Philippines’ Marcos visits Indonesia in first overseas trip as president

JAKARTA, Sept 5 (Reuters) – Philippine President Ferdinand Marcos Jr met with his Indonesian counterpart Joko Widodo on Monday for a state visit focused on bolstering defence, trade and other ties between the two neighbours.

The trip by Marcos, the son and namesake of the late ruler who was overthrown in a popular uprising 36 years ago, is his first official venture overseas since his landslide election victory in May.

President Widodo, widely known as Jokowi, said the leaders had signed a defence and security cooperation agreement, a five-year diplomatic action plan, and agreed to speed up and review maritime borders arrangements.

Trade between the countries had increased by nearly 50% compared to last year, Jokowi said, calling for border trade to be developed further and transport routes revitalised.

Speaking alongside Jokowi at the state palace in Bogor, Marcos said both nations were committed to maintaining regional stability through the 10-member regional grouping, the Association of Southeast Asian Nations (ASEAN).

“We also spoke at length about the role that we believe ASEAN should play while we faced difficulties, (at) this very volatile time in geopolitics, not only in our region, but also in the rest of the world,” he said.

“We agreed that ASEAN is going to be the lead agent in the changes that we would like to see in continuing to bring peace to our countries.”

The Jakarta Post newspaper in an editorial on Monday said the visit would also be a chance for the new president to lobby Widodo on the case of Mary Jane Veloso, a Filipino on death row in Indonesia for drug smuggling, although neither president publicly mentioned the case.

The leaders share joint security concerns with suicide bombings in both countries, including on churches, in recent years. The involvement of Indonesian fighters in the 2017 takeover of the Philippines’ Marawi City by Islamist militants had also demonstrated what analysts say are linkages between regional extremists.

Marcos, who described Indonesia as one of his country’s closest allies, is due to meet business leaders with his economic team later on Monday and will fly to Singapore on Tuesday.

(Reporting by Ananda Teresia and Zahra Maharani in Jakarta and Enrico Dela Cruz and Karen Lema in Manila; Writing by Kate Lamb; Editing by Martin Petty, Ed Davies)

Philippines partially awards T-bill offer, rejects 364-day bids

MANILA, Sept 5 (Reuters) – Following are the results of the Philippine Bureau of the Treasury’s (BTr) auction of T-bills on Monday:

* BTR raises 7.068 billion pesos (USD 124.05 million) from 91-day, 182-day T-bills, less than total 10 billion pesos offered

* BTr awards 4.543 billion pesos of 91-day T-bills at average rate of 2.318% versus previous auction average of 2.070%

* BTr awards 2.525 billion pesos of 182-day T-bills at average rate of 3.485% versus previous auction average of 3.336%

* BTr rejects all bids for 364-day T-bills

* Details are on the BTr’s website www.treasury.gov.ph

(USD 1 = 56.9750 Philippine pesos)

(Reporting by Enrico Dela Cruz; Editing by Kim Coghill)

Oil up nearly 3% as OPEC+ agrees to small oil output cut

HOUSTON, Sept 5 (Reuters) – Oil prices rose about 3% on Monday, as OPEC+ members agreed to a small production cut of 100,000 barrels per day to bolster prices.

Brent crude futures for November delivery settled USD 2.72 higher at USD 95.74 a barrel, a 2.92% gain.

Prices had climbed nearly USD 4 earlier in the session, but were tamed by comments from the White House that US President Joe Biden was committed to taking all steps necessary to shore up energy supplies and lower prices.

US crude CLc1 rose USD 2 to USD 88.85 per barrel, a 2.3% rise after a 0.3% gain in the previous session, in thin volumes during the US Labor Day holiday.

The 100,000 barrels per day (bpd) reduction by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, a group known as OPEC+, amounts to only 0.1% of global demand. The group also agreed they could meet any time to adjust production before the next scheduled meeting on Oct. 5.

“It’s the symbolic message the group wants to send to the markets more so than anything,” said Oanda analyst Craig Erlam, adding that the 100,000 bpd raise last month by OPEC+ was not seen as a big deal.

“What we’ve probably seen from the markets was pricing in most of the worst-case scenario,” Erlam added.

Top OPEC producer Saudi Arabia last month flagged the possibility of output cuts to address what it sees as exaggerated oil price declines.

Russian Deputy Prime Minister Alexander Novak said that expectations of weaker global economic growth were behind a decision by Moscow and its OPEC allies to cut oil output.

Russian Energy Minister Nikolai Shulginov said the country would most likely reduce its oil production by around 2% this year, TASS news agency reported.

“The bigger picture is that OPEC+ is producing well below its output target and this looks unlikely to change given that Angola and Nigeria, in particular, appear unable to return to pre-pandemic levels of production,” Caroline Bain, chief commodities economist at Capital Economics, said.

Oil prices have fallen in the past three months from multi-year highs hit in March, pressured by concerns that interest rate increases and COVID-19 curbs in parts of China could slow global economic growth and dent oil demand.

Lockdown measures in China’s southern technology hub of Shenzhen eased on Monday as new infections showed signs of stabilizing though the city remains on high vigilance.

Meanwhile, talks to revive the West’s 2015 nuclear deal with Iran, potentially providing a supply boost from Iranian crude’s returning to the market, have hit a new snag. The White House on Friday rejected Iran’s call for a deal to be linked with closure of investigations by the U.N. nuclear watchdog, a Western diplomat said.

Iran’s minister of petroleum said the global energy market needs an increase in supply of oil from Iran. nC6N2ZI00P

Use of oil in power generation is also expected to pick up, analysts said, as Russia’s state-controlled Gazprom GAZP.MM on Friday said it would stop pumping gas via the Nord Stream 1 pipeline due to a fault.

The International Energy Agency last month raised its oil demand forecast for the year, partly because it expects gas-to-oil switching in some countries due to record natural gas and electricity prices.

(Reporting by Arathy Somasekhar in Houston and Noah Browning in London; Additional reporting by Florence Tan in Singapore and Emily Chow in Kuala Lumpur; Editing by Leslie Adler, Andrea Ricci and Matthew Lewis)

Gold muted as US jobs data raises doubts over Fed rate-hike path

Sept 5 (Reuters) – Gold prices were steady on Monday, having posted their best day in a month in the last session after a US jobs report showed unemployment rising in August, suggesting the Federal Reserve might slow the pace of rate hikes.

Spot gold was flat at USD 1,710.88 per ounce by 0523 GMT. US gold futures were little changed at USD 1,723.10.

Gold rose as much as 1.3% on Friday after data showed US employers hired more workers than expected in August, but moderate wage growth and a rise in the unemployment rate to 3.7% suggested the labor market was starting to loosen.

“With the Fed meeting just over two weeks away and their ‘blackout period’ fast approaching, any comments from Fed members this week will be scrutinised by traders as they have the ability to move the needle on Fed policy,” said Matt Simpson, a senior market analyst at City Index.

“Any comments alluding to a 75 bp hike could keep gold prices under pressure.”

Fed’s next policy meeting is scheduled for Sept. 20-21.

“Gold gained on Friday as more Americans returned to the workforce. Any easing of the tight labour market will help the Fed tame inflation and potentially reduce its need to tighten rates aggressively,” ANZ said in a note.

Gold tends to perform badly amid a high-interest rate environment as it yields no interest.

The dollar index hit a 20-year high, making gold expensive for holders of other currencies.

Speculators cut net long position in COMEX gold by 9,599 contracts to 20,726 in the week to Aug. 30, while net short position increased in COMEX silver, the US Commodity Futures Trading Commission (CFTC) said on Friday.

Spot silver was flat at USD 18.02 per ounce, platinum rose 0.2% to USD 836.50 per ounce, while palladium gained 0.7% to USD 2,037.50.

Stronger-than-expected platinum shipments to China in the first half of the year spurred shortages elsewhere, as supply declined from mines and recycling, the World Platinum Investment Council said.

(Reporting by Ashitha Shivaprasad and Eileen Soreng in Bengaluru; Editing by Maju Samuel)

Philippines raises USD 7.4 billion via retail treasury bond issue

MANILA, Sept 5 (Reuters) – The Philippines has raised 420.45 billion pesos (USD 7.39 billion) from a retail treasury bond offering that ended on Sept. 2, National Treasurer Rosalia de Leon said on Monday.

The peso-denominated retail bonds due in 2028, which pay a coupon of 5.75%, were the first such issue under the administration of President Ferdinand Marcos Jr. It included a swap offer for holders of existing notes maturing this year and in 2023.

(Reporting by Enrico Dela Cruz; Editing by Martin Petty)

Oil prices climb more than $1/bbl ahead of OPEC+ meeting

SINGAPORE, Sept 5 (Reuters) – Oil prices jumped more than USD 1 a barrel on Monday, extending gains as investors eyed possible moves by OPEC+ producers to tweak production and support prices at a meeting later in the day.

Brent crude futures rose USD 1.43, or 1.5%, to USD 94.45 a barrel by 0054 GMT after gaining 0.7% on Friday. US West Texas Intermediate crude was at USD 88.12 a barrel, up USD 1.25, or 1.4%, following a 0.3% advance in the previous session. US markets are closed for a public holiday on Monday.

Oil prices have fallen in the past three consecutive months, after touching multi-year highs in March, on concerns that interest rate hikes and COVID-19 curbs in parts of China, the world’s top crude importer, may slow global economic growth and cool oil demand.

At their meeting later on Monday, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, a group known as OPEC+, may decide to keep current output levels or even cut production to bolster prices, despite supplies remaining tight.

“While we expect the group to keep output unchanged, the rhetoric may be bullish as it looks to arrest the recent fall in prices,” ANZ analysts said in a note.

Russia does not support an oil production cut at this time and it is likely OPEC+ will keep its output steady when it meets Monday, the Wall Street Journal reported on Sunday, citing unidentified people familiar with the matter.

Meanwhile, negotiations dragged on in attempts to revive the revival the West’s 2015 nuclear deal with Iran. An agreement to do so could allow Tehran to increase exports and improve global supplies.

The White House on Friday rejected linking the deal with the closure of investigations by the U.N. nuclear watchdog a day after Iran reopened the issue, according to a Western diplomat.

(Reporting by Florence Tan; Editing by Kenneth Maxwell)

Investors flock fixed maturity funds on lofty yields, economic concerns

SINGAPORE, Sept 2 (Reuters) – Fixed maturity funds are drawing some of their heaviest flows since the pandemic started as investors, nervous about the global outlook, seek to lock in income at some of the most attractive yields in years.

Such funds, which bundle corporate and government bonds of similar maturities, drew nearly USD 3 billion between May and July, according to Refinitiv data, marking three straight months of net inflows.

While preliminary data showed about USD 1 billion of net outflows in August, money managers sound confident that the heavy outflows of 2021 and early 2022 are reversing.

Yield is the primary drawcard and it has increased as central banks around the world have lifted interest rates to tame rising inflation.

Fixed maturity funds are also considered relatively safe as they offer a predictable income stream over a fixed horizon and a diversified portfolio which reduces credit risk.

With US dollar investment grade yields at about 4.8% on three-year debt, compared with three-year Treasuries at 3.5%, investors feel the price is right.

“Inflationary pressures and recent Fed moves have finally put an end to an extended period of declining interest rates, putting interest rates nearer to the higher end within the last decade since the Global Financial Crisis,” said Doreen Saik, a senior credit analyst at global fund manager M&G Investments in Singapore.

“Coupled with a weaker macro and credit outlook and a clear Fed path, we have seen a flight to quality in IG fixed maturity funds, which are relatively more attractive vis-a-vis other asset classes.”

Turmoil in stock markets – with world shares and emerging market shares each down about 20% this year – also makes a decent steady income more alluring.

“I think as we move into the current interest rate environment, we could possibly see more fixed maturity products offered to investors,” said Benny Gay, Vontobel Asset Management’s Asia head of intermediary clients.

“Investors could get yields that are more attractive than two years ago,” he added.

“STRONG CASE”

Part of the reason investors wish to lock in yields now is that they could fall in future if inflation slows down, of which there are some tentative signs in the United States.

Of course that is not yet clear and there are no such signs in Europe yet — so both runaway inflation and the likelihood that any economic slowdown could lead to companies defaulting on their debt present risks to fixed maturity funds.

Still, the flows suggest a degree of comfort.

“You can create a portfolio of higher quality and shorter duration,” said Marcelo Assalin, head of emerging markets debt at asset manager William Blair who has noticed an uptick in client enquiries about fixed maturity funds, especially in Asia.

“The critical thing is to run a diversified portfolio with concentration to a minimum and there’s a strong case for that type of product now,” he said.

For most, that has meant buying into bundles of global bonds though there are some willing to take on more risk in Asia’s emerging markets, where some managers expect a rally once markets price a stable peak for US rate expectations.

“We … see value outside of China in both investment grade and high yield following the recent sell off,” said Luke Chua, senior investment manager at Pictet Asset Management’s emerging corporate bonds team.

“When US Treasuries stabilise, we can rebound here.”

(Reporting by Rae Wee; Additional Reporting by Tom Westbrook and Gaurav Dogra in Bengaluru; Editing by Ana Nicolaci da Costa)

Dollar set for weekly gain following mixed jobs data

NEW YORK, Sept 2 (Reuters) – The dollar eased from a 20-year high on Friday after data showed the pace of US hiring rose more than expected in August, but wage growth moderated and unemployment ticked higher, giving the Federal Reserve some wiggle room when it raises interest rates later this month.

The US economy added 315,000 jobs in August, data showed, topping the consensus forecast of 300,000 jobs by economists polled by Reuters, and marking the 20th straight month of job growth.

The dollar index, which tracks the currency against six counterparts, zig-zagged following the report, in thin trading ahead of the long North American Labor Day weekend.

At 3:00 p.m. Eastern time (1900 GMT), the US currency was down 0.064% at 109.52 =USD, but was still up 0.6% for the week and set for its third-straight weekly gain.

“Nonfarm payrolls being mixed was an excuse to book profit in the dollar’s surge to 20-year highs,” said Joe Manimbo, senior market analyst at Convera.

The US currency leaped to its strongest level since June 2002 on Thursday, 109.99, and has been riding high since Fed Chair Jerome Powell said at the Jackson Hole symposium in Wyoming last Friday that rates would need to be high “for some time” to combat stubbornly high inflation. nL1N30219A

“Overall what we’re seeing is the market is still bracing for potentially much more aggressive Fed tightening,” said Edward Moya, senior market analyst at Oanda.

Fed funds futures were unchanged after the jobs report and are pricing a 75% chance that the Fed hikes rates by 75 basis points this month, according to Refinitiv data.

The euro was up 0.21%, retracing some of the previous day’s losses against the dollar, but sitting below parity at USD 0.9965.

The European Central Bank is due to meet next week, with money markets betting on an unprecedented 75 basis point hike.

Sterling dipped 0.24% versus the dollar to USD 1.1516, on track to end the week down around 1.9%. Britain’s new prime minister will be announced on Monday, when the ruling Conservative Party’s leadership contest concludes, which could prompt further pound moves.

Against the rate-sensitive Japanese yen, the dollar was up 0.04% at 140.125 yen.

The dollar surged above 140 yen for the first time since 1998 on Thursday.

Japan’s government will take “appropriate” action as needed, Japanese finance minister Shun Suzuki said on Friday.

(Reporting by Iain Withers, Additional reporting by Tom Westbrook in Singapore; editing by Philippa Fletcher, William Maclean and Jonathan Oatis)

Oil climbs ahead of OPEC+ meeting next week

NEW YORK, Sept 2 (Reuters) – Oil prices rose on Friday on expectations that OPEC+ will discuss output cuts at a meeting on Sept. 5, though concern over China’s COVID-19 curbs and weakness in the global economy loomed over the market.

Brent crude futures rose 66 cents to settle at USD 93.02 a barrel, while US West Texas Intermediate (WTI) crude futures rose 26 cents to settle at USD 86.87 a barrel.

Both benchmarks slid 3% to two-week lows in the previous session. Brent posted a weekly drop of 7.9%, and WTI of 6.7%.

A weekly chart shows that US crude futures surpassed last week’s high and have since retreated, and closed below last week’s closing level. That is a bearish signal, according to Eli Tesfaye, senior market strategist at RJO Futures in Chicago.

“When you take out the week’s high and week’s low and then close lower, that’s a reversal down – it’s a signal that there’s weakness, and that’s telling you it’s a weak market,” he said.

The Organization of the Petroleum Exporting Countries and allies led by Russia – a group known as OPEC+ – are due to meet on Sept. 5 against a backdrop of expected demand declines, though top producer Saudi Arabia says supply remains tight.

OPEC+ is likely to keep oil output quotas unchanged for October at Monday’s meeting, three OPEC+ sources said, although some sources would not rule out a production cut to bolster prices that have slid from sky-high levels hit earlier this year. nL8N30926W

OPEC+ this week revised market balances for this year and now sees demand lagging supply by 400,000 barrels per day (bpd), against 900,000 bpd forecast previously. The producer group expects a market deficit of 300,000 bpd in its base case for 2023.

Meanwhile, Iran said it had sent a “constructive” response to US proposals aimed at reviving Tehran’s 2015 nuclear deal with world powers. The United States gave a less positive assessment.

The news made some investors skeptical that a deal was imminent, which supported oil prices, said Phil Flynn, an analyst at Price Futures group in Chicago.

“There’s less confidence that we’re going to get a deal with Iran and that’s leading to some short-covering,” Flynn said.

G7 finance ministers agreed on Friday to impose a price cap on Russian oil, but provided few new details to the plan aimed at curbing revenue for Moscow’s war in Ukraine while keeping crude flowing to avoid price spikes.

In the United States, employers hired more workers than expected in August, but moderate wage growth and a rise in the unemployment rate to 3.7% could ease pressure on the Federal Reserve to deliver a third 75 basis-point interest rate hike this month.

US energy firms this week cut the number of oil and natural gas rigs operating for the fourth time in five weeks. The US oil and gas rig count, an early indicator of future output, fell by five to 760 in the week to Sept. 2, Baker Hughes Co. said on Friday.

Russia’s Gazprom said on Friday that natural gas supplies via the Nord Stream 1 pipeline would remain shut off after the main gas turbine at Portovaya compressor station near St Petersburg was found to have an oil leak.

Investors remain worried about the impact of the latest COVID-19 restrictions in China. The city of Chengdu on Thursday ordered a lockdown that has hit manufacturers such as Volvo.

Data showed Chinese factory activity in August contracted for the first time in three months in the face of weakening demand, while power shortages and COVID-19 outbreaks also disrupted output.

Money managers cut their net long US crude futures and options positions by 10,607 contracts to 168,431 in the week to Aug. 30, the US Commodity Futures Trading Commission (CFTC) said on Friday.

(Reporting by Stephanie Kelly in New York; additional reporting by Noah Browning in London, Sonali Paul in Melbourne and Jeslyn Lerh in Singapore; Editing by Louise Heavens, Matthew Lewis and Jonathan Oatis)

Gold advances as dollar retreats after US jobs data

Sept 2 (Reuters) – Gold bounced over 1% on Friday as the dollar retreated after US jobs data came mostly in line with expectations, but it was still bound for a third consecutive weekly fall pressured by an elevated interest rate environment.

Spot gold rose 0.8% to USD 1,710.29 per ounce by 1:45 p.m. ET (1745 GMT). Prices were still down 1.5% for the week.

US gold futures settled up 0.8% at USD 1,722.6.

“The jobs numbers were very close to market expectations. The market is deeming it as a goldilocks number as it doesn’t suggest weakness, but is not too strong to prompt an even more aggressive Fed,” said Jim Wyckoff, senior analyst at Kitco Metals.

“Gold is kind of seeing a relief-short covering rally.”

Nonfarm payrolls increased by 315,000 jobs last month, the Labor Department said in its closely watched employment report. Economists polled by Reuters had forecast payrolls increasing 300,000.

The dollar index was down around 0.1%, making gold cheaper for overseas buyers while US Treasury yields were also lower for the day.

“A slightly weaker US dollar and US short-term Treasury yields have given gold some relief recently. However, this has not changed the underlying downward trend in gold prices,” said Capital.com analyst Piero Cingari.

Gold has been pressured off late as global central banks raise interest rates to fight soaring inflation. Higher rates increase the opportunity cost of holding the non-yielding asset.

On the technical front, prices need to break above the trendline from the March peak, currently at USD 1,770, before signalling a recovery, Saxo Bank analyst Ole Hansen said in a note.

In physical markets, gold premiums jumped in top consumer China, while a drop in local prices boosted demand in India.

Spot silver rose 0.8% to USD 17.99 per ounce, platinum was also up 0.8% at USD 834.77 per ounce, while palladium gained 0.5% to USD 2,022.43. All three metals were bound for a third straight weekly dip.

(Reporting by Ashitha Shivaprasad and Arundhati Sarkar in Bengaluru; Editing by Krishna Chandra Eluri and Shailesh Kuber)

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