2025-07-24 12:31
Bank says it will determine future step size "prudently" Policy rate raised to 46% in April after market volatility Lira little moved after the rate cut Political risks remain amid corruption probes ISTANBUL, July 24 (Reuters) - Turkey's central bank cut interest rates by 300 basis points to 43% on Thursday, more than expected, resuming an easing cycle that had been disrupted by political turmoil earlier this year, as markets have since calmed and disinflation continued. Going forward, the central bank said it would determine the "step size" of future monetary easing "prudently" and on a meeting-to-meeting basis. It also lowered the upper band of its rate corridor to 46% from 49%. Sign up here. The lira currency remained stable after the decision at 40.48 to the dollar. All but one of 17 economists in a Reuters poll forecast it would cut its benchmark one-week repo rate (TRINT=ECI) , opens new tab, with predictions ranging from 42.50% to 44.50% among those expecting a cut. The bank hiked the policy rate to 46% from 42.5% in April, reversing an easing cycle that had begun in December, following market volatility over the arrest in March of Istanbul Mayor Ekrem Imamoglu, who is President Tayyip Erdogan's main rival. The bank said the underlying inflation trend remained flat in June and it anticipated a "temporary rise" in monthly inflation this month due to one-off factors. "Recent data indicate that the disinflationary impact of demand conditions has strengthened," the policy committee said. It will set policy "taking into account realized and expected inflation, and its underlying trend in a way to ensure the tightness required by the projected disinflation path," it added. "The step size will be reviewed prudently on a meeting-by-meeting basis with a focus on the inflation outlook". Commenting on this, Kieran Curtis, head of EM local currency debt at fund manager Aberdeen, said "It doesn't look like they will automatically do 300 bps next time." RISKS REMAIN Annual inflation dipped to 35.05% in June, having fallen consistently from a peak of 75% in May last year. The bank's latest survey of market participants' expectations showed inflation was seen at 29.66% at end-2025. Most economists expect easing to continue in the months ahead, with the policy rate falling to 36% by the end of 2025, according to the Reuters poll. The tightening in recent months boosted investor confidence, with foreign holdings of lira-denominated bonds up to about 7% from near 5% after the mayor was arrested and jailed. Political risks remain on investors' radar. The lira and bonds weakened this month after the detention of opposition mayors in Adana, Adiyaman and Antalya in a corruption probe. Prosecutors say the arrests are anti-graft measures, but many see them as politically motivated moves against the opposition party CHP in a crackdown that has seen more than 500 detained in just nine months. "To establish economic confidence we need to see political tensions fading, and that has not yet happened," said Selva Demiralp, professor of economics at Koc University. "It remains the biggest risk and complicates the central bank's plan to move forward," she said, noting a Koc survey , opens new tab in July that shows opposition voters have far higher inflation expectations than those of Erdogan voters. https://www.reuters.com/world/middle-east/turkish-cenbank-returns-easing-with-big-300-point-rate-cut-2025-07-24/
2025-07-24 12:24
July 24 (Reuters) - Industrial equipment maker Dover (DOV.N) , opens new tab raised its full-year profit forecast on Thursday, citing robust product demand and sustained momentum in aerospace, defense and data center markets. The Downers Grove, Illinois-based company now expects adjusted profit for 2025 between $9.35 and $9.55 per share, from $9.20 to $9.40 per share previously. Analysts, on average, expect annual adjusted profit of $9.35 per share, according to data compiled by LSEG. Sign up here. "Order trends continued to post positive momentum in the quarter, bolstering our confidence in the second half outlook with a majority of our third quarter revenue already in the backlog," CEO Richard Tobin said. Dover supplies equipment and components, consumable supplies, aftermarket parts, software, and digital solutions to a variety of end-markets, including aerospace and defense. The company also manufactures cooling systems for data centers and has benefited from rising demand for artificial intelligence, which has increased need for Dover’s parts and maintenance services. Profits at Dover’s pumps and process unit, which makes thermal connectors for liquid cooling of data centers, rose to $159.5 million, from $137.2 million a year earlier. Earnings at its clean energy and fueling business increased to $107.8 million, up from $87.5 million last year. The segment, which operates under the Dover Fueling Solutions and OPW brands, includes a portfolio of safety and efficiency solutions for the convenience retail, fueling, and clean energy markets. Dover’s adjusted income in the quarter ended June 30 rose 16% to $2.44 per share, above the analysts’ average estimate of $2.39 per share. Quarterly revenue increased 5% to $2.05 billion, slightly beating estimates of $2.04 billion. https://www.reuters.com/markets/commodities/dover-raises-annual-profit-forecast-strong-product-demand-data-center-strength-2025-07-24/
2025-07-24 12:21
EU, US near potential deal with possible 15% tariff, EU diplomats say Trump to visit Federal Reserve on Thursday ECB rate decision due later in the day July 24 (Reuters) - Gold prices extended losses on Thursday from the previous session as easing trade tensions increased risk sentiment and weighed on demand for safe-haven assets. Spot gold was down 0.7% at $3,362.48 per ounce by 1207 GMT, after shedding 1.3% in the previous session. U.S. gold futures dropped 0.9% to $3,366.40. Sign up here. Following this week's trade deal between the U.S. and Japan, two European diplomats said on Wednesday the European Union and the U.S. are also edging toward a trade deal that could include a 15% U.S. baseline tariff on EU goods and exemptions. "Gold is down this morning due to the positive news flow around global trade... this is reducing downside risks for global growth and supports the prevailing risk-on mood in financial markets," said Carsten Menke, an analyst at Julius Baer. The trade expectations meanwhile drove risk sentiment in the global financial markets, propelling stocks to fresh record highs. "Demand from safe-haven seekers has cooled while central bank buying stays sound, even though not as strong as earlier in the year. We still expect gold to move higher in the longer term," Menke said. A safe-haven asset during times of economic uncertainties, gold also tends to do well in a low-interest rate environment. U.S. President Donald Trump will visit the Federal Reserve on Thursday, the White House said, which could intensify tensions between the administration and the central bank. The Fed's policy meeting, scheduled for July 29-30, is expected to maintain interest rates within their current range. Investors anticipate the central bank will resume rate cuts in September. Elsewhere, the European Central Bank is also expected to keep interest rates steady on Thursday. Spot silver slipped 0.6% to $39.03 per ounce, while palladium dipped 2.2% to $1,249.91. Platinum fell 2.5% to $1,392.70, after falling to its lowest level in more than a week. https://www.reuters.com/world/china/gold-extends-losses-after-trade-deal-hopes-curb-safe-haven-demand-2025-07-24/
2025-07-24 12:21
DUBAI, July 24 (Reuters) - People in a wooden boat opened fire on a Comoros-flagged livestock carrier in the Red Sea near Yemen on Thursday, and the vessel was detained by the Yemeni Coast Guard, according to the United Kingdom Maritime Trade Operations (UKMTO). A maritime security official in the Yemeni government told Reuters the vessel was released after being held on suspicion, with naval forces concerned because its AIS tracking system was turned off and it was sailing north from the Horn of Africa. Sign up here. British security firm Ambrey said the vessel, travelling from Bosaso, Somalia, to Jeddah, Saudi Arabia, reported having received instructions to proceed to Mocha. It did not make clear who had given the instructions. The security firm advised vessels not to transit east of the Hanish Islands, 30 nautical miles to the northwest of Mocha, a port city on Yemen's Red Sea coast, and to maintain a safe distance from small boat activity. Since Israel's war in Gaza against the Palestinian militant group Hamas began in October 2023, the Iran-aligned Houthis have been attacking vessels in the Red Sea in what they say are acts of solidarity with the Palestinians. Israel has responded by launching attacks on Houthis, who control the most populous parts of Yemen, including the vital Hodeidah port. There was no immediate claim of responsibility from the Houthis for Thursday's attack. https://www.reuters.com/world/middle-east/attackers-fire-comoros-flag-ship-red-sea-near-yemen-2025-07-24/
2025-07-24 12:20
BRUSSELS, July 24 (Reuters) - The European Union's expansion of solar energy is on track for its first annual slowdown in more than a decade, industry data showed on Thursday, as some governments reduce subsidies for rooftop solar panels. The trend reflects shifting political priorities in Europe as some member countries have scaled back green measures or support for clean energy from budgets stretched by spending on defence and local industries. Sign up here. The EU is on track to install 64.2 gigawatts of new solar energy capacity in 2025, a 1.4% fall from the 65.1GW installed last year, industry association SolarPower Europe said. "There's a kind of paralysis. There's still interest, but people aren’t making decisions," said Peter Knuth, managing director of German photovoltaic systems installation company enerix. Early purchases in 2022 and 2023, along with rising interest rates, and economic uncertainty have contributed to the falling demand, not falling electricity prices, Knuth added. The year-on-year drop would mark the first time since 2015 that the growth of Europe's solar market has slowed - denting an area of fast progress in Europe's shift to clean energy. Solar capacity growth soared by 51% in 2023, although last year growth had already slowed to 3%. Last month, solar generated 22% of total EU electricity, making it the EU's largest single source of power generation that month. But current deployment rates now indicate the EU will fall short, by about 27GW, of the 750GW of solar capacity which SolarPower Europe said is needed by 2030 for the EU's climate targets and plans to phase out Russian energy. The main cause of the slowdown is fewer residential rooftop solar panel installations - a sector that is set to make up 15% of total new capacity this year, halving the roughly 30% share it held over 2020 to 2023. Germany and France are among the countries reducing their feed-in tariff payments for rooftop solar energy, while the Netherlands is also reducing support for households that export their excess solar power to the grid. Misleading communication regarding a law passed by the previous German government in February cancelling compensation for solar power grid during peak times along with changes to the renewable heating law had also hit demand, Knuth said. The new German government's plans to reassess the need for renewables and promises of an expansion of gas power plants are also not helping, he said. The German Economy Ministry was not immediately available to comment on the data. Asked what the German government could do to help the market, Knuth said: "Best to stay quiet. Honestly. The endless debate about renewable energy ... is counterproductive." https://www.reuters.com/sustainability/climate-energy/eu-solar-energy-rollout-slows-first-time-decade-subsidies-cut-2025-07-24/
2025-07-24 12:19
Deposit rate left at 2% ECB awaits outcome of US-EU trade talks Rumoured 15% tariff worse than ECB's baseline One further rate cut seen as likely FRANKFURT, July 24 (Reuters) - The European Central Bank left interest rates unchanged on Thursday after cutting eight times in a year, biding its time while Brussels and Washington negotiate over trade. The ECB cut its policy rate to 2% last month, halving it from 4% a year earlier, after taming a surge in prices that followed the end of the COVID-19 pandemic and Russia's full-scale invasion of Ukraine in 2022. Sign up here. With inflation now back at the ECB's 2% goal and expected to stay there, policymakers chose to stay put on Thursday, just as trade talks between the European Union and Donald Trump's U.S. administration appeared to be in their final stretch. The ECB's policy-making Governing Council painted a balanced picture of the economy, with near-term uncertainty over trade offset by public investment further down the road. "Partly reflecting the Governing Council’s past interest rate cuts, the economy has so far proven resilient overall in a challenging global environment," the ECB said. "At the same time, the environment remains exceptionally uncertain, especially because of trade disputes." As ECB President Christine Lagarde and her colleagues were in the middle of their meeting late on Wednesday, EU diplomats said the two sides were heading towards a deal that would result in a broad tariff of 15% on U.S. imports of European Union goods. This would be roughly halfway between the ECB's baseline and severe scenarios for the euro zone economy presented last month, but milder than Trump's threatened 30%. The ECB's estimate showed that higher U.S. tariffs would result in lower growth and, depending on the extent of EU retaliation, inflation in the euro zone over the medium term. "If the two sides indeed conclude such a deal, it would support our call that the euro zone economy can regain momentum from the fourth quarter onwards and that the ECB will not need to cut rates further," Berenberg economist Holger Schmieding said. In its statement the ECB said it would decide "meeting by meeting ... based on its assessment of the inflation outlook and the risks surrounding it". Money markets were still pricing in a further interest rate reduction, probably by March, as inflation was seen at risk of going too low. Even the ECB's baseline projection from June, which incorporates 10% tariffs from the United States, saw price growth below 2% over the next 18 months. "Even in the case of a benign outcome (i.e. U.S. tariffs around 10%) we still see scope for further easing as the disinflation process broadens," MUFG's Europe economist Henry Cook said. The euro zone economy is showing some tentative sign of acceleration but growth remains modest. Companies, while still optimistic about an upturn ahead, report starting to feel the pinch from tariffs on their profits. On the bright side, euro zone banks have seen rising loan demand and policy uncertainty has not yet translated into an economic or market downturn. After a short-lived selloff in April investors have taken the trade turmoil in their stride, with European equity indices close to new highs also thanks to Germany's newly found appetite for spending. In fact, erratic policy-making in the United States, including Trump's relentless criticism of the Federal Reserve, has lured foreign investors to euro zone assets. That briefly pushed the euro to its highest level against the dollar since September 2021 at $1.1829 earlier this month. ECB board member and outspoken hawk Isabel Schnabel even said the central bank should watch out for price hikes caused by tariffs and that the bar for further cuts was "very high". But the euro's appreciation has unnerved other policymakers, who fear a stronger currency would make European exports less competitive and contribute to pushing down inflation. "On that front, we would expect Christine Lagarde to strike a reassuring tone, reminding people that the ECB does not target exchange rates but that any resulting downward pressure on inflation will be addressed, if necessary," Julien Lafargue, chief market strategist at Barclays Private Bank, said. https://www.reuters.com/business/finance/ecb-keeps-rates-steady-it-awaits-clarity-over-trade-2025-07-23/
