2025-06-23 11:28

LONDON, June 23 (Reuters) - The pound fell against the dollar on Monday with the greenback benefiting from safe-haven demand as investors assessed the risk of an Iranian response to U.S. attacks on its nuclear sites. By 1054 GMT the pound was down 0.5% versus the dollar at $1.33795 , its lowest level since May 20. Sign up here. British Prime Minister Keir Starmer spoke to U.S. President Donald Trump on Sunday, his office said. Starmer also urged Iran to return to the negotiating table. Market focus is firmly on the price of oil, which earlier spiked as much as 5.7% and was last up 0.5%. "Ultimately the pound is exposed...Pro-cyclical currencies have a negative sensitivity to oil prices," said Francesco Pesole, FX strategist at ING. Elsewhere, UK flash PMIs hit screens showing business activity expanded modestly in June, but the data barely moved the needle on the pound. The S&P Global UK Composite Purchasing Managers' Index rose to 50.7 from 50.3 in May - edging further above the 50.0 growth threshold. "Overall, the PMIs suggest that the biggest hit to the economy was in April and things are now starting to recover. That said, the subdued level of the PMIs is still pointing to near stagnation," Thomas Pugh, chief economist at RSM UK, wrote in a note. The Bank of England held interest rates at 4.25% last Thursday as expected but flagged a weaker labour market and the risk of higher energy prices as conflict in the Middle East escalated. Despite the hold, market watchers took a doveish hint from the 6-3 vote split in favour of keeping rates on hold, with three MPC members in favour of a cut, a factor that is still playing a role according to ING's Pesole. "Markets are still tending towards the doveish side for the pound curve," he said. As of Monday, 58% of traders were betting on a 25-bps rate cut at the BoE's next session in August, with 42% betting on no change. https://www.reuters.com/world/uk/sterling-five-week-low-against-dollar-markets-mull-middle-east-risk-2025-06-23/

2025-06-23 11:21

BUDAPEST, June 23 (Reuters) - Hungary and Slovakia have decided not to support the EU's plan for an 18th sanctions package against Russia, Hungarian Foreign Minister Peter Szijjarto said on Monday in a press briefing broadcast on his Facebook page. Hungary and Slovakia decided to block the sanctions package in response to European Union plans to phase out Russian energy imports, the minister said. Sign up here. "We did this because the European Union ... wants to prohibit member states, including Hungary and Slovakia, from purchasing cheap Russian natural gas and cheap Russian oil as they have done previously," Szijjarto said. Hungary and Slovakia continue to rely on Russian gas and oil supplies and have maintained warm ties with Moscow. The Commission on June 10 proposed a new round of sanctions against Russia for its invasion of Ukraine more than three years ago, targeting Moscow's energy revenues, its banks and its military industry. In response, Slovak Prime Minister Robert Fico said that Slovakia will not back the package of sanctions unless the European Commission provides a solution to the situation Slovakia faces if the bloc phases out Russian energy imports. Sanctions proposals require unanimity in the bloc for approval. Late on Sunday, Hungarian Prime Minister Viktor Orban urged the EU to take a proposed ban on Russian energy off the agenda due to an expected rise in energy prices following the U.S. bombing of Iran. https://www.reuters.com/business/energy/hungary-slovakia-block-russian-sanctions-package-budapest-says-2025-06-23/

2025-06-23 11:14

Iran's Araqchi in Moscow to meet Putin Araqchi brings a letter from supreme leader Iran wants Russia's support after U.S. strikes Russia, already at war in Ukraine, weighs war in Iran LIVE news on Israel-Iran: ISTANBUL/MOSCOW, June 23 (Reuters) - Iran's supreme leader sent his foreign minister to Moscow on Monday to ask President Vladimir Putin for more help from Russia after the biggest U.S. military action against the Islamic Republic since the 1979 revolution over the weekend. U.S. President Donald Trump and Israel have publicly speculated about killing Supreme Leader Ayatollah Ali Khamenei and about regime change, a step Russia fears could further destabilize the Middle East. Sign up here. While Putin has condemned the Israeli strikes, he has yet to comment on the U.S. attacks on Iranian nuclear sites though he last week called for calm and offered Moscow's services as a mediator over the nuclear programme. Iranian Foreign Minister Abbas Araqchi was due to deliver a letter from Khamenei to Putin, seeking the latter's backing, a senior source told Reuters. Iran has not been impressed with Russia's support so far, Iranian sources told Reuters, and the country wants Putin to do more to back it against Israel and the United States. The sources did not elaborate on what assistance Tehran wanted. The Kremlin said that Putin would receive Araqchi but did not say what would be discussed. Araqchi was quoted by the state TASS news agency as saying that Iran and Russia were coordinating their positions on the current escalation in the Middle East. Russia, a longstanding ally of Tehran, plays a role in Iran's nuclear negotiations with the West as a veto-wielding U.N. Security Council member and signatory to an earlier nuclear deal Trump abandoned during his first term in 2018. But Putin, whose army is fighting a major war of attrition in Ukraine for the fourth year, has shown little appetite for a confrontation with the U.S. over Iran just as Trump seeks to repair ties with Moscow. MEDIATION Putin has repeatedly offered to mediate between the U.S. and Iran, and has conveyed Moscow's ideas on resolving the conflict to them while ensuring Iran's access to civil nuclear energy. Putin said Israel had given Moscow assurance on the safety of Russian specialists helping to build two more reactors at the Bushehr nuclear power plant in Iran during air strikes. While Moscow has bought weapons from Iran for its war in Ukraine and signed a 20-year strategic partnership deal with Tehran earlier this year, their relationship - which spans centuries - has at times been troubled. The partnership deal does not contain a mutual defence clause. Inside Russia, there were calls for Russia to support Iran in the same way Washington has supported Ukraine - including air defence systems, missiles and satellite intelligence. At the U.N. Security Council on Sunday, Russia, China and Pakistan proposed the 15-member body adopt a resolution calling for an immediate and unconditional ceasefire in the Middle East after U.S. strikes. Russia's U.N. Ambassador Vassily Nebenzia recalled former U.S. Secretary of State Colin Powell making the case at the U.N. Security Council in 2003 that Iraqi President Saddam Hussein constituted an imminent danger to the world because of the country's stockpiles of chemical and biological weapons. "Again we're being asked to believe the U.S.'s fairy tales, to once again inflict suffering on millions of people living in the Middle East. This cements our conviction that history has taught our U.S. colleagues nothing," he said. https://www.reuters.com/world/china/irans-supreme-leader-asks-putin-do-more-after-us-strikes-2025-06-23/

2025-06-23 10:58

JOHANNESBURG, June 23 (Reuters) - South Africa has signed a $1.5 billion loan agreement with the World Bank, aiming to overhaul its transport and energy infrastructure and reignite economic growth, the National Treasury said on Monday. For more than a decade Africa's most advanced economy has struggled to grow as regular blackouts have crippled productivity while crumbling rail networks and chronically congested ports have frustrated major industries such as mining and automaking. Sign up here. The government hopes the loan will ease transport bottlenecks and improve energy security, but it did not provide details of specific projects the World Bank money would be earmarked for. The financing should also limit rising debt-service costs as it carries more favourable terms than commercial borrowing, including by having a three-year grace period. State-owned energy and transport companies Eskom and Transnet have been mired in operational and financial crises for years, holding back growth, which rose just 0.1% in the first quarter. The Treasury gave the interest rate on the 16-year World Bank loan as six-month Secured Overnight Financing Rate plus 1.49%. It is separate from $500 million of financing the World Bank Group is considering to help unlock private investment in the electricity transmission grid, which needs to be expanded to connect more renewable energy projects. Finance Minister Enoch Godongwana's budget last month contained more than 1 trillion rand ($55.5 billion) of investment across transport, energy, water and sanitation to support growth and improve public services. It aimed for public debt to peak at 77.4% of gross domestic product in the current fiscal year, slowly declining after that. ($1 = 18.0283 rand) https://www.reuters.com/world/africa/south-africa-agrees-15-billion-world-bank-loan-upgrade-infrastructure-2025-06-23/

2025-06-23 10:53

June 23 (Reuters) - Grid operator PJM Interconnection has issued an alert for Monday asking power generators to be ready to operate at maximum capacity if needed, as hot weather continues throughout the eastern U.S. region the grid operator serves. PJM expects its electricity needs to reach 160,000 MW on Monday, 158,000 on Tuesday and 155,000 on Wednesday, it said. Sign up here. The alert is aimed at transmission and generation owners who can schedule maintenance work accordingly, and also signals to neighboring regions that PJM power exports may need to be curtailed, the grid operator said. A hot weather alert is in effect through June 25 for PJM's entire service area, which includes all or parts of 13 states including New Jersey and Illinois plus the District of Columbia, ahead of an expected extended heat wave. Major cities across the U.S. are preparing for extreme temperatures caused by a heat dome that hit the U.S. Plains on Friday and is expected to expand to much of the rest of the country over the coming days. https://www.reuters.com/business/energy/grid-operator-pjm-issues-maximum-generation-alert-monday-amid-heat-wave-2025-06-23/

2025-06-23 10:46

LONDON, June 23 (Reuters) - What matters in U.S. and global markets today I'm excited to announce that I'm now part of Reuters Open Interest (ROI) , opens new tab, an essential new source for data-driven, expert commentary on market and economic trends. You can find ROI on the Reuters website , opens new tab, and you can follow us on LinkedIn , opens new tab and X. , opens new tab Sign up here. In this latest round of Middle East violence, the oil price has been remarkable as much for what it hasn't done as for what it has. Oil prices initially rose this morning following the U.S. strike on Iran over the weekend, but crude has since given back all these gains. I'll discuss this and the rest of the market news below, and then in today’s column, I ask why markets are remaining surprisingly calm despite mounting U.S. debt concerns. Today's Market Minute * Iran said on Monday that the U.S. attack on its nuclear sites expanded the range of legitimate targets for its armed forces and called U.S. President Donald Trump a "gambler" for joining Israel's military campaign against the Islamic Republic. * The U.S. bombing injected fresh uncertainty into the outlook for inflation and economic activity at the start of a week chock full of new economic data and central banker commentary, including two days of Congressional testimony from Federal Reserve Chair Jerome Powell. * Utilities in the developed world are stressing over how to keep up with demand from data centres and artificial intelligence searches. But globally, keeping people cool is likely to be a much bigger drain on electricity grids and a more pressing power sector challenge. Read the latest from ROI global energy transition columnist Gavin Maguire. * The escalation of the Middle East conflict could lead Tehran to disrupt vital exports of oil and gas from the region, sparking a surge in energy prices. But as ROI energy columnist Ron Bousso says, history tells us that any disruption would likely be short-lived. * Several recent global developments have sparked some of the highest levels of uncertainty in decades. ROI outside contributor Joachim Klement claims equity investors seeking clarity should be careful what they wish for. Oil keeps calm, MidEast conflict carries on With global stock and bond markets using crude as a lodestar for how they react to the Iran crisis, the remarkably quick reverse and decline in U.S. oil prices on Monday have seen U.S. and European equities rally following the weekend events. Wall Street futures were up about 0.25% ahead of Monday's bell. European (.STOXXE) , opens new tab and Chinese (.CSI300) , opens new tab, (.HSI) , opens new tab were higher too, with Japan's Nikkei (.N225) , opens new tab bucking the trend even as the yen weakened. Mostly due to the yen slide, the dollar index (.DXY) , opens new tab was firmer. U.S. President Donald Trump said he had "obliterated" Iran's main nuclear sites in strikes over the weekend, joining an Israeli assault in an escalation of conflict in the Middle East as Tehran vowed to defend itself. Trump then openly hinted at 'regime change' in his social media posts on Sunday. U.S. crude prices initially jumped above $78 per barrel to their highest since January, but quickly fell back below Friday's close to trade below $74 - more than $6 below the high for this year and down 11% on levels seen a year ago. Brent prices are down on the day too. While the escalating conflict surrounding Iran has turned unpredictable, it happens in a market where global space oil production capacity is running in excess of 4 million barrels a day - an oversupply expected to persist through the end of next year at least. What's more, outsize bets on the direction for oil linked to the outcome of the Iran war are frustrated by numerous binary outcomes - including both the survival of the Tehran government and even possible mining of the Straits of Hormuz. While the latter could stymie shipping in the region for a bit, it's not clear how long it could be enforced. With global demand set to ebb later this year, due in part due to the growth-dampening effects of U.S. trade tariffs, and U.S. production set to increase, speculative oil price punts are very risky. With oil prices still largely under wraps, the fallout for U.S. Treasuries is similarly limited. With one eye on Federal Reserve chief Jerome Powell's semi-annual Congressional testimony on Tuesday and series of debt auctions during the week, 10-year yields remained stuck in recent ranges about 4.4%. Trump on Friday again floated the idea of firing Powell. "I don't know why the Board doesn't override (Powell)," Trump wrote in a lengthy post on Truth Social criticizing Fed policy. "Maybe, just maybe, I'll have to change my mind about firing him? But regardless, his Term ends shortly." San Francisco Fed President Mary Daly said on Sunday that U.S. central bank should consider giving less forward guidance about its monetary policy intentions, particularly in uncertain times. "Words have power, which is a great tool. But words can be harder to reverse than the interest rate," she said. The economic data calendar homes in on June business surveys, with the flash versions of U.S. soundings from S&P Global due out later in the day. Overall euro zone business activity expanded only modestly in June, with a small improvement in the dominant services industry offsetting more downbeat manufacturing. The services PMI nudged up to sit right on the break-even 50 mark up from May's final reading of 49.7. Optimism among services firms increased and the business expectations index bounced to a four-month high of 57.9 from 56.2. European Central Bank boss Christine Lagarde testifies at the European Parliament later in the day. Economic surprise indexes, capturing how incoming economic readings are above or below expectations overall, show a sharp divergence between Europe and the United States - with the euro zone index at its most positive since May and the U.S. equivalent at its most negative in nine months. Elsewhere, Bitcoin was sharply lower over the weekend, while gold prices also fell back early on Monday. Chart of the day Relatively quick reversals of oil price spikes were largely thanks to the ample spare production capacity - and also due to the fact that any rapid oil price increase curbs demand in turn. The current global oil market certainly has spare capacity. OPEC+, an alliance of producing nations, today holds around 5.7 million barrels per day in excess capacity, of which Saudi Arabia and the United Arab Emirates hold 4.2 million bpd. Although there are concerns about closing of the key Straits of Hormuz waterway, the two Gulf powers could bypass it by oil pipelines. Saudi produces around 9 million bpd and has a crude pipeline that runs from the Abqaiq oilfield on the Gulf coast in the east to the Red Sea port city of Yanbu in the west. The UAE, which produced 3.3 million bpd of crude oil in April, has a 1.5 million bpd pipeline linking its onshore oilfields to the Fujairah oil terminal that is east of the Strait of Hormuz. Today's events to watch * Flash U.S. June business surveys from S&PGlobal (0945EDT) May existing home sales (1000EDT) * Federal Reserve Board Governor Christopher Waller, Fed Board Governor Adriana Kugler, Fed Vice Chair for Supervision Michelle Bowman, and Chicago Fed President Austan Goolsbee all speak. European Central Bank President Christine Lagarde speaks to European Parliament (0800EDT) * EU-Canada summit takes place in Brussels * U.S. Treasury sells $58 billion of 3-year notes Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. Want to receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here. https://www.reuters.com/business/finance/global-markets-view-usa-2025-06-23/