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Hungary's record-low base rate could sink deeper -cbank

May 26, 2015 - reuters.com

BUDAPEST, May 26 (Reuters) - Hungary's central bank flagged a further possible reduction in its base interest rate after cutting it by 15 basis points to a new low of 1.65 percent NBHI on Tuesday, in line with market expectations. ID:nL5N0YH1F9 "The inflation outlook and the cyclical position of the economy point in the direction of a reduction in the policy rate and loose monetary conditions for an extended period," the rate-setting Monetary Council said in a statement. "Cautious easing of the policy rate may continue as long as it supports the achievement of the medium-term inflation target," it said. It added that a recent weakening of the forint EURHUF=D3 -- close to 3-1/2-month lows versus the euro -- was largely due to international factors. (Reporting by Krisztina Than and Gergely Szakacs) ((gergely.szakacs@thomsonreuters.com; +36 1 327 4748; Reuters Messaging: gergely.szakacs.thomsonreuters.com@reuters.net)) Keywords: HUNGARY RATES/OUTLOOK

Danish government says bond issuance still off the cards

May 26, 2015 - reuters.com

COPENHAGEN, May 26 (Reuters) - The Danish government has no plans to sell domestic bonds, Economy Minister Morten Ostergaard said on Tuesday, maintaining the suspension of issuance put in place in January as part of measures to defend the currency peg. When asked when the government could start issuing bonds again, Ostergaard said: "It is not something we have plans for at present, but we will inform you about it when it happens". The government ceased issuing bonds at the end of January as a way of easing demand for Danish assets and thus helping the crown to weaken against the euro. (Reporting by Erik Matzen and Teis Jensen; Writing by Sabina Zawadzki; Editing by Catherine Evans) ((sabina.zawadzki@thomsonreuters.com; +45 33 96 96 50, +45 20 54 86 88;)) Keywords: DENMARK BONDS/

UPDATE 5-Oil drops below $65 on U.S. shale outlook, dollar

May 26, 2015 - reuters.com

* U.S. weekly oil rig count decline slows-Baker Hughes * U.S. producers to ramp up output at current price - Goldman * Dollar rally weighing on oil could run further-Morgan Stanley * OPEC meets next week; Iran sees no output change (Updates prices) By Alex Lawler LONDON, May 26 (Reuters) - Oil fell below $65 a barrel on Tuesday, pressured by the possibility that U.S. shale oil producers could increase drilling activity and by a stronger dollar. U.S. drillers cut the number of rigs by just one last week, data showed on Friday, and Goldman Sachs said prices were at a level that would spur activity. The dollar could rally further, Morgan Stanley said, adding to a growing list of headwinds crude faces that include rising OPEC supply. Brent crude LCOc1 was down 75 cents at $64.77 a barrel at 1245 GMT, while U.S. crude CLc1 , also known as WTI, was 75 cents lower at $58.97. "The main factor weighing on prices is the significantly appreciating U.S. dollar," said Carsten Fritsch, analyst at Commerzbank. "What is more, the decline in drilling activity in the U.S. that has been ongoing for 23 weeks appears to have stopped." ID:nL1N0YD1A9 More drilling in the United States would lessen the prospect of a tighter oil market in coming months, one of the factors that have helped Brent rise from a near six-year low close to $45 in January. "We believe that should West Texas Intermediate prices remain near $60 a barrel, U.S. producers will ramp up activity, given improved returns," Goldman said in a report. ID:nL3N0YH22C A stronger dollar makes dollar-priced commodities more expensive for buyers using other currencies, and tends to weigh on oil prices. The dollar hit a one-month high against a basket of major currencies .DXY on Tuesday. "The USD downward correction is complete," Morgan Stanley said in a report. "A stronger dollar would only reinforce our near-term concerns for oil prices, especially Brent." <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ CHART-Brent vs USD: http://link.reuters.com/dyx74w Return of oil/FX trading poses OPEC dilemma: ID:nL1N0Y61G5 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> Brent collapsed from $115 in June 2014 due to ample supplies in a decline that deepened after OPEC last November dropped its policy of cutting output to support prices, in a bid to slow higher-cost competing supply sources such as U.S. shale. Taking turns in dominating sentiment since then are concerns about ample supplies currently and the prospect of a tighter market ahead as supply growth from higher-cost producers slows. The Organization of the Petroleum Exporting Countries gathers on June 5. On Sunday, Iran said OPEC was unlikely to change its production ceiling at the meeting. ID:nL5N0YF045 (Editing by Alison Williams and Jason Neely) ((alex.lawler@thomsonreuters.com; +44 207 542 4087; Reuters Messaging: alex.lawler.reuters.com@reuters.net)) Keywords: MARKETS OIL/

S.Africa's rand slips one percent as U.S. goods data buoy dollar

May 26, 2015 - reuters.com

JOHANNESBURG, May 26 (Reuters) - South Africa's rand fell by more than one percent to the dollar to 12.0500 ZAR=D3 after the release of U.S. durable goods data and business investment spending plans showed a solid rise, strengthening the dollar. ID:nL5N0YH283 (Reporting by Mfuneko Toyana; Editing by James Macharia) ((mfuneko.toyana@thomsonreuters.com; +27117753153; Reuters Messaging: mfuneko.toyana.thomsonreuters.com@reuters.net)) Keywords: MARKETS SAFRICA/CURRENCY

Swiss luxury watchmaker Ulysse Nardin to cut jobs

May 26, 2015 - reuters.com

ZURICH, May 26 (Reuters) - Swiss luxury watchmaker Ulysse Nardin, whose prices for its marine-inspired watches start at around 7,000 Swiss francs ($7,400), said on Tuesday it is cutting its workforce in Switzerland by more than 8 percent. Now owned by French luxury goods and sports brands group Kering PRTP.PA , the company declined to comment on the decision to cut jobs although all Swiss exporters have had to contend with the rise in the value of the Swiss franc after the central bank abandoned its euro exchange rate cap in January. Ulysse Nardin's spokeswoman Sandra Hurni said that the firm will cut 26 of its 313 jobs in Switzerland, confirming a report by Swiss broadcaster RTN. "We needed to take measures to adapt to the needs of the market," Hurni said. The job cuts will take place across all levels of the watchmaker, Hurni said, without elaborating. Created in 1846, Ulysse Nardin was one of the last remaining major independent family-controlled luxury watchmakers in Switzerland after more than a decade of consolidation when it was snapped up by Kering last year. ID:nL6N0Q55VE Many firms in Switzerland have adjusted prices, looked to develop new markets or sought to cut employment costs following the Swiss National Bank's shock decision to remove the exchange rate cap. ID:nL5N0Y00GM ID:nL5N0W15JF ($1 = 0.9471 Swiss francs) (Reporting by Katharina Bart; Editing by Greg Mahlich) ((Katharina.Bart@thomsonreuters.com; +41 58 306 7312; Reuters Messaging: katharina.bart.thomsonreuters.com@reuters.net)) Keywords: ULYSSENARDIN EMPLOYMENT/

Ukraine's Ukreximbank bond boosted by restructuring plan

May 26, 2015 - reuters.com

LONDON, May 26 (Reuters) - The benchmark bond of Ukraine's Ukreximbank rose by more than 2 cents on the dollar Tuesday after it said 30 percent bondholders backed a plan to give the bank more time to pay its debts. ID:nL5N0YH2CE The 2018-maturing bond XS087773728=TE rose 2.34 cents to 69.3 cents to hit highest level in almost 5 weeks. The hard currency debt of fellow state-entity Oschadbank also gained, with its issue maturing in March 2018 rising 1.020 cents to 67.020 cents in the dollar. XS090643487=TE (Reporting by Karin Strohecker; editing by Marc Jones) ((marc.jones@thomsonreuters.com; +44 (0)207 542 9033; Reuters Messaging: marc.jones.thomsonreuters.com@reuters.net Twitter @marcjonesrtrs)) Keywords: UKRAINE UKREXIMBANK/BONDS

Russia c.bank says has sufficient reserves by any standards

May 26, 2015 - reuters.com

MOSCOW, May 26 (Reuters) - Russia has sufficient forex reserves by any standards but it would be more comfortable if they were larger, central bank First Deputy Governor Ksenia Yudayeva said on Tuesday. "State policy in relation to reserves has departed (from previous norms) because the level is sufficient according to all norms, but it would be more comfortable if they were bigger," she said. (Reporting by Elena Fabrichnaya; Writing by Alexander Winning, editing by Jason Bush) ((alexander.winning@thomsonreuters.com; +7 495 775 1242; Reuters Messaging: alexander.winning.thomsonreuters.com@reuters.net)) Keywords: RUSSIA CENBANK/RESERVES

CANADA FX-C$ retreats to six-week low after U.S. durable goods data

May 26, 2015 - reuters.com

TORONTO, May 26 (Reuters) - The Canadian dollar slipped to its weakest level in six weeks against the greenback on Tuesday after the U.S. dollar extended session gains on data that showed U.S. business investment spending plans increased for a second month in a row in April. ECONUS ID:nLNNQGEBAW The Canadian dollar CAD=D4 touched C$1.2395 to the U.S. dollar, or 80.68 U.S. cents, softer than before the data was released and sharply weaker than Monday's Bank of Canada close at C$1.2313, or 81.21 U.S. cents. (Reporting by Solarina Ho) ((solarina.ho@thomsonreuters.com; 1-416-941-8067; Reuters Messaging: solarina.ho.thomsonreuters.com@reuters.net; Twitter: @shtweet)) Keywords: MARKETS CURRENCY/CANADA

PRECIOUS-Gold drops more than 1 percent as dollar rally continues

May 26, 2015 - reuters.com

* Dollar at one-month high vs currency basket * More U.S. data eyed * Yellen's recent comments reinforce tightening bias (Updates prices) By Clara Denina LONDON, May 26 (Reuters) - Gold fell more than 1 percent on Tuesday as the dollar extended gains following stronger U.S. inflation data and recent comments from Federal Reserve Chair Janet Yellen that reinforced the central bank's tightening bias on monetary policy. Spot gold XAU= dropped to a two-week low of $1,190.10 an ounce earlier and was down 1.3 percent at $1,191.46 by 1225 GMT. U.S. gold futures for June delivery GCcv1 were down $13.50 at $1,190.50 an ounce. The dollar continued its strong run, up 1 percent against a basket of leading currencies, after Fed Yellen said on Friday that interest rates will be raised this year as the U.S. economy was set to bounce back from an early-year slump. ID:nL1N0YD1IH "The dollar is back in vogue, it's turned after last week's strong CPI data, Yellen comments, and there should be more strong data this week," Societe Generale analyst Robin Bhar said. "For the dollar to weaken again, you're going to need some pretty dire U.S. data and the risk is that data is going to get stronger because we are out of the winter season." A stronger dollar makes gold more expensive for holders of other currencies, while higher U.S. interest rates would dent demand for the non-interest-paying metal, increasing the opportunity cost of holding it. Gold's inverse correlation with the dollar has started to strengthen again, and weaken against yields, Barclays said in a note. "We maintain the view that the third quarter is likely to be the weakest quarter for gold, given that we expect the Fed to start increasing rates in September, but the potential downside is likely to be limited," it said. Bullion traders will be keenly eyeing U.S. economic data due later in the day, including durable goods for May and consumer confidence for April, for clues on the strength of the economy and how it would impact the Fed's monetary policy. ECONUS The focus was also on Greece, which said on Monday it needed aid urgently to be able to pay a loan instalment due next week. ID:nL5N0YG19A Any worsening of the Greek debt crisis could potentially trigger demand for gold coins and bars. The metal is usually seen as a hedge against political and financial risk, although the impact on demand for metals from wider political worries is usually short lived. Silver XAG= fell 2.4 percent to a two-week low of $16.69 an ounce. Platinum XPT= dropped 1.7 percent to $1,128.49 an ounce and palladium XPD= slipped 0.7 percent to $780.47 an ounce. (Additional reporting by A. Ananthalakshmi in Singapore; Editing by Alison Williams and Mark Potter) ((clara.denina@thomsonreuters.com)(+44 207 542 9420)(Reuters Messaging: clara.denina.thomsonreuters.com@reuters.net)) Keywords: MARKETS PRECIOUS/

Danish government trims 2015 financing needs

May 26, 2015 - reuters.com

COPENHAGEN, May 26 (Reuters) - Denmark has lowered its 2015 domestic financing needs to 125 billion Danish crowns ($18.3 billion) from a December forecast of 135 billion crowns, the Finance Ministry said on Tuesday. Earlier, the government raised its 2015 growth forecast and reduced its budget deficit expectation in an economic review issued days early as political pundits expect the prime minister to call for an election this week. ID:nL5N0YH1XS . ($1 = 6.8405 Danish crowns) (Reporting by Erik Matzen; writing by Sabina Zawadzki; editing by Teis Jensen) ((sabina.zawadzki@thomsonreuters.com; +45 33 96 96 50, +45 20 54 86 88;)) Keywords: DENMARK DEBT/

UPDATE 1-S&P may cut Polish rating outlook in case of fiscal slippage

May 26, 2015 - reuters.com

* S&P says no immediate rating impact from Duda election * Says policy reversal could lead to cut in outlook * Sees fiscal loosening before parliamentary vote (Adds quotes, details) WARSAW, May 26 (Reuters) - Standard & Poor's may cut its rating outlook on Poland if a trend towards lower budget deficits is reversed, the credit agency said on Tuesday, days after opposition candidate Andrzej Duda's presidential election win. Duda, whose victory on Sunday unsettled Polish markets, has said he wants to reverse a hike in the retirement age, increase personal income tax allowances and slap new taxes on banks and supermarkets. ID:nL5N0YG10S ID:nL5N0YC563 The election result had no immediate impact on the country's A- rating, but "any drastic policy reversals regarding fiscal consolidation or macroeconomic management could lead us to revise our outlook ...to stable (from positive)," S&P said. Employers' lobby Pracodawcy RP has said Duda's election promises would cost about 300 billion zlotys ($79 billion) by 2020, or about 3 percent of GDP per year. The president-elect has not specified how he would fund his proposals. On Monday, the zloty currency EURPLN= fell to a two-month low against the euro, bank stocks sold off sharply PKO.WA since Monday, and Polish government bond yields rose PL10YT=RR . FISCAL LOOSENING? While the government has charge of the day-to-day running of the country, Poland's president can in theory veto and initiate legislation and has a say in foreign policy. Duda's victory improves the chances of his (PiS) party winning parliamentary elections in the autumn, when the pro-business Civic Platform (PO) will try to extend its eight years in office. Recent opinion polls give the PiS a narrow lead. Under Civic Platform, Poland cut its fiscal deficit to about 3 percent of GDP in 2014 from nearly 8 percent in 2010, gaining a reputation for fiscal prudence that helped earn it an upgrade of its rating outlook to positive from S&P. "The ratings on Poland already incorporate our estimates of a certain degree of pre-election spending, including a projected deficit of 3 percent of GDP, which contrasts with the government's forecast of 2.7 percent of GDP," S&P said. "However, given more recent rhetoric from the ruling and opposition parties, further loosening of the government's fiscal stance may be likely before Polish citizens cast their votes in October." All Poland's main credit ratings are comfortably within the investment grade bracket. Fitch also rates Poland at A-, while Moody's is a notch higher at A2. ($1 = 3.7863 zlotys) (Reporting by Marcin Goettig; editing by John Stonestreet) ((marcin.goettig@thomsonreuters.com; +48226539720; Reuters Messaging: marcin.goettig.reuters.com@thomsonreuters.net)) Keywords: POLAND ELECTION/RATING S&P

Russia c.bank says increasing its gold reserves

May 26, 2015 - reuters.com

MOSCOW, May 26 (Reuters) - A first deputy governor of the Russian central bank, Dmitry Tulin, said on Tuesday that the bank was increasing its gold reserves. According to central bank data, Russia's gold reserves rose to 40.1 million troy ounces as of May 1 compared with 39.8 million ounces a month earlier. ID:nR4N0WF00E (Reporting by Elena Fabrichnaya; Writing by Alexander Winning; Editing by Maria Kiselyova) ((alexander.winning@thomsonreuters.com; +7 495 775 1242; Reuters Messaging: alexander.winning.thomsonreuters.com@reuters.net)) Keywords: RUSSIA CENBANK/GOLD

UPDATE 2-IMF declares yuan no longer undervalued, urges reforms

May 26, 2015 - reuters.com

* Says China should have 'floating exchange rate' in 3 yrs * Policy easing needed if 2015 GDP growth below 6.5 pct * IMF expects China growth of 6.8 pct this year (Adds IMF comment about SOE reforms being "too slow") By Koh Gui Qing BEIJING, May 26 (Reuters) - China's yuan currency is no longer undervalued after its recent gains, but the government should quicken reforms to get to having "a floating exchange rate", the International Monetary Fund said on Tuesday. The IMF has previously labeled the yuan CNY=CFXS as "modestly undervalued", despite the currency's gradual appreciation since a landmark 2005 revaluation. The yuan has risen sharply against many currencies apart from the dollar in recent months. "Our assessment now is that the substantial real effective appreciation over the past year has brought the exchange rate to a level that is no longer undervalued," the IMF said. In a reference to how China still has a large trade surplus, despite a stronger yuan, the IMF said Beijing's "still-too-strong external position" highlights the need for other reforms. Noting that China still faced risks from unsustainable credit and investment growth, the IMF urged the government to quicken reforms, especially among struggling state firms shielded from bankruptcy. "Progress with state-owned enterprise reform ... has been too slow," the IMF said. It also called for a more flexible yuan. "We believe that China should aim to achieve an effectively floating exchange rate within 2-3 years," the IMF said in a statement after completing an annual consultation with Chinese officials. SUPPORT FOR GDP GROWTH? China should step up fiscal support for its economy if growth dips below 6.5 percent this year, or prepare to take steps to rein in credit and investment if growth surprises on the upper side, the fund said. The IMF expects China's annual economic growth to be 6.8 percent this year, before slowing further to 6.25 percent in 2016, it said in a report. "If incoming data suggest that growth is likely to exceed 7 percent, the authorities should take advantage of the opportunity to reduce vulnerabilities faster," the IMF said. "If instead growth looks set to dip below 6.5 percent, then fiscal policy should be eased." It said that fiscal stimulus, if needed, should be on-budget and rely on measures that protect the vulnerable, support rebalancing, and are consistent with the reform agenda. China's economy grew 7.4 percent in 2014. It had annual growth of 7 percent in the first quarter and recent data showed growth has lost further momentum into the second quarter, increasing the risk that full-year growth may dip below the government's targeted 7 percent. (Writing by Kevin Yao; Editing by Richard Borsuk) ((kevin.yao@thomsonreuters.com; +8610 6627 1215; Reuters Messaging: kevin.yao.thomsonreuters.com@reuters.net)) Keywords: IMF CHINA/GROWTH

Sri Lanka rupee spot falls near record low; pressure remains

May 26, 2015 - reuters.com

COLOMBO, May 26 (Reuters) - Sri Lanka's central bank permitted the spot rupee to fall by 20 cents to a near record low on Tuesday but prevented it from falling further amid importer dollar demand while exporters held on to the greenback, dealers said. The central bank allowed the spot rupee LKR=LK to slip 0.15 percent or 20 cents to 133.90, near its record low of 134.10, hit on June 28, 2012, Thomson Reuters data showed. Since the central bank defended the currency, dealers moved to forwards because the spot rate did not reflect the real market price, dealers said. Actively traded three-month forwards ended at 137.10/40 per dollar, compared to Monday's close of 136.55/70. Two-month forwards were unchanged at 135.50/80 per dollar and one-month forwards were steady at 134.70/90, as the central bank prevented the currency from falling, dealers said. However, a central bank official on condition of anonymity told Reuters that the bank regulator only intervenes in the spot market and never fixes prices in the forwards. The central bank has allowed the spot to fall 0.75 percent, or by 1 rupee since April 30, to account for broad gains in the dollar and rising credit demand in a low rate environment. Two dealers said some banks are desperate for dollars and have been asking exporters to convert their dollars. Exporters have been holding dollars as it is cheaper for them to borrow cheaper rupee loans for their operations locally at lower interest rate, dealers said. Dealers said the currency would face pressure until either dollar inflows pick up or interest rates rise. The spot rupee has fallen around 2.1 percent so far this year, according to Thomson Reuters data. Dealers also said the dollars are sold between 138.50/139.00 at some authorised foreign exchange dealers outside banks. ($1 = 133.9000 Sri Lankan rupees) (Reporting by Shihar Aneez; Editing by Sunil Nair) ((shihar.aneez@thomsonreuters.com)(+94-11-232-5540)(Reuters Messaging: shihar.aneez.thomsonreuters.com@reuters.net twitter:@shiharaneez)) Keywords: MARKETS SRI LANKA/

SNAPSHOT-India stocks, bonds, rupee, swap, call at close

May 26, 2015 - reuters.com

(Starting June 3, independent news provider NewsRise Financial will provide the market snapshots on Thomson Reuters Eikon. The reports can be accessed via keyword search [NFR AND SNAPSHOT]) STOCKS .BSESN .NSEI ----------------------- The BSE index ended down 0.41 percent at 27,531.41, while the broader NSE index lost 0.37 percent to 8,339.35. Both indexes ended at their lowest closing levels since May 15 on caution ahead of results of major companies such as Tata Motors and uncertainty about Greece's fiscal woes. .BO RUPEE INR=D2 -------------- The Indian rupee slumped to 63.98/99 per dollar, its weakest close since May 13, tracking losses in domestic shares and a rally in the dollar in global markets. The rupee had closed at 63.5625/5725 on Monday. INR/ GOVERNMENT BONDS IN084024G=CC ------------------------------- The benchmark 10-year bond yield rose 3 bps to close at 7.89 percent, but the new 10-year bond yield IN077225G=CC fell 1 bp to 7.67 percent. IN/ INTEREST RATE SWAPS INROIS MIOIS= ------------------------------------- The benchmark five-year swap rate ended flat at 7.10 percent, while the one-year rate fell 1 basis point to 7.48 percent. CALL MONEY INROND= -------------------- India's one-day cash rate was at 7.50/7.55 percent versus its close of 7.45/7.50 percent on Monday. (Compiled by Rafael Nam) ((swati.bhat@thomsonreuters.com)(twitter.com/swatibhat22)(+91-2 2-61807353)(Reuters Messaging: swati.bhat.thomsonreuters.com@reuters.net)) Keywords: INDIA SNAPSHOT/

Poland to take 60 Syrian Christian families-PM

May 26, 2015 - reuters.com

WARSAW, May 26 (Reuters) - Poland's will resettle 60 Christian families fleeing from Syria and will consider further steps to help Christian refugees at risk of persecution in the country, Prime Minister Ewa Kopacz said on Tuesday. "We will start from 60 families," Kopacz told a news conference. (Reporting by Pawel Sobczak; Writing by Marcin Goclowski; editing by John Stonestreet) ((marcin.goclowski@thomsonreuters.com; +48 22 6539724; Reuters Messaging: marcin.goclowski.reuters.com@thomsonreuters.net)) Keywords: MIDEAST CRISIS/POLAND CHRISTIANS

UPDATE 1-Hungarian central bank trims rates to record low

May 26, 2015 - reuters.com

* Bank cuts by 15 bps to 1.65 percent as expected * Hungary launched rate-cutting cycle in March * It has flagged further cautious rate cuts * Inflation still negative, economic outlook improving * Statement to be released at 1300 GMT By Krisztina Than BUDAPEST, May 26 (Reuters) - Hungary's central bank cut its main interest rate to a record low on Tuesday, extending a growth-boosting easing cycle that, given low inflation and still attractive investor returns, analysts believe has yet to run its course. The 15-basis-point cut to 1.65 percent HUINT=ECI was expected by all 19 analysts surveyed by Reuters last week. ID:nL5N0YB42L Neighbouring Romania and Serbia have also been cutting borrowing costs to aid their economies while regional heavyweight Poland ended a rate-cutting cycle in March. The National Bank of Hungary, led by a close ally of Prime Minister Viktor Orban, launched its easing cycle in the same month to support government efforts to boost the economy, and trimmed rates further in April. Forward rate agreements price in at least one more cut, which would take the benchmark to the same level as Poland's. Some analysts say Hungary could continue cutting beyond June, given a supportive economic backdrop and sufficiently attractive yield premiums to core western European markets. Hungary's economic outlook has improved, and credit agency Fitch raised its country outlook to positive from stable last Friday. ID:nL3N0YD5OQ Meanwhile annual inflation has stayed negative, coming in at -0.3 percent in April partly due to government-mandated energy price cuts. The central bank expects average inflation of zero this year, rising to 2.6 percent in 2016. Analysts said the rate decision will be watched very closely in June, when the bank also releases updated economic forecasts. "It will ... be crucial to see what the June decision will be and what the policy guidance will be ... as this will set the interest rate outlook for the entire Q3 period," the Royal Bank of Scotland said in a note. RBS said the bottom of Hungary's easing cycle could be as low as 1.20-1.30 percent. Analysts' median forecast for the base rate is 1.5 percent for the end of this year, before a rebound to 1.9 percent by the end of next year, when U.S. rates are expected to have risen and inflation is seen picking up. The central bank, which has also supported Orban's policies with a massive funding for lending programme, will tread carefully as it probably wants to avoid a sharp weakening in the forint, some analysts have said. At 1204 GMT, the forint EURHUF=D3 traded at 308.70 to the euro, unchanged from levels prior to the rate decision. (Reporting by Krisztina Than; editing by John Stonestreet) ((krisztina.than@thomsonreuters.com; +36 1 327 4745; Reuters Messaging: krisztina.than.thomsonreuters.com@reuters.net)) Keywords: HUNGARY RATES/

FOREX-Dollar back on upward track, hits eight-year high vs yen

May 26, 2015 - reuters.com

* Dollar up 1 percent against basket of currencies * Euro falls below $1.09, Greek concerns growing * U.S. data including durable goods next test for dollar bulls (Updates prices, adds Swiss franc move) By Patrick Graham WARSAW, May 26 (Reuters) - The dollar rose 1 percent against a basket of currencies on Tuesday, extending gains since a rise in U.S. core inflation last Friday and driving the euro briefly below $1.09 for the first time in a month. Against the yen, it broke through longer-term resistance to hit an eight-year high of 122.88 yen, and a number of analysts were optimistic of a push back towards 12-year highs below $1.05 per euro hit in March. In the first proper trade in London since a long holiday weekend, some pointed to growing nerves over Greece, as well as a fall-back in German government bond yields that has made the dollar relatively more attractive compared to the euro. But whether the U.S. currency is ready for an attack on parity with the euro in the weeks ahead is likely chiefly to depend on the next rounds of U.S. economic data improving after a disappointing first quarter. "I think this has turned around and the dollar is back on a bullish trend," said Ian Stannard, head of European FX strategy with Morgan Stanley in London. "The adjustment has now been completed and the dollar can now react to any positive news. Dollar yen breaking through the top of the range is an important event." The dollar index .DXY last traded at 96.850 after reaching a one-month high of 97.121. It stood at $1.0926 per euro, up half a percent on the day, having hit a high of $1.0885. Doubts over whether the U.S. Federal Reserve can raise interest rates this year have been at the heart of a rough few weeks for the dollar and Fed Chair Janet Yellen steadied the ship on Friday by reinforcing the U.S. central bank's tightening bias. ID:nL1N0YD1IH But the first indications of economic growth in April have also been mildly disappointing, even as underlying inflation showed some signs of life. Durable goods numbers as well as a flash PMI sentiment indicator are due later on Tuesday and not everyone was so optimistic as to what they would show. "With data feeding into Q2 GDP showing some signs of weakness, the risk may be on the downside for USD on a disappointment which would validate market concerns on slowing," Citi strategist Josh O'Byrne said in a morning note. Against the yen, the dollar traded up 0.8 percent, having hit an 8-year high of 122.88 yen. The Swiss franc was another winner from the euro's weakness, rising to its strongest in three weeks at 1.0324 francs per euro. EURCHF=D4 (Additional reporting by Shinichi Saoshiro in TOKYO; Editing by Mark Trevelyan) ((patrick.graham@thomsonreuters.com)(+44207 542 9429)(patrick.graham.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

Danish government raises 2015 growth forecast as election looms

May 26, 2015 - reuters.com

COPENHAGEN, May 26 (Reuters) - The Danish government raised its economic growth forecast for 2015 on Thursday and said it saw a lower budget deficit than previously expected, according to a report seen by Reuters. In the report, due to be published later on Tuesday, the government predicted growth of 1.7 percent this year, compared to a forecast given in December of 1.4 percent. It said it sees a budget deficit of 1.3 percent of GDP, compared with a previous forecast of 2.5 percent. Many political pundits expect Prime Minister Helle Thorning-Schmidt to call this week for a general election ID:nL5N0YH1XS . (Reporting by Erik Matzen; writing by Sabina Zawadzki, editing by Anna Ringstrom) ((sabina.zawadzki@thomsonreuters.com; +45 33 96 96 50, +45 20 54 86 88;)) Keywords: DENMARK ECONOMY/FORECASTS

Hungarian central bank cuts rates to new low of 1.65 pct

May 26, 2015 - reuters.com

BUDAPEST, May 26 (Reuters) - Hungary's central bank cut its main interest rate to a record low on Tuesday, extending its easing cycle that, given low inflation and still attractive investor returns, analysts believe has yet to run its course. The 15-basis-point cut to 1.65 percent HUINT=ECI was expected by all 19 analysts surveyed by Reuters last week. ID:nL5N0YB42L The bank is expected to release a statement about the rate decision at 1300 GMT. (Reporting by Krisztina Than and Gergely Szakacs) ((krisztina.than@thomsonreuters.com; +36 1 327 4745; Reuters Messaging: krisztina.than.thomsonreuters.com@reuters.net)) Keywords: HUNGARY RATES/

UPDATE 1-Russia's Putin: c.bank shouldn't allow excessive speculation

May 26, 2015 - reuters.com

(Adds quotes, context) MOSCOW, May 26 (Reuters) - Russia's President Vladimir Putin said on Tuesday that the country's central bank was an independent institution but that it should should not allow excessive speculation on the rouble. "The Russian central bank is an independent structure, in accordance with the law," Putin told a conference of business people. "Its policy is entirely adequate given the current market situation," he said. "We see and understand what is happening with the exchange rate... The central bank shouldn't allow only excessive speculation." The central bank floated the rouble last November but has recently begun regular forex purchases, a move seen by some analysts as aimed at preventing excessive rouble appreciation. The bank has also aggressively cut its key rate by 4.5 percentage points this year, in part because of fears for the economy and health of the banking sector. Some analysts have attributed the pace of the rate cuts to government pressure, although senior ministers and the central bank itself have always insisted it is independent. (Reporting by Vladimir Soldatkin; Writing by Alexander Winning; Editing by Jason Bush) ((alexander.winning@thomsonreuters.com; +7 495 775 1242; Reuters Messaging: alexander.winning.thomsonreuters.com@reuters.net)) Keywords: RUSSIA PUTIN/CENBANK

Austerity backlash rattles Spanish, Portuguese bonds but contagion limited

May 26, 2015 - reuters.com

* Spain, Portugal bonds hit by Rajoy defeat in local vote * Risk premiums rise modestly as ECB limits contagion * Italian bonds show resilience as Greek crisis drags on (Recasts with moves in Portugal, adds more detail, comments) By Emelia Sithole-Matarise LONDON, May 26 (Reuters) - Spanish and Portuguese borrowing costs rose on Tuesday on signs of growing public discontent with austerity, though fears of wider contagion were tempered by the European Central Bank's asset purchases. A battering in Sunday regional and local elections cast doubt on Prime Minister Mariano Rajoy's bet that an economic recovery will secure him a second term later this year and raised concerns in Portugal about the outcome. Portugal has been celebrated among Europe's elite as a model of how to reform an economy after a debt binge. But concerns are rising that its enthusiasm for change has waned as Europe loses its appetite for further belt tightening. ID:nL5N0YF0CH Spanish and Portuguese 10-year bond yields - which reflect sovereign borrowing costs - were 9-11 basis points higher at 1.87 percent ES10YT=TWEB and 2.54 percent PT10YT=TWEB , respectively. Although this lifted their yield premiums over benchmark German bonds - a closely watched market measure of risk - the moves were modest and nowhere near peaks of 1.5 to over 2 percentage points seen at the start of the year before the ECB launched a trillion euro quantitative easing programme. "There has been a market reaction as a result of the Spanish election but it has certainly not been nearly as dramatic as what we would have seen in the past," said Rabobank strategist Matthew Cairns. This was the bond market's first reaction to the weekend election after holidays in much of Europe and the United States on Monday. European stocks stumbled with concerns about Greece's debt crisis also weighing but bonds issued by Italy - which is also pursuing economic and political reforms - held steady, showing limited contagion. "This underscores the fact that you've got the ECB in place as a significant buyer and the feeling in the market that even though we are a long way from the stronger growth of years gone by the economy is healing," Cairns said. "This tends to dilute the market's reaction to these kinds of events." GOING TO THE WIRE Worries about Greece, which is fast running out of cash and has warned it may miss a June 5 debt repayment to the International Monetary Fund, also helped German and other top-rated eurozone debt to outperform the periphery. German Bund yields DE10YT=TWEB , the benchmark for euro zone borrowing costs, were down 4 basis points at 0.56 percent, retreating further from a 2015 high of 0.80 percent hit early this month in a global debt selloff as fears of deflation in the currency bloc receded. They have been falling since last week when ECB policymakers stepped in, with Governing Board member Benoit Coeure saying the central bank would ramp up the asset purchases in May and June in anticipation of thin markets in summer. Greece must repay four loans totalling 1.6 billion euros ($1.76 billion) to the International Monetary Fund next month, starting with a 300 million euro payment on June 5. If no deal is reached for new loans to be disbursed to Athens, Greece is likely to default on the IMF loan repayment. This would start a process that could lead Greece out of the euro zone, though most investors still see that as unlikely. (Editing by Peter Graff) ((emelia.sithole@thomsonreuters.com; +44 20 7542 6752; Reuters Messaging: emelia.sithole.thomsonreuters.com@reuters.net)) Keywords: MARKETS BONDS/EURO

Egyptian pound steady at official auction and on black market

May 26, 2015 - reuters.com

CAIRO, May 25 (Reuters) - Egypt's central bank kept the pound EGP= steady at 7.53 to the dollar at a foreign exchange auction on Tuesday, while the currency was largely stable on the black market. The central bank has held the official exchange rate steady for more than three months since letting the pound weaken at the beginning of 2015. This weakening and other measures have helped reduce black market trading significantly. In Tuesday's auction, the bank said it had offered $40 million and sold $37.8 million at a cut-off price of 7.5301 pounds per dollar CBEO , unchanged from Sunday's rate. On the black market, the pound was trading at 7.675 pounds to the dollar on Tuesday, a trader said, basically unchanged from the 7.67 pounds quoted on Sunday. Black market traders say volumes have fallen sharply since the central bank's drive to stamp out their transactions, including the introduction of a cap in February on the amount of dollars that can be deposited in banks. ID:nL5N0XJ1LI (Reporting by Shadi Bushra; Editing by Katharine Houreld) ((stephen.kalin@thomsonreuters.com; +20 22 578 3290; Reuters Messaging: stephen.kalin.thomsonreuters.com@reuters.net)) Keywords: EGYPT FOREX/

China's Zijin to buy stake in Ivanhoe's DRC copper project

May 26, 2015 - reuters.com

LONDON, May 26 (Reuters) - Chinese mining company Zijin Mining Group 601899.SS has agreed to buy almost half of the Kamoa copper project in the Democratic Republic of Congo (DRC) from Ivanhoe Mines for $412 million, the companies said on Tuesday. Under the deal, Zijin will buy through its subsidiary, Gold Mountains International Mining Company Limited, a 49.5 percent stake in Ivanhoe Mines' subsidiary Kamoa Holding Limited, which currently owns 95 percent in the DRC copper project. The mining sector has been hit in the last three years by a steep decline in metals prices but copper is seen by analysts as one of the commodities with the brightest prospects given some supply constraints. Zijin has also recently purchased a 9.9 percent stake in Ivanhoe mines and the Porgera gold mine in Papua New Guinea from Barrick Gold. ID:nL3N0YH3FV (Reporting by Silvia Antonioli; Editing by Mark Potter) ((silvia.antonioli@thomsonreuters.com; +44)(0)(20 7542 1755; Reuters Messaging: silvia.antonioli.reuters.com@reuters.net)) Keywords: IVANHOE MINES M&A/ZIJIN

Russian central bank says hopes for further cuts to key rate

May 26, 2015 - reuters.com

MOSCOW, May 26 (Reuters) - A first deputy governor of the Russian central bank, Dmitry Tulin, said on Tuesday that he hoped the bank would be able to continue cutting its key interest rate. While explaining the central bank's monetary policy in parliament, Tulin also said the central bank was worried that cuts to the key rate would not be reflected in lower lending rates from banks. Tulin manages monetary policy at the central bank, which has already cut its main lending rate by 450 basis points this year as the economy slides into recession. (Reporting by Elena Fabrichnaya; Writing by Lidia Kelly; Editing by Alexander Winning) ((lidia.kelly@thomsonreuters.com; +7 495 775 1242; Reuters Messaging: lidia.kelly.reuters.com@reuters.net)) Keywords: RUSSIA CRISIS/CENBANK

UPDATE 1-Danish PM promises billions in new spending, fuelling vote talk

May 26, 2015 - reuters.com

(Adds detail, background) COPENHAGEN, May 26 (Reuters) - Denmark's Prime Minister Helle Thorning-Schmidt said on Tuesday the country's economic crisis was over and promised $5.7 billion in extra spending, fuelling media speculation that she was about call a national election. The bullish announcements came just a year after Denmark had to halve its 2014 growth outlook as its export-driven economy faltered on stagnation in Europe. ID:nL6N0TU1ID "Today we can say very clearly that Denmark is out of the crisis," she told reporters, citing lower unemployment, consistent economic growth in recent quarters and consumer confidence at the highest level in years. "We are through the most difficult years and Denmark is now again on a secure path," she added. She announced 39 billion Danish crowns in extra spending up until 2020 for healthcare, the elderly, children's day care, the environment and the police, and shrugged off questions about the election. "The election comes when it comes. But this is a plan that goes into the next election term, and that is our message: we have a plan for the coming years," she said. An economy ministry source told Reuters the government was planning to announce new forecasts on the economy at 1230 GMT on Tuesday, two days early. ID:nC7N0Y3007 A group of veteran economic advisers, known as the Wise Men, also applauded the government's policies on Tuesday and predicted growth this year of 1.9 percent and next year of 2.3 percent. The economy grew 1.1 percent in 2014. On Friday, sources close to the prime minister told Reuters she would probably announce the date of a vote this week, although a final decision was yet to be made. ID:nL5N0YD2M7 In Denmark, only the prime minister can choose the timing of an election, although in this term there is a deadline of Sept. 14. Polls show the ruling Social Democrats behind the main opposition Liberals, but the ratings of Thorning-Schmidt and her party have been on the rise in recent weeks, since the government promised other new spending and proposed cutting benefits for some immigrants. ($1 = 6.8370 Danish crowns) (Reporting by Erik Matzen, Teis Jensen; Writing by Sabina Zawadzki; Editing by Andrew Heavens) ((sabina.zawadzki@thomsonreuters.com; +45 33 96 96 50, +45 20 54 86 88;)) Keywords: DENMARK ELECTION/

UPDATE 1-Barrick to sell 50 pct in Papua New Guinea unit to China's Zijin

May 26, 2015 - reuters.com

(Adds details, background, shares) May 26 (Reuters) - Canadian miner Barrick Gold Corp ABX.TO ABX.N said it would sell 50 percent stake in its unit that manages the Porgera gold mine in Papua New Guinea to China's Zijin Mining Group Co Ltd 601899.SS for $298 million in cash. The deal, a part of Barrick's plan to reduce net debt by at least $3 billion by the end of the year, comes a day after the world's largest bullion producer sold its Cowal mine to Evolution Mining EVN.AX for $550 million. ID:nL1N0YG00R The unit, Barrick Niugini, owns 95 percent in the Porgera mine and the Papua New Guinea government owns the rest. Zijin and Barrick will jointly control Barrick Niugini after the sale, which is expected to be completed in the third quarter, the Canadian miner said on Tuesday. ID:nMKWgnqyCa Barrick said it expected its share of gold production from the Porgera mine to rise to 500,000-550,000 ounces this year from 493,000 ounces in 2014. Barrick's shares closed at C$15.12 on the Toronto Stock Exchange on Monday. Up to Monday's close, the stock had fallen nearly 16 percent over the past 12 months. (Reporting by Sneha Banerjee in Bengaluru; Editing by Kirti Pandey) ((sneha.banerjee@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 1130; ; Reuters Messaging: sneha.banerjee.thomsonreuters.com@reuters.net)) Keywords: BARRICK GOLD JOINTVENTURE/ZIJIN

Russian central banker says bank has to act in line with broader policy

May 26, 2015 - reuters.com

MOSCOW, May 26 (Reuters) - Russia's central bank has to act in line with broader economic policy, the bank's First Deputy Governor Dmitry Tulin said on Tuesday while explaining monetary policy in parliament. Tulin also said that macroeconomic data for April was worrisome. He said inflation had passed its peak, but was still not encouraging. (Reporting by Elena Fabrichnaya, writing by Jason Bush; Editing by Christian Lowe) ((jason.bush@thomsonreuters.com; +7 495 775 1242; Reuters Messaging: jason.bush.reuters.com@reuters.net)) Keywords: RUSSIA CRISIS/CENBANK

REFILE-Barrick to sell 50 pct in Papua New Guinea unit to China's Zijin

May 26, 2015 - reuters.com

(Corrects paragraph 2 to fix typo) May 26 (Reuters) - Canadian miner Barrick Gold Corp ABX.TO said it would sell 50 percent stake in its unit that manages the Porgera gold mine in Papua New Guinea to China's Zijin Mining Group Co Ltd 601899.SS for $298 million in cash. The unit, Barrick Niugini, owns 95 percent in the Porgera mine and Papua New Guinea owns the rest. After the sale, Zijin and Barrick will jointly control Barrick Niugini, the Canadian miner said in a statement on Tuesday. ID:nMKWgnqyCa (Reporting by Sneha Banerjee in Bengaluru; Editing by Kirti Pandey) ((sneha.banerjee@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 1130; ; Reuters Messaging: sneha.banerjee.thomsonreuters.com@reuters.net)) Keywords: BARRICK GOLD JOINTVENTURE/ZIJIN

INDICATORS - Kazakhstan - May 26

May 26, 2015 - reuters.com

India Morning Call-Global Markets

May 26, 2015 - reuters.com

EQUITIES NEW YORK - U.S. stocks were closed on Monday for a public holiday. For a full report, click on .N - - - - LONDON - Britain's share markets were closed on Monday for a public holiday. For a full report, click on .L - - - - TOKYO - Japan's Nikkei share average edged down on Tuesday morning, snapping a seven-day winning streak as investors took profits after the recent gains made on optimism over the economy's recovery and higher shareholder returns. The Nikkei 225 .225 dropped 0.1 percent to 20,395.69 by mid-morning, flitting between positive and negative territory. For a full report, click on .T - - - - HONG KONG - Hang Seng Index .HSI is up 1.4 percent. For a full report, click on .HK - - - - FOREIGN EXCHANGE SYDNEY - The dollar held near one-month highs against a basket of major currencies early on Tuesday, having remained bid in a session made sluggish by public holidays in the United States and Britain. The dollar index .DXY last traded at 96.381, not far from a high of 96.475 set late in the Asian session on Monday, when dollar bulls were still cheering comments from Federal Reserve Chair Janet Yellen For a full report, click on USD/ - - - - TREASURIES NEW YORK - U.S. Treasuries markets were closed on Monday for a public holiday. For a full report, click on US/ - - - - COMMODITIES GOLD SINGAPORE - Gold was stuck in a tight trading range above $1,200 an ounce on Tuesday, as the dollar firmed near a one-month peak against a basket of major currencies on prospects of higher U.S. interest rates this year. Spot gold XAU= was steady at $1,206 an ounce by 0037 GMT. The metal was little changed in the previous session, as liquidity was thin due to U.S. and British holidays. For a full report, click on GOL/ - - - - BASE METALS SINGAPORE - London copper on Tuesday climbed away from three-week lows as markets resumed after a long weekend, buoyed by comments from a Federal Reserve official that soothed concerns about an imminent rise in U.S. interEst rates. Three-month copper on the London Metal Exchange CMCU3 rose 0.8 percent to $6,212 a tonne by 0143 GMT, paring losses of more than 1.5 percent on Friday. It found support around the 30-day moving average at $6,200, having plumbed its weakest since late April at $6,143 a tonne in the previous session. The most-traded July copper contract on the Shanghai Futures Exchange SCFcv1 trimmed 1 percent gains to trade at 44,870 yuan ($7,234) a tonne, up half a percent. For a full report, click on MET/L - - - - OIL SINGAPORE - Crude oil prices were broadly unchanged in early trading on Tuesday, as firm demand supported and ample supply dragged, but analysts said there were signs that a recent rally was running out of steam. Front-month Brent crude prices LCOc1 were up 6 cents to $65.58 per barrel by 0120 GMT. U.S. crude prices CLc1 were up 16 cents at $59.88 a barrel. For a full report, click on O/R (Compiled by Rafael Nam) ((swati.bhat@thomsonreuters.com; twitter.com/swatibhat22; +91-22-61807353; Reuters Messaging: swati.bhat.thomsonreuters.com@reuters.net)) Keywords: MORNINGCALL INDIA/

MIDEAST STOCKS - Factors to watch - May 26

May 26, 2015 - reuters.com

DUBAI, May 26 (Reuters) - Here are some factors that may affect Middle East stock markets on Tuesday. Reuters has not verified the press reports and does not vouch for their accuracy. INTERNATIONAL/REGIONAL * GLOBAL MARKETS-Asian shares slip, dollar stands tall MKTS/GLOB * MIDEAST STOCKS-Gulf markets little moved but Saudi's Ma'aden surges; Egypt slips ID:nL5N0YG1FH * Oil prices steady but indications rally running out of steam O/R * PRECIOUS-Gold holds tight near $1,200 as dollar firms ID:nL3N0YH069 * Islamic State faces battle in Iraq, U.S. reassures Abadi ID:nL5N0YG13F * Turkey says in deal with U.S. on air support for Syria rebels ID:nL5N0YG2CA * Iran to raise oil output capacity by 170,000 bpd from new fields by March 2016 -IRNA ID:nL5N0YG1JR * Houthis suffer first serious setback in south Yemen fighting -residents ID:nL5N0YG1O4 * Stalling economy hurts Turkey's AK Party ahead of election ID:nL5N0YG1NA * Iran will need to spend most of any post-sanctions windfall at home ID:nL5N0YE0B3 * Iraqi bank to open five more branches in bet on future ID:nL5N0YG1HD EGYPT * Egypt's Carbon Holding eyes $4 bln loan by for petchem project ID:nL5N0YG1JP * Egyptian developer Palm Hills raises $212 mln in share issue ID:nL5N0YG174 * Egypt denies Arabtec project to build a million homes has stalled ID:nL5N0YG0FA SAUDI ARABIA * Tens of thousands turn up for funeral of Saudi suicide attack victims ID:nL5N0YG1U1 * Saudi Cement says board proposes H1 cash dividend of 3 riyals/share ID:nL5N0YG1NZ * Saudi Gulf Airlines plans to begin flights at start of November ID:nL5N0YG1IB UNITED ARAB EMIRATES * Dubai's bourse to add trading-at-last session ID:nL5N0YG1ET * UAE April bank lending growth picks up to 8.4 pct y/y; M3 slows ID:nL5N0YG1B1 * Abu Dhabi Islamic Bank eyes UAE expats as industry growth slows ID:nL5N0YG17C * Abu Dhabi's Gulf Capital says eyes four deals in Egypt ID:nL5N0YG110 QATAR * QEWC, Mitsubishi to build $3.2 bln Qatar power, water plant ID:nL5N0YG06Z (Compiled by Dubai newsroom) ((dubai.newsroom@reuters.com)) Keywords: MIDEAST FACTORS/

Australia's gold miners drive M&A revival

May 26, 2015 - reuters.com

By James Regan SYDNEY, May 26 (Reuters) - Gold miners are spearheading a wave of merger and acquisition activity in Australia, riding a rebound in local gold prices to pounce on projects promising quick growth. In the first signs of life since the country's mining boom went bust three years ago, companies are buying assets from international rivals tightening their belts, and partnering with fellow Australian miners. "Everyone is looking for assets that enable them to grow. We've seen more M&A in Australia in 2015 than in the past five years," Ian Murray, chairman of Perth-based Gold Road Resources Ltd GOR.AX told Reuters, referring broadly to the level of interest in the sector. Progressive central bank interest rate cuts aimed at knocking down the Australian dollar and falling labour and mining costs are adding fuel to the frenzy. Gold output in the world's second-biggest producing country after China reached a decade high last year and is tipped to rise further in 2015. Evolution Mining EVN.AX , snapped up Barrick Gold's ABX.TO Cowal mine on Monday for $550 million, giving it a large low-cost mine and putting it ahead of Northern Star Resources NST.AX to be the no. 2 Australia-listed gold miner. ID:nL1N0YG00R A bidding war for the mine attracted 17 different parties, two sources familiar with the process said. U.S-dollar gold prices XAU= are down 37 percent since a late 2011 peak, but Australian dollar gold hit a two-year high in February and is still up 10 percent since early October. "The confluence of big overseas miners looking to repatriate to their home bases and strong indicators such as a weaker Aussie dollar is driving the market further into M&A activity," said Gavin Wendt, an analyst with MineLife consultants. "Add in cheap labor post the boom and a vibrant mid-tier gold sector and it's not hard to see why things are accelerating." Northern Star remains in a position to make "value accretive acquisitions" after buying four mines from Barrick and Newmont Mining Corp NEM.N , according to Chief Executive Bill Beament. DEALS PICK UP Over the lean years, when a strong local currency and high costs trimmed margins, miners skimped on exploration, leaving sparse opportunity to grow organically. So far this year there have been some 26 announced deals in gold mining worth more than $1.7 billion, compared with about $2.2 billion over the previous two years, according to Reuters data. Newcrest Mining Ltd's NCM.AX half-million-ounces-per-year Telfer mine could also go on the block this year, after managing director Sandeep Biswas said in February it was time to time to consider "alternative ownership options". ID:nL4N0VM7XE Evolution tipped it was looking for more mines after paying $230 million in April to acquire two lodes from Luxembourg-based La Mancha Group International BV, which will contribute A$112 million ($88 million) to the Cowal deal. "The lens we are looking through at every opportunity that comes across our desk is whether it will improve the quality of our portfolio," Evolution Executive Chairman Jake Klein told Reuters. Evolution will also pay A$9 million for 19.9 percent of Phoenix Gold PGX.AX , which is accelerating exploration in the Western Australia Goldfields district, where the majority of Australia's 284 tonnes of gold was mined last year. "Assets are being sold at a low point in the cycle and if you position yourself to accumulate them, you are going to do very well," Klein said. Still, warns Northern Star's Beament, as more more buyers show their hands, M&A costs can only go up. "We are in the business of generating superior shareholder returns. Paying some of the premiums being asked for gold assets in today's market is not consistent with that objective," he said. ($1 = 1.2789 Australian dollars) (Editing by Richard Pullin) ((jim.regan@thomsonreuters.com; +612 9373-1814; Reuters Messaging: jim.regan.reuters.com@reuters.net)) Keywords: GOLD AUSTRALIA/M&A

BRIEF-Jaguar Mining Inc Q1 shr loss $0.12

May 26, 2015 - reuters.com

May 25 (Reuters) - Jaguar Mining Inc JAG.V : * Reports Q1 2015 operating and financial results * Q1 revenue $28.7 million versus $31.1 million * Qtrly loss per share $0.12 * Source text for Eikon ID:nPn9zGjcp * Further company coverage JAG.V ((Bengaluru Newsroom; +1 646 223 8780))

GLOBAL MARKETS-Europe stocks stumble, dollar lifted by U.S rate view

May 25, 2015 - reuters.com

* Markets in U.S., much of Europe closed on Monday * Dollar hits one-month high vs other major currencies * CPI data, Yellen speech revive U.S. rate rise expectations * Spanish ruling party takes battering in regional vote * Spanish, Italian, French shares fall By Emelia Sithole-Matarise LONDON, May 25 (Reuters) - European shares fell in thin trade on Monday while the dollar powered ahead after U.S. Federal Reserve Chair Janet Yellen indicated that the central bank was poised to raise interest rates this year. Investor concerns about Greece's debt problems and a poor regional and local election result by Spain's ruling People's Party also weighed on the euro and European shares. ID:nL5N0YF0IR ID:nL5N0YF0CO The pull-back in European stocks mirrored losses on Wall Street on Friday after Yellen suggested the Fed was ready to act if the economy kept improving as expected, though a raft of recent data has suggested it is growing only modestly in the second quarter. She said delaying a policy tightening until employment and inflation hit its targets risked overheating the economy. ID:nL1N0YD1IH The benchmark French CAC 40 .FCHI index shed 0.8 percent. Trading volumes were thin as several markets including Germany, the United Kingdom and the United States were shut for holidays. Spain's IBEX equity index IBEX fell 2.3 percent after voters in regional and local elections on Sunday punished Prime Minister Mariano Rajoy's ruling PP for four years of austerity while Greece's ATG share index .ATG fell 2 percent. "The Greek debt warning and the Spanish election outcome are weighing on the markets, said Naeem Aslam, chief market analyst at AvaTrade. After four months of talks with its euro zone partners and the IMF, Greece's leftist-led Syriza government is still scrambling for a deal that could release up to 7.2 billion euros ($7.9 billion) in remaining aid to avert bankruptcy. RESURGENT DOLLAR In foreign exchange markets, the dollar index .DXY , which measures the greenback against a basket of other major currencies, rose 0.3 percent to a one-month high of 96.475. Against the yen, the dollar traded near a two-month high of 121.78 JPY= , jumping from a low of 120.64 after Yellen's comments and as stronger-than-expected underlying U.S. inflation supported the Fed's case for an interest rate hike later this year. Data on Friday showed the U.S. Labor Department's gauge on core consumer goods prices rose by 0.3 percent last month, bringing the year-on-year rise to 1.8 percent, the highest since October. ID:nLLAMGEBJZ "I would expect rate expectations to continue to rise and for the dollar's uptrend to continue as a result," said Marshall Gittler, head of global FX strategy at IronFX Global. The euro was weaker, falling to a one-month low of $1.0959 EUR= with some traders citing the victory of anti-austerity parties in Spain and Greece's financial crisis as factors. In the most explicit remarks so far about the likelihood of default if negotiations fail, Greece's interior minister said Athens cannot make debt repayments to the IMF next month unless it manages to reach a deal with its lenders. ID:nL5N0YF0IR Oil prices dipped towards $65 a barrel as a rallying dollar and profit-taking took their toll. Brent LCOc1 was down about 0.4 percent at $65.01 after dropping 2.1 percent for the week. O/R ($1 = 0.9110 euros) (Additional reporting by Anirban Nag and Sudip Kar-Gupta; Editing by Toby Chopra) ((emelia.sithole@thomsonreuters.com; +44 20 7542 6752; Reuters Messaging: emelia.sithole.thomsonreuters.com@reuters.net))

Keywords: MARKETS GLOBAL/

PRECIOUS-Gold dips as Yellen comments shore up dollar

May 25, 2015 - reuters.com

* Yellen signals Fed on track to hike US rates this year * Dollar at highest in a month after Yellen's comments * US, UK markets shut on Monday (Updates prices) By Clara Denina LONDON, May 25 (Reuters) - Gold prices fell slightly on Monday, as the dollar gained traction against major currency rivals, on signs the Federal Reserve is preparing to tighten monetary policy for the first time in six years in 2015. Fed Chair Janet Yellen indicated on Friday that the U.S. central bank was poised to raise rates this year, with the world's largest economy set to bounce back from an early-2015 slump. ID:nL1N0YD1IH Higher U.S. interest rates increases the opportunity cost of holding non-yielding bullion. Spot gold XAU= was down 0.2 percent at $1,203.46 an ounce by 1127 GMT, just above a near-two-week low of $1,201.20 hit in the previous session. It posted its biggest weekly drop in a month last week, down 1.4 percent. Liquidity was thin with British and U.S. markets shut for holidays. "The Fed raising the rates is certainly not electrifying news for the precious metal, which is on track to extend its biggest weekly decline since April," AvaTrade chief market analyst Naeem Aslam said. "Yellen last week has confirmed that she is still confident that the rates will rise this year and (gold) traders are not fond of this news at all." The prospect of higher rates later in 2015 boosted the dollar to its highest in a month against a basket of major currencies on Monday. Stronger-than-expected underlying U.S. inflation and persisting Greek debt worries also supported the greenback. ID:nL1N0YD0N2 A stronger dollar makes gold more expensive for holders of other currencies, while diminishing the metal's appeal as an hedge against risk. In the physical markets, gold demand across Asia was soft as investors channel their money towards higher-yielding stock markets. GOL/AS Indian gold jewellery demand in the second half of the year could take a hit as the Hindu calendar shows the number of dates seen as being auspicious for weddings will drop 40 percent in the second half from a year earlier. ID:nL3N0YD26X In other Asia-related news, China has established a fund that is expected to raise about $16 billion for gold-backed investment as part of its "Silk Road" initiative to develop trade and transport infrastructure across Asia and beyond, official media reported. ID:nL3N0YG1RI Silver XAG= was down 0.7 percent at $16.99 an ounce, after falling 2.2 percent last week. Platinum XPT= dropped 0.1 percent to $1,143.88 an ounce and palladium XPD= fell 0.7 percent to $774.98 an ounce. (Additional reporting by A. Ananthalakshmi in Singapore and Veronica Brown in London; Editing by Mark Potter and William Hardy) ((clara.denina@thomsonreuters.com)(+44 207 542 9420)(Reuters Messaging: clara.denina.thomsonreuters.com@reuters.net)) Keywords: MARKETS PRECIOUS/ * Yellen signals Fed on track to hike US rates this year * Dollar at highest in a month after Yellen's comments * US, British markets shut on Monday (Updates prices) By Clara Denina LONDON, May 25 (Reuters) - Gold prices were marginally lower on Monday, as the dollar gained traction against major currency rivals, on signs the Federal Reserve is preparing to tighten monetary policy for the first time in six years in 2015. Fed Chair Janet Yellen indicated on Friday that the U.S. central bank was poised to raise rates this year, with the world's largest economy set to bounce back from an early-2015 slump. ID:nL1N0YD1IH Higher U.S. interest rates increases the opportunity cost of holding non-yielding bullion. Spot gold XAU= was down 0.1 percent at $1,205.06 an ounce by 1339 GMT, but held above a near-two-week low of $1,201.20 hit in the previous session. It posted its biggest weekly drop in a month last week, down 1.4 percent. Liquidity was thin with British and U.S. markets shut for holidays. "The Fed raising the rates is certainly not electrifying news for the precious metal, which is on track to extend its biggest weekly decline since April," AvaTrade chief market analyst Naeem Aslam said. "Yellen last week has confirmed that she is still confident that the rates will rise this year and (gold) traders are not fond of this news at all." The prospect of higher rates later in 2015 boosted the dollar to its highest in a month against a basket of major currencies on Monday. Stronger-than-expected underlying U.S. inflation and persisting Greek debt worries also supported the greenback. ID:nL1N0YD0N2 A stronger dollar makes gold more expensive for holders of other currencies, while diminishing the metal's appeal as an hedge against risk. In the physical markets, gold demand across Asia was soft as investors channel their money towards higher-yielding stock markets. GOL/AS Indian gold jewellery demand in the second half of the year could take a hit as the Hindu calendar shows the number of dates seen as being auspicious for weddings will drop 40 percent in the second half from a year earlier. ID:nL3N0YD26X In other Asia-related news, China has established a fund that is expected to raise about $16 billion for gold-backed investment as part of its "Silk Road" initiative to develop trade and transport infrastructure across Asia and beyond, official media reported. ID:nL3N0YG1RI Silver XAG= was down 0.3 percent at $17.07 an ounce, after falling 2.2 percent last week. Platinum XPT= dropped 0.1 percent to $1,143.99 an ounce and palladium XPD= rose 0.2 percent to $782.72 an ounce. (Additional reporting by A. Ananthalakshmi in Singapore and Veronica Brown in London; Editing by Alison Williams) ((clara.denina@thomsonreuters.com)(+44 207 542 9420)(Reuters Messaging: clara.denina.thomsonreuters.com@reuters.net)) Keywords: MARKETS PRECIOUS/

INDICATORS - Kazakhstan - May 25

May 25, 2015 - reuters.com

PRECIOUS-Gold dips on robust dollar, Yellen comments on rate hike

May 25, 2015 - reuters.com

* Yellen signals Fed on track to hike US rates this year * Dollar at highest in a month after Yellen's comments * US, UK markets shut on Monday (Updates throughout, changes dateline from SINGAPORE) By Clara Denina LONDON, May 25 (Reuters) - Gold edged lower on Monday as the dollar strengthened to a one-month high on signs the Federal Reserve is readying to raise interest rates for the first time in six years in 2015. In a speech to a business group on Friday, Fed Chair Janet Yellen indicated the U.S. central bank was poised to raise rates this year as the world's largest economy was set to bounce back from an early-year slump and headwinds at home and abroad waned. ID:nL1N0YD1IH Higher U.S. interest rates would increase the opportunity cost of holding non-yielding bullion. Spot gold XAU= was down 0.1 percent at $1,204.46 an ounce by 0847 GMT, just above a near-two-week low of $1,201.20 hit in the previous session. It posted its biggest weekly drop in a month last week, down 1.4 percent. Liquidity was likely to remain thin on Monday as British and U.S. markets are shut for holidays. "The Fed raising the rates is certainly not a electrifying news for the precious metal, which is on track to extend its biggest weekly decline since April," AvaTrade chief market analyst Naeem Aslam said. "Yellen last week has confirmed that she is still confident that the rates will rise this year and (gold) traders are not fond of this news at all." The prospect of higher rates later in 2015 boosted the dollar to its highest in a month against a basket of major currencies on Monday. Stronger-than-expected underlying U.S. inflation and persisting Greek debt worries also supported the greenback. ID:nL1N0YD0N2 A stronger dollar makes gold more expensive for holders of other currencies, while diminishing the metal's appeal as an hedge against risk. "The dollar is also regaining momentum, so we could see gold drop below $1,200 soon," a Singapore-based trader said. In the physical markets, gold demand across Asia was soft as investors channel their money towards higher-yielding stock markets. GOL/AS Indian gold jewellery demand in the second half of the year could take a hit as the Hindu calendar shows the number of dates seen as being auspicious for weddings will drop 40 percent in the second half from a year earlier. ID:nL3N0YD26X In other Asia-related news, China has established a fund that is expected to raise about $16 billion for gold-backed investment as part of its "Silk Road" initiative to develop trade and transport infrastructure across Asia and beyond, official media reported. ID:nL3N0YG1RI Silver XAG= was down 0.9 percent at $16.96 an ounce, after falling 2.2 percent last week. Platinum XPT= dropped 0.3 percent to $1,140.45 an ounce and palladium XPD= fell 0.6 percent to $776.45 an ounce. (Additional reporting by A. Ananthalakshmi in Singapore; Editing by Mark Potter) ((clara.denina@thomsonreuters.com)(+44 207 542 9420)(Reuters Messaging: clara.denina.thomsonreuters.com@reuters.net)) Keywords: MARKETS PRECIOUS/

China sets up gold fund as part of Silk Road initiative - media

May 25, 2015 - reuters.com

SHANGHAI, May 25 (Reuters) - China has established a fund that is expected to raise about $16 billion for gold-related investment as part of its "Silk Road" initiative to develop trade and transport infrastructure across Asia and beyond, official media reported. The fund, which will be run by a new company to be set up by gold producers and financial institutions, is expected to raise an estimated 100 billion yuan ($16.13 billion) in three phases, Shanghai Securities News reported at the weekend. Two leading gold producers, Shandong Gold Group, the parent of Shandong Gold Mining Co Ltd 600547.SS , and Shaanxi Gold Group will take stakes of 35 percent and 25 percent respectively, with the rest owned by financial institutions, the newspaper said. The fund's activities could take in the launch of gold-backed exchange-traded funds and buying stakes in listed gold companies and mining firms. President Xi Jinping said earlier this year he hoped annual trade with the countries involved in Beijing's plan to create a modern Silk Road would surpass $2.5 trillion in a decade. ID:nL3N0WV095 China is the world's biggest producer of gold and a top consumer of the precious metal. In 2014 it was the second-biggest consumer of gold jewellery, bars and coins and it took the first place from India in the first quarter of this year, according to the World Gold Council. ($1 = 6.1990 Chinese yuan) (Reporting by Ruby Lian in Shanghai and A. Ananthalakshmi in Singapore; Editing by Alan Raybould) ((ruby.lian@thomsonreuters.com; +86 21 6104 1797; Reuters Messaging: ruby.lian.thomsonreuters.com@reuters.net)) Keywords: CHINA GOLD/

BRIEF-Mungana Goldmines says co and Newcrest sign exploration agreement

May 25, 2015 - reuters.com

May 25 (Reuters) - Mungana Goldmines Ltd MUX.AX : * Mungana signs agreement with Newcrest MUX.AX * Agreement with leading gold producer to spend up to $20M on exploration over a period of up to 8 years * Says Newcrest will earn a 70% interest in an unincorporated joint venture with Mungana (30%) if it incurs $20 million * Agreement for Newcrest to explore for gold-copper at the chillagoe project in north Queensland * Newcrest can spend up to an additional $17M over a further 78 months to earn a 70% interest in the exploration area * Source text for Eikon ID:nASX6MgKSN * ((For more news, please click here MUX.AX )) ((Bengaluru Newsroom; +91 80 6749 1130))

MIDEAST STOCKS - Factors to watch - May 25

May 25, 2015 - reuters.com

DUBAI, May 25 (Reuters) - Here are some factors that may affect Middle East stock markets on Monday. Reuters has not verified the press reports and does not vouch for their accuracy. INTERNATIONAL/REGIONAL * GLOBAL MARKETS-Asian shares little changed, Fed views hurt some markets MKTS/GLOB * MIDEAST STOCKS-Gulf markets slip, tracking oil; Egypt extends gains ID:nL5N0YF0BJ * Oil prices edge up on firm Asian, U.S. demand O/R * Gold struggles near $1,200 on Yellen comments, robust dollar ID:nL3N0YG1GI * Iran set to overhaul fuel pricing and set a single rate -official ID:nL5N0YF0MJ * Iran says OPEC unlikely to change output ceiling - Mehr news agency ID:nL5N0YF045 * Libyan government warplanes attack oil tanker docked at Sirte ID:nL5N0YF0GA * Eastern Libyan state oil firm AGOCO pumps up to 290,000 bpd -spokesman ID:nL5N0YF0MF * Syria says Islamic State kills hundreds, including children, in Palmyra ID:nL5N0YF0DY * Iraq regains ground from Islamic State; mass deaths reported in Palmyra ID:nL5N0YF0HA * IAFC to raise $400 mln Islamic loan for aircraft financing - statement ID:nD5N0Y202W * Zain Jordan sees revenues rising 5 pct in 2015 as internet usage ID:nL5N0YF0KL * Funds feel heat of coal and tar divestment drive ID:nL5N0YB4YC EGYPT * Egypt's Qalaa says seeing strong foreign interest in asset sales ID:nL5N0YF074 * Egyptian pound steady at official auction, weaker on black market ID:nL5N0YF08G SAUDI ARABIA * Saudi king says heartbroken by mosque attack, promises punishment ID:nL5N0YF07C * Saudi's Emaar Economic City says expects tenant inflow to accelerate ID:nL5N0YF086 * Saudi forces and Yemen's Houthis trade heavy fire, border crossing hit ID:nL5N0YF098 UNITED ARAB EMIRATES * UAE banks discuss plan for centralised Islamic finance board ID:nL5N0YF053 * UAE April inflation slows to 4.2 pct y/y ID:nL5N0YF032 KUWAIT * Kuwait's Burgan Bank to consider expanding in UAE, Saudi, Egypt ID:nL5N0YF04Z OMAN * Oman's Bank Sohar launches $250 mln 3-yr debut loan - statement ID:nD5N0Y202V (Compiled by Dubai newsroom) ((dubai.newsroom@reuters.com)) Keywords: MIDEAST FACTORS/

India Morning Call-Global Markets

May 25, 2015 - reuters.com

EQUITIES NEW YORK - U.S. stocks ended weaker on Friday after Federal Reserve Chair Janet Yellen indicated that the central bank was poised to raise interest rates this year, in line with Wall Street's expectations. Lackadaisical trading volume during the session ended a week of slow activity that has left many investors unconvinced that recent record-high levels are likely to last. For a full report, click on .N - - - - LONDON - Britain's top share index rose on Friday and was set to end the week on a positive footing after telecoms company Vodafone VOD.L extended a recent rally driven by merger speculation. For a full report, click on .L - - - - TOKYO - Japan's Nikkei share average rose for a seventh day, hitting a fresh 15-year high on Monday morning, helped by ongoing optimism for higher shareholder returns and the recovering economy. The Nikkei 225 .N225 gained 0.7 percent to 20,409.05, the highest level since April 2000. For a full report, click on .T - - - - HONG KONG - Hang Seng Index .HSI is up 1.7 percent. For a full report, click on .HK - - - - FOREIGN EXCHANGE SYDNEY - The dollar hovered at a two-month high versus the yen and stood firm against other peers after surging on a higher-than-expected U.S. core consumer price index that supported the Federal Reserve's case for a rate hike later this year. The dollar traded near a two-month high of 121.70 yen JPY= after jumping from a low of 120.64 on Friday, helped by a rise in U.S. Treasury yields triggered by the CPI data. A rise above 122.04 would take the greenback to an eight-year high against the yen. For a full report, click on USD/ - - - - TREASURIES NEW YORK - U.S. Treasuries yields rose on Friday as a stronger-than-expected increase in core consumer prices in April revived expectations that inflation may approach the Federal Reserve's 2 percent target later this year. If the price upturn persists, it would allow the U.S. central bank to consider ending its near-zero interest rate policy this year sooner than previously thought, analysts said. For a full report, click on US/ - - - - COMMODITIES GOLD SINGAPORE - Gold was trading close to its lowest in over a week on Monday after Federal Reserve Chair Janet Yellen said the U.S. central bank was poised to hike interest rates this year and as the dollar strengthened to its highest in a month. Spot gold XAU= had slipped 0.2 percent to $1,203 an ounce by 0032 GMT, close to $1,201.20, the metal's lowest since May 13 reached in the previous session. For a full report, click on GOL/ - - - - BASE METALS SINGAPORE - Shanghai copper slipped to its lowest level in more than three weeks on Monday, tracking last week's losses in London after the Federal Reserve sent a strong signal it would raise interest rates this year, boosting the dollar. The most traded July copper contract on the Shanghai Futures Exchange SCFcv1 slipped 1 percent to 44,720 yuan ($7,212) a tonne. It found support at the 200-day moving average of 44,540 yuan but a break of that could spur further technical sales. For a full report, click on MET/L - - - - OIL SINGAPORE - Crude oil futures edged up on Monday, buoyed by healthy Asian appetite and demand from the U.S. driving season. Front-month Brent crude prices LCOc1 were up 6 cents at $65.43 per barrel at 0045 GMT. U.S. crude prices CLc1 were also up 6 cents at $59.78 a barrel. For a full report, click on O/R (Compiled by Rafael Nam) ((swati.bhat@thomsonreuters.com; twitter.com/swatibhat22; +91-22-61807353; Reuters Messaging: swati.bhat.thomsonreuters.com@reuters.net)) Keywords: MORNINGCALL INDIA/

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