Please wait...

Reuters News

WEEKAHEAD-AFRICA-FX-Importers to put pressure on some East African currencies next week

August 21, 2014 - reuters.com

JOHANNESBURG, Aug 21 (Reuters) - Importers in Kenya and Tanzania are expected to keep the local currencies under pressure next week, while low demand for the dollar in Uganda should support the country's shilling. KENYA Kenya's shilling is likely to weaken due to rising month-end demand for dollars against a trickle of greenbacks into the market, traders said. By 1230 GMT market on Thursday, commercial banks quoted the shilling KES= at 88.30 to the dollar, down from last Thursday's close of 88.05. "It looks like the shilling is going to weaken with end-of-month payments of imports by the oil and manufacturing sectors," said Sheikh Mehran, head of trading for I&M bank. Kenya's currency has weakened for the past two weeks as banks started buying the dollar on signs that a domestic funding crunch was easing. However, some analysts say the problem has not gone away. Mehran said inflows of dollars would be limited, with the tea, tourism sectors beset by dwindling earnings. Kenya's tea exports have fetched lower prices all year due to over-production, while its tourism business slid into crisis because of frequent deadly attacks blamed on Islamists from neighbouring Somalia. Worries over the industry's performance have grown due to the Ebola outbreak in west Africa that has caused at least one airline, Korean Airlines 003490.KS , to suspend its flights to Kenya, even though the east African hub itself has not seen any cases. TANZANIA Commercial banks in east Africa's second-biggest economy quoted the shilling at 1,665/1,675 to the dollar on Thursday, weaker than 1,660/1,670 a week ago. "The shilling has been weakening over the past week and is expected to continue depreciating in the coming week," said Hakim Sheikh, a dealer at Commercial Bank of Africa, Tanzania. "The shilling is under pressure because of the easing of the liquidity squeeze on the local currency, which has ushered in a rise of demand for dollars from oil and construction sectors." The Bank of Tanzania said on its website it traded $55.5 million on the interbank foreign exchange market over the past week. UGANDA Month-end dollar inflows during a period of low corporate demand should lend some support to Uganda's shilling next week, traders said. At 1123 GMT commercial banks quoted the shilling at 2,600, slightly firmer than last Thursday's close of 2,605. "I suspect the shilling will be stuck in 2,600-2,615 range since not much is happening on the demand side. But as we eye month-end inflows the bias will be on the appreciation side," said Benon Okwenje, trader at Stanbic Bank. Month end flows normally come in from charities converting dollars to pay salaries. The shilling has strengthened in recent days, underpinned by weak demand from private firms and attractive government bond yields. The unit is also seen stronger after a court overturned an anti-gay law that drew Western criticism and halted aid payments. ID:nL6N0Q731V (Reporting by James Macharia, Fumbuka Ng'wanakilala and Elias Biryabarema; Editing by Xola Potelwa and Alison Williams) ((xola.potelwa@thomsonreuters.com)(+27 11 775 3098)(Reuters Messaging: xola.potelwa.thomsonreuters.com@reuters.net)) Keywords: MARKETS AFRICA/CURRENCY

UPDATE 2-Rouble snaps 3-day losing streak vs dollar, Russian shares up

August 21, 2014 - reuters.com

(Releads on rouble, adds comments, updates prices) MOSCOW, Aug 21 (Reuters) - The rouble strengthened on Thursday, boosted by the approaching end-of-month tax period and hopes that a bilateral meeting between Russia and Ukraine next week could ease tension. Russian shares extended a nine-day rally. At 1500 GMT, the rouble was trading 0.55 percent higher against the dollar at 36.10 RUBUTSTN=MCX and was up 0.42 percent against the euro at 47.92 EURRUBTN=MCX . That left the Russian currency 0.45 percent firmer at 41.43 against the dollar-euro basket RUS=MCX the central bank uses to gauge the rouble's nominal exchange rate. "The rouble is being supported by a combination of factors - there are some signals on a de-escalation of the conflict in Ukraine, there's the tax period ... and the exchange rate has climbed rather high in the past few days," said Ruslan Pshonkovsky, a trader at Roseksimbank in Moscow. The rouble typically strengthens towards the end of the month as major exporters convert their hard currency earnings into roubles to pay their tax obligations to the state budget. Some analysts also view Russian assets as oversold after a series of sharp sell-offs linked to Russia's perceived role in the Ukraine crisis. Supporting sentiment across markets, President Vladimir Putin and Ukrainian President Petro Poroshenko are due to meet on Aug. 26 in Minsk to discuss the situation in eastern Ukraine, where fighting is continuing between pro-Russian rebels and government forces. The speaker of the Russian parliament was quoted as saying on Thursday that the meeting was a step towards defusing the conflict in Ukraine. ID:nL5N0QR1OZ The dollar-denominated RTS share index .IRTS closed 1.4 percent higher at 1,275 points, while the rouble-based MICEX .MCX index ended 1 percent higher at 1,461 points. Zerich Capital analyst Andrei Vernikov, however, was cautious. "Investors are hoping for a weakening of geopolitical tensions ahead of the meeting in Minsk," Vernikov said in a note. "Buying shares on the hope of the success of the negotiations in Minsk after the failure of negotiations in Kiev, Geneva and Berlin is very naive. There need to be other drivers for the growth of the market." Domestically oriented stocks such as banks outperformed the market. Leading bank Sberbank SBER.MM closed up 2 percent while top oil firm Rosneft ROSN.MM rose 0.6 percent. Shares in VTB VTBR.MM closed up 0.9 percent but gave up some early gains after the bank reported an 82 percent slide in first-half profit. VTB had been up 2.1 percent before the results. "The results didn't justify expectations - net profit noticeably fell and was around half forecasts," Olma analyst Ruslan Unisov said in a note. 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 Jason Bush, Yelena Orekhova and Alexander Winning; Editing by Andrew Heavens and Susan Fenton) ((alexander.winning@thomsonreuters.com)(+7 495 775 1242)(Reuters Messaging: alexander.winning.thomsonreuters.com@reuters.net)) Keywords: RUSSIA MARKETS/

GLOBAL ECONOMY-Business growth slows in China and Europe, but faster in U.S.

August 21, 2014 - reuters.com

(Adds U.S. data, NEW YORK dateline) * U.S. factory activity expansion speeds up * Business activity growth slows in China and Europe By Jonathan Cable, Xiaoyi Shao and Ryan Vlastelica LONDON/BEIJING/NEW YORK, Aug 21 (Reuters) - Business growth in China and across Europe slowed this month, surveys showed on Thursday, but U.S. activity picked up speed, leaving a mixed picture of global economic growth. "If you take all these things together we are clearly looking at a global economy that doesn't have a huge amount of momentum behind it," said economist Peter Dixon at Commerzbank. China's manufacturing sector expanded at its slowest pace in three months in August and a Reuters poll showed Japan's economic recovery is likely to be modest despite a small acceleration in the factory sector. Markit/HSBC's preliminary China manufacturing purchasing managers index fell to 50.3 in August from July's 18-month high of 51.7, badly missing a Reuters forecast of 51.5 but just above the 50 threshold that differentiates expansion from contraction. "The sharp drop in the PMI is perhaps not surprising given last month's disappointing activity and lending data. That said, we are not expecting a rapid deterioration in economic momentum," Julian Evans-Pritchard, China economist at Capital Economics, wrote in a note. "Meanwhile, we expect the government to continue to fine tune policy as necessary to prevent growth from slipping too much over the coming quarters." A burst of policy stimulus since April lifted China's annual economic growth to 7.5 percent in the second quarter, from 7.4 percent in the first quarter, the weakest pace in 18 months. In Japan, the PMI for factory activity showed acceleration in August as export and domestic demand increased, another sign economic growth is steadying after shrinking in the second quarter due to a sales tax increase. But the Reuters Tankan survey indicated the recovery is likely to be modest, which could keep pressure on the central bank to act to sustain growth in the world's third-largest economy. EUROPEAN ACTIVITY SLUGGISH Euro zone private business activity expanded more slowly than expected in August, even before the full effects of sanctions imposed on and by Russia over Ukraine are felt. Markit's Composite Purchasing Managers' Index for the euro zone will provide gloomy reading for the European Central Bank as it showed the big two economies of Germany and France struggling. The Composite Flash PMI fell to 52.8 from July's 53.8, far short of expectations in a Reuters poll for a modest dip to 53.4. However, Markit said the data points to third-quarter economic growth of 0.3 percent, matching predictions from a Reuters poll last week. EUGDPQ But there are challenges facing the European economy after Europe and the United States imposed economic sanctions on Moscow over the Kremlin's support for rebels in eastern Ukraine, prompting a tit-for-tat response from Russian President Vladimir Putin. "It is clearly premature to start fretting about a new downturn," said Martin van Vliet at ING. "That said, with geopolitical tensions increasingly posing a threat to the subdued and fragile upturn, it is clearly premature to assume that the ECB's easing work is fully done." Companies in Europe are beginning to show signs of strain. Germany's Adidas ADSGn.DE , the world's No. 2 sportswear firm, cut its profit target due to the rouble's fall and increasing risks to Russian consumer sentiment. Brewer Heineken HEIN.AS said its sales volume in Russia fell by a "low-double digit" percentage. ID:nL6N0QE4MZ The composite PMI in Germany fell to 54.9 from 55.7. Even so, Germany's private sector grew for a 16th straight month in August, suggesting Europe's largest economy could expand robustly in the third quarter after it suffered a surprise contraction in the second. For France, the euro zone's second-largest economy, the Composite PMI rose from 49.4 to the break-even mark at 50, meaning it is neither expanding nor contracting. In Britain, consumers have been the main driver of the country's economic recovery that began last year, but retail sales rose in July at a weaker pace than expected. No action is expected from the ECB in the coming months as it waits to see what effect another round of temporary access to cheap cash for banks has on inflation and economic growth. Consumer prices in the euro zone rose just 0.4 percent on the year in July, the smallest annual rise since October 2009 at the height of the financial crisis, and well within the ECB's "danger zone" below 1.0 percent. U.S. FACTORY EXPANSION FASTER The U.S. manufacturing sector expanded in August, with the rate of growth exceeding expectations and moving at the fastest pace in more than four years, equivalent data from private data vendor Markit showed on Thursday. Markit said its preliminary or "flash" U.S. Manufacturing Purchasing Managers Index rose to 58 in August, its highest since April 2010, from 55.8 in July. Economists polled by Reuters expected a reading of 55.7. "August's survey delivers further evidence that robust manufacturing growth momentum has been sustained through the third quarter, with overall business conditions improving at the fastest pace for over four years," said Tim Moore, senior economist at Markit. Markit's gauge of employment in the U.S. manufacturing sector rose to 54.6 from 51.2, and was at its highest since a matching 54.6 in March 2013. ID:nL2N0QR0NC In a different survey, factory activity in the U.S. mid-Atlantic region expanded in August to its highest level since March 2011, according to the Philadelphia Federal Reserve Bank. Its business activity index rose to 28.0 from 23.9 the previous month. That topped economists' expectations for a reading of 19.2, according to a Reuters poll. Any reading above zero indicates expansion in the region's manufacturing. The survey covers factories in eastern Pennsylvania, southern New Jersey and Delaware. It is seen as one of the first monthly indicators of the health of U.S. manufacturing leading up to the national report by the Institute for Supply Management. "Overall, while the headline was strong, the sub-indexes were softer, and therefore the market's response has been somewhat muted," said Ian Lyngen, senior government bond analyst at CRT Capital in Stamford, Connecticut. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ GRAPHICS: - France, Germany and euro zone PMIs: http://link.reuters.com/zub78v - Euro zone and UK PMI: http://link.reuters.com/zuz47s - European PMIs - last three months: http://link.reuters.com/suw32w - U.S., the euro zone and China: http://link.reuters.com/kaq96v - China's PMI and industrial output: http://link.reuters.com/tus33v - Markit China PMI breakdown: http://link.reuters.com/kur33v - UK retail sales: http://link.reuters.com/raz24v ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Jeremy Gaunt, Clive McKeef and Dan Grebler) ((Jonathan.Cable@thomsonreuters.com)(+44 20 7542 4688)(Reuters Messaging: jonathan.cable.thomsonreuters.com@reuters.net)) Keywords: GLOBAL ECONOMY/

UPDATE 1-Scottish nationalists seek to broaden independence debate beyond currency

August 21, 2014 - reuters.com

* Just under a month to go to Sept. 18 independence vote * Key second televised debate to be held on Aug. 25 * Salmond focuses on health, social issues to broaden campaign * Latest polls: http://link.reuters.com/dyw42w (Updates with details from parliament) By Alistair Smout EDINBURGH, Aug 21 (Reuters) - With less than a month to go until Scotland votes on independence, nationalists are seeking to broaden the debate away from a difficult focus on what currency would be used after breaking from the United Kingdom. Health care and other social issues such as justice and equality are likely to get a bigger airing if pro-independence First Minister Alex Salmond has his way in a second televised debate on Aug 25. The question of whether Scotland could keep the pound if it voted on Sept. 18 to leave the United Kingdom has hampered independence campaigners. The British government has said no and Bank of England Governor Mark Carney has warned of difficulties in monetary union. As a result, uncertainty over the currency dogged the normally fiery Salmond in the first TV debate two weeks ago when he was unexpectedly outshone by the more reserved head of the campaign to keep Scotland in the UK, former finance minister Alistair Darling. But disappointment over Salmond's performance following the first debate was pushed aside last weekend when two polls showed the gap in support narrowing with a two-point swing to the independence camp. An ICM poll had support for independence at 38 percent versus 47 percent opposition, while a Panelbase survey put backing for independence at 42 percent compared to 46 percent. The pro-independence vote continues to lag in all major polls, but Salmond has been trying to leverage the latest swing in support by blitzing the media on topics that might sway undecided voters. HEALTH WARNING He warned, for example, that the publicly funded free health service might be at risk if Scotland stays in the union, but that it could be enshrined in the constitution of an independent Scotland. The current devolved Scottish parliament, led by Salmond's Scottish National Party (SNP), controls health policy. But Salmond says the dependence of Scotland's budget on an allowance from politicians in London makes it vulnerable. "If we stay in our current circumstances ... we will find it progressively more difficult to keep a health service free at the point of need," Salmond told a public meeting this week at Arbroath on the east coast where Scotland signed an historic declaration of independence in 1320. British Prime Minister David Cameron, who opposes independence, described the argument as "desperate", arguing that UK spending on health care had been protected during the term of his coalition government, which came to power in 2010. Britain's three major political parties have united against a breakaway Scotland, issuing pleas for unity and warning about the economic costs of independence to the four million Scottish residents over the age of 16 who can vote on Sept. 18. Oil-rich Scotland accounts for about one-tenth of the UK's gross domestic product, and opponents of independence fear a split would weaken all sides and could damage British diplomatic clout, even raising questions over the UK's permanent seat on the U.N. Security Council. The debate over how much oil is left in the North Sea dominated the last session of Scottish parliamentary question time for Salmond before a break for the referendum. He said there was plenty of the resource left after industry expert Sir Ian Wood said the SNP was overstating the revenues from oil that are remaining. Salmond said that industry figures showed "the extraordinary potential that remains in the waters around Scotland, if indeed the policies are pursued and the stewardship is correct to make sure that these resources work for the Scottish people." FATIGUE Salmond, a veteran political campaigner who has driven the SNP to be Scotland's dominant party, is banking on voter fatigue with the political stalemate over currency to bring new life to the debate in the final weeks before the vote. The position on the currency has remained unchanged for months, with UK parties ruling out a deal but Salmond insisting they would negotiate if Scotland voted for independence. He has also said no one could stop Scotland using the pound informally. But while Salmond may be trying to broaden the discussion, the Better Together campaign led by Darling has vowed to continuing pressing him on the issue of the currency. Darling, a Scot who served as a finance minister in the last British Labour government, has been on the front foot with the currency debate and is unlikely to step back. ID:nL6N0QE4LE Other pro-unionists have chimed in. "We urgently need clarity from the first minister about his Plan B for currency," Scottish Conservative leader Ruth Davidson said in a statement on Wednesday, highlighting an admission from the "Yes" to independence campaign that any informal currency union would be temporary. "Scots need to know what money our wages, pensions and benefits would be paid in," she said. With the second debate seen as crucial in the leadup to the vote, commentators said the pressure was mounting on Salmond to emerge victorious and spark further movement in the polls which currently favour the pro-UK camp. "Maybe Darling has more experience in speaking on a national basis, but if Alex Salmond comes from a more passionate point of view, and changes his tactics on how to project this, that might encourage voters to continue to switch to Yes," said Tanya Abraham, senior research executive at pollster YouGov. (Editing by Jeremy Gaunt) ((alistair.smout@thomsonreuters.com)(+44 207 542 7064)(Reuters Messaging: alistair.smout.thomsonreuters.com@reuters.net)) Keywords: SCOTLAND INDEPENDENCE/

UPDATE 1-U.S. judge calls Argentina debt row hearing amid contempt calls

August 21, 2014 - reuters.com

(Recasts with Thursday U.S. court hearing) By Nate Raymond and Joseph Ax NEW YORK, Aug 21 (Reuters) - The U.S. judge who barred Argentina from servicing its debt until it settled with investors demanding full payment on their bonds scheduled a new hearing on Thursday, after the country unveiled plans to sidestep his ruling that led it to default for the second time in a dozen years. Argentina missed a June interest payment after District Judge Thomas Griesa blocked a coupon payment owed to holders of debt issued under U.S. legislation that was restructured after the country's 2002 default on $100 billion in debt. President Cristina Fernandez, steadfast in her refusal to pay the hedge funds face value on their bonds, this week sent to the Argentine Congress a bill that would allow her government to resume payment to holders of exchanged bonds in defiance of Griesa's court. In a letter to Griesa filed late on Wednesday, NML Capital Ltd, one of a group of plaintiffs known as holdout creditors, said the measures announced by Fernandez on Tuesday were a "grave affront" on the judge's ruling. "The express purpose of these maneuvers is to render this court's orders a nullity," NML's lawyer Robert Cohen said. Griesa said Thursday's hearing would take place at 3 p.m in New York (1900 GMT). In June, Griesa blocked a $539 million interest payment on the restructured debt deposited by Argentina at intermediary Bank of New York Mellon (BONY) BK.N , saying it violated his order. Those funds are still held in limbo in BONY's account. Latin America's No 3 economy then tipped into default on an estimated $29 billion in debt when negotiations with the New York hedge funds collapsed. The president's bill would make state-controlled bank Banco Nacion the intermediary for bondholder payments instead of BONY. The legislation is likely to be enacted by Congress because Fernandez's backers hold a majority in both chambers. Griesa, who has presided over the decade-long legal battle between Argentina and the New York hedge funds, has already threatened Argentina with contempt for making public statements that it had honored its debt obligations. Argentina has accused the judge of overstepping his bounds and siding with the holdouts, and said any contempt charge would have no consequences for a sovereign power. "Argentina's proposed exchange would gut this court's injunctions by replacing financial institutions such as BONY that have refused to participate in Argentina's violations ... with Argentina's patsies that have no interest in abiding by the court's rulings," Cohen wrote. Argentine bond prices were mixed in light trading on Thursday as investors waited to hear from Griesa, Thomson Reuters IFR reported. Argentine bonds took a heavy hit a day earlier when investors reacted nervously to Argentina's strategy to end its long-running debt crisis. Argentina's Discount bonds due 2033 US040114GL81=R were little changed at a bid price of 80.18 cents on the dollar at 11.38 a.m. (1438 GMT), while Par notes maturing in 2038 fell slightly to 48.67 US040114GK09=R , Thomson Reuters data showed. (Additional reporting by Davide Scigliuzzo of Thomson Reuters IFR in New York; Writing by Richard Lough in Buenos Aires; Editing by W Simon) ((Email: richard.lough@thomsonreuters.com; Tel: +54 11 451 005 21; Reuters Messaging: richard.lough.thomsonreuters.com@reuters.net)) Keywords: ARGENTINA DEBT/

POLONIA Rate stays unchanged

August 21, 2014 - reuters.com

WARSAW, Aug 21 (Reuters) - POLONIA the reference rate for Overnight deposits amounted to 2.48 percent. The volume of transactions concluded till 16:30 by banks participating in POLONIA fixing amounted to 2,890 mln PLN. Note: Description of reference rate at: http://www.acipolska.pl/ ((warsaw.newsroom@reuters.com))

FOREX-Dollar trades in tight range ahead of Yellen speech

August 21, 2014 - reuters.com

* Traders shrug off bullish U.S. data * Yellen to speak on jobs Friday * Norwegian crown hits two-month high (Adds New York open, updates prices; changes byline, dateline, previous LONDON) By Michael Connor NEW YORK, Aug 21 (Reuters) - The dollar held onto healthy recent gains to trade little changed on Thursday as central bankers gathered for a three-day meeting in Wyoming that will feature a potentially market-rattling speech by Federal Reserve Chair Janet Yellen. The dollar has climbed steadily this week against other major currencies, riding rising U.S. Treasury yields in contrast to declining euro rates. The U.S. dollar index DXY. of six currency combinations touched a fresh 11-month peak of 82.364 in overnight trading but was down 0.06 percent in early New York trading. The dollar was little changed against the Japanese yen JPY= at 103.73 yen, while the euro recovered from an 11-month low against the dollar after better-than-expected German private sector growth data. The euro, which traded in early May a hair under $1.40, was last up 0.20 percent to $1.3283. Currency trading was also dulled by worries ahead of a flurry of financial indicators on Thursday, according to Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington. U.S. data showing fewer than forecast Americans filing new claims for unemployment benefits had little effect on the dollar, as did a stronger-than-anticipated rise in America's leading economic indicators for July. ID:nW1N0OM00D "Stronger short-term gains for the buck are seen hinging on remarks Friday from Fed Chair Janet Yellen on the job market," Manimbo said. "Words that strike a more dovish than hawkish tone would leave the dollar vulnerable to a pullback." Amongst the biggest movers in the European session was the Norwegian crown which hit a two-month high against the euro EURNOK=D4 after forecast-busting growth data. Norway's economy grew 1.2 percent in the second quarter, double expectations, and piling pressure on the central bank to bring forward a rate hike. ID:nL5N0QR209 The crown also rose sharply against the dollar NOK= despite the greenback being the most sought-after of the actively traded currencies in the past few sessions. The dollar last traded at 6.154 crowns, off 0.6 percent. In the euro zone, Germany's private sector grew for a 16th month running in August, suggesting Europe's largest economy could expand robustly in the third quarter after it surprisingly contracted in the second. ECONDE Data from France, however, showed business activity was stagnant in August, although service sector growth picked up. ECONFR (Editing by James Dalgleish) ((anirban.nag@thomsonreuters.com; +44 20 7542 8399; RM: anirban.nag.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

Battered sterling gains foothold, prospects in doubt

August 21, 2014 - reuters.com

* Fed minutes raised speculation of earlier U.S. rate rise * Weaker than expected retail sales adds pressure on pound * Pound had gained after BoE said two voted for rate hike By Patrick Graham LONDON, Aug 21 (Reuters) - Sterling steadied in afternoon trade in Europe on Thursday after a broad surge for the dollar overnight drove the British currency to its lowest in more than four months. The fall overnight had brought the pound's losses since mid-July to more than 6 cents, weighed down after a year of gains by some worse numbers on the economy and resulting doubts over the timing of a rise in interest rates. Retail sales was the latest in a run of slightly softer data to add to the impression that one of Europe's best performing economies has peaked. The pound traded 0.1 percent weaker at $1.6582. "The effects of poor wage growth seem to be having a knock-on effect on the high street, with many families still struggling with their living expenses," said Dennis de Jong, managing director retail broker UFX. "Consumer spending has clearly been stifled over the past couple of months and this might be a sign that the economy is starting to cool after the hot summer." Poor wage growth -- average British pay is falling in real terms -- has developed into the main barrier to the Bank of England making good on longstanding expectations it would raise rates either in November of this year or early next. Bank of England minutes on Wednesday showed the first dissenting votes at a policy committee meeting earlier this month but the majority said the inflation outlook was still too weak to justify raising borrowing costs. "We still think the Bank of England will raise interest rates in November," said Michael Sneyd, a strategist with French bank BNP Paribas in London. "There are dovish messages in the minutes yesterday, but the bottom line is that it only takes three more members of the council to vote for a rise in rates for it to happen." Sneyd and his colleagues at BNP are still in the broadly bullish camp that drove the pound some 15 percent higher in the year to July, hitting a peak of $1.7192 just over a month ago. Investors have been trimming those bets since and Sneyd said that a positioning indicator run by BNP had halved from 43 points in July to around 20 now. He said that had encouraged him to believe there was now room for more money to swing back behind sterling, still supported by an economy that is expanding far faster than its peers in Europe. Against the euro, the pound remains far more robust. The euro hit a session high of 80.085 pence after the retail sales figures, but at 80.01 pence is still just over one full penny away from almost 2-year lows hit a month ago. "I still like sterling against the euro but with this dollar strength I think the action yesterday and overnight showed you that its worth selling cable into any rally," said a dealer with one large bank in London. "The dollar is only getting stronger." (Editing by Alison Williams) ((patrick.graham@thomsonreuters.com)(+44207 542 9429)(patrick.graham.thomsonreuters.com@reuters.net)) Keywords: MARKETS STERLING/AFTERNOON

PRECIOUS-Gold hits 2-month low on firm dollar, US jobless data

August 21, 2014 - reuters.com

* Minutes showed Fed debated raising rates earlier * Platinum falls to 3-month lows * U.S. jobless claims fall, bolster labour market outlook (Updates prices, adds U.S. jobless claims data) By Clara Denina LONDON, Aug 21 (Reuters) - Gold slid around 1 percent to its lowest in two months on Thursday, extending losses to a fifth session on a firm dollar and after slightly better than expected U.S. jobless claims fed expectations for an early interest rate hike. U.S. policymakers debated whether interest rates should be raised earlier given a surprisingly strong job market recovery, minutes from the July meeting of the Fed's rate setting committee showed on Wednesday. ID:nL2N0QQ228 On Thursday, the U.S. Labor Department report shoed the number of Americans filing new claims for unemployment benefits fell slightly more than expected last week, pointing to a sustained improvement in labour market conditions. ID:nL2N0QR0NC Higher interest rates would dull the appeal of non-interest-bearing assets such as gold. Spot gold XAU= fell as much as 1.4 percent to its lowest since June 18 at $1,273.54 an ounce. It was down 1.3 percent at $1,275.65 by 1412 GMT. U.S. gold futures GCcv1 fell 1.1 percent to $1,280. "Gold was already on the defensive before the minutes as the tensions in Ukraine were easing and the market was paying less attention ... so you had other drivers like the dollar, which has been moving up since the start of the week," ABN Amro analyst Georgette Boele said. "And then you had these less dovish minutes, which put extra pressure on gold, and this is also ahead of tomorrow's speech by Yellen at Jackson Hole ... The main topic should be employment, and the way she sounds will be crucial." The U.S. dollar traded just below 11-month highs against a basket of major currencies, buoyed by rising Treasury yields and the slightly hawkish tone in the U.S. central bank's minutes. The dollar slipped slightly after the U.S. jobless claims data. FRX/ The next focus for the market will be Fed Chair Janet Yellen's comments at the Jackson Hole central bankers' gathering on Friday. Any escalation of violence in Ukraine and the Middle East could, however, prompt investors to temporarily seek safety in gold. Although those conflicts have helped push bullion up around 7 percent this year, any impetus that they have provided has not lasted long, analysts said. Holdings in the SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, rose 0.9 tonne to 800.09 tonnes on Wednesday, the third straight daily increase. GOL/ETF Silver XAG= fell 0.4 percent to $19.38 an ounce, having earlier touched a two-month low of $19.25. Spot platinum XPT= fell to its lowest level in more than three months at $1,407.30. It was down 0.3 percent at $1,416 at 1414 GMT, down for the ninth consecutive session in the longest losing streak since July 2008. Spot palladium XPD= , which hit a 13-1/2 year high of $900 earlier this week before falling back, was up 1.3 percent at $873.25 an ounce. (Additional reporting by A. Ananthalakshmi in Singapore and Susan Thomas in London; Editing by Michael Urquhart and Jane Baird) ((clara.denina@thomsonreuters.com)(+44 207 542 9420)(Reuters Messaging: clara.denina.thomsonreuters.com@reuters.net)) Keywords: MARKETS PRECIOUS/

Fighting in Ukraine could boost Raiffeisen costs

August 21, 2014 - reuters.com

VIENNA, Aug 21 (Reuters) - Combat in eastern Ukraine could force Raiffeisen Bank International RBIV.VI to increase its extra provisioning costs for the crisis in that country from 250 million euros ($331.7 million) this year, officials told analysts on Thursday. The Austrian lender booked half of the extra costs for Ukraine -- mainly driven by depreciation of the local currency -- in the first six months of the year, Chief Risk Officer Johann Strobl said. "The other negative impact that we have to expect from fighting in the eastern part of Ukraine is very, very difficult to assess. It is too early, but these numbers are not included yet," he said. The Kiev government is trying to put down a revolt by pro-Russian separatists in eastern Ukraine. ID:nL5N0QQ4UA RBI, emerging Europe's number-two lender, said earlier its credit exposure in eastern Ukraine was around 470 million euros at the end of June, of which around 140 million was already covered by provisions. It has 80 branches in the Donestsk and Lugansk regions and determines day by day which to open. Its total group credit exposure in Ukraine, where it is a top five bank with nearly 3 million customers, was 3.4 billion euros net of provisions at the end of June. (1 US dollar = 0.7537 euro) (Reporting by Michael Shields; editing by Jane Baird) ((Michael.Shields@thomsonreuters.com; +43 1 531 12 258; Reuters Messaging: michael.shields.thomsonreuters.com@reuters.net)) Keywords: UKRAINE CRISIS/RAIFFEISEN COSTS

CORRECTED-Scottish nationalists look to broaden independence debate beyond currency

August 21, 2014 - reuters.com

(Corrects paragraph 3 to show Bank of England governor has warned of difficulties in monetary union) * Just under a month to go to Sept. 18 independence vote * Key second televised debate to be held on Aug. 25 * Salmond focuses on health, social issues to broaden campaign * Latest polls: http://link.reuters.com/dyw42w By Alistair Smout EDINBURGH, Aug 21 (Reuters) - With less than a month to go until Scotland votes on independence, nationalists are seeking to broaden the debate away from a difficult focus on what currency would be used after breaking from the United Kingdom. Health care and other social issues such as justice and equality are likely to get a bigger airing if pro-independence First Minister Alex Salmond has his way in a second televised debate on Aug 25. The question of whether Scotland could keep the pound if it voted on Sept. 18 to leave the United Kingdom has hampered independence campaigners. The British government has said no and Bank of England Governor Mark Carney has warned of difficulties in monetary union. As a result, uncertainty over the currency dogged the normally fiery Salmond in the first TV debate two weeks ago when he was unexpectedly outshone by the more reserved head of the campaign to keep Scotland in the UK, former finance minister Alistair Darling. But disappointment over Salmond's performance following the first debate was pushed aside last weekend when two polls showed the gap in support narrowing with a two-point swing to the independence camp. An ICM poll had support for independence at 38 percent versus 47 percent opposition, while a Panelbase survey put backing for independence at 42 percent compared to 46 percent. The pro-independence vote continues to lag in all major polls, but Salmond has been trying to leverage the latest swing in support by blitzing the media on topics that might sway undecided voters. HEALTH WARNING He warned, for example, that the publicly funded free health service might be at risk if Scotland stays in the union, but that it could be enshrined in the constitution of an independent Scotland. The current devolved Scottish parliament, led by Salmond's Scottish National Party (SNP), controls health policy. But Salmond says the dependence of Scotland's budget on an allowance from politicians in London makes it vulnerable. "If we stay in our current circumstances ... we will find it progressively more difficult to keep a health service free at the point of need," Salmond told a public meeting this week at Arbroath on the east coast where Scotland signed an historic declaration of independence in 1320. British Prime Minister David Cameron, who opposes independence, described the argument as "desperate", arguing that UK spending on health care had been protected during the term of his coalition government, which came to power in 2010. Britain's three major political parties have united against a breakaway Scotland, issuing pleas for unity and warning about the economic costs of independence to the four million Scottish residents over the age of 16 who can vote on Sept. 18. Oil-rich Scotland accounts for about one-tenth of the UK's gross domestic product, and opponents of independence fear a split would weaken all sides and could damage British diplomatic clout, even raising questions over the UK's permanent seat on the U.N. Security Council. FATIGUE Salmond, a veteran political campaigner who has driven the SNP to be Scotland's dominant party, is banking on voter fatigue with the political stalemate over currency to bring new life to the debate in the final weeks before the vote. The position on the currency has remained unchanged for months, with UK parties ruling out a deal but Salmond insisting they would negotiate if Scotland voted for independence. He has also said no one could stop Scotland using the pound informally. But while Salmond may be trying to broaden the discussion, the Better Together campaign led by Darling has vowed to continuing pressing him on the issue of the currency. Darling, a Scot who served as a finance minister in the last British Labour government, has been on the front foot with the currency debate and is unlikely to step back. ID:nL6N0QE4LE Other pro-unionists have chimed in. "We urgently need clarity from the first minister about his Plan B for currency," Scottish Conservative leader Ruth Davidson said in a statement on Wednesday, highlighting an admission from the "Yes" to independence campaign that any informal currency union would be temporary. "Scots need to know what money our wages, pensions and benefits would be paid in," she said. With the second debate seen as crucial in the leadup to the vote, commentators said the pressure was mounting on Salmond to emerge victorious and spark further movement in the polls which currently favour the pro-UK camp. "Maybe Darling has more experience in speaking on a national basis, but if Alex Salmond comes from a more passionate point of view, and changes his tactics on how to project this, that might encourage voters to continue to switch to Yes," said Tanya Abraham, senior research executive at pollster YouGov. (Editing by Jeremy Gaunt) ((alistair.smout@thomsonreuters.com)(+44 207 542 7064)(Reuters Messaging: alistair.smout.thomsonreuters.com@reuters.net)) Keywords: SCOTLAND INDEPENDENCE/

London platinum/palladium 1400 fix - Aug 21

August 21, 2014 - reuters.com

Gold Fields to try new mining techniques at South Deep project

August 21, 2014 - reuters.com

* South Deep sits on $50 bln reserve * Project has been plagued by setbacks * New methods may speed up extraction By Ed Stoddard JOHANNESBURG, Aug 21 (Reuters) - Gold Fields GFIJ.J will pilot two new techniques at its flagship South Deep mine, the last remaining asset in its South African home base, as it tries to unlock value from the world's second-largest gold reserve. Chief Executive Nick Holland said at an earnings presentation on Thursday the new methods at South Deep, a fully-mechanised operation, were in a bid to meet a target of producing 700,000 ounces a year there by around 2018. Currently, Gold Fields is using a system called "destress mining" in which horizontal cuts are made into the rock in such a way that a lot of the "stress" that can cause rock bursts underground are removed. But it also means opening up vast areas which require a lot of support, so much time and money can be spent before any bullion is extracted. Holland said the company was experimenting with a variation of destress mining as well as an entirely new way of doing things called the inclined slot method, which has been employed at its Australian operations. In layman's terms: with the inclined slot method, you open, extract and then back-fill without support structures, speeding up the whole process of getting to the gold, which is done with machines rather than miners holding hand-drills. "It is much quicker, easier and probably will be cheaper," Holland told journalists. "It's going to be a year for us to pilot it, assimilate all the results and determine the way forward," he said. South Deep descends to three kms (almost two miles) and South Africa, with the world's deepest mines, has over a century of experience when it comes to extracting ore far below the surface with a large, unskilled workforce. But heavily mechanised mining is relatively virgin territory in South Africa's gold reefs, from which a third of the bullion ever mined in recorded history has been produced. South Deep, which sits atop a mammoth 40-million ounce reserve worth around $50 billion at current spot prices, is one of the few gold mines in South Africa where sophisticated mechanisation is possible because the seam is so big - 120 metres wide in some places, making it suitable for big machines. Gold Fields has brought in a top Australian engineering team to help overcome the technical and geological challenges at South Deep, where delays and shifting production targets have annoyed investors. In the most recent setback, production has been curtailed by maintenance and a safety review though Gold Fields insists this "will make the mine safer and position the mine for an improved performance in 2015". It is also a long-term project which is seen producing gold for several decades to come and the company's stable of global mines are generating a steady cash flow at the moment. Gold Fields reported a 20 percent rise in quarterly profit on Thursday despite a fall in prices and production as output increased at its lower-cost mines. (Editing by David Evans) ((Edward.Stoddard@thomsonreuters.com; +27 11 775 3160; Reuters Messaging: edward.stoddard.thomsonreuters.com@reuters.net)) Keywords: GOLDFIELDS SOUTHDEEP/

Holdout creditor calls on U.S. court to hold Argentina in contempt

August 21, 2014 - reuters.com

NEW YORK, Aug 21 (Reuters) - A U.S. investment fund pressing for full repayment on Argentine debt is urging a U.S. judge to consider declaring Argentina in contempt after Buenos Aires announced plans to skirt court rulings that pushed it into default. NML Capital Ltd is one of a group of plaintiffs known as holdout creditors who U.S. District Court Judge Thomas Griesa said must be paid in full if Argentina is to resume payments to other creditors who accepted to exchange debt for a fraction of face value. In a letter to the judge filed late on Wednesday, NML Capital Ltd said the measures announced by Argentine President Cristina Fernandez on Tuesday were a "grave affront" on Griesa's ruling. "The express purpose of these maneuvers is to render this court's orders a nullity," NML's lawyer Robert Cohen said. Cohen's letter urged Griesa to hold an emergency hearing to address "whether this court should hold Argentina in contempt". President Fernandez's government has sent a bill to Congress that would replace its New York intermediary bank with state-run Banco Nacion, which would be a way to resume payments to creditors who accepted restructured debt following Argentina's $100 billion debt default in 2002. In June, Griesa blocked a $539 million coupon payment on the restructured debt deposited by Argentina at intermediary Bank of New York Mellon (BONY) BK.N , saying it violated his order. Those funds are still held in limbo in BONY's account. Latin America's No 3 economy then tipped into default on an estimated $29 billion in debt when negotiations with the New York hedge funds collapsed. Griesa, who has presided over the decade-long legal battle between Argentina and the New York hedge funds, has already threatened Argentina with contempt for making public statements that it had honored its debt obligations. "Argentina's proposed exchange would gut this court's injunctions by replacing financial institutions such as BONY that have refused to participate in Argentina's violations ... with Argentina's patsies that have no interest in abiding by the court's rulings," Cohen wrote. (Reporting by Nate Raymond in New York; Writing by Richard Lough Editing by W Simon) ((Email: richard.lough@thomsonreuters.com; Tel: +54 11 451 005 21; Reuters Messaging: richard.lough.thomsonreuters.com@reuters.net)) Keywords: ARGENTINA DEBT/

UPDATE 2-Ukraine's economy minister Sheremeta offers resignation

August 21, 2014 - reuters.com

* Government acts like "predator" towards business, he says * Without reforms economy will take 3-4 yrs to achieve 0 pct growth * Parliament must approve resignation (Adds comments on outlook for economy) KIEV, Aug 21 (Reuters) - Ukrainian Economy Minister Pavlo Sheremeta said on Thursday he had tendered his resignation, voicing frustration at the poor pace of economic reform by a government which he said acted "like a predator towards business". After months of fighting in its eastern regions following the toppling of a government blighted by corruption and economic mismanagement, Ukraine's economy has contracted sharply, even with a multi-billion dollar financial lifeline from the International Monetary Fund. That money comes with requirements for reform, which have been slow in coming. When he was appointed, soon after the ousting of a Moscow-backed president in February, Sheremeta vowed to slash red tape and eliminate corrupt practices that had helped almost to bankrupt Ukraine But he has not managed to push substantive legislation through parliament and on Thursday he said without reforms it would take three to four years for Ukraine to achieve flat growth if the economy falls by the expected 6-7 percent this year. "It's sad ... The economy will never advance if the government continues to behave like a predator towards business," he said at a televised briefing. Earlier, in a sign of frustration at the lack of broad support for reform, Sheremeta said on his Facebook page that he no longer wanted to "fight against yesterday's system". Sheremeta's offer to resign follows comments from Prime Minister Arseny Yatseniuk on Wednesday that voiced dissatisfaction with the speed and depths of reforms. ID:nL5N0QQ2A3 Parliament, which is still packed with many former supporters of ex-President Viktor Yanukovich, has managed to pass legislation on taxation and sanctions on Russia in recent weeks - but only after being pushed by Yatseniuk who at one point also threatened to resign over the legislature's inaction. The post of economy minister was the first political appointment for Sheremeta, a former economics academic. According to the terms of the $17 billion IMF loan package, Ukraine must implement set reforms, including deficit-reduction targets and raising the price of gas to households and industry. The IMF decides on the disbursement of the second tranche of $1.4 billion on Aug 29., and Kiev has asked it to take into account the extra financial burden of fighting the insurgency. ID:nL5N0QQ2A3 The resignation of Sheremeta, who has not been a key negotiator with the IMF, will have to be approved by parliament. This might be one of the last acts of the current parliament which is likely to be dissolved next week, paving the way for a new election in October. He has handed over his duties temporarily to his deputy Anatoliy Maksyuta, he said. (Reporting by Natalia Zinets; Writing by Richard Balmforth and Alessandra Prentice; Editing by Jeremy Gaunt) ((Richard.Balmforth@thomsonreuters.com)(+380442449150)(Reuters Messaging: richard.balmforth.thomsonreuters.com@reuters.net)) Keywords: UKRAINE CRISIS/SHEREMETA

Sri Lanka rupee ends steady; seen stable on c.bank intervention

August 21, 2014 - reuters.com

COLOMBO, Aug 21 (Reuters) - The Sri Lankan rupee closed steady on Thursday, as exporter dollar sales were offset by greenback buying from a state bank, while dealers expect the currency to be stable throughout the year after the central bank governor's comments. The rupee LKR=LK ended at 130.19/22 per dollar, little changed from the Wednesday's close of 130.19/22. ID:nL4N0QQ4JE "The appreciation trend is intact, though we expect the rupee to be stable with the central bank intervening," a currency dealer said on condition of anonymity. Central bank governor Ajith Nivard Cabraal in a foreign correspondents' forum late on Wednesday said the bank would intervene in the market for stability of the rupee. "It's a thin market. We intervene because we don't want the market to get disturbed with a single transaction whether its an inflow or outflow." Dealers said one of the two state banks, through which the central bank usually intervenes in the market, bought dollars at 130.20 per dollar and were not sure if they were buying on behalf of the central bank. The central bank has absorbed $1.09 billion from the market through Wednesday, a central bank official said, to keep the rupee steady and prevent sharp appreciation as well as excess volatility in the rupee. (Reporting By Shihar Aneez; 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/

TABLE-NSE Currency Futures traded on Aug 21

August 21, 2014 - reuters.com

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

August 21, 2014 - reuters.com

STOCKS .BSESN .NSEI ----------------------- The benchmark BSE index closed 0.17 percent higher and the broader NSE index up 0.20 percent, as persistent buying by foreign investors continued to bolster blue chips such as State Bank of India. .BO GOVERNMENT BONDS IN084024G=CC -------------------------------- India's benchmark 10-year bond yield ended up 3 basis points at 8.51 percent after minutes from the Federal Reserve suggested the prospect of earlier-than-expected rate increases by the U.S. central bank, although broader losses were capped by lower global oil prices. IN/ RUPEE INR=D2 -------------- The partially convertible rupee ended slightly weaker at 60.67/68 per dollar against its previous close of 60.61/62, snapping a three-day rising streak, as the dollar rallied broadly after minutes from the Federal Reserve July meeting suggested potentially earlier-than-expected rate hikes. INR/ INTEREST RATE SWAPS INROIS MIOIS= ------------------------------------- The benchmark five-year swap rate ended down 1 bp at 8.03 percent. The one-year rate closed unchanged at 8.46 percent. CALL MONEY INROND= --------------------- India's cash rate ended higher at 7.70/7.75 as against previous close of 7.00/7.10 percent but below the repo rate on ample liquidity. ---------------------- Double click on codes in <> Reuters MIOR/MIBOR MIBR= NSE MIBID/MIBOR MIBR=NS Reuters Corporate Bond Yield/Spread 0#AAAINBMK= For Reuters Benchmarks IN/BENCH (Compiled by Dipika Lalwani) ((dipika.lalwani@thomsonreuters.com; +91-22-61807098; Reuters Messaging: dipika.lalwani.thomsonreuters.com@reuters.net)) Keywords: INDIA SNAPSHOT/

UPDATE 1-Indonesia c.bank to keep monetary policy tight in 2015

August 21, 2014 - reuters.com

By Adriana Nina Kusuma JAKARTA, Aug 21 (Reuters) - Bank Indonesia will not loosen its monetary policy until the current account deficit narrows to 2.5 percent of gross domestic product (GDP), a level unlikely to be reached until after next year, the central bank governor said on Thursday. Bank Indonesia Governor Agus Martowardojo said the main focus of the central bank next year would be to narrow the current account deficit, which reached 4.27 percent in the second quarter. "Overall, we will keep our position for monetary policy. We will control inflation to reach our target of 3.5 to 5.5 percent (in 2014). We are guiding the current account deficit healthier to 2.5 percent of GDP," Martowardojo told reporters. Bank Indonesia started a tightening cycle in June last year after the current account deficit hit a record high of 4.4 percent of GDP. In the following months, it raised the benchmark interest rate by 175 basis points to 7.5 percent, a level that has remain unchanged since November 2013. The policy was aimed at supporting the rupiah, easing inflation and slowing growth to bring down imports in Southeast Asia's largest economy. The central bank expected the current account deficit to reach around 3.0 percent for full year 2014 against last year's 3.3 percent. The current account is the widest measure of the flow of goods, services and money in and out of a country. Despite its efforts to slow growth, the central bank expects GDP to rebound next year. In a state budget meeting with parliament, Bank Indonesia forecast economic growth at 5.4 to 5.8 percent in 2015, stronger than its growth projection of 5.1 to 5.5 percent this year. It also predicted the rupiah to be traded at 11,800-12,000 per dollar, stronger than expectations for 11,600-11,800 this year. (Writing by Gayatri Suroyo; Editing by Randy Fabi and Robert Birsel) ((gayatri.suroyo@thomsonreuters.com; +622129927609; Reuters Messaging: gayatri.suroyo.thomsonreuters.com@reuters.net)) Keywords: INDONESIA ECONOMY/CURRENTACCOUNT

Indian rupee snaps 3-day gains on broad dlr rally post Fed minutes

August 21, 2014 - reuters.com

* Rupee ends at 60.67/68 per dlr vs 60.61/62 prev close * Traders expect relative calm in rupee in near term * FII flows into debt, stock mkt to be key for direction By Swati Bhat MUMBAI, Aug 21 (Reuters) - The Indian rupee weakened slightly on Thursday, snapping a three-day rising streak, as the dollar rallied broadly after minutes from the Federal Reserve July meeting suggested potentially earlier-than-expected rate hikes. The U.S. dollar .DXY traded at 11-month highs against a basket of major currencies after the Fed's minutes suggested any strong jobs market recovery could lead it to raise interest rates earlier than it had been anticipating. ID:nL2N0QQ228 However sentiment remains broadly supported on strong foreign buying in Indian markets, especially in debt. Foreign banks bought debt worth $2.44 billion on Wednesday, their highest since at least August 2009, clearing house data showed. Foreign funds have purchased $26.4 billion in debt and equities combined so far in 2014. "Portfolio flows into stocks are expected to continue going ahead this year but heavy flows will prompt central bank buying. We should see the currency stabilise for now," said Param Sarma, director and chief executive officer at NSP Forex. The partially convertible rupee INR=D2 closed at 60.67/68 per dollar compared with 60.61/62 in the previous session. Data on Thursday showing growth in China's factory sector slowing to a three-month low in August also hit Asian currencies. ID:nL4N0QQ1S4 Analysts expect the rupee to remain broadly in a range given the central bank has tended to intervene at times when the rupee weakens suddenly or when the currency strengthens much below 60 to the dollar. "Despite sentiment being positive on India, there is very strong resistance for the rupee at 60 levels. Very near-term the rupee may hold in a 60.50 to 61.00 range and between 60 and 61.80 in the medium term," NSP's Sarma said. In the offshore non-deliverable forwards PNDF , the one-month contract was at 61, while the three-month was at 61.60. FACTORS TO WATCH * Dlr surges on hawkish-sounding Fed, Aussie hit by CN PMI FRX/ * Hawkish Fed, weak China PMI hurt Asia FX EMRG/FRX * Asia shares sour on China, US dollar in demand MKTS/GLOB * Foreign institutional investor flows INFII INFII01 * For data on currency futures INRFUTURES DIARIES & DATA: Indian Data Watch ECONIN European diary WEU/EQTY2 Indian diary IN/DIARY US Diary US/DIARY (Editing by Anand Basu) ((swati.bhat@thomsonreuters.com; +91-22-61807353; Reuters Messaging: swati.bhat.thomsonreuters.com@reuters.net)) Keywords: MARKETS INDIA FOREX/

RPT-FOREX-German data brings some relief to euro, Norwegian crown rallies

August 21, 2014 - reuters.com

(Repeats to additional subscribers) * Better-than-expected German PMI survey helps euro * Minutes showed Fed debated raising rates earlier * Norwegian crown hits 2-month high vs euro after growth data By Anirban Nag LONDON, Aug 21 (Reuters) - The euro recovered from a 11-month low against the dollar on Thursday after better-than-expected German private sector growth data, although gains were limited given the numbers did little to alter expectations of more monetary stimulus. Amongst the biggest movers in the European session was the Norwegian crown which hit a two-month high against the euro EURNOK=D4 after forecast-busting growth data. Norway grew 1.2 in the second quarter, double of expectations, and piling pressure on the central bank to bring forward a rate hike. ID:nL5N0QR209 The crown also rose sharply against the dollar NOK= despite the greenback being the most sought-after of the actively-traded currencies in the past few sessions. The dollar, buoyed by rising Treasury yields and widening interest rate differentials in its favour, traded just below 11-month peaks against a basket of major currencies, having scaled those highs after minutes of the Federal Reserve's July meeting, released on Wednesday, sounded slightly hawkish. In the euro zone, Germany's private sector grew for a 16th month running in August, suggesting Europe's largest economy could expand robustly in the third quarter after it surprisingly contracted in the second. ECONDE Data from France showed business activity was stagnant in August, although service sector growth picked up. ECONFR While the composite euro zone survey showed activity slowing in August, it offered some relief to the single currency, as some had feared a far worse reading. ID:nL9N0OF007 The euro rose 0.1 percent to $1.3278 EUR= after the German survey, having hit an 11-month low of $1.3242 in Asian trade. It was last trading at $1.3265, steady on the day. The single currency has shed 1.2 percent in the past week as the dollar rallied on better-than-expected housing data. Falling German bund yields, lower money market rates, and a narrowing euro zone current account surplus helped push the euro lower. "The German data was better than expected, but it is clear that economic momentum is declining from a month earlier. While the euro can bounce a bit, the upside is rather limited from here," said Yujiro Goto, currency analyst at Nomura. "The euro should be on a gradual declining path." RISING U.S. YIELDS The euro's bounce saw the dollar index .DXY slip to 82.253, having earlier hit 82.364, its highest since September. It broke out of the 81.188/81.716 range that held for much of this month. The Fed minutes showed policymakers debated whether interest rates should be raised earlier given a surprisingly strong jobs market recovery. Most officials, however, wanted further evidence before changing their view. ID:nL2N0QQ228 In any case, U.S. Treasury yields rose. Two-year US2YT=RR yields hit a two-week high just shy of 0.5 percent. That underpinned the dollar, which touched its highest in over four months against the yen at 103.965 JPY= , not far from the April peak of 104.13. A break there could see the market aim for the 2014 high of 105.45 set in January. Despite overall dollar bullishness, the greenback underperformed the Norwegian crown. Norway's crown rose to a two-month high of 8.1565 crowns per euro EURNOK=D4 on solid volumes and analysts said more gains are likely in store. "Today's growth figures are likely to carry momentum. We continue to hold longs in Norwegian crown versus the Swedish crown, but nearer term strength may be more pronounced against euro with euro/Norwegian crown eyeing lows on the year around 8.10-8.11," said Josh O'Byrne, analyst at Citi. (Editing by Nigel Stephenson and Toby Chopra) ((anirban.nag@thomsonreuters.com; +44 20 7542 8399; RM: anirban.nag.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

FOREX-German data brings some relief to euro, Norwegian crown rallies

August 21, 2014 - reuters.com

* Better-than-expected German PMI survey helps euro * Minutes showed Fed debated raising rates earlier * Norwegian crown hits 2-month high vs euro after growth data (Updates with Norwegian crown, details, quotes) By Anirban Nag LONDON, Aug 21 (Reuters) - The euro recovered from a 11-month low against the dollar on Thursday after better-than-expected German private sector growth data, although gains were limited given the numbers did little to alter expectations of more monetary stimulus. Amongst the biggest movers in the European session was the Norwegian crown which hit a two-month high against the euro EURNOK=D4 after forecast-busting growth data. Norway grew 1.2 in the second quarter, double of expectations, and piling pressure on the central bank to bring forward a rate hike. ID:nL5N0QR209 The crown also rose sharply against the dollar NOK= despite the greenback being the most sought-after of the actively-traded currencies in the past few sessions. The dollar, buoyed by rising Treasury yields and widening interest rate differentials in its favour, traded just below 11-month peaks against a basket of major currencies, having scaled those highs after minutes of the Federal Reserve's July meeting, released on Wednesday, sounded slightly hawkish. In the euro zone, Germany's private sector grew for a 16th month running in August, suggesting Europe's largest economy could expand robustly in the third quarter after it surprisingly contracted in the second. ECONDE Data from France showed business activity was stagnant in August, although service sector growth picked up. ECONFR While the composite euro zone survey showed activity slowing in August, it offered some relief to the single currency, as some had feared a far worse reading. ID:nL9N0OF007 The euro rose 0.1 percent to $1.3278 EUR= after the German survey, having hit an 11-month low of $1.3242 in Asian trade. It was last trading at $1.3265, steady on the day. The single currency has shed 1.2 percent in the past week as the dollar rallied on better-than-expected housing data. Falling German bund yields, lower money market rates, and a narrowing euro zone current account surplus helped push the euro lower. "The German data was better than expected, but it is clear that economic momentum is declining from a month earlier. While the euro can bounce a bit, the upside is rather limited from here," said Yujiro Goto, currency analyst at Nomura. "The euro should be on a gradual declining path." RISING U.S. YIELDS The euro's bounce saw the dollar index .DXY slip to 82.253, having earlier hit 82.364, its highest since September. It broke out of the 81.188/81.716 range that held for much of this month. The Fed minutes showed policymakers debated whether interest rates should be raised earlier given a surprisingly strong jobs market recovery. Most officials, however, wanted further evidence before changing their view. ID:nL2N0QQ228 In any case, U.S. Treasury yields rose. Two-year US2YT=RR yields hit a two-week high just shy of 0.5 percent. That underpinned the dollar, which touched its highest in over four months against the yen at 103.965 JPY= , not far from the April peak of 104.13. A break there could see the market aim for the 2014 high of 105.45 set in January. Despite overall dollar bullishness, the greenback underperformed the Norwegian crown. Norway's crown rose to a two-month high of 8.1565 crowns per euro EURNOK=D4 on solid volumes and analysts said more gains are likely in store. "Today's growth figures are likely to carry momentum. We continue to hold longs in Norwegian crown versus the Swedish crown, but nearer term strength may be more pronounced against euro with euro/Norwegian crown eyeing lows on the year around 8.10-8.11," said Josh O'Byrne, analyst at Citi. (Editing by Nigel Stephenson and Toby Chopra) ((anirban.nag@thomsonreuters.com; +44 20 7542 8399; RM: anirban.nag.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

Indian gold premiums to stay low in 2014 due to weak demand - refiner

August 21, 2014 - reuters.com

NEW DELHI, Aug 21 (Reuters) - Indian gold premiums will average $3-$4 an ounce over London prices this year, roughly half what they were last year, because of continuing restrictions on imports that will soften demand, the head of the country's biggest gold refiner said on Thursday. Struggling with a high trade deficit, India raised its gold import duty to a record 10 percent last year and made it mandatory to export a fifth of all bullion imports. Gold is India's second-biggest expense on the import bill after oil. The restrictions crimped supply, pushing premiums at one point to about $160 an ounce. Premiums - the difference between local prices and the global benchmark - are a good measure of supply and demand in the market. The drop in demand means MMTC-PAMP's premiums on gold will probably fall to an average of $3-$4 an ounce over London prices this year compared with last year's average of $7-$10, Rajesh Khosla, managing director of the refiner, told Reuters. "Quantitative restriction is here to stay," Khosla said. "As a country we do not have the foreign exchange to spend on an unlimited free import of gold. And that is the reality." MMTC-PAMP, a joint venture of Swiss refiner PAMP and India's MMTC Ltd MMTC.NS , had to close its refinery for three months after the government imposed the restrictions in August last year. The government later allowed refiners to hold 15 percent of their licensed quantity of 150 kg as bulk allocation. The World Gold Council said this month that the import restrictions meant India's gold demand in 2014 would be 850-950 tonnes, below the record 974.8 tonnes last year. ID:nL4N0QJ54E (Reporting by Krishna N Das; Editing by Alan Raybould) ((Krishna.Das@thomsonreuters.com; +91-11-4178-1023, +91-98711-18314; Reuters Messaging: Krishna.Das.thomsonreuters.com@reuters.net, Twitter handle: @Krishnadas56)) Keywords: INDIA GOLD/IMPORTS

London platinum/palladium 0945 fix - Aug 21

August 21, 2014 - reuters.com

Gold Fields earnings rise as low-cost mines boost output

August 21, 2014 - reuters.com

JOHANNESBURG, Aug 21 (Reuters) - South African bullion producer Gold Fields GFIJ.J reported a 20 percent rise in quarterly profit on Thursday despite a fall in prices and production as output increased at its lower-cost mines. But the company also reported fresh setbacks at its flagship South Deep project, its last mine in South Africa, where production has been curtailed by maintenance and a safety review. Delays at South Deep, a mechanised operation where a team of Australian engineers has been brought in to iron out problems, has been a source of annoyance to investors. But Gold Fields said the review "will make the mine safer and position the mine for an improved performance in 2015". Gold Fields' adjusted headline earnings increased to 24.6 cents per share in the quarter to the end of June from 20.5 cents in the previous quarter and versus a loss of 36 cents for the same quarter a year earlier. Production fell by 2 percent to 548,000 ounces compared to the March quarter and the gold price XAU= also slipped to an average of $1,288 an ounce from $1,293. But the company's lower-cost mines boosted output and earnings. Output at the Granny Smith mine in Australia rose to 85,000 ounces from 65,000 ounces while all-in costs fell to $692 per ounce from $910. (Reporting by Ed Stoddard; editing by Jason Neely) ((Edward.Stoddard@thomsonreuters.com; +27 11 775 3160; Reuters Messaging: edward.stoddard.thomsonreuters.com@reuters.net)) Keywords: GOLD FIELDS RESULTS/

Fading volatility promises long period of gold stagnation

August 21, 2014 - reuters.com

(Repeats with no changes to text) * Volatility in gold slumps in line with other markets * Price stagnation 'could go on for 5 years' * Inflation dormant in major economies, for now By Jan Harvey and Clara Denina LONDON, Aug 20 (Reuters) - Ultra-calm trading conditions in gold are becoming self-perpetuating as a persistent lack of volatility frustrates investors seeking a return, pushing them further away from a market that analysts say could be becalmed for years. Gold XAU= , which saw a dramatic reversal last year after a 12-year bull run took prices to record highs in 2011, has seen the spread between its daily price highs and lows narrow to just $15 an ounce this year on average, from nearly $25 in 2013. Implied volatility, an estimation of an asset's future volatility, has dropped in gold to around 12 percent this month from an average of 19 percent in August last year, and from highs of nearly 60 percent in mid-2008. With the dollar strengthening, equities showing a better return, and signs of inflation still notably absent from most developed economies, the metal has run out of reasons to rise. "We are pretty unexcited by the outlook of gold," Charles Morris, head of absolute return at HSBC Global Asset Management, said. "It could stay in this range for another five years. "If inflation is under control for a long period of time, then gold will be under control for a long period of time, and because you don't get a yield, it is a waste of money to have a large position in gold." Gold is not the only market to be losing momentum. Volatility in the global foreign exchange market approached historic lows in July, while average daily volumes dropped by almost 14 percent, data from FX settlement system CLS showed. "What the central banks have done to provide liquidity has pushed down volatility in the commodity market, and interest rates market, and indeed equities," Credit Suisse analyst Tom Kendall said. "They all feed through to every part of the traded economy, so it is a problem for FX traders, it is a problem for interest rates traders, it's a problem across everything." As an asset in its own right, gold does not lack price drivers at the moment. The problem is, they are working against each other. Federal Reserve policy is slowly normalising after years of ultra-loose conditions, which had fed into rising gold prices. The U.S. central bank has signalled that it is ready to start thinking about raising interest rates, probably next year. That should be pushing prices lower, as should a rise in the dollar index this year. But working against that is uncertainty over the long-term inflationary effects of the monetary stimulus measures that followed the 2008 financial crisis. Gold has also taken support from outbreaks of violence in Ukraine and the Middle East, which some fear may destabilise a fledgling recovery in the European Union and push up oil prices. The fact that this unrest has not done more to push prices is adding to investors' caution over gold. "There has been very little and short-lived correlation between the Middle East problems, Russia and Ukraine with gold itself," Adam Laird, investment manager at Hargreaves Lansdown, said. "There is a lot of concern among smaller investors that the market has not been able to react to wider political events." STORE OF VALUE Not all buyers are seeking price volatility. Those who buy metal as a store of value, for instance, prefer a stable market. This has particularly been true in India, historically the world's biggest gold consumer, where buying dried up during the violent price moves that followed the collapse of Lehman Brothers. But supply to Indian consumers has been constrained by restrictions on gold imports as the government tries to get its current account deficit under control, meaning its response to a more appealing price environment has been limited. Meanwhile buyers in China, which has recently overtaken India as the world's number one gold consumer, appear much less happy with price stability. Consumer demand is not in any event going to lead to a repeat of gold's scorching price rise of the last decade. The doubling in gold prices in the three years to September 2011 was overwhelmingly due to investment flows, as funds piled into the metal as a haven from financial market risk. What would turn gold around would be a significant rise in inflation, which few economists see happening any time soon. Until another clear driver emerges, investors prefer to stay on the sidelines. "Essentially, you have plenty of supply, (and) demand is likely to fall because of low volatility, rising interest rates and a strong dollar," HSBC's Morris said. "You put all this together and you think: 'why are people going to come running'?" (Reporting by Jan Harvey; editing by Veronica Brown and Keiron Henderson) ((jan.harvey@thomsonreuters.com; +44)(0)(207 542 7744; Reuters Messaging: jan.harvey.reuters.com@reuters.net)) Keywords: GOLD VOLATILITY/

INDICATORS - Kazakhstan - Aug 21

August 21, 2014 - reuters.com

India Morning Call-Global Markets

August 21, 2014 - reuters.com

EQUITIES NEW YORK - U.S. stocks ended mostly higher on Wednesday, with the S&P 500 just missing a record close, after minutes from the Federal Reserve's July meeting gave investors reason to believe that the central bank is in no rush to raise interest rates. The Dow Jones industrial average .DJI rose 59.54 points, or 0.35 percent, to end at 16,979.13. The S&P 500 .SPX gained 4.91 points, or 0.25 percent, to finish at 1,986.51. The Nasdaq Composite .IXIC dipped 1.03 points, or 0.02 percent, to close at 4,526.48. For a full report, click on .N - - - - LONDON - Britain's top share index retreated from a three-week high on Wednesday, halting a five-day winning streak, with companies trading without the attraction of their latest dividend putting pressure on the broader market. The benchmark index closed down 0.4 percent, or 23.83 points, at 6,755.48 points after gaining for five days in a row and climbing to its highest since late July a day earlier. For a full report, click on .L - - - - TOKYO - Japanese stocks rose to a three-week high on Thursday morning, clocking gains for the ninth consecutive day, as the weaker yen shored up exporters after minutes of the U.S. Federal Reserve's July meeting raised the risk of an earlier rate hike. The Nikkei share average .N225 climbed 1.0 percent to 15,601.99 in midmorning trade, the highest level since August 1. For a full report, click on .T - - - - HONG KONG - Hang Seng Index .HSI set to open down 0.1 percent. For a full report, click on .HK - - - - FOREIGN EXCHANGE SYDNEY - The U.S. dollar traded at 11-month highs against a basket of major currencies early on Thursday, having been given a second wind after minutes of the Federal Reserve's July meeting sounded slightly hawkish. The dollar index .DXY , still basking in the afterglow of Tuesday's upbeat U.S. housing data, climbed as far as 82.358, reaching a high not seen since early September. For a full report, click on USD/ - - - - TREASURIES NEW YORK - U.S. Treasury yields rose to one-week highs on Wednesday after minutes of the latest Federal Reserve meeting said the central bank was surprised at the U.S. labor market's quick progress, suggesting a rate increase would come sooner rather than later. Yields on U.S. long government debt advanced for a third straight session, which may reflect investors' overall comfort with the pace of the U.S. recovery. It could also mean investors are booking profits amid a searing government bond rally this year. For a full report, click on US/ - - - - COMMODITIES GOLD SINGAPORE - Gold extended losses to a fifth session on Thursday to trade near a two-week low after the U.S. dollar strengthened on indications from the U.S. Federal Reserve that it could raise interest rates sooner than expected. Spot gold XAU= fell 0.2 percent to $1,289.66 an ounce by 0020 GMT, after hitting a two-week low of $1,287.83 in the previous session. For a full report, click on GOL/ - - - - BASE METALS SYDNEY - London copper was steady on Thursday just above $7,000 a tonne which it touched in the previous session on encouraging signs from the U.S. economy and ahead of a key China factory data. Three-month copper on the London Metal Exchange CMCU3 traded flat at $7009.75 a tonne by 0058 GMT, pausing for breath after climbing 2.1 percent the session before, when it hit the highest in eight days at $7027.50 a tonne. For a full report, click on MET/L - - - - OIL NEW YORK - Brent edged down toward $102 a barrel on Thursday, near the 14-month low hit earlier this week, as concerns over excess oil supply and slowing demand weighed on prices. Brent crude LCOc1 for October dropped 24 cents to $102.04 a barrel by 0252 GMT after posting a 72-cent gain in the previous session. For a full report, click on O/R (Compiled by Indulal PM) ((indulal.p@thomsonreuters.com; +91-22-6180-7183; Reuters Messaging: indulal.p.thomsonreuters.com@reuters.net)) Keywords: MORNINGCALL INDIA

MIDEAST STOCKS - Factors to watch - August 21

August 21, 2014 - reuters.com

DUBAI, Aug 21 (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-Asia shares slip as China disappoints, Japan bucks trend MKTS/GLOB * Brent edges down to $102, near 14-month low, on China concerns O/R * Gold extends losing streak; near 2-week low on strong dollar RTRS-GOL * MIDEAST STOCKS-Banks lift Saudi to 6-year high; Suez project cheers Egypt MEAST-STX * Obama unlikely to deepen Iraq military involvement, say U.S. officials US-IQ-SECUR * Gaza war rages on, Hamas says Israel tried to kill its military chief IL-PS * Jordan's trade deficit widens by 10.5 percent in first half JO-TRACC * Iranian parliament sacks minister, in setback for Rouhani IR-POL * Germany, Italy say prepared to send weapons to Iraq's Kurds DE-IT-IQ-SECUR * IAEA report to show Iran meeting nuclear deal terms -diplomats IAEA-IR * Libya restarts oil exports from biggest port as fighting rages in Benghazi LY-OILG * Iran to delay iron ore export tax to 2015 due to weak market - source IR-IRN TURKEY * Erdogan allies likely to dominate Turkey's new cabinet TR-POL * Turkish lira slides as dollar gains ahead of Fed minutes TR-FRX * Turkish end-July central govt debt stock falls to 590.2 bln lira TR-GFIN * Bulgaria may extend Turkish border fence to bar Syrian, Iraqi refugees TR-BG * Fitch: Turkish Banks' Loan Growth, External Debt Raise Tail Risk YKBNK.IS TR-BANK-AAA * Turkish Airlines shares jump after Q2 profit beats expectations THYAO.IS EGYPT * Four beheaded corpses found in Egypt's Sinai - security sources EG-VIO * Egyptian pound unchanged on official and black markets EG-FRX * Egypt's Pioneers Holding posts 55 pct rise in Q2 net profit PIOH.CA * Egypt's ASCOM Geology chosen for Suez project work-parent ASCM.CA CCAP.CA UNITED ARAB EMIRATES * StanChart's $300 million fine raises heat on board STAN.L * UAE tells citizens to avoid central London areas due to crime AE-GB * Dubai's Nakheel says repays all $2.15 bln bank debt four years early NAKHD.UL ENBD.DU DISB.DU * Singer resigns as CEO of Dubai financial zone authority AE-REGS * UAE's ADNOC to double diesel, jet fuel production with new refinery AE-REFI * Abu Dhabi Das crude slips into wide discount on ample supply -trade AE-CRU SAUDI ARABIA * Saudi Arabia's July oil output rises to 10 mln bpd- source SA-OILG * Saudi Aramco leads $30 mil investment in natural gas fuels company Siluria SDABO.UL KUWAIT * Kuwait detains Muslim cleric suspected of funding militants - security source KW-JUDIC QATAR * German minister accuses Qatar of funding Islamic State fighters DE-QA-DIP * Palestinian president due in Doha to meet Emir and Hamas leader PS-QA * Al Jazeera rejects Al Gore's allegations on Current TV deal QA-MDIA OMAN * Oman's Renaissance shares hit 8-week high on investment in unit RSC.OM (Compiled by Dubai newsroom) ((dubai.newsroom@reuters.com)) Keywords: MIDEAST FACTORS

Fading volatility promises long period of gold stagnation

August 20, 2014 - reuters.com

* Volatility in gold slumps in line with other markets * Price stagnation 'could go on for 5 years' * Inflation dormant in major economies, for now By Jan Harvey and Clara Denina LONDON, Aug 20 (Reuters) - Ultra-calm trading conditions in gold are becoming self-perpetuating as a persistent lack of volatility frustrates investors seeking a return, pushing them further away from a market that analysts say could be becalmed for years. Gold XAU= , which saw a dramatic reversal last year after a 12-year bull run took prices to record highs in 2011, has seen the spread between its daily price highs and lows narrow to just $15 an ounce this year on average, from nearly $25 in 2013. Implied volatility, an estimation of an asset's future volatility, has dropped in gold to around 12 percent this month from an average of 19 percent in August last year, and from highs of nearly 60 percent in mid-2008. With the dollar strengthening, equities showing a better return, and signs of inflation still notably absent from most developed economies, the metal has run out of reasons to rise. "We are pretty unexcited by the outlook of gold," Charles Morris, head of absolute return at HSBC Global Asset Management, said. "It could stay in this range for another five years. "If inflation is under control for a long period of time, then gold will be under control for a long period of time, and because you don't get a yield, it is a waste of money to have a large position in gold." Gold is not the only market to be losing momentum. Volatility in the global foreign exchange market approached historic lows in July, while average daily volumes dropped by almost 14 percent, data from FX settlement system CLS showed. "What the central banks have done to provide liquidity has pushed down volatility in the commodity market, and interest rates market, and indeed equities," Credit Suisse analyst Tom Kendall said. "They all feed through to every part of the traded economy, so it is a problem for FX traders, it is a problem for interest rates traders, it's a problem across everything." As an asset in its own right, gold does not lack price drivers at the moment. The problem is, they are working against each other. Federal Reserve policy is slowly normalising after years of ultra-loose conditions, which had fed into rising gold prices. The U.S. central bank has signalled that it is ready to start thinking about raising interest rates, probably next year. That should be pushing prices lower, as should a rise in the dollar index this year. But working against that is uncertainty over the long-term inflationary effects of the monetary stimulus measures that followed the 2008 financial crisis. Gold has also taken support from outbreaks of violence in Ukraine and the Middle East, which some fear may destabilise a fledgling recovery in the European Union and push up oil prices. The fact that this unrest has not done more to push prices is adding to investors' caution over gold. "There has been very little and short-lived correlation between the Middle East problems, Russia and Ukraine with gold itself," Adam Laird, investment manager at Hargreaves Lansdown, said. "There is a lot of concern among smaller investors that the market has not been able to react to wider political events." STORE OF VALUE Not all buyers are seeking price volatility. Those who buy metal as a store of value, for instance, prefer a stable market. This has particularly been true in India, historically the world's biggest gold consumer, where buying dried up during the violent price moves that followed the collapse of Lehman Brothers. But supply to Indian consumers has been constrained by restrictions on gold imports as the government tries to get its current account deficit under control, meaning its response to a more appealing price environment has been limited. Meanwhile buyers in China, which has recently overtaken India as the world's number one gold consumer, appear much less happy with price stability. Consumer demand is not in any event going to lead to a repeat of gold's scorching price rise of the last decade. The doubling in gold prices in the three years to September 2011 was overwhelmingly due to investment flows, as funds piled into the metal as a haven from financial market risk. What would turn gold around would be a significant rise in inflation, which few economists see happening any time soon. Until another clear driver emerges, investors prefer to stay on the sidelines. "Essentially, you have plenty of supply, (and) demand is likely to fall because of low volatility, rising interest rates and a strong dollar," HSBC's Morris said. "You put all this together and you think: 'why are people going to come running'?" (Reporting by Jan Harvey; editing by Veronica Brown and Keiron Henderson) ((jan.harvey@thomsonreuters.com; +44)(0)(207 542 7744; Reuters Messaging: jan.harvey.reuters.com@reuters.net)) Keywords: GOLD VOLATILITY/

London platinum/palladium 1400 fix - Aug 20

August 20, 2014 - reuters.com

PRESS DIGEST- Canada - Aug 20

August 20, 2014 - reuters.com

Aug 20 (Reuters) - The following are the top stories from selected Canadian newspapers. Reuters has not verified these stories and does not vouch for their accuracy. THE GLOBE AND MAIL * The fallout from the Mount Polley spill has reached other mines in British Columbia. The province has suspended the environmental assessment of the proposed Morrison copper and gold mine, pending the final report into Mount Polley. A review is also under way at the Red Chris mine, owned by Imperial Metals Corporation - which also owns the Mount Polley mine. (http://bit.ly/1oYMnK6) * Winnipeg's Red River has become ground zero in the ongoing fight for a national inquiry into Canada's missing and murdered aboriginal women, its muddy waters the site of a grim discovery by police divers who were actually looking for another person's body when they happened upon the remains of Tina Fontaine. (http://bit.ly/1rWQ1aQ) Reports in the business section: * Industry Canada said it will hold a consultation on the future of a band of airwaves used for rural Internet access and reiterated a commitment it made last year to force telecommunications providers to "use it or lose it" when it comes to spectrum licenses. The department added that it hopes to re-purpose some of that band of spectrum for cellular use in urban areas. That has left New Brunswick-based Xplornet Communications Inc, one major provider of rural Internet services, worried about the impact on its customers. (http://bit.ly/YyautZ) NATIONAL POST * The Royal Canadian Mounted Police is investigating two more men with suspected ties to Calgary who allegedly left Canada to participate in the Syrian civil war, according to community members. Both men are from Windsor, Ontario, but are believed to have spent time in Calgary, where counter-terrorism investigators have been asking questions about at least ten jihadist recruits. (http://bit.ly/1qoY91N) * Mayor Rob Ford says if re-elected, he will move to reduce crowding on buses and streetcars and establish new express bus routes without adding to the ranks of the Toronto Transit Commision. (http://bit.ly/1qp0dH3) FINANCIAL POST * Hedge funds, mostly American, seem to have their fingerprints all over the Canadian oil patch these days. Orange Capital LLC emerged on Tuesday as the latest to take a position in a Canadian oil and gas company. The New York-based fund has built a 5.3 percent stake in Calgary-based Bellatrix Exploration Ltd BXE.TO since July 2, according to regulatory filings.(http://bit.ly/1ocB94z) * Toronto startup Vantage Analytics has raised C$1.1 million in its first round of funding from Real Ventures and a number of angels with e-commerce and retail expertise. (http://bit.ly/1rWWyCm) (Compiled by Rishika Sadam in Bangalore) ((Rishika.S@thomsonreuters.com;)(within U.S. +1 646 223 8780, outside U.S. +91 80 6749 6997)(;)(Reuters Messaging: rishika.s.thomsonreuters.com@reuters.net)) Keywords: PRESS DIGEST CANADA/

London platinum/palladium 0945 fix - Aug 20

August 20, 2014 - reuters.com

INDICATORS - Kazakhstan - Aug 20

August 20, 2014 - reuters.com

UPDATE 1-Silver miner Hochschild's adjusted core profit up on cost cuts

August 20, 2014 - reuters.com

(Adds details, share movement) Aug 20 (Reuters) - Silver miner Hochschild Mining Plc HOCM.L reported a 4 percent rise in first-half adjusted core earnings, helped by its aggressive cost-cutting programme and increased output from its mines in Peru and Argentina. Hochschild's adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose to $94.3 million, from $90.4 million a year earlier. Net revenue fell 8.6 percent to $282 million for the six months ended June 30. ID:nRST5678Pa The miner, which cancelled dividend payments until its financial situation improves, said the capital required to bring its flagship Inmaculada gold and silver project in southern Peru to production restricted payment of an interim dividend. Hochschild, which has been battling rising costs and falling precious metal prices, backed its production target for the year and said the Inmaculada project is set to be commissioned at the end of the year. Attributable silver equivalent production from the company's three underground mines in Peru and Argentina for the period rose 3 percent to 11.85 million pounds, Hochschild said in July. ID:nL4N0PR20D Hochschild's shares rose 1.7 percent to 162.7 pence in early trade on the London Stock Exchange. (Reporting by Abhiram Nandakumar in Bangalore; Editing by Gopakumar Warrier) ((abhiram.nandakumar@thomsonreuters.com)(within UK +44 20 7542 1810)(outside UK +91 80 6749 1136)(Reuters Messaging: abhiram.nandakumar.thomsonreuters.com@reuters.net)) Keywords: HOCHSCHILD MIN RESULTS/

Login required

Please note that, in order to view the full text, you must be logged-in at our system.

Please login at the easy-forex homepage (new users need registration).

Thank you.