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UPDATE 2-South Korea Sept data cements further rate cut view

October 01, 2014 - reuters.com

* Sept exports +6.8 pct y/y (Reuters poll: +8.2 pct) * Sept HSBC/Markit S.Korea mfg PMI at s/adj 48.8 vs 50.3 * Sept CPI +1.1 pct y/y (Reuters poll: +1.5 pct) (Updates throughout with markets, new comments) By Christine Kim and Choonsik Yoo SEOUL, Oct 1 (Reuters) - South Korean inflation hit a 7-month low last month and manufacturers reported a decline in export orders, data showed on Wednesday, reinforcing expectations that the Bank of Korea could ease monetary policy when it meets on Oct. 15. Annual inflation dipped to 1.1 percent in September from 1.4 percent in August, below the weakest forecast in a Reuters survey and the lowest since February. It stood far below the bottom of the central bank's 2.5 percent-3.5 percent target. Bond futures prices rose and the won dropped as the inflation data firmed up expectations of a BOK rate cut. Worries over weak domestic demand took the shine off September's relatively strong foreign trade data which showed signs of improvement in demand from China. "The low inflation data and dovish remarks from yesterday's monetary policy meeting minutes could all heighten expectations for another rate cut," said Park Chong-hoon, economist at Standard Chartered Bank Korea. The liquid December futures on three-year treasury bonds KTBc1 rose 0.17 points to 107.80 by 0245 GMT while the won KRW= fell 0.7 percent to 1,062.9 per dollar. The won was also hit by the dollar's global strength. DEFLATIONARY RISKS Exports grew 6.8 percent in September from a year earlier as shipments to China regained some strength to post annual growth for the first time in six months, trade ministry data showed, although analysts saw some distortions from holidays. Overseas sales also fell short of the median 8.2 percent gain seen in a Reuters survey, while an HSBC/Markit Economics survey of purchasing managers showed export orders shrank for a sixth consecutive month in September. The PMI on South Korea's manufacturing activity fell to a seasonally adjusted 48.8 in September from 50.3 in August while a sub-index on new export orders dipped to 48.8 from 49.4. South Korea's economy, the fourth-largest in Asia, was widely expected to recover this quarter after posting its weakest quarterly growth in nearly two years in the April-June period, but Wednesday's extremely low inflation reading underscored shaky domestic demand. "The export data failed to get attention from the markets today as the inflation data came as a surprise because the official views from the government and the central bank have been that inflation would gradually rise," said Kong Dong-rak, a fixed-income analyst at Hanwha Securities. Finance Minister Choi Kyung-hwan has repeatedly warned of mounting deflationary risks in the local economy and introduced a bold set of stimulus measures in July, while pressuring the central bank to join the government's growth promotion efforts. Many of the Bank of Korea's seven board members expressed their concern about the risks from inflation staying at an extremely low level for a long time, minutes from their Sept. 12 meeting released on Tuesday showed. The central bank expects the local economy to recover to growth of 3.8 percent this year and further to 4.0 percent next year, compared with actual 3.0 percent last year, but domestic demand is widely seen remaining weak. Minister Choi has pledged to keep fiscal policy in a pro-growth mode until tangible signs of a sustained economic recovery appear, and possibly through the rest of President Park Geun-hye's term in office ending in early 2018. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Trade/CPI/PMI ID:nS6N0NU02P ID:nS6N0NU02O ID:nS7N0MG05D S.Korea economy graphic http://link.reuters.com/mad96t S.Korea trade graphic http://link.reuters.com/xef92t Reuters POLL ID:nL3N0RR07Z ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Additional reporting by Joonhee Yu; Editing by Eric Meijer) ((christine.kim@thomsonreuters.com; 822 3704 5665; Reuters Messaging: christine.kim.thomsonreuters.com@reuters.net)) Keywords: SOUTHKOREA ECONOMY/TRADE

Australian dlr stung by soft retail data, weighs on NZ dlr

October 01, 2014 - reuters.com

* Aussie retail sales disappoint with slight 0.1 pct rise in Aug * AUD down 0.8 pct, very close to 2014 trough * Kiwi falls 0.6 pct, eyes dairy auction By Gyles Beckford and Cecile Lefort SYDNEY/WELLINGTON, Oct 1 (Reuters) - The Australian dollar was pulled closer to this year's trough on Wednesday following a surprisingly weak retail sales figure, dragging the New Zealand dollar lower in the process. The Aussie AUD=D4 dropped 0.8 percent on the day to $0.8670 after retail sales rose a meager 0.1 percent in August, missing forecasts of 0.4 percent. ID:nL3N0RW03Y "U.S dollar strength was the dominant theme and the weak retail sales data didn't help," said Su-Lin Ong, senior economist at RBC Capital Markets. It even fell against a wounded euro which had slipped overnight amid disappointing economic data in the euro zone. The common currency leapt nearly a full cent to A$1.4537 EURAUD=R , pulling closer to a three-month peak of A$1.4588 touched Tuesday. The Aussie was closing in on the 2014 low of $0.8660, a level of key support, and a breach would take it to its weakest in more than four years. "It may take a bit of work to break it, but it seems inevitable," Ong added, seeing the next major level at $0.8320. The Aussie has tumbled more than 6 percent in the past month amid a strengthening U.S. dollar and sliding commodity prices. Other data showed a marginal rise of 0.1 percent in Australian home prices in September following three months of strong gains. The slowdown should actually be welcomed by the Reserve Bank of Australia which recently has become concerned that a surge in borrowing to buy investment properties could lift prices to unsustainable levels. Renewed pressure on the Aussie weighed on its New Zealand neighbour, which dropped 0.6 percent on the day versus the greenback. It was last at $0.7766 NZD=D4 , not far from a 14-month low of $0.7708 touched Monday. The next major test will come from the fortnightly dairy auction later on Wednesday. Some hope global prices may be finding a bottom after their precipitous slide of around 45 percent since their peak in February. "A weak figure here could see the NZ dollar dip back to its $0.7700 support, while an increase in dairy prices could see the kiwi looking toward $0.80," said ASB economist Christina Leung in a note. The kiwi, which dropped 6.5 percent in September, finds strong support from a cluster of daily lows made in mid-2013 between $0.7670/80. New Zealand government bonds 0#NZTSY= were firmer, with yields off 1.5 to 2.5 basis points. Australian government bond futures also edged up, with the three-year bond contract YTTc1 gaining 3 ticks to 97.290. The 10-year contract YTCc1 added 2 ticks to 96.505. (Editing by Biju Dwarakanath) ((Cecile.Lefort@thomsonreuters.com)(+61 2 9373-1234)(Reuters Messaging: cecile.lefort.thomsonreuters@reuters.net)) Keywords: MARKETS AUSTRALIA/FOREX

MIDEAST STOCKS - Factors to watch - October 1

October 01, 2014 - reuters.com

DUBAI, Oct 1 (Reuters) - Here are some factors that may affect Middle East stock markets on Wednesday. Reuters has not verified the press reports and does not vouch of their accuracy. INTERNATIONAL/REGIONAL * GLOBAL MARKETS-Asian shares slip, dollar near highs; HK unrest eyed MKTS/GLOB * Brent edges above $95 on relief over China's PMI O/R * Gold struggles near 9-month low on stronger dollar GOL-RTRS * MIDEAST STOCKS-Most markets rise; Qatar slips ahead of index change MEAST-STX * MIDEAST DEBT-Gulf loan pricing bites bank margins; correction hoped for in 2015 MEAST-DBT * Middle East Crude-DME Oman slips back in discount MEAST-CRU * Luxembourg launches 200 mln euro debut sukuk at 2 bps under M/S - leads LU-SUK * Some win, some lose in Gulf's sukuk mutual fund market SUK-FUND * Kurds seize Iraq/Syria border post; Sunni tribe joins fight against Islamic State IQ-SECUR * Tunisia approves 27 candidates for presidential race TN-VOTE * EMEA syndicated loans reach $813 bln in first nine months-data EMRG-LOA * OPEC oil output hits highest since 2012 on Libya, Saudi-Reuters Survey OPEC-RTRS * Protesters in eastern Libya close second oilfield, seize company plane ENI.MI LY-OILG * Syria raids show Saudi, UAE ambition to extend regional authority SA-AE-DIP * Wheat warfare: Islamic State uses grain to tighten grip in Iraq IQ-SY-SECUR * Algeria awards four of 31 oil, gas fields in auction -officials DZ-OILG * Iran to give military grant to Lebanese army - official IR-LB-DEF TURKEY * Hesitant Turkey seeks mandate for military action against Islamic State TR-SECUR * RHI drops plan to buy Turkish raw materials plant RHIV.VI * Turkish treasury borrows 1.84 bln lira in sukuk issue TR-SUK * Turkey hikes energy prices, pushing 2014 inflation forecasts above 9 pct TR-INFL * Turkey's net external debt stock $237.8 bln at end-H1 TR-GVD EGYPT * Egypt's GASC seeks wheat for Nov. 1-10 shipment EG-WHT * Egypt's Sisi delivers economic reforms but hurdles remain EG-POL * Egypt aims to pay $2 bln to $3 bln of debt to oil firms by end of 2014 -minister BP.L EG-GVD * Orascom Telecom shares rise 4 percent after trading resumes OTMT.CA * Egyptian court jails 68 Muslim Brotherhood supporters EG-JUDIC * Egypt's M2 money supply up 17.14 pct on year in August -central bank EG-MONS SAUDI ARABIA * Saudi Electricity signs 2.56 bln riyals deals for Riyadh metro 5110.SE * Saudi focus on Asia may result in cheaper crude: Russell SA-CRU * Virgin Mobile launches services in Saudi Arabia 7010.SE 7020.SE 7030.SE * Funds to slow Saudi stock buying, bullish on UAE -survey SA-AE-STX UNITED ARAB EMIRATES * Germany examines Etihad, Air Berlin codeshare plans AB1.DE AE-AIRL * UAE firm signs deal to build Egypt's first coal-fired power plant AE-EG-PWR * Dana Gas signs deal to recover $280 mln owed by Egypt DANA.AD * Etihad Rail set to launch next phase of UAE railway network AE-TRAN * UAE's Amanat Holdings to launch $374 mln Dubai flotation in Oct IPO-ITCA.DU * TABLE-UAE Aug bank lending growth up at 7.2 pct y/y, M3 slows AE-ECI QATAR * TABLE-Qatar Aug credit growth rebounds to 9.0 pct y/y, M2 up QA-ECI * TABLE-Qatar C/A surplus narrows to $14.9 bln in Q2 QA-TRACC * Qatar's economic growth edges up to 5.7 y/y pct in Q2 QA-GDP * Qatar's Ahli Bank signs $200 mln debut syndicated loan -statement AABQ.QA KUWAIT * Kuwait investment firm Global says management withdraws resignations GIHB.BH * Kuwait starting to cut subsidies, IMF report says KW-SDS OMAN * Omani lender NBO prices cheap $500 mln bond on high investor demand NBO.OM * Oman crude OSP fall to $97.26/bbl for November OM-CRU (Compiled by Dubai newsroom) ((dubai.newsroom@reuters.com)) Keywords: MIDEAST FACTORS

Indian FX/debt factors to watch - Oct 1

October 01, 2014 - reuters.com

India Morning Call-Global Markets

October 01, 2014 - reuters.com

EQUITIES NEW YORK - U.S. stocks slipped on Tuesday, dragged down by energy and materials shares as economic data disappointed. Major indexes also posted losses for the month, but ended the quarter with gains. The S&P energy index .SPNY was down 1.2 percent on Tuesday following a more than 3 percent drop in U.S. oil prices. The S&P materials index .SPLRMA also fell 1.2 percent. Shares of Chevron CVX.N, down 1 percent at $119.32, were the biggest drag on the S&P 500. For a full report, click on .N - - - - LONDON - Britain's top share index dropped on Tuesday, with retailers falling after Next NXT.L said it would have to lower its full-year profit forecast if the unusually warm weather continued. The UK benchmark showed little reaction to data showing Britain's economy is bigger than previously estimated. For a full report, click on .L - - - - TOKYO - Japan's Nikkei share average was little changed in choppy trade on Wednesday, with a weak yen supporting sentiment despite mixed data from the Bank Of Japan's tankan survey. Business confidence among Japanese manufacturers improved for the first time in two quarters in the three months to September, a central bank survey showed, an encouraging sign that parts of the economy are stabilising. For a full report, click on .T - - - - HONG KONG - Financial markets in Hong Kong are closed on Wednesday, Oct. 1, for China's National Day holiday and on Thursday, Oct. 2, for the Chung Yeung Festival, and will resume trading on Friday. For a full report, click on .HK - - - - FOREIGN EXCHANGE Dollar rises above 110 yen for the first time since August 2008. For a full report, click on USD/ - - - - TREASURIES NEW YORK - U.S. Treasury prices fell on Tuesday, although month-end buying was seen as stemming weakness as the market stayed within its recent range before Friday's highly anticipated September jobs report. Treasuries have oscillated from weakness on Friday to gains on Monday amid concerns that asset manager Pimco may need to liquidate positions if investor redemptions increase after the departure of co-founder Bill Gross. For a full report, click on US/ - - - - COMMODITIES GOLD SINGAPORE - Gold extended losses on Wednesday to trade near a nine-month low and looked likely to break below the key $1,200-an-ounce level as the dollar gained in strength. The absence of top buyer China, which begins a week long holiday from Wednesday, is also likely to add pressure. Spot gold XAU= slipped 0.2 percent to $1,206.90 an ounce by 0038 GMT, its fourth straight session of losses. The metal had fallen to $1,204.40 in the previous session - its lowest since early January. For a full report, click on GOL/ - - - - BASE METALS SYDNEY - London copper slipped to its lowest in more than three months on Wednesday, pummelled by a stronger dollar and concerns swelling supply could overwhelm fragile demand growth in top consumer China. Three-month copper on the London Metal Exchange CMCU3 had slipped 0.3 percent to $6,648.50 a tonne by 0114 GMT, after earlier hitting its weakest since June 13 at $6,645.50 a tonne. It lost 1.1 percent in the previous session. For a full report, click on MET/L - - - - OIL NEW YORK - World oil prices tumbled to their lowest in more than two years on Tuesday, with U.S. crude posting its biggest daily decline since 2012, as a drop in gasoline prices and end-of-quarter selling capped three months of steep losses. Oil prices in the United States and Europe have plummeted since the end of June as output from the Middle East, Africa and the United States swamped the market and outweighed fears of supply disruptions from war-torn oil-producing regions. For a full report, click on O/R (Compiled by Abhishek Vishnoi) ((abhishek.vishnoi@thomsonreuters.com; +91 22 61807225; Reuters Messaging: abhishek.vishnoi.thomsonreuters.com@reuters.net)) Keywords: MORNINGCALL INDIA/

FOREX-Euro pressured as low inflation puts heat on ECB

October 01, 2014 - reuters.com

* Euro falls to fresh two-year low of $1.2571 * Euro zone inflation cools further in September * China PMI & Australian retail trade data next in focus By Ian Chua SYDNEY, Oct 1 (Reuters) - The euro languished near a fresh two-year trough early on Wednesday, having come under fire as a further slowdown in euro zone inflation intensified pressure for more stimulus from the European Central Bank. The common currency fell as far as $1.2571 EUR= before managing a bounce to $1.2629. That ended a dismal month in which it skidded 3.82 percent - its biggest decline in over two years. Data on Tuesday showed annual inflation cooled to 0.3 percent in September, from 0.4 percent, well below the ECB's target of just under 2 percent. Persistently weak price growth underscores the difficulty of hitting that target while the euro zone economy continues to stagnate. ID:nL6N0RV1TO "The EUR/USD gapped lower by a big figure, falling toward 1.2570, before finding support and partially rebounding to 1.2630 this morning," said David de Garis, senior economist at National Australia Bank. "Euro zone equities closed up 1.2 percent, presumably assisted by the prospect of continued stimulative policy from the ECB." The euro briefly dipped below 138.00 yen EURJPY=R for the first time in nearly three weeks, but managed to claw back to 138.45. Renewed heat on the common currency helped push the dollar index .DXY to a four-year high of 86.218. The index has since edged back down to 85.928. Against the yen, the greenback was at 109.64 JPY= , having scaled a six-year peak of 109.86. Dollar bulls all but shrugged off a decline in U.S. consumer confidence in September and a home price report that fell short of expectations. ID:nL2N0RV15Y Many still believe the U.S. economy is on a recovery path that will allow the Federal Reserve to hike interest rates well before the ECB and Bank of Japan. Indeed, the dollar index surged nearly 8 percent in the past three months, its best quarterly performance in six years. Trading in Asia is again going to be subdued with China closed for National Day and pro-democracy unrest in Hong Kong sapping confidence. ID:nL6N0RV5F9 Despite the holiday, China will release a survey on its vast manufacturing sector at 0100 GMT. Any disappointment will no doubt fan worries about slower Chinese economy. ID:nL3N0RR3GB On Tuesday, China cut mortgage rates and downpayment levels for some home buyers for the first time since the 2008 global financial crisis, stepping up efforts to boost a faltering economy. ID:nL3N0RV3IG Australia's retail sales due at 0130 GMT will also be closely watched by Aussie bears, who have so far failed to push the Australian dollar through its 2014 trough of $0.8660 AUD=D4 . ECONAU The Aussie was last at $0.8747, having dropped 6.3 percent in September. (Editing by Shri Navaratnam) ((ian.chua@thomsonreuters.com; +61 2 9373 1871; RM: ian.chua.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

COMMODITIES-Oil, metals, crops drag index to biggest quarterly loss in 3 yrs

September 30, 2014 - reuters.com

By Barani Krishnan NEW YORK, Sept 30 (Reuters) - Commodities posted their biggest quarterly drop in three years on Tuesday as plummeting oil prices and lower markets from gold to copper to soybeans brought the third straight monthly decline to a sector pressured by a surging U.S. dollar. Oil's benchmark Brent crude fell to its lowest in more than two years. U.S. crude slid nearly 4 percent, its biggest daily decline since 2012. Gold futures hit a 2014 low, the sharpest monthly slide since June 2013. Copper had its biggest monthly loss since March. Soybeans fell their most in a quarter since 2008. Traders said commodities fell under pressure from the U.S. dollar's rally to a four-year high, which gave the currency its biggest quarterly gain in six years. Other factors included pressure on oil from a slide in the expiring front-month contract in U.S. gasoline, concerns about China's growth and the record harvest in U.S. soybeans. "With end-of-quarter rebalancing, we've seen more selling triggered as investors change their allocations, and with the dollar's strength, commodities are getting sold across the board," said Amrita Sen at Energy Aspects in London. The 19-commodity Thomson Reuters/Core Commodity CRB Index .TRJCRBTR fell nearly 2 percent on the day, 5 percent on the month and 10 percent on the quarter. It was the CRB's biggest quarterly loss since September 2011. The index has fallen every month since the end of June. In energy markets, U.S. crude CLc1 closed down $3.41 at $91.16 barrel. New York gasoline for October RBc1 slid 4 percent, or almost 11 cents, to finish below $2.60 a gallon, giving back half its gains from a two-week rally. Brent crude LCOc1 lost more than $2.50 to trade under $95, after setting a two-year low at $94.24. O/R U.S. gold futures GCcv1 settled down 0.6 percent at $1,218.80 an ounce, after a 2014 low of $1,204.30. "The bottom line is that the dollar will continue to appreciate against the euro quite significantly in the next couple of months until the end of next year and this will see gold prices fall," Commerzbank analyst Daniel Briesemann said. GOL/ Three-month copper on the London Metal Exchange CMCU3 ended down 1.1 percent at $6,667 a tonne, down 4.5 percent in September, its biggest monthly slump since March. MET/L "There's not a whole lot of positive near-term indicators to get the copper market to rebound," Nomura metals and mining analyst Patrick Jones said. "We're getting to the point now where we have meaningful new supply starting to hit the market," he said, anticipating a "worrisome" property market in top metals consumer China. Soybean futures Sc1 settled at $9.13-1/4 a bushel, a quarterly decline of nearly 35 percent, the biggest since 2008, as traders bet that record U.S. harvest will replenish supplies depleted by huge exports to China. GRA/ (Reporting By Barani Krishnan; Editing by David Gregorio) ((barani.krishnan@thomsonreuters.com; +1 646 223 6192; Reuters Messaging: barani.krishnan.thomsonreuters.com@reuters.net)) Keywords: MARKETS COMMODITIES/

PRECIOUS-Gold posts first quarterly loss this year as dollar soars

September 30, 2014 - reuters.com

* Gold notches 6 pct drop in Sept, biggest in 15 months * Dollar hits 4-year high * Unrest in Hong Kong could hit physical demand from China (Adds comment, NEW YORK to dateline, second byline, updates market activities) By Frank Tang and Clara Denina NEW YORK/LONDON, Sept 30 (Reuters) - Gold fell to a nine-month low on Tuesday as the dollar surged and commodities led by crude oil tumbled on expectations of further gains in the U.S. currency. Spot gold prices touched their lowest since Jan. 1 at $1,204.40 an ounce. Though gold managed to recoup earlier losses, the metal is still down about 6 percent for the month with a quarterly drop of around 9 percent, marking the sharpest monthly loss since June 2013 and first quarterly loss this year. The dollar surged to a four-year high against a basket of currencies and a two-year high against the euro on Tuesday after euro zone inflation fell in September. FRX/ ID:nL6N0RV1PJ Earlier this month, the U.S. Federal Reserve indicated it could raise borrowing costs faster than expected when it starts moving. A strengthening U.S. economic outlook and the dollar surge also weighed heavily on bullion's investment appeal. "The dollar has been the overwhelming pressure on gold in the past month, which outweighs any safe-haven concerns in the Middle East and inflation fears," said Frances Hudson, investment director and global thematic strategist at Standard Life Investments, which manages $333.6 billion in client assets. Spot gold XAU= was down 0.5 percent at $1,209.30 an ounce by 2:41 p.m. EDT (1841 GMT). Bullion prices partially erased losses after disappointing U.S. consumer confidence and home prices data. ID:nL2N0RV15Y U.S. COMEX gold futures for December delivery GCZ4 settled down $7.20 at $1,211.60 an ounce in heavy trading. The U.S. currency has posted a record-breaking 11 weeks of successive gains, and is set for its biggest quarterly gain in six years, on expectations the Federal Reserve will raise interest rates well ahead of its counterparts in Japan and the euro zone. A stronger U.S. currency makes dollar-denominated precious metals more expensive for holders of other currencies. Investors tend to withdraw from non-interest-bearing assets to seek higher yields elsewhere when the dollar gains. Investors also monitor pro-democracy protests in Hong Kong, which could hit retail sales in the region, a hot spot for tourists from mainland China, especially during the one-week National Day holiday that begins on Wednesday. Lower gold prices dragged other precious metals down, with silver XAG= fell 2.8 percent to $16.98, having earlier hit $16.83, its lowest since March 2010. It also notched its biggest quarterly loss since mid-2013. Platinum XPT= was down 0.1 percent at $1,298.50 an ounce and set for a 12 percent quarterly drop. Palladium XPD= fell 2.3 percent to $768.10 an ounce, having touched a five-month low earlier and posted a 14 percent monthly loss, its biggest since September 2011. (Additional reporting by A. Ananthalakshmi in Singapore; Editing by Keiron Henderson, David Evans and Andrew Hay) ((Frank.Tang@thomsonreuters.com; +1 646 223 6126; Reuters Messaging: frank.tang.thomsonreuters@reuters.net)) Keywords: MARKETS PRECIOUS/

FOREX-Dollar hits 4-year high, poised for best quarter in 6 years

September 30, 2014 - reuters.com

* Euro slips below $1.26 for 1st time in 2 years * Euro on track for biggest quarterly loss vs dollar since 2010 * Norwegian crown biggest mover, gains nearly 1 pct * Kiwi stabilizes after hitting near 14-month low (Updates market action, adds quote) By Richard Leong NEW YORK, Sept 30 (Reuters) - The dollar climbed to a four-year high against a basket of currencies and hit a two-year high against the euro on Tuesday after euro zone inflation fell in September, putting the greenback on track for its biggest quarterly gain in six years. The Norwegian crown EURNOK= was another big mover, up 0.9 percent to a three-week high of 8.114 crowns per euro after its central bank unveiled plans to buy 250 million crowns per day in October. ID:nL6N0RV1MT "U.S. data have been very supportive of the dollar against other major currencies," said Sireen Harajli, currency strategist at Mizuho Corporate Bank in New York. The dollar index .DXY , which measures it against a basket of six major currencies, has gained 7.7 percent over the last three months, the biggest quarterly gain since 2008 and a record-setting 11 straight weeks of gains. It was last up 0.4 percent at 85.91. The United States will likely expand faster than Japan and the euro zone in the foreseeable future, which will cause the Federal Reserve to raise interest rates ahead of its Japanese and European counterparts, analysts said. Data showed euro zone inflation slowed to 0.3 percent year-over-year rise in September from 0.4 percent the previous month, pushing the 18-nation block closer to deflation which the European Central Bank seeks to avert. ID:nL6N0RV1PJ The anticipated policy divergence between the ECB and the Fed has helped grow the spread between the two-year U.S. Treasury yield US2YT=RR and its German counterpart DE2YT=RR to 65 basis points, close to the widest in seven years and bolstering the appeal of the dollar. Earlier, the euro sank below $1.26 EUR= for the first time since September 2012, hitting a low of $1.25710 on the EBS trading platform. It was last down 0.4 percent at $1.2629. The euro was on track to fall 7.8 percent against the dollar in the third quarter, its biggest quarterly loss since the second quarter of 2010. The dollar inched up to another six-year high against the yen of 109.86 yen JPY=EBS , and was last trading up 0.17 percent on the day at 109.695 yen. Some analysts had cautioned that the dollar's three-month-long rally was at risk of running out of steam, particularly against the yen. "It seemed overstretched at the moment," Harajli said. The greenback was on pace to rise 8.3 percent versus the yen in the quarter, the biggest quarterly gain in six quarters. Tuesday's mildly disappointing U.S. data on housing, consumer confidence and Midwest business activity pushed the dollar off its earlier highs. ID:nN9N0PZ019 ID:nN9N0Q300D ID:nZON05A100 "We do think the trend is still favorable for the greenback. The United States still looks better than most of the world," said Gary Thayer, chief macro strategist at Wells Fargo Advisors in St. Louis, Missouri. Among other currencies, the New Zealand dollar NZD=D4 edged up 0.4 percent at $0.7797 after hitting its lowest in nearly 14 months following data that showed that country's central bank weakened the kiwi in August. For the quarter, it has fallen 11 percent, one of the weakest developed currencies in the third quarter. ID:nL3N0RU1HG The Hong Kong dollar HKD= steadied after falling on Monday against the dollar on worries about how aggressively Beijing might deal with pro-democracy protesters there. ID:nL3N0RV2UQ (Additional reporting by Jemima Kelly and Patrick Graham in London, Lisa Twaronite in Tokyo and Ian Chua in Sydney; Editing by Mark Trevelyan, David Gregorio and Tom Brown) ((richard.leong@thomsonreuters.com; +1 646 303 6313; Reuters Messaging: richard.leong.thomsonreuters.com@thomsonreuters.net; Twitter @RichardLeong2)) Keywords: MARKETS FOREX/

REFILE-Strong dollar, rising volatility mark Q3 markets. Same again in Q4?

September 30, 2014 - reuters.com

(Corrects spelling of name in 12th paragraph) * http://bit.ly/1taJzMF By Jamie McGeever LONDON, Sept 30 (Reuters) - The biggest scramble for dollars and sharpest rise in currency volatility for years were the hallmarks of financial markets in the third quarter, developments which have intensified worries that the final three months of the year might be equally bumpy. The dollar's 7-percent surge was its biggest quarterly rise since the same period in 2008, when the collapse of Lehman Brothers triggered the global financial crisis and a worldwide rush into the U.S. currency. The swing of such a magnitude in the world's reserve currency, which is used to price almost everything in global commerce from Apple shares to zinc, permeated all financial markets. It lifted volatility, and crushed the value of commodities and emerging market currencies in the process. The biggest gainer from 22 assets and market instruments tracked by Reuters was China-listed A-shares, which rose 16.1 percent, and the biggest loser was Brent crude oil futures, which fell almost 14 percent. More than half of the 22 fell. Much of what the fourth quarter holds will hinge on how much faith investors retain in their collective belief that the U.S. economy will outperform its peers, the Federal Reserve will soon raise interest rates, and the dollar will strengthen further. Contrast that to the euro zone, where deflation fears grew in the third quarter, the European Central Bank eased historically loose policy even further and, remarkably, 10-year German government bond yields fell below 1 percent. "The dollar move is not going to hurt the U.S. economy in any appreciable way, certainly not at this point," Deutsche Bank chief U.S. economist, Joe LaVorgna, said, noting that the United States is producing much more of its own energy and so slashing its import bill and trade deficit. "This is all good. The Fed has been perpetually disappointed by the evolution of the economy, but monetary policy has to be forward-looking," he said. Investors buying the dollar against a basket of six major currencies on July 1 would be 7.4 percent better off today .DXY and almost 8 percent in the black if they had bought the dollar against the Japanese yen JPY= . The dollar also rose against the euro EUR= , which buckled under the weight of grim views on euro zone growth and inflation. Throw in the a late flurry of jitters around the Scottish independence referendum this month, and implied volatility in major exchange rates hit their highest levels this year. In the case of short-dated pricing, especially in sterling, it was the most volatile period in years. Morgan Stanley global head of currency strategy, Hans Redeker, expects this to remain a feature of the coming months as the dollar rises further and exchange rates provide the shock absorber to shifting global economic plates. "Economic decoupling never takes place, so in an environment of non-synchronised global growth the exchange rate always comes back under the spotlight," he said. "Two thirds of global funding costs is determined by U.S. dollar funding rates. Volatility is going to stay with us and is going to normalise," he said. European assets suffered across the board. The euro fell to a two-year low against the dollar, euro zone stocks lost almost 10 percent and peripheral sovereign bonds slipped. The exception, of course, were German bonds. The surge in demand for the safest of all euro zone bonds pushed the 10-year yield below 1 percent, and 2-year yields turned negative. A stronger dollar and rising volatility bodes ill for emerging markets, as investors become less inclined to take risks and more inclined to put their cash in relatively safe and attractive developed markets, notably the United States. Emerging market local currency bonds fell about 5 percent in the third quarter and most emerging currencies suffered. Brazil's real fell to a 6-year low on Monday, posting a fall of about 10 percent on the month BRL= . Similarly, high-yield bonds, which had seen unparalleled inflows in the first half of the year, also started to feel the pinch. They fell more than 3 percent in the third quarter. But some analysts point out that the spike in volatility and the dollar later in the quarter followed the slump in volatility across many equity, bond and currency markets earlier in the period to lows not seen for years, if ever. "Seen through the lens of history and economics, the recent dollar move is small," according to Goldman Sachs. (Editing by Louise Ireland) ((jamie.mcgeever@thomsonreuters.com)(+44 207 542 8510)) Keywords: MARKETS QUARTERLY/WRAP

Bond investors cool to Europe's stragglers as political clouds gather

September 30, 2014 - reuters.com

* Market fears Greece may exit bailout prematurely * Greek yields hit highest since May * Spain, Italy gains ease as quarter ends * Spain court ruling, Italian reforms provide relief * Weak euro zone inflation keeps spotlight on ECB (Updates prices into close) By John Geddie LONDON, Sept 30 (Reuters) - Investors' love affair with low-rated but high-yielding euro zone bonds is starting to wane, as political risks dent faith that the European Central Bank alone will be able to ensure the bloc's recovery. Greek bond prices fell to their lowest since May on Tuesday, on track to record their first quarter of losses since early last year, while momentous gains in Spanish and Italian debt seen over the last year are also dwindling. The prospect of Greece escaping the strict conditions of its bailout programme, a bid for independence by one of Spain's richest regions and rumours of moves to topple the Italian prime minister are all troubling investors. Nerves have not been soothed by management changes last week at the world's biggest bond fund, PIMCO, which created uncertainty about what it may do with its holdings of so-called peripheral euro zone debt. "There is this weird feeling that everybody is spooked... everybody is really worried about the flows," said Hans Humes, chief investment officer at Greylock Capital in New York. Ten-year Greek bond yields, which rise as prices fall, climbed 13 bps on Tuesday to hit 6.65 percent, having hit four-month highs of 6.81 percent earlier. GR10YT=TWEB The gap between yields on Greek bonds -- the lowest-rated sovereign debt in the single currency bloc -- and on benchmark German Bunds stood at some 571 basis points, its widest since March. The rise in yields comes as investors worry that the Greek government could torpedo its chances of further debt relief as it tries to appease an electorate by curtailing a deeply unpopular bailout programme. ID:nL6N0RO4HI Across the Adriatic, another government crisis is stirring. Italian Prime Minister Matteo Renzi overcame fierce opposition to win backing in his party for labour reforms on Monday, but rumours of a leadership challenge persist. ID:nL6N0RU41P Renzi, 39, who came to power in February, has struggled to live up to promises to get the euro zone's third largest economy back on track, with the government revising upwards debt and deficit forecasts this week. In Spain, a burgeoning separatist movement in well-off Catalonia shows many of the hallmarks of the Scottish referendum that rattled British markets earlier this month. Spain's constitutional court on Monday suspended a vote scheduled for Nov. 9, but with a large majority of Catalans set on holding a referendum, investors are worried that a region accounting for a fifth of the country's output could secede. The court's move to bloc the referendum came as a relief to markets on Tuesday, with yields in both Spain and Italy edging down around 6-7 bps. ES10YT=TWEB IT10YT=TWEB SHALLOWER GAINS But strategists point out that recent gains have been more restrained. Fervent investor demand for the relatively high return on offer in Europe's periphery has sent government borrowing costs to record lows. Now, strategists say, investors have become more cautious, trading more regularly on negative headlines rather than just holding the bonds in the belief that ultra-easy monetary policy will continue to ensure their performance. "We are in a period of quite high volatility in peripheral countries," said Alessandro Giansanti, senior strategist at ING. "Every time we see some weakness in equity markets due to some geopolitical event or other, it is a warning signal for widening in peripheral spreads." Italian 10-year yields have fallen some 35 bps this quarter, around half the decline seen in the last two quarters. Spanish equivalents - having suffered their worst week since June 2013 earlier this month - have fallen some 50 bps this quarter, which compares with 56 bps in the second quarter and 92 bps in the first three months of the year. "You don't need to be a genius to see that clearly you've travelled a lot of the way that you are going to travel," said Mark Dowding, co-head of investment grade at Bluebay. The consensus among strategists is that this slight pull back from the periphery should be just a blip as long as investors believe the ECB will eventually embark on a full-scale sovereign bond-buying scheme, known as quantitative easing. Data on Tuesday showed euro zone inflation rooted at 0.3 percent in September, well below target and supporting the argument that the ECB's policy efforts are falling short. ID:nL6N0RV1TO Banks including RBS are calling for QE as early as November, while others see it as unlikely before March. But some ECB policymakers have been eager to play down the prospect of QE, which they say may not work as effectively in the euro zone as it did in the United States and Britain and could violate a ban on the ECB funding governments. A Reuters poll published last week showed economists still see only a 40 percent probability of the ECB purchasing sovereign bonds. ID:nL3N0RP2YY "Were (central bank chief Mario) Draghi to come out and categorically rule out forever QE as a possibility, (peripheral) spreads would go higher," said Bluebay's Dowding, adding that, conversely, QE would narrow the gap between Spanish and German 10-year bonds by around 50 bps. (Editing by Nigel Stephenson, Peter Graff, Crispian Balmer) ((John.Geddie@thomsonreuters.com)(+44 20 7542 3486)(Reuters Messaging: john.geddie.thomsonreuters.com@reuters.net))

Keywords: MARKETS BONDS/EURO

UPDATE 1-U.S. dlr share of central bank FX reserves steady in Q2 -IMF

September 30, 2014 - reuters.com

(Rewrites throughout to add IMF release of currency holdings by central banks worldwide) NEW YORK, Sept 30 (Reuters) - The U.S. dollar share of global central banks' currency reserves was a little more than 60 percent in the second quarter of 2014, according International Monetary Fund data released on Tuesday. The greenback's share of FX reserves was $3.830 trillion, or about 60.6 percent of total allocated reserves, roughly the same as the first quarter. At the beginning of the financial crisis in 2008, the dollar's share of global currency reserves was about 63 percent. Currency holdings of global central banks rose to a record $12 trillion in the second quarter from $11.859 trillion in the first three months of the year. Global reserves are assets of central banks held in different currencies primarily used to back their liabilities. Central banks have sometimes bought and sold official international reserves to influence exchange rates. The euro's share of reserves edged lower to 24.2 percent, totaling $1.527 trillion in the second quarter. In the first quarter, the euro's share was at 24.4 percent, while at its peak in 2009, its share of allocated reserves was 28 percent. The yen's share edged higher to 4.0 percent in the second quarter from 3.9 percent in the first. The IMF also broke out central bank holdings in the Australian and Canadian dollars, which were previously classified under "Other Currencies." Central banks held US$120.1 billion in the Australian currency globally as of the second quarter, up from US$117.4 billion in the previous quarter. Australian dollar reserves have risen 17 percent over the last 12 months. Central banks held US$127.3 billion in Canadian dollars, up from US$$119.4 billion previously. Over the last year, Canadian dollar holdings have risen 17 percent as well. The Australian and Canadian dollars have been in demand since the global financial crisis as relative safe havens. The Aussie in particular was highly desired given its high yield relative to other currencies in the developed world. The move by the IMF earlier this year to disclose holdings in the Australian and Canadian dollars is part of a wider review to provide more transparency in global financial data. It is also a reflection of a growing trend by central banks around the world to diversify their holdings beyond the U.S. dollar, the euro, and yen. Meanwhile, unallocated reserves, or those reserves not known and believed to be mostly held by China, rose to $5.687 trillion in the second quarter from $5.532 trillion previously. That represented 47.4 percent of total foreign exchange holdings. China reportedly holds between 65 percent to 75 percent of its reserves in U.S. dollars, analysts said. At the end of the second quarter, China's FX reserves rose to nearly $4 trillion, according to data from China's central bank. The IMF data provides only limited insight into shifts in the composition of central bank holdings because it does not show one-third of the world's reserves. (Reporting by Gertrude Chavez-Dreyfuss; Editing by Grant McCool) ((gertrude.chavez@thomsonreuters.com; 646-223-6322; Reuters Messaging: rm://gertrude.chavez.reuters.com@reuters.net)) Keywords: CURRENCY RESERVES/IMF

S.Africa's rand falls to fresh 8-month low after poor trade data

September 30, 2014 - reuters.com

JOHANNESBURG, Sept 30 (Reuters) - South Africa's rand continued a downward spiral against the dollar on Tuesday, tumbling to fresh eight-month lows after the revenue service reported a sharp widening of the trade deficit. The trade account recorded a 16.3 billion rand ($1.44 billion) shortfall ZATBL=ECI in August, its biggest gap in seven months. The poor trade data compounds South Africa's economic problems brought about by expected policy normalisation in the United States. South Africa's wide current account deficit, fed by a gaping trade deficit, puts the rand at the forefront of the emerging market sell-off. "Alongside still-weak growth data and an exposed rand, this will serve as a reminder of the ongoing vulnerability of South Africa to changes in external financing conditions, because of the size of its current account deficit," said Razia Khan, head of Africa research at Standard Chartered Bank. The rand ZAR=D3 fell to 11.3490 after the trade data, its weakest since Jan. 30. It was extending losses that have seen it test weaker levels every day for the past four sessions. At 1529 GMT, it had come back slightly to 11.3070/dollar. In a hawkish statement on Tuesday, South African Reserve Bank Deputy Governor Lesetja Kganyago said the central bank had little room to boost demand in the economy and should focus on inflation. ID:nL6N0RV2SB Yields on government bonds climbed 4 basis points to 8.365 percent on the benchmark 2026 issue ZAR186= . (1 US dollar = 11.2960 South African rand) (Reporting by Xola Potelwa) ((xola.potelwa@thomsonreuters.com; +27 11 775 3098; Reuters Messaging: xola.potelwa.thomsonreuters.com@reuters.net)) Keywords: MARKETS SAFRICA/CURRENCY

S.Africa stocks end down but charts point to possible rebound

September 30, 2014 - reuters.com

* Top-40 slips 0.11 percent * All-share down 0.07 percent JOHANNESBURG, Sept 30 (Reuters) - South African bullion producers such as Harmony Gold HARJ.J remained under pressure on Tuesday, weighing on the wider market which ended in the red, after the precious metal fell to a nine-month low in the face of relentless dollar gains. The benchmark Top-40 index .JTOPI slipped 0.11 percent on the day and has lost almost 4 percent this quarter, the biggest fall since the same period in 2011 when it fell more than 7 percent, pushing it further back from record peaks hit in July. But the market could be in for a technical bounce as the Top-40's 14-day RSI - a momentum indicator tracked by chartists - has strayed into oversold territory. This helped the index pull back from deeper losses earlier in the session. Africa's top gold producer AngloGold Ashanti ANGJ.J lost 0.37 percent but came off troughs reached earlier in the day. Rival Harmony Gold HARJ.J shed 2.33 percent to 24.70 rand while Gold Fields GFIJ.J ended 2.35 percent lower. Sibanye Gold SGLJ.J bucked the trend, adding 4.75 percent, after it said Van Eck Associates Corporation, an asset manager, had raised its stake in the company to over 5 percent. This is a sign of confidence in a gold producer which has positioned itself as a dividend play because it is mining mature assets that generate cash. But the overall picture for bullion is gloomy. Spot gold XAU= touched its lowest since Jan. 1 at $1,204.40 an ounce and is on track for a quarterly loss of 9 percent, hit by expectations that the dollar will rise in tandem with U.S. interest rates. "Gold bulls' worst nightmares involve a rampant dollar and surging real interest rates," Macquarie analyst Matthew Turner said. The benchmark Top-40 index .JTOPI lost 0.11 percent to 44,160 while the wider All-share index .JALSH shed 0.07 percent to 49,336. (Reporting by Ed Stoddard; Editing by Crispian Balmer) ((Edward.Stoddard@thomsonreuters.com; +27 11 775 3160; Reuters Messaging: edward.stoddard.thomsonreuters.com@reuters.net)) Keywords: MARKETS SAFRICA/STOCKS

Sterling ends mixed after dollar surge

September 30, 2014 - reuters.com

* Two-week low against dollar, firmer against euro (Adds more quotes, updates prices) By Patrick Graham LONDON, Sept 30 (Reuters) - Sterling hit a two-week low against the dollar on Tuesday but firmed to a more than two-year high against the euro, reflecting the latest leg of a broad-based rally for the U.S. currency that dates back almost three months. Dealers said Middle Eastern investors had been seen buying and then selling the pound after a mixed bag of data confirmed the British economy expanded strongly in the second quarter but also showed the UK current account deficit widened further. The outlook for the pound has darkened this month, this year's strong tone undermined first by Scotland's referendum on independence and then by the political fallout of a very close vote and doubts over the economy. A conference this week of Prime Minister David Cameron's Conservative Party has so far served only to highlight political risks to sterling ahead of next May's parliamentary elections. Cameron followed a handful of defections to the anti-EU UK Independence Party (UKIP) by saying on Tuesday that it "wouldn't break my heart" if Britain left the European Union in a referendum after the 2015 election. "I'm really pretty bearish on sterling now," said Graham Davidson, a spot currency dealer with National Australia Bank in London. "The housing market is slowing, the current account is getting worse and worse, and we are running the sort of budget deficit for which euro zone economies are getting slated. Plus the political scene is looking quite worrying." He said the pound could head towards $1.50-1.53 in the medium term but that "might happen quicker than people expect". Sterling fell as low as $1.6194, its weakest against the dollar since Sept. 16 and more than 6 percent off its mid-July six-year peak close to $1.72. By late afternoon in London it was trading at $1.6228, down 0.1 percent on the day. The Bank of England's sterling index was set at 85.3 against a basket of currencies, flat on the day. There remain substantial sources of support for the pound. Despite some rockier signals, most banks' core scenario is that the Bank of England will raise interest rates before the U.S. Federal Reserve next year. The contrast with a euro zone that is struggling to generate any economic growth at all is more stark. As the euro sank to its lowest in just over than two years against the dollar, the pound gained to 77.66 pence per euro, the strongest rates for sterling since July of 2012. By 1518 GMT it stood up 0.4 percent on the day at 77.82 pence. "Against the euro I would still be buying pounds," said a senior spot currency trader with one international bank in London. "Against the dollar I would probably be modestly selling. I believe, like most people it seems, that the dollar is on a bull run until the end of this year but on the euro we could easily see 75 pence soon." (Reporting by Patrick Graham; Editing by Tom Heneghan) ((patrick.graham@thomsonreuters.com; +44 207 542 9429; Reuters Messaging: patrick.graham.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/STERLING

UPDATE 2-Romania cuts interest rates to record low 3 pct to try and pull out of recession

September 30, 2014 - reuters.com

(Adds governor, analyst quote) By Luiza Ilie BUCHAREST, Sept 30 (Reuters) - Romania's central bank cut its benchmark interest rate to a new record low of 3 percent on Tuesday, as benign inflation gave it room to help an economy that has dipped into recession. Analysts had expected the quarter-point cut, the second in as many months, and see the bank slashing another quarter point off borrowing costs by the end of the first quarter of 2015. However, Governor Mugur Isarescu said any future rate moves would have to be carefully weighed, appearing to suggest the bank could keep rates on hold at its next meeting on Nov. 4. Further policy easing would be by cutting minimum reserve requirements again on commercial banks' liabilities, he said. "Because we're not certain inflation will continue to stay on a significantly lower path than expected in the long term, I think ... the next central bank board will make decisions about the interest rate, if it makes them, with great care," Isarescu told a press conference. "On the other hand, on the side of minimum reserve requirements, the steps are much more clearly defined." A new central bank board will be in place at the Nov. 4 policy meeting as the current board's term expires next month, although most of its members have been reappointed. On Tuesday, the bank cut minimum reserve requirements for commercial banks' leu-denominated liabilities to 10 percent from 12 percent starting on Oct. 24. Requirements for foreign currency liabilities were unchanged at 16 percent. Domestic money market rates have been volatile in recent weeks as banks struggled with a liquidity shortage, and the Finance Ministry has sold less debt than planned. "The cut in minimum reserves will free up funds, and some of it could end up on the treasuries market, particularly in short-term paper of one to three years," said Vlad Muscalu, chief economist at ING Bank Romania. Muscalu estimated the minimum reserve requirement cut could release around 3 billion lei ($857.9 million) into the market. Yields for one-year and three-year paper both fell 5 basis points after the decision. The leu currency EURRON= was virtually unchanged, trading at 4.406 per euro. The rate cut followed a surprise quarter-point reduction in August. The bank has resumed its easing cycle, after halting it in March, to shore up the Romanian economy, which tipped into recession - defined as two consecutive declines in gross domestic product quarter-on-quarter - in the second quarter. Isarescu also said he saw no risk of a rate hike over the next 12 months. He said the bank was much more influenced by developments in Europe than in the past, adding that keeping a disproportionate gap between Romanian rates and those of European states, including its neighbours, carried risks. At 3 percent, Romanian rates are at a record low but still the highest among emerging EU states. The bank's Nov. 4 meeting will be held two days after the first round of a presidential election. "The bank is likely to take stock of the impact of previous rate cuts, while watching carefully the political risks associated with presidential elections," BCR said in a note. "All in all, a busy local political calendar along with the unsettled situation in Ukraine are important elements that speak in favor of a stable key rate over the next months." Romania began cutting rates last year, later than its emerging European peers as inflation was stubbornly high. But inflation has since eased sharply and was at a lower-than-expected 0.8 percent in August, below the bank's 1.5-3.5 percent target band. In a bid to curb volatility of money market interest rates, the bank also on Tuesday narrowed the corridor of its standing facilities. As a result, its deposit rate will remain at 0.25 percent from Oct. 1, but its lending rate will fall to 5.75 percent, from the current 6.25 percent. ($1 = 3.4968 Romanian lei) (Reporting by Luiza Ilie; Editing by Matthias Williams/Alison Williams/Susan Fenton) ((luiza.ilie@thomsonreuters.com; +4021 305 5262; Reuters Messaging: luiza.ilie.thomsonreuters.com@reuters.net)) Keywords: ROMANIA CENBANK/RATES

FOREX -Dollar hits 4-year high, heads for best quarter in 6 years

September 30, 2014 - reuters.com

* Euro slips below $1.26 for 1st time in 2 years * Euro on track for biggest quarterly loss vs dollar since 2010 * Norwegian crown biggest mover, gains nearly 1 pct * Kiwi stabilizes after recent steep sell-off (Updates market action, changes dateline, previous LONDON) By Richard Leong NEW YORK, Sept 30 (Reuters) - The dollar surged to a four-year high against a basket of currencies and a two-year high against the euro on Tuesday after euro zone inflation fell in September, putting the greenback on track for its biggest quarterly gain in six years. The Norwegian crown EURNOK= was another big mover, up 0.9 percent to a three-week high of 8.1084 crowns per euro after its central bank unveiled plans to buy 250 million crowns per day in October. ID:nL6N0RV1MT "U.S. data have been very supportive of the dollar against other major currencies," said Sireen Harajli, currency strategist at Mizuho Corporate Bank in New York. The dollar index .DXY , which measures it against a basket of six major currencies, has gained almost 8 percent over the last three months, the biggest quarterly gain since 2008 and a record-breaking 11 successive weeks of gains. It was last up 0.4 percent at 85.93. The U.S. economy will outgrow its counterparts in Japan and the euro zone for years as the Federal Reserve will likely raise interest rates by the second half of 2015 as its Japanese and European counterparts will likely embark on more stimulus, analysts said. Data showed euro zone inflation slowed to 0.3 percent year-over-year increase in September from 0.4 percent the previous month, pushing the 18-nation block closer to deflation which the European Central Bank seeks to avert. ID:nL6N0RV1PJ The divergence of monetary policy between the euro zone and the United States has helped increase the spread between the two-year U.S. Treasury yield US2YT=RR and its German Counterpart DE2YT=RR to 65 basis points, close to the widest in seven years and bolstering the appeal of the dollar. Earlier, the euro sank below $1.26 EUR= for the first time since September 2012, hitting a low of $1.25710 on the EBS trading platform. It was last down 0.5 percent at $1.2618. The euro was on track to fall 9.4 percent against the dollar in the third quarter, its biggest quarterly loss since the second quarter of 2010. The dollar inched up to another six-year high against the yen of 109.86 yen JPY=EBS , and was last trading up 0.16 percent on the day at 109.67 yen. Some analysts had cautioned that the dollar's three-month-long rally was at risk of running out of steam, particularly against the yen. "It seemed overstretched at the moment," Harajli said. The greenback was on pace to rise 8.3 percent versus the yen in the quarter, the biggest quarterly gain six quarters. Tuesday's mildly disappointing U.S. data on housing, consumer confidence and Midwest business activity pushed the dollar off its earlier highs. ID:nN9N0PZ019 ID:nN9N0Q300D ID:nZON05A100 OTHER CURRENCIES The rise in the Norwegian crown due to Norges Bank's sale of its foreign exchange reserves next month might not last in the long term, analysts said. "In particular, the crown purchases could suggest that the Norwegian government is starting to run out of oil revenues to fund its expenditure," Valentin Marinov, head of European currency strategy at Citi in London. Among other currencies, the New Zealand dollar NZD=D4 edged up 0.1 percent at $0.7774 after losing 3.9 percent over the previous three sessions following data that showed that country's central bank weakened the kiwi in August. For the quarter, it has fallen over 11 percent, one of the weakest developed currencies in the third quarter. ID:nL3N0RU1HG The Hong Kong dollar HKD= stabilized after falling on Monday against the dollar on worries about how aggressively Beijing might deal with the pro-democracy protesters. ID:nL3N0RV2UQ (Additional reporting by Jemima Kelly and Patrick Graham in London, Lisa Twaronite in Tokyo and Ian Chua in Sydney; Editing by Mark Trevelyan and David Gregorio) ((richard.leong@thomsonreuters.com; +1 646 303 6313; Reuters Messaging: richard.leong.thomsonreuters.com@thomsonreuters.net; Twitter @RichardLeong2)) Keywords: MARKETS FOREX/

POLONIA Rate rises 0.04 pp.

September 30, 2014 - reuters.com

WARSAW, Sep 30 (Reuters) - POLONIA the reference rate for Overnight deposits amounted to 2.51 percent. The volume of transactions concluded till 16:30 by banks participating in POLONIA fixing amounted to 2,110 mln PLN. Note: Description of reference rate at: http://www.acipolska.pl/ ((warsaw.newsroom@reuters.com))

UPDATE 2-Russia's rouble sinks after media report says c.bank mulls capital controls

September 30, 2014 - reuters.com

(Writes through to form market report) MOSCOW, Sept 30 (Reuters) - Russia's rouble hit an all-time low against a dollar-euro basket RUS=MCX on Tuesday, falling below the level at which the central bank intervenes to defend the currency, after a news report said the bank was considering imposing capital controls. The central bank, which last intervened to defend the rouble in May, said it was unable to provide immediate comment on the news report. Bank officials have repeatedly said they oppose the imposition of capital controls. The Finance Ministry also said it was unable to comment. The rouble briefly plunged to 44.47, below the level of 44.40 where the central bank starts unlimited interventions to defend the currency, before recovering to 44.33 by 1430 GMT. A forex trader at a large Western bank said the rouble had plunged on a Bloomberg story citing two unnamed Russian officials as saying the central bank was considering imposing temporary capital controls if net capital outflows intensified. The currency basket "didn't go any higher because there's no official confirmation (of the Bloomberg report)", the trader said. The rouble fell 0.52 percent against the dollar to 39.64 RUBUTSTN=MCX but was just 0.05 percent weaker at 50.06 against the euro EURRUBTN=MCX , which sagged after data showing annual euro zone inflation at just 0.3 percent in September. The rouble has been under heavy selling pressure for months due to falling oil prices, economic sanctions over the Ukraine crisis and strong demand for dollars from Russian firms shut out of international capital markets because of the sanctions. Analysts said it was unlikely that the central bank would introduce capital controls. Neil Shearing, chief emerging markets economist at Capital Economics in London, described them in a note as "a measure of last resort". "As things stand, the central bank is more likely to respond to increased outflows by hiking interest rates," Shearing said. Russian shares were mixed on Tuesday, with no significant impact seen from a decision by European Union officials to leave in place their sanctions against some companies and individuals over the Ukraine crisis. ID:nL6N0RV2X3 Some market participants had hoped that some of the sanctions would be withdrawn because of a fragile ceasefire broadly holding in eastern Ukraine. The dollar-denominated RTS index .IRTS was down 0.1 percent at 1,124 points at 1430 GMT, while its rouble-based peer MICEX .MCX traded 0.4 percent higher at 1,414 points. Energy companies in general outperformed, with oil company Rosneft ROSN.MM up 1.2 percent and gas producer Gazprom up 2 percent. Top bank Sberbank SBER.MM , however, fell 1.2 percent. Shares in business conglomerate Sistema AFKS.MM , which have lost over 60 percent of their value since the company's chairman was placed under house arrest on money-laundering charges two weeks ago, were 2.2 percent higher. For rouble poll data see FXRUB FXEURRUB FXRUS For Russian equities guide see RU/EQUITY For Russian treasury bonds see 0#RUTSY=MM Russia in graphics: http://link.reuters.com/dun63s (Reporting by Alexander Winning, Vladimir Abramov and Lidia Kelly; Editing by Jason Bush and Gareth Jones) ((alexander.winning@thomsonreuters.com; +7 495 775 1242; Reuters Messaging: alexander.winning.thomsonreuters.com@reuters.net)) Keywords: RUSSIA ROUBLE/

PRECIOUS-Gold set for first quarterly loss this year on dollar strength

September 30, 2014 - reuters.com

* Gold on track for 5.5 pct drop in September * Quarterly drop of 8 percent in prospect (Updates prices, adds comment) By Clara Denina LONDON, Sept 30 (Reuters) - Gold fell to a nine-month low on Tuesday as the dollar climbed, with the metal set to post its sharpest monthly loss since June 2013 and the first quarterly loss this year on expectations of further gains in the U.S. currency. Cash prices touched their lowest since Jan. 1 at $1,204.40 an ounce and although managing to recoup earlier losses, the metal is still down about 5.5 percent for the month and heading for a quarterly drop of 8 percent. Spot gold XAU= was trading unchanged at $1,215.80 an ounce at 1429 GMT, erasing losses after lower-than-expected U.S. data. U.S. gold futures GCcv1 lost $2.40 to $1,216.20 an ounce. "The bottom line is that the dollar will continue to appreciate against the euro quite significantly in the next couple of months until the end of next year and this will see gold prices fall," Commerzbank analyst Daniel Briesemann said. "Pressure is clearly there and I would be very surprised to see gold show more upside." The dollar climbed to a four-year peak against a basket of major currencies, before paring some gains as data showed the pace of business activity growth in the U.S. Midwest decelerated slightly in September. ID:nN9N0Q300D The U.S. currency has posted a record-breaking 11 weeks of successive gains on expectations the Federal Reserve will raise interest rates well ahead of its counterparts in Japan and the euro zone. The U.S. central bank indicated this month that it could raise borrowing costs faster than expected when it starts moving. ID:nW1N0Q400M The next market focus will be the release of September non-farm payrolls data on Friday. ECONUS The strength in the dollar has been driving gold's declines over the past few weeks. A stronger U.S. currency makes dollar-denominated precious metals more expensive for holders of other currencies. Investors tend to withdraw from non-interest-bearing assets to seek higher yields elsewhere when the dollar gains. "The pressure is definitely on for gold to end the year in the red," said Howie Lee, investment analyst at Phillip Futures. "We see little in the way to stop gold's downward slide, given that the Fed has made clear its intention to hike (rates) sooner (rather) than later and the Ukraine tensions have reached a fragile ceasefire." Investors were also watching political unrest in Hong Kong as any worsening of tensions there could lead to some investment demand for gold. Tens of thousands of pro-democracy protesters blocked Hong Kong's streets on Tuesday, maintaining pressure on China as it faces one of its biggest political challenges since the Tiananmen Square crackdown 25 years ago. ID:nL3N0RU5EJ The protests, however, could hit retail sales in the region, a hot spot for tourists from mainland China, especially during the one-week National Day holiday that begins on Wednesday, bullion dealers said. Lower gold prices dragged other precious metals down, with silver XAG= hitting its lowest since March 2010 at $17.07 an ounce and headed for its biggest quarterly loss since mid-2013. Platinum XPT= was down 0.1 percent at $1,298.70 an ounce and set for a 12 percent quarterly drop. Palladium XPD= fell 1.9 percent to $771.50 an ounce, having touched a five-month low earlier and was also poised for a monthly and quarterly loss. (Additional reporting by A. Ananthalakshmi in Singapore; Editing by Keiron Henderson and David Evans) ((clara.denina@thomsonreuters.com)(+44 207 542 9420)(Reuters Messaging: clara.denina.thomsonreuters.com@reuters.net)) Keywords: MARKETS PRECIOUS/

UPDATE 2-South African central bank should keep policy focus on inflation -Kganyago

September 30, 2014 - reuters.com

* Confidence in economy weak, will put pressure on CPI * Trade deficit soars in August, weakens rand * Kganyago says little scope to ease policy to boost demand (Adds trade data, market reaction, analyst comment) JOHANNESBURG, Sept 30 (Reuters) - South Africa's central bank has little policy room to boost demand in the economy and should keep its focus on taming inflation, Deputy Governor Lesetja Kganyago said on Tuesday. Likely interest rate increases in the United States would require corresponding policy shifts in South Africa, said Kganyago, who has emerged as the front runner to head the bank when Governor Gill Marcus ends her five-year term on Nov. 8. ID:nL3N0RO3NZ The South Africa Reserve Bank left interest rates unchanged at 5.75 percent at a policy meeting this month but faces a dilemma as inflation has persisted above a 3-6 percent target band while economic growth has slowed and the bank cut its growth forecasts for the three years to 2016. ID:nL6N0RJ3H0 "Confidence in the economy is currently weak, and all else equal, will tend to put upward pressure on inflation rates as households and firms seek (wage and) price increases as a way to improve their finances," Kganyago said in a speech at an investment summit. "Today, there is little policy space left to boost demand." Africa's most advanced economy needed to be more competitive, partly by ensuring that inflation did not price local goods and services "out of world markets", Kganyago said. In a sign that exporters are still struggling after a global recession hit the economy five years ago, South Africa's trade deficit more than doubled to 16.3 billion rand ($1.4 bln) in August, the widest in seven months, data from the revenue service showed on Tuesday. ID:nJ8N0PY008 The shortfall, which partly reflects the lingering impact of prolonged strikes for higher wages in the platinum and auto sectors, points to a widening current account gap and pushed the rand ZAR=D3 to 11.3490 against the dollar on Tuesday, its weakest since late January. "The trade deficit is likely to remain structurally high over the medium term which suggests that a turnaround in the currency's fortunes seems unlikely anytime soon," said Jeffrey Schultz, an economist at BNP Paribas Cadiz Securities. The rand has fallen more than 7 percent against the dollar this year, and Kganyago said rising global interest rates would put downward pressure on the currency and push up local rates. The central bank has already lifted its benchmark rate by 75 basis points this year to combat inflation, and some analysts expect one more increase at the last policy-setting meeting of 2014 in November. "Monetary policy must retain and strengthen its focus on inflation," Kganyago said. "In doing so, we will push the envelope of transparency and clarity wherever possible; to help ensure that inflation expectations do not drift from the target." (1 US dollar = 11.3150 South African rand) (Additional reporting by Xola Potelwa; Editing by Susan Fenton) ((stella.mapenzauswa@thomsonreuters.com; +27117753161; Reuters Messaging: stella.mapenzauswa.thomsonreuters.com@reuters.net)) Keywords: SAFRICA POLICYMAKER/KGANYAGO

London gold 1500 fix - Sept 30 - 1216.50 dlrs

September 30, 2014 - reuters.com

Egypt's Sisi delivers economic reforms but hurdles remain

September 30, 2014 - reuters.com

* Investors want to see more reforms, IMF loan deal * Sisi hails Suez Canal expansion as flagship project * Risks remain from inflation, currency, power cuts By Stephen Kalin CAIRO, Sept 30 (Reuters) - In his first 100 days in office, Egyptian President Abdel Fattah al-Sisi has made a fast start on economic reform: slashing costly fuel subsidies, raising taxes and devising infrastructure projects to secure long-term revenues and ease unemployment. Those are moves that have long been sought by foreign investors. But winning their full confidence will require pushing ahead with further politically-sensitive reforms and sealing an elusive deal with the International Monetary Fund. A loan from the global lender would serve as a badly-needed stamp of approval for a country battered by political turmoil since a popular uprising ended 30 years of rule by autocrat Hosni Mubarak in 2011. For decades, Mubarak mostly avoided politically-risky reforms that might anger a population reliant on subsidised food and fuel. His Islamist successor Mohamed Mursi also showed little sign of progress during a tumultuous year in power. Investors hope that Sisi, a former army chief who overthrew Mursi, cracked down harshly on his followers and won the election to succeed him, will have the authority to enact measures that his predecessors could not. "We don't want politicking, we don't want drama. We want a leader who is going to implement an investment regime for Egypt focused on the longer term," said Bryan Carter, lead portfolio manager for emerging debt at Acadian Asset Management in Boston. Raising fuel prices and taxes may ease the burden on the cash-strapped state, which faces a crippling budget deficit around 11 percent of economic output and double digit unemployment. But Sisi's ultimate challenge is luring back foreign investors who remain wary of Egypt's artificially strong currency, rising inflation, stifling bureaucracy and electricity shortages. "The solution to Egypt's longer term economic problems will not come from any sort of austerity internally or restructuring of the fiscal budget. It's got to come from the catalysation of investments," said Carter. Egypt has been consulting with the IMF about implementing a value-added tax (VAT), which the government predicts would generate more than $4 billion in revenues. Investors are eager to see the VAT pushed through without opposition or unrest, though officials have not given a time-line for its implementation. Egypt resumed regular consultations with the IMF this month for the first time since March 2010 - a necessary step before securing a loan package. Cairo had postponed the talks with the global financial body following Mubarak's overthrow in 2011. ID:nL5N0RE0SW SUEZ FLAGSHIP PROJECT Cairo is pinning its hopes on an international investment and aid conference scheduled for February in the Red Sea resort town of Sharm al-Sheikh. It hopes foreign governments, private investors and international donor organisations will make hefty pledges there. Investment Minister Ashraf Salman told Reuters in an interview this month he was aiming for $10 billion in foreign investment in the current fiscal year and hopes Egypt will attract $18 billion a year by 2018, highly ambitious targets. ID:nL3N0RH56B Foreign direct investment was about $8 billion annually before the 2011 uprising and reached only $4.1 billion in the fiscal year that ended in June. Sisi's flagship project is the expansion of Egypt's Suez Canal, a strategic global shipping lane which brings in about $5 billion of revenue and foreign reserves each year. He hopes that figure will more than double with the new venture and has set an ambitious one-year target for completing the initial phase. ID:nL6N0QB2D2 The former army chief appears also to be banking on the canal's symbolism and geopolitical importance to raise his public stature. Egypt nationalised the canal in 1956, prompting shareholders Britain and France to invade along with Israel. The crisis ended after Egypt sank 40 ships and the United States, Soviet Union and United Nations intervened forcing the invaders to withdraw. Egyptians flocked to banks this month to buy $8.5 billion worth of Suez Canal investment certificates, which the government held up as a public vote of confidence in the economy. Some foreign investors are not as enthusiastic as Egyptians, who have been longing for an economic recovery and political stability. "We do not have a lot of details. There are still some question marks because it is a big project," said Remy Marcel, co-fund manager for the Middle East and North Africa at asset management company Amundi. "It is too early to really figure out what would be the consequences of this project. On paper it looks very positive; it would help to create some jobs and increase revenues." NO QUICK FIXES Sisi seems to have space for further manoeuvre. So far, cuts to fuel subsidies have not triggered unrest as was feared, even though they have driven up prices across the board. But the breathing room may not last if the president remains committed to fiscal discipline as promised. That would require him to make further bold moves such as pushing ahead with more subsidy cuts and introducing the VAT. "There are no quick fixes, including the removal of subsidies, which most foreign investors wrongly seem to believe can be achieved without social unrest," said Daniel Broby, chief executive of Gemfonds, a UK-based investment boutique. Egypt's currency, another critical factor for foreign investors, has been stable in the official market since June, but the persistence of the black market and constraints on dollar outflows are keeping investors cautious. Expectations of a significant currency depreciation following parliamentary elections slated for the end of the year have delayed some investors' return to the market and also caused the hoarding of dollars, keeping the black market alive. Egypt's main index .EGX30 has gained 18.6 percent since Sisi's election and now stands well above its level before the 2011 uprising. That signifies a vote of confidence by domestic investors, but official data does not show a substantial increase in foreign investors returning to the bourse. A Cairo-based fixed-income trader said investors have not yet returned to the government bond market either. "We haven't heard of foreigners buying government debt in the past two months or so," he said. REALISTIC PROSPECTS Egyptian ministers appointed by Sisi to oversee the economy seem far more realistic about prospects than officials who served under Mubarak and often painted a rosy picture. Finance Minister Hany Kadry Dimian told Reuters this month the government was aiming to boost economic growth to 5-6 percent within three years and halve the budget deficit in seven years, while acknowledging challenges ahead. ID:nL3N0RH507 "There's been nothing earth shattering. But it's the relentless march toward progress and the realisation of this (reform) framework that matters, and that's exactly what we want to see," said Carter of Acadian. Sisi has come under strong criticism from human rights groups since last year when, as army chief, he overthrew Mursi following mass protests and then mounted a ruthless crackdown on Mursi's Muslim Brotherhood. Security forces killed hundreds of Brotherhood supporters in the streets and arrested thousands of Islamists. Secular activists have also been jailed for violating a law which places severe restrictions on protests. But most Egyptians crave stability and Sisi has delivered, stifling political turmoil and promising to defeat the Sinai-based militant group Ansar Bayt al-Maqdis, which has killed hundreds of members of the Egyptian security forces. (1 US dollar = 7.1500 Egyptian pound) (Editing by Michael Georgy and Peter Graff) ((stephen.kalin@thomsonreuters.com)(+20 101 584 1700)(Reuters Messaging: stephen.kalin.thomsonreuters.com@reuters.net)) Keywords: EGYPT ECONOMY/INVESTMENT

CORRECTED-Get used to Norway buying crowns -c.bank chief

September 30, 2014 - reuters.com

(Corrects 1st para to make clear first purchase expected Oct. 1, not already carried out) OSLO, Sept 30 (Reuters) - Currency markets should get used to Norges Bank buying Norwegian crowns, the head of the central bank told Reuters, after the bank said on Tuesday it will start making purchases from Oct. 1 to cover the government's non-oil budget deficit. "I hope and believe that they (the markets) will get used to this, they way they got used to the daily purchases of currency (in the past)," Oeystein Olsen said in an interview after delivering a speech. "We don't think it should have come as a shock to the markets. We had warned about this." (Reporting by Joachim Dagenborg, writing by Gwladys Fouche, editing by Terje Solsvik) ((gwladys.fouche@thomsonreuters.com; +47 23 31 65 94; Reuters Messaging: gwladys.fouche.reuters.com@reuters.net)) Keywords: NORWAY CENBANK/CHIEF

London platinum/palladium 1400 fix - Sept 30

September 30, 2014 - reuters.com

RPT-Romania cenbank sees no rate hike risk over next 12 months

September 30, 2014 - reuters.com

(Repeats to add reporter name) BUCHAREST, Sept 30 (Reuters) - Romania's central bank Governor Mugur Isarescu on Tuesday said he did not see the risk of the bank having to hike interest rates over the next 12 months, saying any future potential decision would need to be carefully assessed. "Because we're not certain inflation will continue to stay on a significantly lower path than expected in the long term, I think ... the next central bank board will make decisions about the interest rate, if it makes them, with great care," Governor Mugur Isarescu told reporters. "On the other hand, on the side of minimum reserve requirements, the steps are much more clearly defined." The bank cut its benchmark interest rate ROINTR=ECI by another quarter point to a new record low of 3 percent on Tuesday, as meagre inflation gave it room to help an economy that has dipped into recession. ID:nL6N0RV2B8 Inflation fell to a lower-than-expected 0.8 percent on the year in August from July's 1.0 percent, due to falling food prices, the National Statistics Board said on Wednesday. Analysts polled by Reuters expect inflation at 2.2 percent at the end of 2014, within the bank's 1.5-3.5 percent target. (Reporting by Luiza Ilie; writing by Radu Marinas) ((radu.marinas@thomsonreuters.com; +40 21 305 5263; Reuters Messaging: radu.marinas.thomsonreuters.com@reuters.net)) Keywords: ROMANIA CENBANK/ISARESCU

London gold 1030 fix - Sept 30 - 1210.00 dlrs

September 30, 2014 - reuters.com

London platinum/palladium 0945 fix - Sept 30

September 30, 2014 - reuters.com

UPDATE 1-Newmont Indonesia restarts copper exports; supply overhang looms

September 30, 2014 - reuters.com

* Newmont says exports 30,000 T from Indonesia on Monday * Refined copper seen in 226,000 T surplus in 2014-Reuters poll (Adds Newmont Indonesia spokesman's comments, copper market impact) By Michael Taylor and Melanie Burton JAKARTA/SYDNEY, Sept 30 (Reuters) - Newmont Mining Corp NEM.N sent out its first copper concentrate shipment from Indonesia this week that ended a nine-month hiatus, highlighting a ramp up in copper mine supply that is expected to tip the market into surplus this year. U.S.-based miners Newmont and Freeport-McMoRan Inc FCX.N halted exports in January after Indonesia imposed a hefty export tax that the miners said violated their mining contracts. The export tax was part of moves to force all miners to develop local mineral processing facilities, which would bring bigger returns for the government from Indonesia's mineral resources. Newmont signed a key deal to resolve the export dispute with the Indonesian government early in September and expects to be fully operational at its Batu Hijau mine within six to eight weeks. It had halted production in June. ID:nL3N0RN30Y ID:nL3N0RO3RT "We've exported 30,000 tonnes," Newmont Indonesia spokesman Rubi Purnomo told Reuters in a text message, adding that the shipment was made late on Monday. The country's largest producer, Freeport, resumed shipments in early August after it agreed with the government on an initial road map for building processing capability in the country. Freeport's open-pit mining was facing a week-long suspension as an investigation takes place into a fatal mining accident at the weekend. But traders said they expected Freeport to continue shipping concentrate from its stockpiles. "A one week stoppage isn't going to make too much of a dent - they've got some pretty huge port stocks," one Singapore-based concentrate trader said. Freeport said in mid-August it had built up a 140,000-tonne stockpile and that it expects total copper concentrate production to reach 1.8 million tonnes this year, down from an expected 2.2 million tonnes, with exports of about 700,000 tonnes. ID:nL4N0QJ373 As a result of boom time investment, new mine supply from around the world is feeding into the market and is expected to result in a surplus, weighted towards the end of the year. Goldman Sachs said this month it expects copper to fall to $6,600/t on a three- and six-month horizon, and $6,200/t on a 12-month horizon. Benchmark copper on the London Metal Exchange CMCU3 traded at around $6,743 a tonne on Tuesday and was facing its steepest monthly loss since March. It is down 8.4 percent year to date. MET/L Cashing in on improving mine supply, Pan Pacific Copper, Japan's biggest copper smelter, aims to raise by more than 9 percent the processing fees it charges sellers of raw material concentrate in 2015, a senior executive said on Monday. Higher charges are typically seen when concentrate supply rises or when smelter capacity thins. Last year the fees were at $92 per tonne and 9.2 cents per pound. ID:nL3N0RU1EE For the first six months of the year, the global refined copper market was in a 526,000 tonnes deficit compared with a 139,000 tonnes surplus in the same period a year earlier, the International Copper Study Group said. ID:nEONE9I0S2 Analysts polled by Reuters expect a 226,000-tonne surplus this year. COMMODITYPOLL01 (Additional reporting by Wilda Asmarini in Jakarta; Editing by Clarence Fernandez and Muralikumar Anantharaman) ((michael.taylor@thomsonreuters.com; +62)(0)(21 2992-7602; Reuters Messaging: michael.taylor.thomsonreuters.com@reuters.net)) Keywords: INDONESIA NEWMONT MINING/EXPORTS

INDICATORS - Kazakhstan - Sept 30

September 30, 2014 - reuters.com

MIDEAST STOCKS - Factors to watch - September 30

September 30, 2014 - reuters.com

DUBAI, Sept 30 (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 of their accuracy. INTERNATIONAL/REGIONAL * GLOBAL MARKETS-Asia stocks unsettled by HK, sluggish China factories MKTS/GLOB * Brent crude slips back towards $97, set for third monthly drop O/R * Gold poised for worst month in 15 months on dollar strength GOL-RTRS * MIDEAST STOCKS-Egypt rebounds, profit-taking shifts to Kuwait MEAST-STX * Middle East Crude-DME Oman flips into premium, strongest in 2 months MEAST-CRU * Israel PM tries to shift focus from Islamic State to Iran at U.N. IL-IR * Libya's parliament holds crisis talks with rival assembly LY-POL * Political conflicts worsening Yemen food security - UN agency YE-POL * POLL-Gulf Arab economic growth to quicken in 2015 despite cheaper oil MEAST-ECI * Luxembourg sets IPT at flat/minus 2 bps area vs midswaps for debut sukuk LU-SUK TURKEY * Turkish treasury to issue 1.84 bln lira-denominated sukuk TR-SUK * Turkish tanks reinforce border as Islamic State shells Syrian town TR-SY * Turkish banks' Jan-Aug net profit 16.7 bln lira - watchdog TR-BANK * Turkish August foreign visitor arrival rise 7.1 pct - ministry TR-ECI EGYPT * Sawiris says still interested in Telecom Italia TLIT.MI * Egypt's top refinery hopes expansion will revive exports EG-REF * Collision delays Suez Canal traffic - sources EG-PORT * Egypt's Sidi Kerir aims to boost revenues by 18 pct in 2-1/2 years SKPC.CA * France's Total wins Egypt gas exploration licence-source TOTF.PA EG-EXPL * Egyptian pound steady on official market, weaker on black market EG-FRX SAUDI ARABIA * Saudi Aramco sets October propane at $735/T, down $10 SDABO.UL * Ashmore appoints Sfakianakis regional director for GCC ASHM.L * Saudi Sipchem says affiliate restarts butanediol plant 2310.SE * Saudi's Sedco Capital launches first in-house managed Islamic fund ISLF-FUND * Saudi Tasnee to pay 1.8 bln riyals to up stake in Cristal subsidiary 2060.SE GULIN.UL UNITED ARAB EMIRATES * Founder sells 5 mln shares in Al Noor Hospitals Group ANHA.L * Dubai Emaar's mall unit IPO priced at top end of range EMAR.DU IPO-EMAA.DU * Dubai flexes legal muscles as financial court system grows AE-LAW * Dubai's Emirates NBD to price NZ dollar bond on Monday - leads ENBD.DU * UAE's Dana Gas wins gas exploration deals in Egypt DANA.AD QATAR * Qatar's foreign minister denies paying ransoms to militant groups QA-SECUR * TABLE-Qatar Aug trade surplus falls 4 pct y/y to $8.7 bln QA-TRACC * Doha Bank calls shareholder meeting to approve India assets buy DOBK.QA KUWAIT * Kuwait revokes citizenship of opposition activist KW-JUDIC * Kuwait markets authority endorses UN terror financing rules KW-REGS BAHRAIN * Bahrain court revokes citizenship of nine over arms smuggling -agency BH-JUDIC * Saudi Telecom's Bahrain unit bets on data to boost revenue 7010.SE OMAN * National Bank of Oman sets IPT for five-year bond at mid-100s over M/S NBO.OM (Compiled by Dubai newsroom) ((dubai.newsroom@reuters.com)) Keywords: MIDEAST FACTORS

India Morning Call-Global Markets

September 30, 2014 - reuters.com

EQUITIES NEW YORK - U.S. stocks ended lower on Monday following protests in Hong Kong that added to worries about Chinese growth and after a disappointing forecast from Ford Motor Co F.N . The S&P consumer discretionary sector .SPLRCD , down 0.6 percent, had the most losses. Ford shares fell 7.5 percent and the stock was the S&P's biggest percentage decliner after it lowered its outlook late during the session, saying North American margins will be at the low end of its previous guidance For a full report, click on .N - - - - LONDON - Britain's top share index ended flat on Monday as unrest in Hong Kong kept a lid on Asia-exposed stocks and concern over demand for metals hit miners. The blue-chip FTSE 100 index .FTSE closed down 2.79 points flat in percentage terms - at 6,646.60 points. The index, which dropped 2.8 percent last week, is down 1.5 percent so far this year. For a full report, click on .L - - - - TOKYO - Japanese stocks fell on Tuesday morning as a one-two punch of weak economic data and a profit warning from Sumitomo Corp 8053.T depressed sentiment. Investors were already on the back foot before the start of trading as pro-democracy protests in Hong Kong dented risk appetite in global markets. For a full report, click on .T - - - - HONG KONG - Hang Seng Index .HIS is down 1.5 percent. For a full report, click on .HK - - - - FOREIGN EXCHANGE SYDNEY - The dollar hovered at a four-year peak against a basket of major currencies early on Tuesday, on track to post its biggest monthly gain in well over a year even as some analysts warned its three-month long rally was at risk of running out of puff. Trading in Asia is likely to be subdued with investors keeping a wary eye on the spreading pro-democracy protests in Hong Kong and with a raft of holidays in the region this week. For a full report, click on USD/ - - - - TREASURIES NEW YORK - Treasuries prices gained on Monday as civil unrest in Hong Kong weighed on global stock markets, and the yield curve flattened as investors bet that U.S. economic data would continue to improve. Uncertainty around demonstrations in Hong Kong, where protesters defied volleys of tear gas and police baton charges to stand firm in the center of the global financial hub on Monday, was seen as one driver of demand for bonds. For a full report, click on US/ - - - - COMMODITIES GOLD SINGAPORE - Gold held steady above a nine-month low on Tuesday, but was poised to post its sharpest monthly loss in 15 months as a rapid climb in the dollar dimmed the metal's appeal. Spot gold XAU= was little changed at $1,216.55 an ounce by 0038 GMT, after dipping in the last two sessions. For a full report, click on GOL/ - - - - BASE METALS SYDNEY - London copper was flat but not far off three-month lows on Tuesday ahead of data on growth in China's huge manufacturing sector, and was facing its steepest monthly loss since March on a looming increase in supply. Three-month copper on the London Metal Exchange CMCU3 was trading at $6,733 a tonne by 0030 GMT, down 0.1 percent after small gains in the previous session. Prices hit their lowest since June 16 at $6,666 a tonne on Monday. For a full report, click on MET/L - - - - OIL NEW YORK - U.S. crude oil rose on Monday backed by strong U.S. economic data, while Brent edged up after nearing a two-year low last week. With U.S. refinery maintenance season around the corner, analysts said, prices for U.S. crude, or West Texas Intermediate (WTI), may come under pressure. Gasoline prices have risen around 6 percent in the last two weeks because of refinery maintenance shutdowns, and strength in gasoline has supported crude prices. For a full report, click on O/R (Compiled by Abhishek Vishnoi) ((abhishek.vishnoi@thomsonreuters.com; +91 22 61807225; Reuters Messaging: abhishek.vishnoi.thomsonreuters.com@reuters.net)) Keywords: MORNINGCALL INDIA/

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