Since the start of this year the yuan has lost 1.8% against the dollar, largely as a result of central bank's efforts, reversing much of last year's near 3% rise as Beijing sought to change the perception the yuan was a safe one to one appreciation bet. Beijing's efforts to clamp down on such trades combined with concerns over China's economic health are expected to keep the yuan on the back foot in coming weeks. Earlier this month, a Chinese company became the first to default on a corporate bond, and concerns about economic growth were highlighted by a dramatic 18% fall in exports in February and sluggish manufacturing. "Given China's recent relatively weak export performance, we see little upside for the yuan this coming year," said Tao Wang, an economist at UBS in Hong Kong.
Libyan oil production has played havoc with the Brent market and a tanker that was taken over by rebels has been boarded by the United States. The New York Times reports that U.S Navy commandos seized a fugitive oil tanker in the Mediterranean waters southeast of Cyprus on Monday morning, thwarting an attempt by a breakaway Libyan militia to sell its contents on the black market, the Pentagon said. No one was hurt in the operation, the Pentagon said in a statement. The fugitive tanker, called the Morning Glory, had sailed into the Libyan port of Sidra under a North Korean flag but North Korea disavowed the ship and denied providing any authorization. News reports have said it was operated by a company based in Alexandria, Egypt, and that after leaving Libyan waters it appeared to have sailed the Mediterranean in search of a buyer for its oil.
In a statement early Monday morning, the Pentagon said that the Libyan and Cypriot governments had requested American help in seizing control of the tanker. President Obama authorized the operation just after 10 p.m. Sunday night, the statement said. Within a few hours a Navy SEAL team on the guided missile destroyer Roosevelt boarded and took control of the tanker, “a stateless vessel seized earlier this month by three armed Libyans,” the statement said. The Roosevelt also provided helicopter support, the statement added, but it did not say how many Americans had participated in the seizure or what force might have been used.
The American intervention is a salvation to the fragile transitional government in Tripoli, the Libyan capital, which faced the loss of its main source of revenue and sole source of political power if renegade militias succeeded in selling Libya’s oil. Despite days of furious bluster, the Libyan authorities were unable to stop the tanker from arriving in the eastern port of Sidra early last week or from leaving with the oil a few days later. The loss of control over oil revenue threatened the government so gravely that the transitional government appeared to teeter, with Parliament voting to remove its prime minister without any consensus on his long-term replacement. The seizure of the oil, which the United States Navy says it is now returning.
The AP Is reporting that Officials say Fulani Muslim herders attacked three Christian villages and killed more than 100 civilians. Hundreds of thatched-roof huts were set ablaze. Thousands have been killed in recent years in competition for land and water between mainly Muslim Fulani herdsmen and Christian farmers across Nigeria’s Middle Belt. More than 100 people were killed in similar attacks in neighboring Katsina state last week.
Dow Jones reports that spot gold reached a fresh six-month high in early European trading hours Monday. Last week's jitters surrounding Chinese economic and credit conditions and ongoing tensions surrounding Ukraine briefly carried into the new week – gold touched $1,392.08 per troy ounce, its highest price since early September, before slightly to just below Friday's settlement price at $1,378.30 per ounce.
Bloomberg Reports that wheat traded near the highest level in almost five months, extending a weekly gain, after a referendum in Crimea to leave Ukraine and join Russia boosted concerns supplies from the Black Sea region will be disrupted. The contract for May delivery climbed as much 1% to $6.9425 a bushel on the Chicago Board of Trade and was at $6.9275 by 2:01 p.m. in Singapore. Prices climbed 5.1% last week, touching $6.965 on March 13, the highest since Oct. 25. Futures are set to gain 14% this quarter, the most since the three months through September 2012.
Happy St Patrick’s Day!