2024-09-18 19:22

Canadian dollar gains 0.3% against the greenback Touches a 12-day high at 1.3542 Bets increase on BoC cutting by 50 basis points Bond yields fall across the curve TORONTO, Sept 18 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Wednesday as the Federal Reserve cut interest rates by half a percentage point, but the move was limited as investors raised bets the Bank of Canada would step up the pace of its easing. The loonie was trading 0.3% higher at 1.3560 to the U.S. dollar, or 73.75 U.S. cents, after touching its strongest level since Sept. 6 at 1.3542. The Fed kicked off what is expected to be a steady easing of monetary policy with a larger-than-usual reduction in borrowing costs that followed growing unease about the health of the job market. "Initial price action in financial markets is consistent with a relatively dovish interpretation of the Fed's likely policy path," said Karl Schamotta, chief market strategist at Corpay. Wall Street rose, bond yields eased and the U.S. dollar (.DXY) , opens new tab extended recent declines against a basket of major currencies. The rate decision could "clear the way for an acceleration in easing from other major central banks, making the Bank of Canada more likely to deliver an equivalently sized cut at its October meeting," Schamotta said. Minutes from the BoC's rate decision earlier this month showed governing council members feeling that, if the economy failed to pick up as anticipated, it might be appropriate to lower the policy rate more quickly. Investors see a 59% chance the Canadian central bank would ease by 50 basis points in October, up from 46% before the Fed decision. The central bank has cut rates three times since June, moving in quarter-point increments. Canadian bond yields eased across the curve. The 2-year was down 3.3 basis points at 2.889%, moving closer to the 2-year low it touched during Tuesday's session at 2.845%. Sign up here. https://www.reuters.com/markets/currencies/c-hits-12-day-high-fed-opts-supersized-rate-cut-2024-09-18/

2024-09-18 19:12

OTTAWA, Sept 18 (Reuters) - Canadian Prime Minister Justin Trudeau looks set to survive a confidence vote next week after a rival party said on Wednesday it would not back an attempt to defeat his minority Liberal government. The official opposition Conservatives, who have a commanding lead in the polls, said they would try to topple Trudeau next Wednesday on the grounds that Canadians cannot afford the promised increase in an existing federal carbon tax. Trudeau will need support from other legislators to survive a confidence vote in the House of Commons and quickly found it from Yves-Francois Blanchet, leader of the separatist Bloc Quebecois, which seeks independence for the province of Quebec. "The Bloc Quebecois serves the people of Quebec. It does not serve the Conservatives," Blanchet told reporters, saying replacing Trudeau with Conservative leader Pierre Poilievre would not suit Quebec's interests. The Bloc, which like the Liberals are a center-left party, could well insist on pro-Quebec concessions in return for keeping Trudeau in power. Trudeau, who first took office in November 2015, faces increasing unhappiness from voters over rising prices and a nationwide housing crisis. The confidence vote will be his first real test since the smaller New Democratic Party this month tore up a 2022 deal to keep the Liberals in office until an election that must be held by end-October 2025. Trudeau will have to survive a series of other confidence votes to make it that far. While working formally with separatists is generally seen as politically toxic in Canada, federal parties have in the past struck one-off deals to gain Bloc support. In 2009, the Bloc backed the then minority Conservative government on a confidence vote. Sign up here. https://www.reuters.com/world/americas/trudeau-set-survive-confidence-vote-next-week-with-opposition-support-2024-09-18/

2024-09-18 19:12

LNG vessel eyed for Argentine project to begin output in 2027 New regulatory framework secures 30 years of LNG exports HOUSTON, Sept 18 - BP's Pan American Energy (BPPAE.UL) is looking to negotiate contracts with Asian consumers to allocate liquefied natural gas from a floating project in Argentina, Rodolfo Freyre, a company vice president, told the GasTech conference on Wednesday. Pan American and marine infrastructure company Golar LNG (GLNG.O) , opens new tab in July signed a contract to deploy in Argentina a vessel that will be used to produce LNG off the South American country's coast, starting in mid-2027. The vessel currently has a contract to operate in Cameroon, which will end in 2026, Freyre said. Pan American's floating project could inaugurate Argentina's LNG exports. "We saw this opportunity that Golar had... so we started working hard with them. And we actually acted pretty quickly to try to sign a contract for a 20-year deal, expecting to have LNG production maybe by 2027," Freyre said. Pan American set up talks this week in Houston with potential LNG buyers from several Asian countries, company sources said. A delegation from rival Argentine producer YPF (YPFDm.BA) , opens new tab last month traveled to India also seeking to negotiate LNG contracts, the company CEO said last week. Oil and gas producers YPF, Petronas (PETRA.UL), Tecpetrol and Pan American are progressing three projects that would turn Argentina, which sits on the world's second largest shale gas reserves, into a LNG exporter in the coming years. The three will require more than $60 billion in total investment. The projects are expected to be driven by new regulation proposed by President Javier Milei's administration for large investments, including those to develop LNG. "The RIGI (Promotional Regime for Large Investment) is basically a promotional benefit for stability. We worked a lot with the government to incorporate these type of things to make these projects feasible. Without it, I mean, I would say that there's no LNG, period," Freyre said. The law is expected to secure LNG exports for up to 30 years without policy changes that could create obstacles, he added. Milei's economic reforms have already reduced Argentina's energy subsidies by $2.7 billion this year while leaving an energy trade surplus of almost $3 billion, compared to deficits in previous years, Energy Secretary Eduardo Rodriguez Chirillo said in Houston last week. Sign up here. https://www.reuters.com/business/energy/bps-pan-american-energy-looks-asian-customers-willing-buy-argentinian-lng-says-2024-09-18/

2024-09-18 17:35

By Promit Mukherjee and David Ljunggren OTTAWA, Sept 18 (Reuters) - The Bank of Canada's governing council was split on the outlook for inflation ahead of its Sept 4 decision to cut rates for the third time in a row, minutes published on Wednesday showed. The BoC said on Sept 4 that it was juggling the impact of two opposing forces on inflation - the persistently high cost of shelter and services on one hand and a weakening economy and rising unemployment on the other. "Some members took the view that the risks were balanced, with strength in shelter and services price inflation offsetting the downward pressure from excess supply," it said. "Some had become more concerned with the downside risks to inflation, particularly if the economy and labor market weakened further." The bank started trimming rates in June after consumer prices showed consistent decline and has reduced borrowing costs three times by a cumulative 75 basis points to 4.25%. Data released on Tuesday showed the annual inflation rate in August fell to the central bank's 2% target, its lowest point since February 2021, sparking hopes of a jumbo cut at the bank's next meeting on Oct. 23. Money markets see an almost 46% chance of a 50 basis point rate cut in October. Governing council members felt that if the economy and labor market failed to pick up as anticipated due to lower borrowing costs, it might be appropriate to lower the policy rate more quickly, the minutes said. With inflation approaching target, the bank needed to guard against the downside risks to inflation stemming from weakness in economic activity, they said. Growth stalled in June and is likely to stay flat in July, with economists now predicting annualized third quarter GDP would likely be half of the BoC's forecast of 2.8%. The economic woes have been further exacerbated by a rising unemployment level that hit 6.6% in August, up from 5.0% in January 2023. The governing council said per capita consumption could take longer to rebound and worsen further if businesses postponed hiring due to soft demand. This could weaken inflation more than expected, it said. Keywords: CANADA CENBANK/ Sign up here. https://www.reuters.com/world/americas/bank-canada-members-split-inflation-outlook-minutes-show-2024-09-18/

2024-09-18 13:01

AVEIRO DISTRICT, Portugal, Sept 18 (Reuters) - A wave of deadly wildfires in Portugal has pushed emergency services to the limit and much-needed reinforcements arrived on Wednesday from Spain and Morocco, authorities said, as cooler weather also brought a glimmer of hope. At least seven people have died due to the blazes in the Aveiro and Viseu districts, with dozens of houses destroyed and tens of thousands of hectares of forest and scrubland consumed. Authorities have mobilised more than 5,000 firefighters. Reuters footage showed local residents in the northwestern Aveiro district - one of the worst-hit - distributing food and water to exhausted fire engine crews, wishing them "strength in the combat". "We know they are very tired. And then, as they don't have access to food and water, we are trying to help, and it's our way of thanking them," one volunteer, Cristina Almeida, said. A specialised emergencies team of 270 Spanish military personnel would be deployed in the central Viseu district from Wednesday and up to four heavy water-bombing aircraft were expected to arrive from Morocco, civil protection authority said. Spain, Italy and France have already sent two water-bombing aircraft each after the Portuguese government on Monday requested help under the EU civil protection mechanism. "We are in a stressful situation, at the limit of our capabilities," civil protection chief Duarte Costa told CNN Portugal, adding that the reinforcements would allow for some rotation of exhausted Portuguese firefighters and aircraft maintenance. Data from the European Forest Fire Information Service showed that large-scale blazes had burned an area of more than 90,000 hectares (347 square miles) since Saturday, making this year's total of at least 124,000 ha the widest burned area since 2017, when Portugal suffered two devastating wildfires that killed more than 100 people. After temperatures that had kept above 30 Celsius (86 Fahrenheit) since the weekend, officials expected cooler air to help with the firefighting effort in the coming days, but the meteorological situation in general remained unfavourable, civil protection commander Andre Fernandes told reporters. At least some of the dozens of fires across Portugal have been started by arsonists, motivated by possible commercial interest, spite or criminal negligence, police said, and Prime Minister Luis Montenegro vowed to "spare no effort in repressive action" against such crimes. Police said in a statement they had arrested 12 people since Saturday suspected of arson in the districts of Aveiro, Leiria, Castelo Branco, Porto and Braga. Sign up here. https://www.reuters.com/business/environment/beset-by-wildfires-portugal-gets-help-spain-morocco-2024-09-18/

2024-09-18 12:30

FRANKFURT, Sept 18 (Reuters) - German gas and water association DVGW on Wednesday warned that a ramp-up in low-carbon hydrogen technology could fall behind as participants feel discouraged by regulatory and political indecision. A survey taken from across hydrogen stakeholders in Europe's biggest economy found that the desired transition from carbon- emitting natural gas to hydrogen from renewable electricity via electrolysis is feared to be slowing. Speakers at in an online press conference during DVGW's annual congress said they expected more determined action and less bureaucracy to dispel doubts about high costs and too little availability. WHY ITS IMPORTANT? The Berlin government wants national electrolysis capacity of 10 gigawatts (GW) by 2030 amid a raft of other measures concerning imports, transport, wholesale markets and storage, to create affordable new energy, to cut emissions and secure the long-term competitiveness of German industries. Failure to uphold momentum would undermine industries' confidence, drive up energy costs and prolong the burning of coal, oil and gas. KEY QUOTES: Matthias Belitz, head of sustainability at chemical industry association VCI: "Even a good research and innovation environment is of little use if the applications are not competitive. Policymakers must urgently improve on this." DVGW chairman Gerald Linke: "A clear political commitment that we cannot go without blue hydrogen (derived from gas with carbon sequestration) to bridge imports gaps ... would be an important signal." Peter Mueller-Baum, executive at engineering and machine-building industries' group VDMA: "Our companies ... need more reliability and planning security for their investment decisions." Roderik Hoemann, head of energy and climate at steel industry group WV Stahl: "In order to speed applications and with that, hydrogen demand, in the industry, (these factors) will be decisive: a coherent support framework, a quick infrastructure build-up and competitive power and hydrogen prices." Sign up here. https://www.reuters.com/business/energy/german-gas-industry-warns-over-wavering-support-hydrogen-ramp-up-2024-09-18/