russian crude. "The market right now thinks that supply will still make it to market in one way, shape or another, there is not too much concern," said John Kilduff, a partner at Again Capital in New York. Kremlin spokesperson Dmitry Peskov said on Friday that Russia had built up a certain immunity to Western sanctions. The EU sanctions followed U.S. President Donald Trump's threats last week to impose sanctions on buyers of Russian exports unless Russia agrees to a peace deal within 50 days. ING analysts said the part of the package likely to have an effect is the EU import ban on refined products processed from Russian oil in third countries, though ING said that could prove difficult to monitor and enforce. Curbing some of crude's losses during afternoon trade on Monday were investor concerns around diesel supplies resulting from the sanctions package, analysts said. "As the day has gone on the diesel crack spread started to firm quite a bit, suggesting that the market cannot ignore the fact that any disruptions in Russian oil supply could tighten supplies of diesel and that seems to be giving us a bit of support today," said Phil Flynn, senior analyst with Price Futures Group. Low-sulphur gasoil futures were trading at a $26.58 per barrel premium to Brent crude at 1:45 p.m. EDT, up around 4% on the day. If prices hold near that level, it would be the highest close since February 2024. "We have a bit of room for error on the crude side, barrels can be shuffled around a bit but it is harder to shuffle around tight supplies of diesel," Flynn added. Iran, another sanctioned oil producer, is due to hold nuclear talks with Britain, France and Germany in Istanbul on Friday, an Iranian foreign ministry spokesperson said on Monday. That follows warnings by the three European countries that a failure to resume negotiations would lead to international sanctions being reimposed on Iran. In the United States, the number of operating oil rigs fell by two to 422 last week, the lowest total since September 2021, Baker Hughes said on Friday. "Oil-focused drilling is expected to remain at subdued levels through the balance of the year," StoneX analyst Alex Hodes said in a note on Monday. "We aren't anywhere close to prices that merit a significant pullback in investment though," Hodes added. U.S. tariffs on EU imports are set to kick in on August 1, though U.S. Commerce Secretary Howard Lutnick said on Sunday that he was confident the United States could secure a trade deal with the bloc. U.S. tariffs are potentially negative for oil demand and economic activity, Again Capital's Kilduff said. Some support may come from oil inventory data if it shows tight supply, said IG market analyst Tony Sycamore.
