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South Africa's rand still on firmer ground after budget

October 24, 2014 - reuters.com

JOHANNESBURG, Oct 24 (Reuters) - South Africa's rand hovered near the previous day's five-week highs against the dollar on Friday, still anchored by a well-received medium term budget statement mid-week, in the absence of more immediate drivers. Despite announcing a slightly wider budget deficit forecast for 2014/15, Finance Minister Nhlanhla Nene bolstered investor confidence in the currency and local bonds on Wednesday by vowing to clamp down on spending. ID:nL6N0SH44Y Analysts lauded his statement on the whole, saying it would go a long way to lessen the chances of more credit downgrades for Africa's most advanced economy. The rand ZAR=D3 traded at 10.9300 to the dollar at 1545 GMT, up 0.4 percent from Thursday's close. It was within a whisker of Thursday's high of 10.9235, the currency's strongest level since Sept 17. The rand was however caught in a narrow range for much of Friday's session, reflecting a dearth of market moving news and data on the day. "We've had a very quiet day and that goes for just about all the forex markets," RMB trader Jim Bryson said. "There's a lack of drivers, no real news." The rand was still among the strongest performers in a basket of 20 emerging currencies tracked by Reuters, surpassed only by Brazil's real BRL= , the Polish zloty PLN= and Latvia's lats LVL= . The debt market was also sluggish, with the yield for the 2026 secondary market benchmark ZAR186= dipping just half a basis point to 7.91 percent. (Reporting by Stella Mapenzauswa; Editing by Ed Stoddard) ((stella.mapenzauswa@thomsonreuters.com; +27117753161; Reuters Messaging: stella.mapenzauswa.thomsonreuters.com@reuters.net)) Keywords: MARKETS SAFRICA/CURRENCY

FOREX-Euro up after report on bank stress tests, short-covering

October 24, 2014 - reuters.com

(Recasts with New York trade, updates prices, adds comment, changes dateline, previous LONDON) * Euro short-covering supports currency * Sterling rises after Q3 UK GDP data By Daniel Bases NEW YORK, Oct 24 (Reuters) - The euro rallied on Friday ahead of an official report on the health of the euro zone's main banks as investors continued a trend of covering their short-positions leading to buying of the currency against the U.S. dollar. Despite Friday's weakness, the dollar is on track to close the week with a gain. Concerns about the first diagnosed case of Ebola in New York City, which stifled the dollar's rally late Thursday, have waned, strategists said. The U.S. Federal Reserve will meet next Tuesday and Wednesday, and the consensus view is that it will wrap up asset purchases under its third round of quantitative easing. A group of 25 banks have failed European stress tests, while up to 10 of those continue to have a capital shortfall, sources familiar with the matter told Reuters on Friday. ID:nF9N0NG029 Bloomberg News first reported the results of the tests, which are due on Sunday. Currency strategists said this just added more fuel to the short-covering that has supported the euro's position. "It is all speculation at this point and the ECB tried to remind us of that. It just highlights that this is a risk that is not as negative perhaps as was price in," said Camilla Sutton, chief currency strategist at Scotiabank in Toronto. Bloomberg News' report said that 105 banks had passed the ECB's test, known as the comprehensive assessment, and that negotiations were continuing with about 10 banks shown to have a net capital shortfall. The euro zone's 130 biggest banks received the European Central Bank's final verdict on their finances on Thursday after a review aimed at drawing a line under persistent doubts about the health of the region's banking sector. They will not be made public until 1100 GMT on Sunday. In mid-morning New York trade, the euro was up 0.15 percent at $1.2665 EUR= , up from Thursday's two week low. It traded flat against the Japanese yen at 136.89 EURJPY= . The dollar was off 0.10 percent to 108.12 yen JPY= . The dollar index, which measures the greenback against its major trading partners' currencies, was down 0.10 percent, but on track to end the week up 0.75 percent .DXY . "The dollar rally has paused a bit here and I think one of the core reasons is a bit of added uncertainty as to how the Fed will react to the stronger dollar and to the renewed worries about global growth concerns," said Brian Daingerfield, currency strategist at the Royal Bank of Scotland in Stamford, Connecticut. The Fed's statement will be parsed for clues on how quickly the central bank may start raising interest rates, now not expected until late 2015. "For the dollar to appreciate, you need the stock market to hold up in the face of a clean exit from QE3 by the Fed," said David Woo, head of global rates and currency research at Bank of America Merrill Lynch in New York. Elsewhere, sterling rose to $1.6098 GBP= , after the GDP data showed Britain's economy grew by 0.7 percent in the third quarter, down from 0.9 percent the quarter before, but in line with economists' expectations. (Additional reporting by Anirban Nag in London and Lisa Twaronite in Tokyo; Editing by Bernadette Baum) ((daniel.bases@thomsonreuters.com; +1 646 223 6131; Reuters Messaging: daniel.bases.reuters.com@reuters.net; Twitter: @djbases)) Keywords: MARKETS FOREX/

Hollande says France has taken necessary measures on deficit

October 24, 2014 - reuters.com

BRUSSELS, Oct 24 (Reuters) - France considers that it has done what is necessary to bring its budget deficit under control although talks continue with the European Commission over the country's 2015 budget, President Francois Hollande said on Friday. "We consider that we have done what we had to do: continue to reduce the structural deficit, save 21 billion euros, conduct very significant structural reforms, strengthen our economy," he told a news conference in Brussels after an EU summit. EU leaders agreed that growth in the bloc was too low and that there was a risk of stagnation, Hollande added. (Reporting By Jean-Baptiste Vey; Writing by Nick Vinocur) ((nicholas.vinocur@thomsonreuters.com; +33 1 4949 5188; Reuters Messaging: nicholas.vinocur.thomsonreuters.com@reuters.net)) Keywords: FRANCE ECONOMY/EU

POLONIA Rate falls 0.25 pp.

October 24, 2014 - reuters.com

WARSAW, Oct 24 (Reuters) - POLONIA the reference rate for Overnight deposits amounted to 1.74 percent. The volume of transactions concluded till 16:30 by banks participating in POLONIA fixing amounted to 2,154 mln PLN. Note: Description of reference rate at: http://www.acipolska.pl/ ((warsaw.newsroom@reuters.com))

Swiss gold referendum's support falls short of majority-poll

October 24, 2014 - reuters.com

* Poll finds 44 pct of Swiss voters support gold initiative * Short of majority needed, group expects opposition to rise * Vote on Nov. 30, brought by right-wing SVP party ZURICH/LONDON, Oct 24 (Reuters) - A proposal to prohibit the Swiss National Bank from selling any of its gold reserves has the support of 44 percent of the public, a closely watched survey showed on Friday, though that result falls short of the backing it needs to pass into law. The group behind the opinion poll also said support was likely to diminish as a Nov. 30 vote on the measure approaches. That proposal has sparked jitters in both gold and currency markets. If approved, the SNB would have to massively bolster its gold holdings, which stood at 1,040 tonnes this month according to the World Gold Council, representing 7.8 percent of reserves. ID:nL6N0SH4OV The right-wing Swiss People's Party (SVP) proposed the measure, which would require the SNB to hold at least 20 percent of its assets in gold. It would also prevent the bank from selling any of its gold, even if the ratio of gold to other assets climbs above 20 percent. To get to 20 percent, the SNB would have to go on a buying spree that could push gold prices significantly higher. It could also endanger the three-year cap on the value of the Swiss franc against the euro imposed by the SNB to prevent the Swiss currency from appreciating, ward off deflation and boost growth. The poll, conducted by Berne-based research institute gfs.bern in partnership with Swiss broadcaster SRG, found that 44 percent of respondents favoured the initiative, short of the majority needed for passage, while 39 percent opposed it. Of those asked, 17 percent were undecided or gave no answer. Authors of the study, which comes after an online poll on Tuesday by free Swiss daily newspaper 20 Minuten showed a similar result, said it expected opposition to eat away at support for the SVP's proposal as the vote approaches. ID:nL6N0SG2XK "Increasing opposition during an election campaign corresponds with the normal scenario for a public initiative," the study read. The study, the most reliable polling yet ahead of the vote, also said the public was still at the early stages of making up its mind over the proposal and that this could significantly alter the final result. SNB OPPOSITION If it is adopted, the government would have up to three years to write the proposal into law, subject to consultation with stakeholders. The SNB would then have five years to up its holdings to at least 20 percent. The SVP gold initiative is opposed by the Swiss government, the central bank and several influential parties, and one of the SNB's board members this week again stressed its disagreement with the proposal. "We're taking this extremely seriously," Fritz Zurbruegg told a public conference at the Graduate Institute in Geneva on Tuesday. "The SNB doesn't (normally) take a stand in politics. This is an initiative that we feel would seriously impair our ability to fulfil our legal mandate. This will seriously affect how we exercise monetary policy." Gold prices are little changed so far this year after plunging 28 percent in 2013, dramatically ending a more than decade-long bull run. A "yes" vote, leading to sustained official sector buying, would likely have a significant price impact. "Implications of this could be quite dramatic for the gold price, and maybe for markets beyond gold," UBS strategist Beat Siegenthaler said, speaking before the poll result was released. "It's really an attempt to return to some kind of gold standard, for those who don't trust paper money and who want gold backing it up." Central banks were heavy sellers of gold until recently, cashing in on an asset that had languished near $300 an ounce for a decade before slipping to a 20-year low in 1999. The same gfs.bern poll also showed a majority of Swiss voters are against plans to place severe limits on immigration and population growth. ID:nL6N0SJ2K0 (Reporting by Joshua Franklin in Zurich and Jan Harvey in London; Additional reporting by Tom Miles in Geneva; Editing by Larry King) ((joshua.franklin@thomsonreuters.com; +41583067007; Reuters Messaging: joshua.franklin.thomsonreuters.com@reuters.net)) Keywords: SWISS GOLD

Turkish markets steady after central bank keeps rates on hold

October 24, 2014 - reuters.com

ISTANBUL, Oct 24 (Reuters) - Turkish markets were steady on Friday, a day after the central bank kept rates on hold and repeated its commitment to tight monetary policy until the inflation outlook improves. Markets welcomed the bank's decision, as economists were wary of any dovish signals from the bank over possible rate cuts, which they said could hurt the lira. The lira TRYTOM=D3 was firm at 2.2339 against the dollar by 1456 GMT from 2.2393 late on Thursday. The main share index .XU100 was 0.1 percent down at 79,417.13, underperforming the broader emerging markets index .MSCIEF , which was up 0.33 percent. The 10-year benchmark bond yield tTR240724T0=IS slightly rose to 8.84 percent from Thursday's 8.83 percent. (Reporting by Seda Sezer; Editing by Humeyra Pamuk) ((seda.sezer@thomsonreuters.com; +90 212 350 7062;)) Keywords: MARKETS TURKEY/

Putin says Russia will not "burn" its forex reserves

October 24, 2014 - reuters.com

LAURA, Russia, Oct 24 (Reuters) - Russia intends to continue moves to a floating exchange rate and will not "burn" through its foreign exchange reserves, President Vladimir Putin said on Friday. "We will gradually move to a floating exchange rate. We will not burn our reserves thoughtlessly. We will use them for a certain balancing," Putin told a meeting with Russian and foreign experts on Russia. Putin also said that Russia will put the main emphasis on attracting private investment into its economy. (Reporting by Alexei Anishchuk, Writing by Jason Bush, Editing by Timothy Heritage) ((jason.bush@thomsonreuters.com; +7 495 775 1242; Reuters Messaging: jason.bush.reuters.com@reuters.net)) Keywords: RUSSIA PUTIN/FOREX

Russian economy minister sees "big risks" of negative economic growth in 2015 -Ifax

October 24, 2014 - reuters.com

MOSCOW, Oct 24 (Reuters) - There are "very big risks" that Russia's economic growth could turn negative in 2015 if oil prices remain close to present levels, Economy Minister Alexei Ulyukayev said on Friday, news agency Interfax reported. "This is of course very serious," Ulyukayev said, after warning that growth in real household income and retail sales could turn negative. "As a result there are very big risks that overall economic growth will be negative, and that investment (growth) will also turn out to be minus." In August, the ministry halved its official economic growth forecast for 2015 to 1 percent. ID:nL5N0QW1WA (Reporting by Jason Bush; Editing by Catherine Evans)

London gold 1500 fix - Oct 24 - 1232.75 dlrs

October 24, 2014 - reuters.com

Sterling up on UK GDP, eyes first weekly rise in four

October 24, 2014 - reuters.com

(Updates prices, adds quote) By Anirban Nag and Jamie McGeever LONDON, Oct 24 (Reuters) - Sterling rose against the dollar on Friday after figures showed the UK economy met expectations and grew at a healthy pace, providing a relief for those worried that weakness overseas could be a drag on activity. The pound moved further above $1.60 and on a broader trade-weighted basis =GBP was on track for its first weekly rise in four. Britain's economy grew by 0.7 percent in the third quarter, down from 0.9 percent the quarter before but in line with economists' expectations, preliminary figures showed on Friday. That put annual growth at 3.0 percent, also down slightly but among the fastest rates in the developed world, prompting British finance minister George Osborne to tweet: "The UK is leading the pack in an increasingly uncertain global economy." "This should calm fears for now that the slowdown in Europe and deflation fears around the globe are not such an immediate threat to the UK economy," said Jon Pryor, head of FX dealing, corporate and institutional treasury at Investec. Sterling money markets continued to price a first interest rate rise by the Bank of England around the middle of next year, potentially the first post-crisis hike by any big central bank. GBPOIS=ICAP Sterling was up 0.2 percent against the dollar at $1.6063 GBP= . It was flat against the single currency, though, with the euro getting a fillip from a media report that more than 100 euro zone banks were set to pass the European Central Bank's stress test. The euro was steady at 78.925 pence EURGBP= . MONETARY AND POLITICAL UNCERTAINTY There is, however, a degree of uncertainty surrounding the strength of the economic recovery and by extension the timing of the BoE's first rate hike. There are several reasons why British growth might continue to slow into the end of the year, including the recent burst of financial market volatility and growing signs of renewed stagnation in the euro zone. A persistently wide current account deficit, deteriorating public finances and weak wage growth that dampens consumer spending are also factors. Earlier this week, BoE chief economist Andy Haldane said he was "gloomier" on the economy, implying that rates could remain "lower for longer". ID:nL6N0SC0UG Investors are also becoming increasingly wary about political risks in Britain, which they say could have a bearing on investment flows and sterling. Analysts said the European Commission's proposal to raise Britain's contribution to the EU budget by 2.1 billion euros - due to the British economy growing faster compared to other EU partners - could not have come at a worst time. Prime Minister David Cameron could come under pressure to move towards a more anti-euro platform ahead of next year's general election in May if his party loses a by-election on Nov 20 in Rochester. The by-election will be held following the defection of Mark Reckless from the Conservative Party to the euro-sceptic UKIP. "The political risk premium for sterling seems to be rising and with UK data weakening, sterling is set to break lower," Morgan Stanley said in a note. "Sterling/dollar is a sell near $1.61 with a near term target of $1.57." (Editing by Tom Heneghan) ((jamie.mcgeever@thomsonreuters.com)(+ 44 207 542 8510)(Reuters Messaging: jamie.mcgeever.thomsonreuters.com@reuters.net)) Keywords: MARKETS STERLING/

UPDATE 1-Brazil posts widest current account gap as pct of GDP since 2002

October 24, 2014 - reuters.com

(Recast, adds detail of 12-month deficit and FDI) BRASILIA, Oct 24 (Reuters) - Brazil's current account deficit widened sharply in September, central bank data showed on Friday, reaching its largest 12-month gap in more than a decade as the country's trade balance suffers from lower commodity prices. Brazil posted a current account deficit BRCURA=ECI of $7.907 billion in September, its largest this year and above market expectations for a gap of $7.250 billion, according to the median forecast of 19 analysts in a Reuters poll. Brazil's current account deficit in September of last year was $2.764 billion. In the last 12 months through September, the current account deficit was equivalent to 3.70 percent of gross domestic product, its biggest gap since February of 2002. The widening deficit threatens to surpass the central bank estimate for a $80 billion shortfall this year. So far in 2014 Brazil has averaged a monthly deficit of $7 billion. On the other hand, foreign direct investment (FDI) has remained robust, but not enough to cover the current account deficit. So far this year, Brazil has attracted $46.215 billion in foreign direct investment while its current account deficit shot up to $62.730 billion. In September, the country saw FDI inflows of $4.214 billion, above market expectations for $3.450 billion. (Reporting by Alonso Soto and Luciana Otoni Editing by W Simon and Chizu Nomiyama) ((asher.levine@thomsonreuters.com; +55-11-5644-7756; Reuters Messaging: asher.levine1.thomsonreuters.com@reuters.net)) Keywords: BRAZIL ECONOMY/EXTERNAL

London platinum/palladium 1400 fix - Oct 24

October 24, 2014 - reuters.com

COLUMN-LME Week rings the changes for the world of metals: Andy Home

October 24, 2014 - reuters.com

(Andy Home is a Reuters columnist. The opinions expressed are his own) By Andy Home LONDON, Oct 24 (Reuters) - Another LME Week, the annual pilgrimage of the global metals industry to London, has come and gone. It is a time-honoured tradition, and on the surface at least this one was no different from those of previous years. The London Metal Exchange (LME) Seminar on Monday morning, the official opening ceremony, was as packed as ever. The champagne flowed as freely as ever at the cocktail parties hosted by Triland Metals and Mitsui Bussan Commodities at the Dorchester hotel that evening. On Tuesday the massed ranks of tuxedoed traders, producers and consumers descended on the Grosvenor House hotel for the LME black-tie dinner to engage in the ritual sport of betting on the length of the guest speaker's speech. These are merely the most visible of the many private parties, side meetings and seminars that constitute the annual dialogue of the great and good in the industrial metals supply chain. THE BEGINNING OF THE END? And yet, there was something different about this one. It wasn't just that the cocktail circuit was lighter this year as brokers and, before readers collectively reach for their emails, my own employer reined in the largesse of times past. After all, it's been a turbulent time in the LME brokerage business. Barclays Capital BARC.L , Credit Suisse CSGN.VX and Deutsche Bank DBKGn.DE have all gone. JPMorgan JPM.N has significantly reduced its footprint, selling part of its business to Mercuria. ID:nNrm3m4MxN This mass departure has been driven by the current dynamic of post-crisis regulation and risk reduction, but it fits into a longer-running cycle of investment banks' revolving-door participation in LME trading. Standard Bank London's ongoing absorption into China's ICBC is perhaps a more telling manifestation of deeper structural changes in the world of metals trading. Or, to quote Ken Hoffman, global head of metals and mining at Bloomberg Intelligence, speaking at its "East Meets West" seminar, we may be seeing the "beginning of the end of trading metals in the West as we know it". Hoffman's contention is that on current trends "Asia may surpass the West in metals trading volume by 2020, if not sooner". Fittingly, therefore, this was the year that Hong Kong Exchanges and Clearing (HKEx) 0388.HK , which bought the LME back in 2012, really laid out its store in terms of tapping into the booming liquidity of the Chinese metals markets. CONNECTING WITH CHINA Spearheading its strategy will be the launch in December of three mini contracts for copper, aluminium and zinc. ID:nL6N0SG46W It's not the first time such contracts, called "mini" because with a lot size of 5 tonnes they are smaller than the 25 tonne contracts traded on the LME, have been tried. Both the LME itself and then the Singapore Exchange failed to get any long-lasting traction. But HKEx has a unique advantage in the form of its 34 members from mainland China, a natural distribution channel for the high net wealth individuals who, according to Bonnie Liu, senior vice president of Asia Commodities at the exchange, account for around 70 percent of trading on China's own exchanges. Moreover, these contracts will be denominated in (offshore) renminbi (RMB) and cleared in Hong Kong, removing in part the previous barriers to Chinese investor participation. It's no coincidence that they mirror the highly liquid base metal contracts traded on the Shanghai Futures Exchange. It's all part and parcel of HKEx's broader goal of replicating its pending Hong Kong-Shanghai stock-connect model ID:nL3N0SH3BI in the commodities space, according to Charles Li, HKEx chief executive. "You have to create something in Asia that China can trade," he said at the LME seminar. If HKEx can successfully leverage the LME pricing franchise into China, Chinese exchanges might conceivably "bring their contracts to Hong Kong". HKEx also announced last week a memorandum of understanding with China Merchants Group on "exploring initiatives such as LME warehousing in Asia and the development of new RMB-denominated products". Don't hold your breath, though, on the LME opening warehouses in mainland China any time soon. Li was cautious in his comments, noting that it would require a change in Chinese regulator CSRC's rule-book. "That battle has huge machine guns and bunkers that are very hard for you to take," he warned, drawing from his apparently inexhaustible book of military metaphors. "Instead, we are trying to develop a broader strategy of collaboration and partnership and fight the war on a broader field. Hopefully, when we win the war (warehousing) will be part of the treaty." BALANCING ACT The trick for HKEx will be to develop products that can connect with China without losing the unique features of the LME trading model that have made it the global pricing benchmark for industrial metals. There is still simmering anger among the LME brokerage community about the scale of the increases in trading fees due to come into effect at the start of next year. And one of the longest rounds of applause at the LME Dinner came when guest speaker Apurv Bagri, chief executive at ring-dealing member Metdist Trading, warned that reshaping the market into "an American-style exchange" would erode the LME's unique connectivity with its industrial user base. However, if the LME's existing trading model is to be preserved, its good delivery function must first be fixed. With the court-room challenge to the exchange's previous warehousing consultation now dismissed, expect an avalanche of second-phase reforms. ID:nL6N0SA2HA A new consultation, due to be launched next month, will cover both logistical and legal reviews of the LME's warehousing network as well as the rule-changes required to launch physical premium contracts. Then will come a drive into the universe of ferrous metals trading, with Matt Chamberlain, head of business development, suggesting an initial focus on new steel scrap and rebar contracts. The list of "Phase 2" products on his slide runs the gamut of the steel supply chain; iron ore, coking coal, stainless steel, hot-rolled coil and cold-rolled coil. All, however, will be "American-style" cash-settled products, albeit co-existing with the LME's current but moribund physically settled steel billet contract. THE ONLY CONSTANT? Compounding the downbeat mood among parts of the LME "Street" is the general sense that the only thing that's not going to change much over the next year are metal prices. Most seem braced for more of the same tough trading conditions that characterised the last 12 months. Macquarie Bank's survey of the 400 plus participants at its Base Metals Summit on Monday underlined the generally flat sentiment permeating this year's LME Week. The audience's weighted-average expectation for cash copper in one year's time was $6,663 per tonne, only marginally different from Monday's official LME price of $6,615. The prognosis for aluminium wasn't much better at $1,997 per tonne, compared with Monday's official price of $1,955. Nickel remains the collective bull favourite, despite or maybe because of the collapse of this year's early rally. The Macquarie audience's average view was for a run-up to $19,859 per tonne from Monday's $15,315. Nickel was picked as the metal to watch by both Macquarie analyst Jim Lennon and by Paul Gait, analyst at Sanford C. Bernstein, at the Bloomberg seminar. Robin Bhar, analyst at Societe Generale, went for lead and tin. Gayle Berry of Jefferies went for spreads in general rather than a specific metal. Everyone last week was talking about zinc, albeit with widely diverging views about the much-heralded and long-anticipated market deficit. It was a dichotomy nicely captured in the title of the paper presented at the LME Seminar by Duncan Hobbs, analyst at Noble Group: "Zinc market outlook - balance of material vs balance of opinion". As for aluminium, it was typical of this enigmatic market that the two speakers at the LME Seminar, Citi's David Wilson and Natixis' Nic Brown, were at odds over whether the global market will be in surplus or deficit next year. If you're confused, maybe try seeing things a little differently. One of the more thought-provoking presentations last week came from Colin Pratt, managing consultant at CRU Group, at CRU's breakfast meeting. Under the title "Two and a half cheers for resource nationalism", Pratt noted that Indonesia's ban on raw material exports, resource nationalism writ large, had transformed the two previous dogs of the LME complex, aluminium and nickel, into this year's out-performers. Was it coincidence, he asked, that this year's under-performers, copper and iron ore, are heavily weighted by production volumes to "safe" investment countries? A new metric for the base metals? Time will tell. But it's a new age for the LME and, if Hoffman is right, it may be the start of a new era for global metals trading. (editing by Jane Baird) ((andy.home@thomsonreuters.com)(Tel: 44-207-542-4412)) Keywords: LME WEEK/HOME

Sri Lanka rupee forwards up on bank dollar sales

October 24, 2014 - reuters.com

COLOMBO, Oct 24 (Reuters) - Sri Lankan rupee forwards ended slightly higher as banks sold dollars to cover short position in the local currency as President Mahinda Rajapaksa, also the finance minister, presented the 2015 budget in the parliament. Rajapaksa, presenting the budget in the parliament on Friday afternoon, said Sri Lanka in 2015 would trim its value added tax and reduce its budget deficit to the lowest level since 1977. ID:nL3N0SJ3VM The spot currency LKR=LK was quoted at 130.85/95 per dollar but not traded, dealers said. It was not traded during the week after closing at 130.60/80 on Oct. 17. The three-day forwards, or spot-next, actively traded in the absence of spot, ended at 130.90/131.00 per dollar, tad firmer from Thursday's close of 131.00/05. "We have seen some bank selling with the budget speech," a currency dealer said. Dealers said they are awaiting to see the impact of the budget and the exporters were reluctant to sell dollars ahead of the budget announcement. Dealers said the central bank's moral suasion was not seen on the spot, but it persuaded some banks not to trade the spot-next below 131.10 in the early trade. Central bank officials were not available for comment. Nandalal Weerasinghe, a central bank deputy governor, said on Monday the monetary authority would intervene to prevent short-term volatility in the rupee and said moral suasion was to prevent sharp changes. Weerasinghe said the central bank has been preventing a sharp appreciation in the currency by intervening to maintain some stability over the last 12 months. Overseas investors sold a net 30.9 billion Sri Lankan rupees ($236.24 million) worth of government securities in the five weeks through Oct. 22, data from the central bank showed. ($1 = 130.8000 Sri Lankan rupee) (Reporting by Shihar Aneez and Ranga Sirilal; Editing by Anand Basu) ((shihar.aneez@thomsonreuters.com; +94-11-232-5540; Reuters Messaging: shihar.aneez.thomsonreuters.com@reuters.net twitter:@shiharaneez)) Keywords: MARKETS SRI LANKA/FOREX

Brazil posts current account deficit of $7.9 bln in September

October 24, 2014 - reuters.com

BRASILIA, Oct 24 (Reuters) - Brazil posted a current account deficit BRCURA=ECI of $7.907 billion in September, central bank data showed on Friday. The country had been expected to post a deficit of $7.250 billion, according to the median forecast of 19 analysts in a Reuters poll. Brazil's current account deficit in August was $5.489 billion. (Reporting by Alonso Soto and Luciana Otoni Editing by W Simon) ((asher.levine@thomsonreuters.com; +55-11-5644-7756; Reuters Messaging: asher.levine1.thomsonreuters.com@reuters.net)) Keywords: BRAZIL ECONOMY/EXTERNAL

Vietnam domestic market commodity prices-Oct 24

October 24, 2014 - reuters.com

Oct 24 (Reuters) - Following are domestic prices of Vietnam's key commodities. Unit: million dong VND= per tonne. Item Oct 20-24 Oct 13-17 Location Robusta beans 38.3-41.2 40.6-42.1 Central Highlands Black pepper 182.0-186.0 188.0-189.0 Southern region Refined sugar 13.0-15.5 13.0-15.5 Southern region Summer-autumn paddy 5.90-6.30 5.50-6.40 Mekong Delta ___________________ SJC gold 3.570-3.590 3.577-3.592 Hanoi, HCM City NOTES: Gold prices are low/high selling prices quoted in million dong during the week by top manufacturer SJC per 3.75-gram ingot. Coffee export prices COFFEE/ASIA1 Rice export prices RICE/ASIA1 Historical data VNCOMM01 Central bank's gold auction SBVGOLD2013 ($1=21,250 dong) (Compiled by Hanoi Newsroom) ((hanoi.newsroom@thomsonreuters.com)(+844 3825 9623)) Keywords: VIETNAM COMMODITIES/PRICES

India cbank says did not buy or sell bonds via OMOs in week to Oct 17

October 24, 2014 - reuters.com

MUMBAI, Oct 24 (Reuters) - The Reserve Bank of India did not buy or sell any bonds under open market operations (OMOs) in week to Oct. 17, it said in a release on Friday. ($1 = 61.1600 rupees) (Reporting by Zeba Siddiqui; Editing by Anand Basu) ((zeba.siddiqui@thomsonreuters.com;)(+91 22 6180 7503)(; Reuters Messaging: zeba.siddiqui.thomsonreuters.com@reuters.net)) Keywords: INDIA CBANK/BONDS

New Issue- Grand City Properties prices 500 mln euro 2021 bond

October 24, 2014 - reuters.com

Oct 24(Reuters) -Following are terms and conditions of a bond priced on Friday. Borrower Grand City Properties S.A., Luxembourg GYC.DE Issue Amount 500 million euro Maturity Date October 29, 2021 Coupon 2.0 pct Reoffer price 95.564 Payment Date October 29, 2014 Lead Manager(s) Morgan Stanley & Co. International plc, J.P. Morgan Securities plc, Deutsche Bank AG, London Branch Ratings BB+ (S&P) Listing Ireland Full fees Undisclosed Denoms (K) 100-1 Security details and RIC, when available, will be on Z4UQ Customers can right-click on the code for performance analysis of this new issue For ratings information, double click on RRS0001 For all bonds data, double click on BONDS For Top international bonds news TOP/DBT For news about this issuer, double click on the issuer RIC, where assigned, and hit the newskey (F9 on Reuters terminals) ((EMEA Fixed Income Desk Bangalore; jenifer.prabhaker@thomsonreuters.com; Reuters Messaging jenifer.prabhaker.reuters.com@reuters.net; +91 80 6677 2510, fax +44 20 7542 5285))

TABLE-Indian govt had no outstanding loans from RBI in Oct 17 week

October 24, 2014 - reuters.com

Oct 24 (Reuters) - The Indian government had no outstanding loans with the central bank under ways and means advances in the week ended Oct. 17, according to the Reserve Bank of India's weekly statistical supplement released on Friday. The central government had no outstanding loans in the week earlier as well. State governments had 15.31 billion rupees ($250.3 million) of loans from the RBI in the week ended Oct. 17, compared with 21.28 billion rupees in the previous week, the release showed. ($1 = 61.1600 rupees) (Reporting by Zeba Siddiqui in Mumbai; Editing by Anand Basu) ((zeba.siddiqui@thomsonreuters.com; +91 22 6180 7503; Reuters Messaging: zeba.siddiqui.thomsonreuters.com@reuters.net)) Keywords: INDIA CENBANK/LOANS

Polish cbanker Hausner says rates now at appropriate level:report

October 24, 2014 - reuters.com

WARSAW, Oct 24 (Reuters) - Poland's main interest rate is at an appropriate level after a 50 basis points cut earlier this month, and it should now be kept steady, Bloomberg quoted central bank rate-setter Jerzy Hausner as saying. "I consider the current level of interest rates as adequate in light of available economic forecasts," Bloomberg cited Hausner. "When asked if the rates should be cut more, I reply: no. But I don't rule it out, if current forecasts become subject to significant changes." (Reporting by Pawel Florkiewicz; Writing by Christian Lowe; Editing by Adrian Krajewski) ((christian.lowe@thomsonreuters.com; +48 22 653 97 00; Reuters Messaging: christian.lowe.thomsonreuters.com@reuters.net)) Keywords: POLAND CENBANK/RATES HAUSNER

FX COLUMN-Tax issues, election uncertainty leave sterling at risk

October 24, 2014 - reuters.com

-- Neal Kimberley is an FX market analyst for Reuters. The opinions expressed are his own -- By Neal Kimberley LONDON, Oct. 24 (Reuters) - Sunny September days that cut into British retail sales ID:nL9N0CA01R have ushered in taxing problems for the UK government's finances and could weigh the pound down versus the dollar. GBP= The budget position is worsening and that may unnerve investors, particularly before the May 2015 parliamentary election, the outcome of which remains impossible to call. The expected timing of any Bank of England interest rate increase has been pushed further and further into 2015, which may also make investors think twice before buying sterling. ID:nL6N0SH2A3 In fact, speculators' bets against sterling are at their most negative since the week of the Scottish referendum last month, which saw a late surge in support for the pro-independence camp. They had been well into positive territory for much of the year. IMM/FX Both this positioning data and options prices GBP1MRR= show investors less negative on the pound than they were just before the vote, but the bias to sell has been maintained. Retail sales volumes fell 0.3 percent on the month in September, their weakest performance since January, and grew 2.7 percent year-on-year. Economists had expected 0.1 percent monthly and 2.8 percent annual growth. The Office for National Statistics said mild weather had put shoppers off buying winter clothes. Whatever the reason, the lower the retail sales, the less sales tax is paid to the British authorities. That is not great news for British Finance Minister George Osborne, who is already struggling to cut Britain's budget deficit against a backdrop of lacklustre growth in government revenues. ID:nL6N0SG1SK September's government borrowing was 15.3 percent higher than a year earlier at 11.8 billion pounds, the ONS said. For the first six months of the financial year that began in April, public-sector net borrowing, excluding state-controlled banks, was 58.0 billion pounds, 10.3 percent up on 2013. While Britain's economic recovery since mid-2013 has been stronger than expected, it has not yet translated into burgeoning tax revenues. Slow wage growth has kept a lid on income tax. So has government policy to relieve the lower paid of income tax by raising the level at which it becomes payable. A decline by mortgage approvals in September to their lowest since July last year could mean fewer houses change hands, lowering the amount of stamp duty paid to the government. ID:nS8N0PK03K And the tax take from costly-to-extract North Sea oil may be reduced by falling crude prices CLc1 LCOc1 ID:nL5N0R91DE . MAY POLL Whoever takes power in Britain in May 2015 will, like the current coalition, have to address the budget deficit. The problem for investors is that there is absolutely no clarity about the make up of the next British government. The centre-right Conservative Party, the biggest party in the governing coalition, is worried it will lose support to the increasingly popular UK Independence Party, which wants to see Britain leave the European Union. That might seem to benefit the centre-left opposition Labour Party. But its vote could be hurt in Scotland by a swing toward the Scottish Nationalist Party. All in all, it is hard to predict who will take office in May 2015, let alone how the new government will address the challenge of getting British government finances into a better balance. From that perspective, the outlook for the pound against the dollar is not too rosy. (Editing by Nigel Stephenson; Reuters Messaging: neal.kimberley.thomsonreuters.com@reuters.net, Larry King) ((neal.kimberley@thomsonreuters.com)) Keywords: MARKETS FOREX/GBP

FOREX-Euro dips ahead of banks' stress test results, sterling firm

October 24, 2014 - reuters.com

(Updates, adds fresh details) * European bank stress test results awaited * Sterling rises after Q3 UK GDP data * Yen firm on safety bids after NY doctor tests positive for virus By Anirban Nag LONDON, Oct 24 (Reuters) - The euro slipped against the yen on Friday, with investors cautious ahead of the results on Sunday of stress tests on euro zone banks, with the single currency also lagging the pound after robust third-quarter UK growth data. Sterling GBP=D4 gained after figures showed the British economy growing in line with forecasts and at a healthy pace, providing relief for those worried that weakness overseas, especially in the euro zone, could drag more on activity. The euro was down 0.1 percent at 78.85 pence EURGBP=D4 and shed 0.1 percent against the yen to trade at 136.84 EURJPY=R . Against the dollar, the euro was steady at $1.2650 EUR= , having hit a two-week low of $1.2614 on Thursday. The euro zone's 130 biggest banks received the European Central Bank's final verdict on their finances on Thursday after a review aimed at drawing a line under persistent doubts about the health of the region's banking sector. They will not be made public until 1100 GMT on Sunday. Generally investors are expecting few failures and surprises, especially amongst household names, but going into the weekend, most preferred to be cautious about the euro. ID:nL6N0SI47Y "Evidence that a significant number of banks -- say more than 15 percent of total, among them large European lenders -- failed, and the capital shortfall is substantially above consensus of 25 billion euros, could fuel concerns about future credit growth and the economic outlook, weighing on the euro," said Valentin Marinov, currency strategist at Citi. "If only a handful of smaller banks fail and the capital shortfall does not exceed market estimates, this may help euro stabilise. The longer-term risks for euro could remain on the downside, however." YEN FIRM The yen was helped by safe-haven bids after news that a doctor had tested positive for the Ebola virus in New York City after returning from West Africa. ID:nL2N0SI2LX The first confirmed case in the city worried investors because of the possible repercussions in the global financial centre, although some said the market focus could soon shift. "The volatile move was a good chance for some to buy the dollar on dips," said Kaneo Ogino, director at Global-info Co in Tokyo, a foreign exchange research firm. "I think, next week the market will be more event-driven, with the FOMC and the Bank of Japan, so the downside should be limited," he said, adding that dollar support at 107 yen was likely to hold for now. The greenback was about 0.1 percent lower at 108.15 yen JPY= after earlier dropping as low as 107.86 yen. The U.S. Federal Reserve will meet next Tuesday and Wednesday, and the consensus view is that it will wrap up asset purchases under its third round of quantitative easing. The Bank of Japan appears set to resist pressure for more stimulus measures, or to accept its inflation target is unrealistically high, at its next policy meeting on Oct. 31, people familiar with its deliberations have told Reuters. ID:nL3N0SB47X The yen had faced overnight pressure after a Wall Street Journal report sparked talk of more easing. The article, citing people familiar with the Japanese central bank's thinking, said the BOJ saw "a much bigger possibility of inflation slipping below 1 percent" due to falling oil prices. Sterling rose against the dollar GBP=D4 to $1.6040, after the GDP data showed Britain's economy grew by 0.7 percent in the third quarter, down from 0.9 percent the quarter before, but in line with economists' expectations. Money markets continue to price in a first interest rate rise by the Bank of England around the middle of next year, potentially the first post-crisis hike by any big central bank. (Additional reporting by Lisa Twaronite; Editing by Catherine Evans) ((anirban.nag@thomsonreuters.com)(+44 20 7542 8399; Reuters Messaging: anirban.nag.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

Brazil real gains after slumping to 9-1/2-year low

October 24, 2014 - reuters.com

RIO DE JANEIRO, Oct 24 (Reuters) - The Brazilian real gained 1 percent early on Friday after slumping to a 9-1/2-year low in the previous session on fears that President Dilma Rousseff may defeat market-favorite candidate Aecio Neves in Sunday's presidential election. The real BRL= strengthened as much as 1.2 percent in the first minutes of the session but later trimmed gains to trade 0.7 percent stronger around 2.50 per dollar. It closed Thursday at its weakest level since April 2005 on election fears. After markets closed on Thursday, two major surveys by pollsters Ibope and Datafolha showed Rousseff gaining a clear lead ahead of the Oct. 26 runoff vote. ID:nL2N0SI2IS Some analysts said Thursday's sharp sell-off was overdone, making room for a correction. Others noted that, under Rousseff, the central bank will likely continue its program of currency interventions, which is expected to cushion the real's depreciation trend. Neves, on the other hand, is expected to immediately stop the sale of currency swaps that are used by the central bank to support the real. All analysts warned, however, that the market will remain extremely volatile as investors brace for what seems to be one of Brazil's tightest presidential election in decades. (Reporting by Walter Brandimarte and Bruno Federowski Editing by W Simn) ((walter.brandimarte@thomsonreuters.com; +55 21 2223 7149; Reuters Messaging: walter.brandimarte.thomsonreuters.com@reuters.net)) Keywords: BRAZIL MARKETS/REAL

London gold 1030 fix - Oct 24 - 1231.75 dlrs

October 24, 2014 - reuters.com

London platinum/palladium 0945 fix - Oct 24

October 24, 2014 - reuters.com

India gold sales jump about 20 pct for Diwali - trade body

October 24, 2014 - reuters.com

By A. Ananthalakshmi SINGAPORE, Oct 24 (Reuters) - Gold sales in India during the festivals of Diwali and Dhanteras celebrated this week rose by about a fifth, a senior official at the country's biggest gold trade group said on Friday. Premiums in India, the second biggest buyer of bullion, jumped to $17-$18 an ounce this week, compared with $12 last week, on surging demand. Dhanteras, associated with Lakshmi - the goddess of wealth, and Diwali, the festival of lights, are both considered auspicious to buy gold. "Diwali sales across the country were very good. It was about 20 percent higher compared with last year," Bachhraj Bamalwa, director at the All India Gems and Jewellery Trade Federation, told Reuters. The trade body represents more than 300,000 jewellers. The strong demand from India could support global gold prices XAU= . GOL/ India set a record high import duty on gold last year to curb its trade deficit, and made it necessary for importers to re-export a fifth of all their purchases. The moves contained imports into the country, with the resulting supply shortage sending local premiums to about $160 an ounce over the global benchmark at one point. Some of the rules were eased earlier this year, leading to higher imports and a fall in local prices. "This year prices were low, sentiment was good and we have a stable government in the centre; all of these helped boost sales," Bamalwa said, referring to this year's election of Narendra Modi as the prime minister. Though the major gold buying festivals of the year are over, Bamalwa said sales could continue to be strong due to the wedding season that will extend until early next year. In anticipation of strong demand during the festivals, India had imported $3.75 billion worth of gold in September - a 450 percent jump from the same period last year. The jump in imports weighed on the country's trade deficit again, sparking fears that the government could tighten the screws again on overseas purchases of gold. India's finance minister was quoted in local media as saying that he could look at curbs on gold imports after the festive season. ID:nD8N0RJ00R Any further curbs could hurt imports and push up premiums, Bamalwa said. In other parts of Asia, buying interest for gold was quiet, with premiums slipping in some regions, dealers said. "I think prices have to fall toward or below $1,200 before people come into the physical markets again," said a trader in Hong Kong, where premiums slipped to $1.10-$1.20 an ounce from about $1.50 last week. In China, premiums fell to about $1.50 an ounce on Friday from $2-$3 an ounce. GOLD/ASIA1 (Editing by Anand Basu) ((ananthalakshmi.as@thomsonreuters.com; +65 6870 3726; Reuters Messaging: ananthalakshmi.as.thomsonreuters.com@reuters.net)) Keywords: INDIA GOLD/DEMAND

BRIEF-Drdgold posts 10 pct rise in quarterly gold production

October 24, 2014 - reuters.com

Oct 24 (Reuters) - Drdgold Ltd DRDJ.J : * Revenue increased by 18 sequentially to R528.5 million * Q1 gold production up 10 pct to 37 005 oz * AISC down 9 pct to $1 237/oz * Q1 EBITDA up 87 pct to R48.0 million * Q1 operating profit up 11 pct to R79.7 million * Q1 gold sold was 17 pct higher at 38 291oz Source text for Eikon: ID:nJseX0001a Further company coverage: DRDJ.J ((Bangalore Newsroom +91 806 749 1130)) Keywords: DRDGOLD /BRIEF

INDICATORS - Kazakhstan - Oct 24

October 24, 2014 - reuters.com

UPDATE 1-Massive gold nugget goes on sale for $400,000 in San Francisco

October 24, 2014 - reuters.com

(Adds common weight of nugget, will be on display until Sunday) By Alex Dobuzinskis Oct 23 (Reuters) - A 5-pound gold nugget dug up in Northern California this past summer and believed to be the largest privately held piece of its kind from the state was offered for sale at $400,000 on Thursday. The chunk of gold, which is the size of a misshapen baked potato and weighs 72 troy ounces, or about 5 pounds (2.3 kg), is on display at the San Francisco Fall Antiques Show from Thursday through Sunday, said David McCarthy, senior numismatist for Kagin's Inc. The California-based numismatic firm was billing it as the "Butte Nugget" because it was unearthed in Butte County in Northern California by a man prospecting for gold on public land in July, according to the company. The firm did not identify the man for whom it is selling the nugget or where in the county it was discovered. "There are bigger ones in museums and there were bigger ones certainly near the Gold Rush period, but today it's believed to be the largest gold nugget in private hands in California," said Donald Kagin, president of Kagin's. McCarthy, who evaluated the find, said the man who found it photographed its excavation step by step and took McCarthy to the spot where it was unearthed, but not before blindfolding him. "I've seen the pictures of the nugget being slowly exposed as he was digging it up, it was very obvious it had been in the ground for a very long time," McCarthy said. Kagin's earlier this year offered for sale pieces from a trove of rare Gold Rush-era coins that were discovered in California last year by a couple walking their dog and assessed at more than $10 million. Many of the coins were offered on Amazon.com. Adrian Ash, head of research at gold and silver exchange company BullionVault, said in an email the gold content was largely irrelevant and that the nugget's value derived from its unusual size. "Unlike a big diamond, its price would be destroyed by working it into an objet d'art," Ash said. McCarthy said that if someone agreed to pay the $400,000 asking price for the nugget before Sunday, he would seek to have it remain on display until then. (Reporting by Alex Dobuzinskis in Los Angeles; Editing by Dan Whitcomb, Lisa Shumaker and Peter Cooney) ((alex.dobuzinskis@thomsonreuters.com; 1-213-955-6781; Reuters Messaging: alex.dobuzinskis.thomsonreuters.com@reuters.net)) Keywords: USA GOLD/SANFRANCISCO

BRIEF-Eldorado Gold gives drilling update

October 24, 2014 - reuters.com

Oct 23 (Reuters) - Eldorado Gold Corp ELD.TO : * Announces drilling update * At white mountain, over 7,500 metres of exploration drilling, over 12,400 metres of delineation drilling are completed year-to-date * At the jinfeng operation, year-to-date, a total of 3,600 metres of drilling has been completed * Has completed over 6,000 metres of exploration drilling this year at our piavitsa project in the halkidiki mining district, Greece * Source text for Eikon ID: * Further company coverage ELD.TO ((Bangalore Newsroom; +1 646 223 8780))

Massive gold nugget goes on sale for $400,000 in San Francisco

October 23, 2014 - reuters.com

Oct 23 (Reuters) - A huge gold nugget dug up in Northern California earlier this year that is believed to be the largest privately held piece of its kind from the state was offered for $400,000 on Thursday, said the president of the company behind the sale. The chunk of gold, which is larger than a human palm and weighs 72 troy ounces, was being put on sale at the San Francisco Fall Antiques Show at Fort Mason on Thursday afternoon, said Donald Kagin, president of California-based numismatic firm Kagin's Inc. Kagin's Inc was billing it as the "Butte Nugget" because it was unearthed in Butte County in Northern California by a man prospecting for gold on public land in July, according to the company. The firm did not identify the man or say where exactly in the county the nugget was discovered. "There are bigger ones in museums and there were bigger ones certainly near the Gold Rush period, but today it's believed to be the largest gold nugget in private hands in California," Kagin said. David McCarthy, the senior numismatist for Kagin's Inc who evaluated the find, said the man who found it photographed its excavation step-by-step. "I was able to use his pictures to positively identify the location where the gold was discovered," McCarthy said in a statement. "Nuggets like this don't come along every day. I really didn't believe that I would see a California nugget of this size unearthed during my lifetime." Kagin's Inc earlier this year offered for sale pieces from a trove of rare Gold Rush-era coins discovered in California last year by a couple walking their dog and worth more than $10 million. Many of the coins were offered on Amazon.com. Adrian Ash, head of research at gold and silver exchange company BullionVault, said in an email that the gold content is largely irrelevant to the rarity value of the large nugget Kagin's Inc was set to offer for sale on Thursday. "Unlike a big diamond, its price would be destroyed by working into an objet d'art," Ash said. (Reporting by Alex Dobuzinskis in Los Angeles; Editing by Dan Whitcomb and Lisa Shumaker) ((alex.dobuzinskis@thomsonreuters.com; 1-213-955-6781; Reuters Messaging: alex.dobuzinskis.thomsonreuters.com@reuters.net)) Keywords: USA GOLD/SANFRANCISCO

UPDATE 2-Hochschild Q3 output falls, but on track for annual target

October 23, 2014 - reuters.com

* Q3 attributable production 4.8 mln silver equiv ounces * Keeps FY production target of 21 mln silver equiv ounces * Sees further cost savings next year * Shares fall as much as 3.6 pct (Rewrites first paragraph, adds detail) By Esha Vaish Oct 23 (Reuters) - Peruvian precious metals miner Hochschild HOCM.L posted a decline in third-quarter production, hit by lower grades at its Pallancata mine and a two-week strike at its Arcata asset, but said was it was still on track to reach its annual target. The company, which gets the bulk of its production from underground mines in southern Peru, said attributable production dropped to 4.8 million silver equivalent ounces in the three months ended Sept. 30, from 6.3 million silver equivalent ounces a year earlier. ID:nRSW0641Va However, thanks to strong output in the first half, Hochschild kept its production target of 21 million silver equivalent ounces for the year. "Everybody was thinking that they're going to beat their numbers quite strongly for the year, and it doesn't look like it's going to be quite so strong," Numis Securities analyst Cailey Barker told Reuters. Analysts on average are expecting full-year EBITDA of $155.9 million, on revenue of $516.18 million, according to Thomson Reuters I/B/E/S. Last year, a sudden and sharp drop in bullion prices to their lowest in a decade knocked miners cold, putting their balance sheets under stress and forcing many of them to slash costs to limit the damage. Hochschild responded by halting dividend payments, slashing directors' salaries and cutting costs at its mines -- measures that ultimately helped it exceed its target of saving $200 million this year. ID:nL4N0PR20D The company, which also operates in Argentina, said on Thursday it had already saved about $270 million so far this year and expected all-in sustaining costs per silver equivalent ounce to fall by 0-5 percent. Further cost savings of about $50 million has been identified for 2015, said Hochschild. Barker said given the weakness in prices, the company's 2015 savings needed to be close to the 2014 amount, although it would be a "tall order for them". Silver XPT= , which lost 36 percent in value in 2013, has fallen yet another 8 percent since the beginning of the year. Gold XAU= has risen 2.9 percent, barely denting the impact of the 28 percent tumble it took last year. "They're still under water at these prices ... It's all predicated on Inmaculada coming in and what sort of costs that will eventually come out with," analyst Barker said. Although Hochschild had expected its Inmaculada project in southern Peru to be commissioned at the end of the year, analysts at Barclays said the company was still a "bit behind" on plant construction. "It appears first production will probably be slightly delayed compared to the original (plan of) Q4 2014," Barclays analysts said, but kept their price target of 163 pence on Hochschild stock. The company's shares, which have been trading near their lowest in more than five years, closed down more than 3 percent. They have shed 13 percent in value since the start of the year. (Reporting by Esha Vaish in Bangalore; Additional reporting by Silvia Antonioli in London; Editing by Gopakumar Warrier and Mark Potter) ((esha.vaish@thomsonreuters.com; within UK +44 20 7542 1810, outside UK +91 80 6749 1136; Reuters Messaging: esha.vaish.thomsonreuters.com@reuters.net)) Keywords: HOCHSCHILD MIN RESULTS/

London gold 1500 fix - Oct 23 - 1232.75 dlrs

October 23, 2014 - reuters.com

Swiss gold referendum holds risks for franc

October 23, 2014 - reuters.com

* "Yes" vote could see volatility in Swiss franc * Right-wing Swiss party opens campaign on Thursday * Share of gold in SNB's reserves has been falling By Anirban Nag and Alice Baghdjian LONDON/ZURICH, Oct 23 (Reuters) - The Swiss franc has been a haven of relative calm in choppy currency markets in recent weeks, but a referendum next month on "saving" Switzerland's gold reserves could change all that. The Nov. 30 vote, called by the right-wing Swiss People's Party (SVP), is aimed at preventing the Swiss National Bank from offloading its gold holdings. It would also require the central bank to bring back gold parked abroad and hold at least 20 percent of its assets in gold. The SNB opposes the initiative, saying it would curb its ability to shape monetary policy. The central bank now holds less than 8 percent of its assets in gold, so a "Yes" vote - which is possible but not likely, polls suggest - would probably send gold prices XAU= rocketing. The SNB would have to buy about 1,500 tonnes over the next five years. For currency investors, though, the new requirement could generate volatility in the franc and threaten the three-year-old cap on its value against the euro, which the SNB imposed to prevent the Swiss currency from appreciating, ward off deflation and boost growth. The bank now invests the bulk of its currency reserves of around 500 billion francs in euros and about a quarter in dollars. The share of gold holdings has been coming down over the past few years as it stepped up its intervention in the currency market. A "Yes" vote would see it more than double the quantity of gold holdings. Given the preponderance of euros in its FX reserves, that would most likely entail selling euros. The single European currency EUR= would probably drop, threatening the SNB's 1.20 francs per euro floor EURCHF= , analysts said. "Even if considered a remote tail risk, some investors might want to take out insurance, particularly if the polls ... were to suggest more support than is currently expected," said Beat Siegenthaler, currency strategist at UBS, Zurich. "If it (the initiative) came through, the market would immediately conclude that the (euro/Swiss franc) floor is less viable, less sustainable." The SVP also backed an initiative against mass immigration, which proposed quotas for European Union immigrants and was backed by a narrow margin of voters in February. The gold initiative's committee began its campaign in the Swiss capital, Berne, on Thursday. Posters showing a red and white piggy bank - the colours of Switzerland's flag - and the slogan "Save our Swiss gold" can already be seen around the country, including Zurich's main railway station. SCOTLAND AGAIN? The latest polls show the initiative does not have huge support - about 45 percent, which is expected to decline as the vote comes closer - and is controversial even within the SVP. ID:nL6N0SG2XK It is also not prominent on investors' radar. "The lack of attention being given to the upcoming referendum in Switzerland on the SNB's gold holdings has similarities with the lack of attention given to the Scotland referendum until just two weeks before the vote," said Derek Halpenny, European head of global market research at Bank of Tokyo Mitsubishi. "And like the independence vote in September, a `Yes' result in the gold referendum could have considerable foreign-exchange implications going forward." Sterling GBP=D4 hit an 11-month low and options to hedge against swings in the currency rose to four-year highs as the pro-independence camp gained support in the two weeks before the Sept. 18 vote. Scotland eventually voted against independence. So far, euro/Swiss franc options EURCHFVOL= show little desire to hedge against sharp moves in the franc. One-month risk reversals EUCH1MRR= , which gauge demand for options on a currency rising or falling, shows a bias for euro calls - bets the single currency will rise. COSTLY GOLD CRIMPS POLICY Higher gold holdings would escalate costs for the SNB and impair its ability to intervene freely in the currency market. Four years ago, the SNB came under strong criticism domestically after its currency interventions led to sharp losses. The SNB also reported a loss for 2013, as profit from its foreign currency reserves failed to offset a decline in the value of its gold holdings after prices slumped. ID:nL6N0M40GH A "Yes" vote would not prevent the SNB from expanding its balance sheet. It could still print Swiss francs to stop the currency from rising, but that would entail considerable cost as it would need to buy more gold to meet the new requirements. SNB vice-chairman Jean-Pierre Danthine said earlier this month that had the terms of the initiative been in force three years ago, it would have obliged the SNB to buy gold as well as euros in large quantities to defend the currency floor. "Our defence of the minimum exchange rate would thus have involved huge costs, which would almost certainly have caused foreign exchange markets to doubt our resolve to enforce the rate by all means," he said. ID:nL6N0S41XH Marvin Barth, a currency strategist at Barclays, said given the considerable balance sheet costs, the SNB was likely to impose negative interest rates to reduce the franc's appeal. "We expect that the SNB's first policy step in the event the gold referendum is passed would be to cut deposit rates to or below the ECB's negative 20 basis points," he said in a note. (Reporting by Anirban Nag; Editing by Larry King) ((anirban.nag@thomsonreuters.com; +44 20 7542 8399 ; Reuters Messaging: anirban.nag.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/SWISS GOLD

London platinum/palladium 1400 fix - Oct 23

October 23, 2014 - reuters.com

UPDATE 2-African Barrick tightens full-year costs target

October 23, 2014 - reuters.com

* Sees full-year all-in sustaining costs at $1,100 per ounce sold * Third-quarter AISC falls 14 pct to $1,098 per ounce * Third-quarter EBITDA rises 17 pct to $75.8 million * Gold production up 16 pct to 190,986 ounces in third quarter * Cuts 500 jobs at Bulyanhulu mine in third quarter (Adds details, CEO and analysts' comments; updates share movement) Oct 23 (Reuters) - African Barrick Gold Plc ABGL.L tightened its costs target for the full year as it increased output while also cutting jobs to beat the sharp drop in gold prices. The miner reported a fall in overall expenses for an eighth successive quarter after it cut more than 500 jobs at its flagship Bulyanhulu mine in Tanzania in the third quarter ended Sept. 30. African Barrick's stock was among the top percentage gainers on the FTSE-250 Midcap Index .FTMC on Thursday, rising as much as 4.8 percent in early trading. To beat shrinking gold prices, African Barrick has been accelerating production at Bulyanhulu, the largest of its three operating mines in Tanzania, by increasing its use of technology. Many gold and silver miners were forced to shelve new projects and slash costs last year after prices of precious metals fell to their lowest in a decade. Gold XAU= fell 28 percent and silver XAG= plunged 36 percent in 2013. "By the end of next year we expect Bulyanhulu to produce 350,000 ounces at $900 per ounce," Chief Executive Bradley Gordon told Reuters. The mine, which produced 198,286 ounces of gold in 2013 at an overall cost of $1,344 per ounce sold, now employs around 1,900 people, compared with 3,400 a year ago. African Barrick, which reported a 17 percent jump in third-quarter core profit, said it anticipates full-year costs at the lower end of it target range of $1,100-$1,175 per ounce sold. All-in sustaining costs (AISC) - a widely used measure that includes production and exploration expenses - fell 14 percent to $1,098 per ounce sold in the third quarter. The company also reiterated it was on track to exceed planned cost savings of $185 million this year. "Every part of the business has been under review and we're still seeing lots of opportunity (in terms of reducing costs further), but mainly in the mining part of the business, the actual physical mining cycle," Gordon said. Job cuts at the corporate level have also helped African Barrick reduce its cost base. "The number of people in the business has reduced significantly; the number of expats has gone from 550 down to 200 and we see that number going lower," Gordon said. African Barrick, which operates primarily in Tanzania, initiated an operational review last year after parent Barrick Gold Corp's ABX.TO failed attempt to sell the business to a Chinese buyer. Core earnings, or earnings before interest, taxes, depreciation, and amortization (EBITDA), rose to $75.8 million in the third quarter from $64.8 million a year earlier. Revenue rose 9 percent to $240.9 million. African Barrick said gold production rose 16 percent to 190,986 ounces and reiterated its full-year target of more than 700,000 ounces of gold. Shares in the FTSE-250 company were up 3.4 percent at 201.7 pence at 1136 GMT. (Reporting by Roshni Menon in Bangalore; Editing by Feroze Jamal) ((roshni.menon@thomsonreuters.com; within UK +44 20 7542 1810, outside UK +91 80 6749 1136; Reuters Messaging: roshni.menon.thomsonreuters.com@reuters.net;)) Keywords: AFRICAN BARRICK RESULTS/

London gold 1030 fix - Oct 23 - 1240.50 dlrs

October 23, 2014 - reuters.com

London platinum/palladium 0945 fix - Oct 23

October 23, 2014 - reuters.com

Silver miner Hochschild keeps full-year output target

October 23, 2014 - reuters.com

Oct 23 (Reuters) - Precious metals miner Hochschild Mining Plc HOCM.L kept its production target of 21 million silver equivalent ounces for this year despite posting a fall in third-quarter production. The Latin American company, which has been slashing costs as precious metal prices remain weak, said it had identified further cost savings of about $50 million for 2015. Hochschild has already achieved about $270 million of cost savings this year. Attributable production dropped to 4.8 million silver equivalent ounces in the three months ended Sept. 30, from 6.3 million ounces a year earlier, as the company shut its ageing Ares mine in Peru. ID:nRSW0641Va Hochschild gets the bulk of its production from underground mines in southern Peru and has operations in Argentina as well. (Reporting by Esha Vaish in Bangalore; Editing by Gopakumar Warrier) ((esha.vaish@thomsonreuters.com; within UK +44 20 7542 1810, outside UK +91 80 6749 1136; Reuters Messaging: esha.vaish.thomsonreuters.com@reuters.net)) Keywords: HOCHSCHILD MIN RESULTS/

African Barrick Gold's third-quarter core profit jumps 17 pct

October 23, 2014 - reuters.com

Oct 23 (Reuters) - African Barrick Gold Plc ABGL.L reported a 17 percent jump in third-quarter core profit as it sold more gold than a year earlier and costs fell. Core earnings, or earnings before interest, taxes, depreciation, and amortization (EBITDA), rose to $75.8 million from $64.8 million a year earlier. Revenue for the three months ended Sept. 30 rose to $240.9 million from $220 million a year earlier. African Barrick said gold production rose 16 percent to 190,986 ounces, with gold sales rising 11 percent. Cash costs fell 7 percent to $679 per ounce during the period. The FTSE 250 company, which operates primarily in Tanzania, reiterated its full-year production forecast of more than 700,000 ounces of gold. ID:nPRrN5C6Aa The company, which is in the midst of a massive cost-cutting drive, said it remained on track to exceed planned cost savings of $185 million. (Reporting by Roshni Menon in Bangalore) ((roshni.menon@thomsonreuters.com; within UK +44 20 7542 1810, outside UK +91 80 6749 1136; Reuters Messaging: roshni.menon.thomsonreuters.com@reuters.net;)) Keywords: AFRICAN BARRICK RESULTS/

BRIEF-African Barrick Q3 core profit rises

October 23, 2014 - reuters.com

Oct 23 (Reuters) - African Barrick Gold Plc ABGL.L : * Q3 revenue up 9 percent at $241 million * Q3 EBITDA rises 17 percent to $76 million * Q3 gold sales 11 percent higher at 178,490 ounces * Q3 gold production up 16 percent to 190,986 ounces * Says on track to exceed planned cost savings of $185 million by end 2014 * Continues to expect full-year production in excess of 700,000 ounces * Sees FY cash costs of around $740 per ounce sold, AISC costs around $1,100 per ounce sold Source text for Eikon: ID:nPRrN5C6Aa Further company coverage: ABGL.L ((Bangalore Newsroom +44 20 7542 1810)) Keywords: AFRICAN BARRICK GOLD /BRIEF

INDICATORS - Kazakhstan - Oct 23

October 23, 2014 - reuters.com

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