BHP cuts iron ore production outlook, will it help boost iron-ore prices, Aussie?

Dhwani Mehta FXStreet

BHP Group, the world’s biggest miner, announced on Wednesday that it slashed its forecast for iron ore output after a tropical Australian cyclone, Reuters reports.

This comes after its rival Rio Tinto also cut its production outlook. Rio Tinto suffered operational issues in the first quarter, including a fire at its Cape Lambert operations.

Additional Details:

“BHP, which put its fiscal 2019 iron ore production under review following the cyclone, lowered its forecast to 265 million-270 million tonnes, from 273 million-283 million tonnes.

Iron ore output for the three months to end-March fell 5 percent to 64 million tonnes, down from 67 million tonnes a year ago.

BHP also increased its full-year production costs to less than $15 a tonne, from less than $14 a tonne previously, due to lower volumes and increased remediation costs.”

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

GBP/USD off highs, back to 1.3620

GBP/USD remains slightly on the defensive at the end of the week, receding to the low 1.3600s after hitting fresh tops past 1.3670 earlier in the day. Cable’s correction comes after two daily gains in a row and amid a tepid advance in the Greenback, while poor UK data also accompany the downside.

EUR/USD treads water below 1.1700

EUR/USD now trades with modest losses around 1.1670 following another unsuccessful atempt to advance past 1.1700 the figure in a convincing fashion. The pair’s decline follows a maginal rebound in the US Dollar as market participants continue to assess recent US data as well as developments from the US bond market.

Gold eases from mid-May highs; holds above $4,600 amid bearish USD

Gold pulls back slightly from its highest level since mid-May, touched during the Asian session on Monday, though it manages to hold above $4,600. Diminishing odds of an immediate Fed rate hike continue to undermine the US Dollar despite further escalation of US-Iran tension and inflation risks stemming from higher oil prices. This continues to underpin the non-yielding bullion, though bulls seem hesitant ahead of key US inflation data and Fed Chair Kevin Warsh's speech at the Jackson Hole Symposium later this week.

Week ahead: Fed’s Jackson Hole and Nvidia earnings to dictate markets

The new Fed chair, Kevin Warsh, has made few public appearances since taking the central bank helm in May, yet he’s found it difficult to steer off controversy. Question marks about his relations with the President, Donald Trump, continue to swirl, while markets are still trying to make sense of his approach to monetary policy.

CFTC Report: Oil positioning rebounds; VIX and Yen exposure turn more bearish

The week in one sentence: Speculative positioning turned more constructive in the week to August 18. WTI recorded the largest increase, followed by a sharp narrowing in CAD net shorts. VIX and JPY positioning moved the other way, while Gold remained the clearest crowded long despite a softer spot price.

$20 billion offered, $2 billion taken: Why Treasury doubled its buyback cap

The US Treasury moved off its own calendar on Wednesday, and that is the part worth sitting with. At 12:32 GMT, the department said it would at least double the size of liquidity support buyback operations in the 10-year to 20-year and 20-year to 30-year sectors, lifting the maximum from $2 billion per operation to at least $4 billion, effective September 9 and running to November 4.