Written by Econintersect
Early Bird Headlines 23 November 2015
Econintersect: Here are some of the headlines we found to help you start your day. For more headlines see our afternoon feature for GEI members, What We Read Today, which has many more headlines and a number of article discussions to keep you abreast of what we have found interesting.
Note: From now to 03 December there may be occasions where Early Bird appears at irregular times and may have some shorter than usual content because 1/2 of our limited staff is on vacation.
Global
Euro and commodities skid, Asia stocks mixed (Reuters) The euro sagged to a seven-month trough on Monday as the prospect of more policy easing in Europe benefited the U.S. dollar, while activity in Asian shares was crimped by a holiday in Japan. The strength of the dollar also combined with worries about Chinese demand to clobber commodity prices again, sending copper to its lowest in over six years.
Hedge Funds Are Back to Bearish on Gold as Price Slump Deepens (Bloomberg) Prices are trapped in their worst rout since July as Federal Reserve officials talk up improvements for the U.S. economy and reinforce signs that they’re ready to raise borrowing costs for the first time since 2006. That prospect has sent investors fleeing. Assets in exchange-traded products backed by gold have fallen to the lowest since 2009. Money managers are holding a net-short position in the metal for first time since August as their long wagers shrunk to the smallest in seven years.
U.S.
In the first majority-Muslim U.S. city, residents tense about its future (The Washington Post, MSN News) In 2013 Hamtramck, Michigan earned the distinction of becoming what appears to be the first majority-Muslim city in the United States following the arrival of thousands of immigrants from Yemen, Bangladesh and Bosnia over a decade. Four of six city council members are Muslim, but, rather than considering Sharia law, the Muslims in this Detroit-area city appear to be more concerned with becomong more American, five calls to prayer daily not withstanding.
EU
16 detained in overnight raids in Belgium; Brussels remains on high alert (Al Jazeera) Paris fugitive Salah Abdeslam was not among those detained during 22 overnight raids, Belgian authorities said Monday.
UK
Defence review: ‘Strike brigades’ to be created by 2025 (BBC News) David Cameron will give details of an additional £12 billion ($18 billion) of equipment spending, as he outlines the Strategic Defence and Security Review in the Commons. He proposes to add two 5,000-strong “strike brigades” that can be rapidly deployed are to be created by 2025 to help the UK respond to “diverse” threats.
France
French Youth Line Up to Join the Military After Paris Attacks (Bloomberg) France says it’s at war and its young people are heeding the call of duty. Applications to join the army have tripled since last week.
Morocco
Moroccan solar plant to bring energy to a million people (BBC News) A giant solar thermal plant at Ouarzazate, Morocco will harness the Sun’s warmth to melt salt, which will hold its heat to power a steam turbine in the evening. The first phase will generate for three hours after dark; the last stage aims to supply power 20 hours a day. It is part of Morocco’s pledge to get 42% of its electricity from renewables by 2020.
Saudi Arabia
Cut Oil Supply or Drop Riyal Peg? Saudis Face ‘Critical’ Choice (Bloomberg) Saudi Arabia is pumping record amounts of oil this year, leading OPEC’s effort to defend market share even as Brent crude trades near the lowest level in six years. The slide in oil revenue has forced the kingdom to tap savings and sell debt to preserve its 30-year-old peg to the dollar. Bank of America Corp. says that may mean the country faces a “critical” choice next year: either cut production to help boost prices or adjust the riyal’s rate to stem the decline in foreign reserves. Bank of America strategists, led by Francisco Blanch in New York, wrote in a Nov. 19 report:
“A depeg of the Saudi riyal is our number one black-swan event for the global oil market in 2016, a highly unlikely but highly impactful risk. It is a lot easier politically to implement a modest supply cut at first than allow for a full-blown currency devaluation.”
China
China Pulled Further Into Syria Crisis Amid Terrorism Threat (Bloomberg) The violence swirling out from Syria in recent weeks is pressuring China to step off the sidelines and take a more active role in international efforts to stem the conflict. The execution of a Chinese captive announced by Islamic State on Wednesday — the first such killing — showed the country isn’t beyond the reach of a group that has claimed responsibility for recent attacks in Beirut, Paris and Egypt’s Sinai Peninsula. Moreover, Russia’s decision to launch airstrikes to support the Syrian government has left China increasingly alone in opposing military intervention in a civil war that has fueled Islamic State’s rise.
Argentina
‘Kirchner era’ ends with opposition win in Argentina (Associated Press) President-elect Mauricio Macri’s promises to revitalize Argentina’s sagging economy with free-market reforms and improve strained relations with the United States resonated with voters, carrying him to a historic win that ended 12 years of often-conflictive rule by President Cristina Fernandez and her late husband. But when the business-friendly opposition candidate takes office Dec. 10, he will inherit a country with around 30% inflation, near-zero economic growth and entrenched government social spending that private economists warn is not sustainable. He also lacks majorities in either chamber of Congress to pass his deep reforms.
Venezuela
Venezuela Sees Crude in Mid-$20s If OPEC Doesn’t Act (Bloomberg) Oil prices may drop to as low as the mid-$20s a barrel unless OPEC takes action to stabilize the market, Venezuelan Oil Minister Eulogio Del Pino said. Venezuela is urging the Organization of Petroleum Exporting Countries to adopt an “equilibrium price” that covers the cost of new investment in production capacity, Del Pino told reporters Sunday in Tehran. Saudi Arabia and Qatar are considering his country’s proposal for an equilibrium price at $88 a barrel, he said.
Mexico
Oil Deal of the Year: Mexico Set for $6 Billion Hedging Windfall (Bloomberg) Mexico is set to get a record payout of at least $6 billion from its oil hedges this year, according to data compiled by Bloomberg. The Latin American country locks in oil sales as a shield against price declines through a series of financial deals with banks including Goldman Sachs Group Inc., JPMorgan Chase & Co. and Citigroup Inc. For 2015, Mexico guaranteed sales at almost $30 a barrel higher than average prices over the past year.
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