2025-12-11 06:40

HANOI, Dec 11 (Reuters) - Vietnam's parliament on Thursday approved a revised law that restricts exports of refined rare earths and reaffirms a ban on ore exports, in a bid to support a domestic industry that has struggled for decades to exploit its substantial reserves. Vietnam has some of the world's largest deposits of rare earths, according to the U.S. Geological Survey, though the government agency earlier this year significantly lowered its estimate of the country's reserves to 3.5 million metric tonnes from 22 million tonnes. Sign up here. Changes to the existing law on minerals state that "deep processing of rare earths must be associated with building a modern industrial ecosystem to improve the domestic value chain and ensure autonomy," which indirectly restricts the export of refined rare earths. The West is scrambling for alternatives to China's refined rare earths, used in cars, renewable infrastructure and other sensitive industries. Beijing, which dominates global supplies, introduced export controls in April at the height of its trade war with the U.S. Vietnam's restrictions will have no immediate impact as the country has virtually no refining capacity at the moment. It has banned the export of rare earth ores since at least 2021. But regulatory hurdles have long prevented the exploitation of its reserves by local enterprises and foreign partners. The new law reaffirms the ban on exporting ores and stresses that "exploration, exploitation and processing activities must be strictly controlled." https://www.reuters.com/world/asia-pacific/vietnam-curbs-exports-refined-rare-earths-reaffirms-ban-ore-trade-2025-12-11/

2025-12-11 06:27

Indian rupee most shorted, bearish bets at 10-month high Long positions on Chinese yuan rise to nearly three-year high Bearish bets decline for rupiah, S.Korean won Dec 11 (Reuters) - Analysts ramped up long bets on most Asian currencies on stronger growth prospects and weakness in the greenback, a Reuters poll showed on Thursday, while short positions on the Indian rupee surged to a 10-month high. They turned bullish on the Singapore dollar , upped their long positions on the Thai baht , and pushed long bets on the Malaysian ringgit to their highest levels since mid-June, according to a fortnightly poll of 11 respondents. Sign up here. The ringgit has risen 8.8% so far this year, on track to notch its strongest performance since 2017. The Malaysian central bank's tight monetary stance, capped by just a modest quarter-point move in 2025, alongside brighter growth prospects have lifted the currency. The ringgit is likely to find support from fiscal reforms, strong domestic-led investment outlook, and narrowing yield differentials with the U.S., said Lloyd Chan, senior currency analyst with MUFG. Meanwhile, recent weakness in the dollar index on bets of further policy easing has also helped regional currencies. All poll responses were collected before the U.S. Federal Reserve cut rates by 25-basis-points on Wednesday. Long positions on the Chinese yuan also rose to their highest since late January 2023. The currency rose for a fourth straight month in November - its longest string of monthly gains in four years. A record export surplus in the first 11 months of the year has buoyed the yuan. At the same time, Beijing is planning to expand domestic demand and shore up the broader economy in 2026 with a more proactive policy push. Short bets on Indonesian rupiah , South Korean won and Taiwan dollar have decreased. Indonesia's domestic economy has proven resilient, powered by robust fiscal stimulus and a brighter growth outlook. In contrast, the sharp weakness in the won has forced government authorities to issue a stern warning to markets. The Indian rupee , on the other hand, had short bets surging to their highest levels in ten months. The currency is set to mark its eighth straight year of depreciation with a more than 5% loss. Analysts at Barclays see limited potential for USDINR to move lower, noting that the Reserve Bank of India does not appear to be particularly concerned about the fall, given the inflation gap between India and advanced economies. They expect the unit to reach 94 per dollar by end of 2026. "As long as the currency continues on its 'crawl', moving roughly along the path that forwards imply, it should not prompt major resistance from the RBI." Meanwhile, the Philippine central bank's aggressive rate‑cutting cycle has fuelled a clear tilt toward bearish bets on the peso . The Bangko Sentral ng Pilipinas is expected to cut rates for the fifth consecutive meeting later in the day. The Asian currency positioning poll is focused on what analysts and fund managers believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht. The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3. A score of plus 3 indicates the market is significantly long U.S. dollars. The figures include positions held through non-deliverable forwards (NDFs). The survey findings are provided below (positions in U.S. dollar versus each currency): https://www.reuters.com/world/china/bullish-views-rise-most-asia-currencies-indian-rupee-shorts-spike-2025-12-11/

2025-12-11 06:23

New duties of up to 50% will be imposed in 2026 on certain goods Majority of products will see tariffs of up to 35% China and some local business groups oppose the hike Move seen as appeasing US ahead of next USMCA review MEXICO CITY, Dec 10 (Reuters) - Mexico's Senate on Wednesday approved tariff hikes of up to 50% next year on imports from China and several other Asian countries, aiming to bolster local industry despite opposition from business groups and the governments of targeted countries. The proposal, passed earlier by the lower house, will raise or impose new duties of up to 50% from 2026 on certain goods such as autos, auto parts, textiles, clothing, plastics and steel from countries without trade deals with Mexico, including China, India, South Korea, Thailand and Indonesia. The majority of products will see tariffs of up to 35%. Sign up here. The Senate passed the bill, with 76 votes in favor, 5 against, and 35 abstentions. The approved bill is softer than one that stalled in the lower house this autumn, with tariffs on about 1,400 different product lines - mostly textiles, apparel, steel, auto parts, plastics and footwear - and reduced duties on roughly two-thirds of them compared with the original proposal. China's Ministry of Commerce responded on Thursday saying it would track Mexico's new tariff regime and weigh its impact, but warned that such measures would "substantially undermine" the interests of trade. "China has always opposed all forms of unilateral tariff increases and hopes Mexico will correct such unilateralist and protectionist practices as soon as possible," the commerce ministry said. China's Ministry of Foreign Affairs did not immediately comment on the higher tariffs. Analysts and the private sector say the move is aimed at appeasing the U.S. ahead of the next review of the United States-Mexico-Canada trade agreement (USMCA), and that it is also intended to generate $3.76 billion in additional revenue next year as Mexico seeks to reduce its fiscal deficit. "On the one hand, it protects certain local productive sectors that are at a disadvantage with respect to Chinese products. It also protects jobs," said Mario Vazquez, a senator for the opposition PAN party. But, also, "the tariff is an additional tax that citizens pay when they buy a product. And these are resources that go to the state. We would need to know what they are going to be used for. Hopefully, production chains in the country will be strengthened,” Vazquez said. Emmanuel Reyes, a senator from the ruling Morena party, defended the measure. "These adjustments will boost Mexican products in global supply chains and protect jobs in key sectors," said Reyes, who is chairman of the Senate Economy Committee. "This is not merely a revenue-raising tool, but rather a means of guiding economic and trade policy in the interest of general welfare," he said. Mexico had said in September that it would raise its tariff on automobiles and other goods from China and other Asian countries. The United States has been pushing countries in Latin America to limit their economic ties with China, with which it competes for influence in the region. https://www.reuters.com/business/retail-consumer/mexicos-senate-approves-tariff-hikes-chinese-other-asian-imports-2025-12-11/

2025-12-11 06:15

LONDON, Dec 11 (Reuters) - Nearly half of UK businesses surveyed by FX and cash management solutions provider MillTech say that they have lost money due to a volatile pound and plan to hedge more of their currency risk, and for longer, a report released on Thursday showed. The report surveyed over 250 chief financial officers and treasurers at UK companies in October about their hedging plans and costs. It showed 48% of those polled said they had lost money as a result of the big swings in sterling's value. Sign up here. WHY IT’S IMPORTANT Currency volatility has accelerated this year, as geopolitical uncertainty has picked up and global trade relations have become more unpredictable since U.S. President Donald Trump has pushed to enact his "America First" agenda. Hedging rates by UK corporates have risen for their third consecutive year to 78%, up from 76% in 2024 and 70% in 2023. Among firms not currently hedging, 68% are now considering doing so in response to market conditions, MillTech's survey showed. KEY QUOTE "Most CFOs treat FX like a slow-dripping tap. It’s something they can put off fixing while it’s only a nuisance. But this year, that drip turned into a full-on leak, and many UK firms have been scrambling with towels and buckets," Eric Huttman, chief executive of MillTech, said. CONTEXT Sterling hit four-year highs above $1.37 in July against a broadly weak dollar, then fell back as UK fiscal worries weighed on sentiment. It is set for its most volatile year since 2022, LSEG data shows. BY THE NUMBERS The mean hedge ratio, or the percentage of companies' foreign exchange exposure that they protect, is at 53%, up from 45% in 2024. Hedges in 2025 cover an average period of 5.52 months, versus 5.55 months in 2024, but well above the 4.04 months in 2023. https://www.reuters.com/world/uk/many-uk-firms-say-volatile-pound-triggered-losses-2025-need-hedge-grows-2025-12-11/

2025-12-11 06:05

BOJ keeping watchful eye on rising bond yields Policymakers set high hurdle for ramping up bond buying Japan not seeing panic selling considered prerequisite for action BOJ sticking to taper plan, eyes cut to super-long JGB buying TOKYO, Dec 11 (Reuters) - The Bank of Japan sees limited need for emergency intervention to restrain rising bond yields, a move that runs counter to its effort to roll back stimulus, three sources familiar with its thinking said. Growing market anticipation of an interest rate hike in December has pushed up the benchmark 10-year Japanese government bond (JGB) yield to an 18-year high this week, drawing attention to how the central bank could respond. Sign up here. BOJ Governor Kazuo Ueda, speaking in parliament on Tuesday, said recent increases in bond yields were "somewhat rapid" and reiterated the central bank's readiness to respond nimbly in exceptional circumstances. Policymakers are keeping a watchful eye on market moves but are reluctant to take action presently, such as ramping up bond purchases or conducting emergency market operations, the sources said, citing a high threshold for intervention. They also see no imminent need to tweak the BOJ's plan to steadily reduce bond purchases, including for super-long tenors that have recently led to yields rising to record highs, they said. "It would take a panicky sell-off that is out of sync with fundamentals, something Japan isn't seeing right now," said one of the sources on the high hurdle for the BOJ to ramp up bond buying, a view echoed by two other sources. Rather, the recent yield rises are due to investors taking a wait-and-see approach on uncertainty over how far the BOJ could eventually raise rates, and how much of bonds the government will sell to fund next fiscal year's budget, they said. Ueda has signalled the BOJ will offer some clarity on its future rate-hike path when the board decides to raise rates to 0.75% from 0.5% - a move markets expect at next week's policy meeting. Last year, the BOJ exited a decade-long, massive stimulus including by ditching its bond yield curve control and slowing the pace of JGB purchases. In laying out its taper plan, the BOJ said that while long-term rates should be determined by markets, it will respond "nimbly" if yields rise rapidly in a way out of sync with fundamentals. Ueda has repeated the language, whenever asked about yield moves at press briefings or in parliament, including on Tuesday. The 10-year JGB yield rose to an 18-year high of 1.97% on Monday, approaching the psychologically important 2% line that has not been breached for nearly two decades. The BOJ will focus on what is driving the moves rather than specific yield levels, and stay cautious on intervening as doing so would give a wrong signal to markets that it could discontinue efforts to normalise policy, the sources said. Intervening would also give markets the impression the BOJ has a line in the sand on where it would step in, running counter to its attempt to have market forces drive bond price moves, they said. Yields around the globe have been climbing in recent weeks, as many central banks signalled they are either at or near the end of their own easing cycles, while the BOJ is widely anticipated to hike rates at its policy meeting next week. JGB yields have also risen on expectations that Prime Minister Sanae Takaichi's expansionary fiscal policy would lead to a huge issuance of bonds, at a time the BOJ was reducing its presence in the market. https://www.reuters.com/world/asia-pacific/bank-japan-reluctant-intervene-rising-yields-sources-say-2025-12-11/

2025-12-11 06:05

LITTLETON, Colorado, Dec 11 (Reuters) - Major Asian economies including China, India, Japan and Vietnam have cleaned up their power generation systems by more than the United States and Europe in 2025, setting the stage for an East-West divergence in energy transition momentum heading into 2026. Over the first 10 months of 2025, the United States was the only major power market to increase the carbon intensity of power generation compared to the year before, according to data from energy think tank Ember. Sign up here. The chief driver of the rise in U.S. carbon intensity has been a roughly 13% increase in coal-fired power generation, which has lifted U.S. power sector emissions from fossil fuel use to three-year highs. European power firms have also lifted their collective CO2 emissions so far this year compared to 2024, while China, India, Japan and Vietnam have all registered year-to-date declines in CO2 output from fossil fuel power generation. With winter approaching in the Northern Hemisphere, higher generation from fossil fuels can be expected across Asia, Europe and North America in the coming months, which will lift the carbon intensity of all major power systems. But the U.S. is likely to continue leading the pack in terms of carbon emissions growth as power firms in the country opt to dial up output from coal plants ahead of cleaner natural gas plants following a steep rise in national natural gas prices. CARBON INTENSITY GLIDE PATHS All major power systems have reduced their carbon intensity - or the amount of carbon dioxide (CO2) released per kilowatt hour (KWh) of electricity production - over the past five years or so. However, only China has managed to register consistent annual declines in intensity since 2019, largely on the back of world-leading deployment of clean power sources that have allowed utilities to cut back on fossil fuel reliance. During January to October of 2025, China's carbon intensity of power output averaged 562 grams of CO2 per KWh, compared to nearly 670 grams of CO2/KWh in 2019, Ember data shows. Elsewhere, other major power systems have posted at least one annual rise in carbon intensity since 2019 as a mixture of rising power demand, patchy clean power supplies and power policy pivots have sparked shifts in generation mixes. However, only the U.S. system has posted an increase so far in 2025, with an average of 383.3 grams of CO2 emitted per KWh during January to October, compared to 381.2 grams during the same months in 2024. Europe's average carbon intensity is down around 2% so far this year from 2024, while India (down 5%), Japan (down 3%) and Vietnam (down 2%) have also registered reductions. COAL-HEAVY GROWTH Asian economies remain far more coal-reliant than major power networks in Europe and North America. India generates roughly 70% of its electricity from coal, China's coal share is 55%, Vietnam's is 48% and Japan's is around 27% so far this year. In contrast, Europe has generated less than 13% of its electricity supplies from coal-fired power plants this year, while the U.S. coal share is around 16%. However, the U.S. is the only major power market to register a steep rise in coal's share of the overall generation mix so far this year, which is why the U.S. carbon intensity path is out of whack with trends in other regions. The U.S. coal share of around 16.1% so far this year compares with a 14.6% coal share in 2024, and so marks an 11% rise in the share of utility electricity supplies coming from coal plants compared to the year before. Indeed, coal plants have been by far the largest source of electricity supply growth in the U.S. this year, and have accounted for around 73% of the increase in total electricity supplies during January to October, Ember data shows. In all other major power markets, coal's share of the supply growth has been far less, including in India where extra coal-fired output accounted for only half of the overall rise in electricity supplies. TRACKING TRENDS INTO 2026 In the U.S., the roughly 50% climb in average natural gas prices this year has been a major driver of higher coal-fired power generation, as utilities remain under pressure to keep energy prices in check for consumers. Natural gas prices are expected to remain firm through the coming winter thanks to record-large demand from LNG exporters, who can compete with utilities for gas in the U.S. gas market. That outlook for sustained strength in gas prices should keep coal-fired output levels elevated in the U.S. through well into 2026, and could ensure that the U.S. carbon intensity trend keeps climbing. In China and Europe, enduring economic woes have curbed overall industrial activity, and have thereby limited the demand from factories, steel and chemical plants and other major power consumers. Any improvement in economic activity in China and Europe will feed through to higher fossil fuel power generation, and in turn will lift the carbon intensity in those markets. Greater industrial production and demand in China will also boost the economies in the rest of Asia, and could result in a broad upturn in Asia's power sector carbon intensity in 2026. For 2025, however, the U.S. remains the main stand-out in terms of carbon intensity momentum, which continues to go against the global trend of steadily cleaner power networks. The opinions expressed here are those of the author, a columnist for Reuters. Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn , opens new tab and X , opens new tab. https://www.reuters.com/markets/commodities/us-coal-binge-helps-asia-pull-ahead-west-clean-power-push-2025-12-11/