Economy

Australia's Resources Riches Have Made Its Economy Covid-Proof – BNN

Published

2 weeks ago

March 28, 2021

Harry Miller

(Bloomberg) —

The global economic recovery is set to drive Australia’s resources earnings to an all-time high this financial year, led by number one export iron ore, while rapid growth in the production of battery minerals will see them challenge coal in importance in coming years.

A strong bounce back from the pandemic, especially in China, is forecast to lift Australia’s resources and energy exports to A$296 billion ($225 billion) in the year ending June 30, according to a quarterly report from the government.

Iron ore giants BHP Group, Rio Tinto Group and Fortescue Metals Group Ltd. are enjoying an earnings bonanza after prices surged on the back of strong demand from Chinese steelmakers and supply disruptions in number two producer Brazil. The strength in iron ore, and other key exports such as liquefied natural gas and copper, has helped to insulate the Australian economy from Covid-19, with gross domestic product strengthening by more than 3% in the final two quarters of 2020.

“The outlook for Australia’s resources and energy exports has strengthened since our last report, supported by the global economic recovery and associated government stimulus measures,” the Department of Industry, Science, Energy and Resources, said in a media release. Production constraints elsewhere in the world had seen prices for many commodities gain momentum in the early part of 2021, the department said.

Price gains are likely to moderate, leading to a modest decline in resources earnings in fiscal 2022, although growth in demand for the materials vital to the clean energy transition is seen buoying the industry out to 2026 and beyond. Lithium exports are set to jump more than five-fold over the period which, along with strong copper and nickel output gains, will put the value of those three metals combined at A$28 billion, just short of Australia’s third-largest export earner in that year, metallurgical coal.

China’s import ban on some Australian commodities poses a downside risk to the forecasts, the report said, even though coal and copper producers had successfully diverted sales to other markets. “At present, a high degree of uncertainty exists around the extent to which China’s informal import restrictions will persist through the outlook period,” the report said.

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Economy

Britain is ‘bouncing back’ into the same old economy – The Guardian

Published

20 hours ago

April 10, 2021

Harry Miller

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Britain is ‘bouncing back’ into the same old economy The Guardian

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Economy

CANADA STOCKS – TSX ends flat at 19,228.03

Published

1 day ago

April 10, 2021

Harry Miller

* The Toronto Stock Exchange’s TSX falls 0.00 percent to 19,228.03

* Leading the index were Corus Entertainment Inc <CJRb.TO>, up 7.0%, Methanex Corp, up 6.4%, and Canaccord Genuity Group Inc, higher by 5.5%.

* Lagging shares were Denison Mines Corp, down 7.0%, Trillium Therapeutics Inc, down 7.0%, and Nexgen Energy Ltd, lower by 5.7%.

* On the TSX 93 issues rose and 128 fell as a 0.7-to-1 ratio favored decliners. There were 26 new highs and no new lows, with total volume of 183.7 million shares.

* The most heavily traded shares by volume were Toronto-dominion Bank, Nutrien Ltd and Organigram Holdings Inc.

* The TSX’s energy group fell 1.61 points, or 1.4%, while the financials sector climbed 0.67 points, or 0.2%.

* West Texas Intermediate crude futures fell 0.44%, or $0.26, to $59.34 a barrel. Brent crude fell 0.24%, or $0.15, to $63.05 [O/R]

* The TSX is up 10.3% for the year.

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Economy

Canadian dollar outshines G10 peers, boosted by jobs surge

Published

1 day ago

April 10, 2021

Harry Miller

By Fergal Smith

TORONTO (Reuters) – The Canadian dollar advanced against its broadly stronger U.S. counterpart on Friday as data showing the economy added far more jobs than expected in March offset lower oil prices, with the loonie also gaining for the week.

Canada added 303,100 jobs in March, triple analyst expectations, driven by the recovery across sectors hit by shutdowns in December and January to curb the new coronavirus.

“The Canadian economy keeps beating expectations,” said Michael Goshko, corporate risk manager at Western Union Business Solutions. “It seems like the economy is adapting to these closures and restrictions.”

Stronger-than-expected economic growth could pull forward the timing of the first interest rate hike by the Bank of Canada, Goshko said.

The central bank has signaled that its benchmark rate will stay at a record low of 0.25% until 2023. It is due to update its economic forecasts on April 21, when some analysts expect it to cut bond purchases.

The Canadian dollar was trading 0.3% higher at 1.2530 to the greenback, or 79.81 U.S. cents, the biggest gain among G10 currencies. For the week, it was also up 0.3%.

Still, speculators have cut their bullish bets on the Canadian dollar to the lowest since December, data from the U.S. Commodity Futures Trading Commission showed. As of April 6, net long positions had fallen to 2,690 contracts from 6,518 in the prior week.

The price of oil, one of Canada‘s major exports, was pressured by rising supplies from major producers. U.S. crude prices settled 0.5% lower at $59.32 a barrel, while the U.S. dollar gained ground against a basket of major currencies, supported by higher U.S. Treasury yields.

Canadian government bond yields also climbed and the curve steepened, with the 10-year up 4.1 basis points at 1.502%.

(Reporting by Fergal Smith; Editing by Andrea Ricci)

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