European Union’s Ambassador Michael Miller yesterday called on the government to ensure a level playing field in Biman Bangladesh Airlines’ aircraft purchase, as the government is set to buy Boeing planes over European rival Airbus.

Speaking at a press conference following a meeting on non-tariff barriers in trade between Bangladesh and the EU at the commerce ministry, he also said the bloc was ready to launch formal negotiations towards signing a Free Trade Agreement (FTA) soon.
In response to journalists raising the issue of Biman’s aircraft purchase, the EU envoy said Bangladesh should take “public procurement” decisions “on the basis of commercial merit”.

“Our economic operators are able to compete as best they can with the economic operators from any given country,” Miller said.

“Actually, to get the best value for your taxpayers’ money, in our view, Airbus has an incredibly competitive offer. It should be taken very seriously and we look forward to the very swift conclusion of negotiations between Airbus and Biman,” the ambassador added.

A prospective Airbus deal had gained traction in 2023 through high-level European engagement. Under the previous Awami League government, a decision to buy 10 Airbus planes had been announced, but the interim government shifted towards Boeing after Sheikh Hasina’s ouster in August 2024 and amid pressure over US tariffs.

Later, Biman signed a $3.7 billion deal with Boeing on April 30 to acquire 14 aircraft, concluding more than three years of competition between Boeing and Airbus for the airline’s next major fleet order. Days later, Airbus submitted a fresh proposal to sell Biman 10 aircraft, which Biman was reportedly evaluating.

FTA TALKS AFTER ‘VALIDATION’ FROM EU MEMBERS

Speaking on the signing of an FTA, Miller said Bangladesh has requested for talks regarding an FTA and an investment protection agreement with the EU.

The European Commission president has already told Prime Minister Tarique Rahman that the EU is ready to explore where the common ground exists for the FTA, according to Miller.

He said negotiations on both the FTA and an investment protection agreement would begin once EU member states complete a validation process expected later this week.

He said such agreements typically cover a wide range of areas beyond tariffs, including e-commerce, intellectual property protection, and trade and human rights.

On Bangladesh’s request for support on a three-year deferment of its Least Developed Country (LDC) graduation, Miller said the EU has been discussing the frictions in the relationship and the steps the government has taken or plans to remove them.

“At a moment when the international rules-based order is under incredible pressure, we are your reliable partners,” he said.

“We believe in the rule of law, we believe in fair and transparent procedures, we believe in multilateralism, all of which should be music to the ears of Bangladeshi colleagues, businessmen and citizens,” he added.

Meanwhile, Commerce Minister Khandakar Abdul Muktadir said Bangladesh has resolved 48 of 61 non-tariff barriers raised by the EU and is processing solutions for the remaining 13, after the EU flagged them in March.

A decision on Bangladesh’s request for LDC deferment is expected at the UN General Assembly’s 81st session later this month.

Talks to launch FTA negotiations may begin in the near future, he added.

The minister also mentioned two recent US purchases as examples of value-based procurement.

He cited an American company’s offer to supply 117 LNG cargoes through 2038 at an average price of around $9, based on index pricing, which the cabinet committee on government purchase approved.
Google News LinkFor all latest news, follow The Daily Star's Google News channel.

“We considered that to be a good offer, so we approved it,” he said,

The minister also cited wheat imports from the US. “Compared with wheat that we import from other sources, the percentage of wastage in that wheat is much lower. If you translate that into monetary value, it becomes more cost-effective.”

He said when it comes to making purchase decisions, instead of just considering the face value, several factors have to be taken into account, including overall savings, the long-term benefits.

“Whenever we make any purchase – from America, the European Union, or anywhere else, including China or India – we try to apply our best judgment based on the merits of each purchase individually,” the minister added.

The manager of Norway's $2.3 trillion sovereign wealth fund has proposed significantly cutting its exposure to US Treasuries as part of ‌a wider shake-up of its bond investments to improve returns, according to a letter published this week.

Norges Bank Investment Management has recommended reducing its weighting to government bonds within its benchmark bond index to 50% from 70%, with US Treasuries, the biggest holding, getting the biggest cut, according to the letter.

The changes would mean cutting nearly $80 billion from the fund's current holdings of about $215 billion of US Treasuries as of the end of June, according to Reuters' calculations.

Government bond markets have been under pressure recently, with long-term borrowing costs soaring as rising inflation and government debt levels spooked investors.

Norway's sovereign wealth fund, the world's largest, owns on average 1.5% of ⁠all listed companies globally. Its scale means that portfolio decisions can influence broader market flows. Any cuts to its bond holdings are unlikely to be implemented until several months into 2027 at the earliest.

The letter containing the fund's proposals was sent in response to questions from Norway's finance ministry about the wealth fund's investment strategy for bonds.

Norges Bank IM said it would await the ministry's response, and any changes would be done gradually to limit market impact and transaction costs.

The proposals will form part of recommendations to the ministry in January. They will be discussed as part of the fund's annual white paper process next spring, after which the ministry will make a final recommendation to parliament which will then hold a hearing, a Norges Bank IM spokesperson said.

"We recommend that the government subindex of the bond index be reduced from 70% to 50%," Ida Wolden Bache, governor of Norges Bank, and Norges Bank IM CEO Nicolai Tangen wrote in the letter.

"A government share of 50% will be ‌sufficient to ⁠cover the liquidity needs, including in periods of turbulence in financial markets."

The fund also proposed considering an increase in investments in unlisted assets in a separate letter, in part as a way to reduce concentration risks that have grown in its equity portfolio amid the boom in the share prices of a handful of US tech companies.

Under its current mandate, the fund can own unlisted real estate and renewable energy assets, but it has a lower share of unlisted investments than comparable funds.

The dollar jumped on Friday after data showed that US employers added 162,000 jobs in August, well above the 56,000 additions expected by economists, boosting bets on a September Federal Reserve interest rate hike.The dollar gave up some of its early gains, however, as US markets head into a three-day holiday weekend and as traders waited on next week’s inflation data.
Labor Day on Monday is a US public holiday.

August’s job gains followed an unexpected 23,000 job decline in July. The unemployment rate held steady at 4.1 percent.“I don’t think this number changes anything really,” said Noel Dixon, senior macro strategist at State Street, pointing ahead to next week’s inflation reading.

“It’s all going to boil down to what that core number is going to be next week and I think the markets are going to react accordingly.”

Economic data for August is seen as key to whether the Fed will hike at its September 15-16 meeting.

Fed Governor Christopher Waller said on Thursday that if upcoming data confirms inflation pressures are cooling off, he is inclined to argue in favor of keeping interest rates steady.

Producer price inflation data is due on Thursday and consumer price inflation data is scheduled for Friday next week.

Economists expect core CPI to ease to 2.4 percent on the year, from 2.5 percent in July.

Elements of Friday’s jobs data also supported slowing inflation, Dixon said.

“In today’s number the unemployment rate stayed steady but if you look at wages year over year, that’s the lowest since June 2021. So if Waller and (Fed Chairman Kevin) Warsh and (Fed Bank of New York President John) Williams, who I think are very influential, wanted to hang their hat on something, they could hang it on that,” Dixon added.

The US trade deficit in July widened to its largest since March 2025, government data showed Thursday, as imports climbed on the back of the booming AI tech build-out.

US trade has seen wide fluctuations since President Donald Trump returned to the White House last year and rolled out sweeping tariffs on allies and competitors, in efforts to narrow the trade gap.
But the trade deficit in the world’s biggest economy grew to $88.6 billion in July -- a 24.4 percent increase from the month prior -- as exports of crude oil and gold fell while imports of tech products jumped.Exports dipped 2.1 percent to $310.7 billion, the Department of Commerce said.

Imports rose 2.8 percent to $399.3 billion, bolstered by computers, computer accessories and semiconductors.The US deficit with Taiwan, a major manufacturer of chips, reached a record $20.7 billion for the month.

The trade gaps with Mexico, Vietnam, Thailand, South Korea and Malaysia meanwhile also hit their highest on record.

While Trump’s tariffs have hit economies representing the majority of US trade, American officials have been careful to exempt products like chips, smartphones and other types of electronics.

Washington is looking to develop new tariffs on semiconductors, Commerce Secretary Howard Lutnick told CNBC Wednesday, adding that tech giants are aware of the Trump administration’s intent.

“What you’re going to see is targeted, thoughtful tariff policy that basically says if you build here, you don’t pay,” Lutnick said.

Over the past year, businesses have scrambled to step up imports before new waves of US duties kicked in.

Some firms expect further challenges in managing through Trump’s policies, which have caused business costs to rise, according to services sector survey data from the Institute for Supply Management. Activity in the sector jumped in August.

Although the US Supreme Court struck down many of Trump’s global tariffs in February, officials in July replaced them with fresh duties targeting 60 trading partners.

A separate trade investigation taking aim at 16 partners including China, the European Union and Taiwan, could lead to a further round of tariffs.

The United States meanwhile is engaged in a trade war with neighboring Canada, with which its deficit narrowed in July. Last month, Trump slapped a 50-percent duty on billions of dollars in Canadian goods, prompting Ottawa’s planned retaliation.

Also weighing on trade flows is fallout from the Middle East war, with Iran largely blocking off the Strait of Hormuz -- a key waterway for global energy and fertilizer transit.

A delegation of QatarEnergy, Bangladesh's largest contracted liquefied natural gas (LNG) supplier, is coming soon to find a possible way of resuming the LNG supply as its cargo halt created fuel furors in the country.
QatarEnergy stopped supplying LNG to Bangladesh immediate after the outbreak of the US-Israel war on Iran in the Middle East and restrictions on the passage of vessels through the strategic Strait of Hormuz.

The Middle-Eastern company announced 'force majeure' on March 4 to cease LNG supply to Bangladesh, and since then, it had extended the taboo every month. And under its latest announcement, QatarEnergy was not to send gas cargos until September.

The LNG-marketing team of QatarEnergy is expected to hold discussion with top officials of state-run Petrobangla and its subsidiary Rupantarita Prakritik Gas Company Ltd (RPGCL) on September 9.

"The visit of this team to Bangladesh is a follow-up to the visit of a high-powered Bangladeshi delegation to Qatar a couple of week ago," a senior official of the Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) told The Financial Express on Sunday.

Qatar had assured Bangladesh of all possible support in ensuring energy security, particularly amid the current challenging circumstances, during a meeting between Foreign Minister Khalilur Rahman and Qatar Prime Minister and Foreign Minister Sheikh Mohammed bin Abdulrahman bin Jassim Al Thani in Doha, he said.

Describing Bangladesh as a brotherly country, the Qatari prime minister had assured the Bangladeshi delegation, also comprising state minister for the MPEMR Aninda Islam Amit, of extending all possible support to Bangladesh in ensuring energy security.

"QatarEnergy has been showing positive intentions to help Bangladesh in coming out of the energy crisis after the visit of the Bangladeshi delegation," says Petrobangla Chairman Md Abdul Mannan.

He told the FE that the Qatari company already had expressed intention to supply at least one LNG cargo soon and ensure smooth LNG supply from next year.

Sources have said supply halt of LNG by Qatar has been affecting Bangladesh badly as at least 70 per cent of Bangladesh-bound LNG delivery is currently being affected as a consequence.

According to S&P Global Energy CERA data, Bangladesh received about 60 per cent of its LNG-import requirements from Qatar in 2025.

Apart from QatarEnergy, several long-term and short-term suppliers, including OQ Trading International of Oman and US's Excelerate, also stopped supplying LNG to Bangladesh as they were to source it from Qatar, market insiders said.

Bangladesh is currently struggling to meet its gas demand amid elevated LNG prices and as contracted long-term LNG suppliers continue to restrict scheduled cargo deliveries, they said.

Due to disruptions to long-and short-term LNG supplies, Bangladesh is being compelled to rely more on volatile spot market to source LNG to mitigate potential shortages after supplies from the Middle East were restricted due to navigation disruptions through the Strait of Hormuz.

State-run Petrobangla is being compelled to buy LNG at over US$ 28 per million British thermal unit (MMBtu) to supply natural gas to industries, power plants, households and other gas-guzzling consumers.

If Qatar would supply LNG, the price would have less than half of spot market rates, even amid the current high price of energy on the international market with the Brent crude price hovering around US$96 per barrel.

The country's overall natural gas supply was about 2,334 million cubic feet per day (mmcfd) with 702mmcfd of regasified LNG, according to official Petrobangla data as of September 5.

Bangladesh's natural gas demand is around 4,000mmcfd, according to Petrobangla.

State-run Petrobangla has been rationing gas to industries, power plants and other consumers to cope with a supply shortage of natural gas.

World ​food prices rose in August to their highest since late 2022, as adverse weather and ‌war disruption in the Black Sea heightened concern over supply of staples, the United Nations’ Food and Agriculture Organization said on Friday.

Extreme heat and drought in Europe, the threat of a severe El Nino weather pattern and trade upheaval caused by the Ukraine ​and Iran wars have unsettled agricultural markets, pushing grain prices to three-year highs and sugar to a one-year ​peak.

The FAO Food Price Index, which tracks monthly changes in a basket of internationally traded food commodities, averaged 133.3 points in August, up from July’s revised reading of 130.8.

That was the highest ​score since November 2022, though nearly 17 percent below a record peak from March 2022, after Russia’s full-scale invasion of ​Ukraine.

“August’s increase in global food prices is a warning that the risk premium is returning to food markets: climate shocks, geopolitical tensions and disrupted trade logistics are converging to tighten supply expectations,” FAO Chief Economist Maximo Torero said in a statement.

The FAO’s ​price benchmarks for cereals, vegetable oils, sugar, meat and dairy all rose in August.

The extreme weather in Europe ​affected prospects for the maize (corn) and sugar beet harvests as well as livestock output, while the anticipated El Nino phenomenon ‌fuelled concerns for palm oil and sugar output in Asia, it said.

Escalating attacks in the Black Sea have curtailed grain shipments from Russia and Ukraine in their 4-1/2-year-old war, while the US-Iran conflict was straining flows of fertiliser for crops.

Among food categories, FAO’s cereals price index rose 2.2 percent month-on-month to its highest since May 2024, and the vegetable oil index edged up ​0.6 percent to its highest since June 2022.

The agency’s sugar benchmark jumped 11.9 percent to its highest since June 2025, with lower production in Brazil’s crucial center-south region adding to weather concerns in Europe and Asia.

In a separate report, the agency cut its 2026 global cereal production forecast by 3.4 million metric tons from a previous estimate in July to 2.980 billion tons, now 2.0 percent below 2025 in the largest annual decline since 2018.

Projected output would still be the second-largest on record, however.

Forecast world cereal stocks at the close of 2026/2027 were revised down 1.1 percent to 947.2 million tons, now only marginally above the previous season.

A reduced estimate of coarse grain stocks outweighed an upward revision for wheat that reflected an anticipated build-up in Russian and Ukrainian stocks due to shipping disruption, the FAO said.

Thailand said Friday it would introduce clearer rules on AI data centres to regulate the fast-growing sector, and urged almost 50 sites currently under construction to hold the projects until then.

As demand for artificial intelligence heats up, tech giants are racing to invest billions of dollars in Southeast Asia, attracted by a growing plugged-in user base.

But the rapid expansion has outpaced regulation and concerns are growing across the world about the centres' impact on the environment, including their use of electricity and water, and local communities.

"Thailand is attracting interest from both local and foreign investors... We need to ensure alignment with laws, standards and the national interest," said Prime Minister Anutin Charnvirakul.

Regulations would be revised to make them "airtight" and prioritise public safety, he said at the first meeting of a new government committee on data centres.

Around 35 data centres are currently operating in Thailand, according to Danucha Pichayanan, secretary-general of the government's National Economic and Social Development Council.

Another 49 are under construction, 11 projects have been approved and 117 more are under review, he said.

"We don't have the power to suspend the construction of the 49 data centres" until the new rules are drawn up, Danucha told AFP.

"They are only asked for cooperation, if they would like to halt their construction pending the clearer regulations, which are expected next month."

New data centres -- warehouse-like facilities that store online files and power AI tools from chatbots to image generators -- are springing up worldwide, and the sector is growing particularly fast in Asia.

Microsoft announced in March it would invest more than $1 billion in cloud and AI data centre infrastructure and operations in Thailand over the next two years.

The news followed Google's launch in January of a new "cloud region" in Bangkok, with data centres that would contribute more than $40 billion to Thailand over five years.

But there are concerns in Thailand that the lack of rules up to now has allowed centres to pop up without proper consideration or regulation.

On Thursday, the energy ministry raised concerns over a Bangkok data centre it said was stockpiling 200,000 litres of diesel in underground tanks without permission.

Bangkok Governor Chadchart Sittipunt said the capital had received six applications for standalone data centres, three of which have been operating since 2022, with the other three paused pending review.

Well above the European Central Bank’s two-percent target, the figure from the EU’s statistical office was up sharply from 2.9 percent in July and in line with forecasts by analysts for Bloomberg.

“Looking at the main components of euro area inflation, energy is expected to have the highest annual rate in August,” Eurostat said, noting that energy prices were up 14.3 percent in August after rising 10.3 percent in July.

The US war against Iran and the near-total closure of the Strait of Hormuz, a key energy trade route, have sent global energy costs soaring.

“Inflation should remain well above target into next year, as higher gas and food prices put additional upward pressure on the index,” said Leo Barincou of Oxford Economics. The ECB is expected to again raise interest rates at its meeting on September 10 to tame the surge in prices, after a first hike in June.

The bank’s chief, Christine Lagarde, warned in July that the energy shock from the conflict “could intensify further”.

“The ECB will hike again next week,” said Kamil Kovar at Moody’s Analytics, adding that the jury was out on whether the decision would be followed by another increase in December.

“The broad-based increase in energy prices -- not just transport fuel, but also gas and now even electricity -- is playing in hawks’ favour,” he said.

Core inflation, which strips out volatile energy and food prices, has remained largely stable in recent months.

In August it slowed back to 2.4 percent after accelerating slightly to 2.5 in July.

Food and drinks inflation in August remained at 1.2 percent, the same level recorded last month. Eurozone inflation was last above 3.3 percent in September 2023, when it stood at 4.3 percent.

At the time consumer price rises were slowing after reaching a peak of 10.6 percent in October 2022, driven by surging energy prices caused by Russia’s invasion of Ukraine.

President Donald Trump’s plan to secure direct US access to a large share of Venezuela’s vast oil reserves could end up derailing the country’s long-awaited petroleum revival by stifling competition, distorting markets and deterring the foreign investment needed to rebuild the South American nation’s battered energy industry.

The plan unveiled on Monday would see Washington acquire a 35 percent equity stake in private oil firm North American Blue Energy Partners (NABEP), which is controlled by Venezuelan businessman Alejandro Betancourt.

The company would receive a 100-year lease on 17 Venezuelan oilfields holding an estimated 65 billion barrels of reserves.

In exchange, the US would receive a guaranteed 20 percent share of production at cost and retain a right of first refusal to purchase all remaining output. The arrangement would make NABEP the world’s second-largest private oil company by reserves, behind only Saudi Arabia’s national oil giant.

NABEP, which currently produces around 170,000 barrels per day, says it aims to raise output to more than 1 million bpd in the near term.

The Trump administration argues that the arrangement is a key part of its “three-part plan of stabilization, reconstruction and democratic transition” for Venezuela after its removal of former President Nicolas Maduro in January.

The White House adds that the deal will help the US create “new robust, strategic and defensible supply chains” in the Western Hemisphere, allowing Washington to refill its depleted strategic petroleum reserves, lower fuel costs and promote the “revitalization” of US manufacturing.

The proposal has already drawn fierce criticism from Venezuela’s opposition and Democrats in the US, with some calling it akin to modern-day colonialism and others arguing that it bears the hallmarks of election-year policymaking as Trump faces growing pressure over cost-of-living concerns ahead of the crucial midterm elections in November.

What’s clear is that his proposal carries significant political, legal and commercial risks, not least the threat of hampering the recovery it’s seeking to encourage.

A TWO-TIERED SYSTEM

The US has never exercised direct control over another country’s oil resources.

Even after the US invasion of Iraq in 2003, Baghdad remained in charge of resource decisions.

At present, such an arrangement appears difficult to implement.

The US government lacks the legal mechanisms necessary to routinely purchase and dispose of crude oil below market prices.

Yet a determined administration could seek to rewrite the rules, establish new purchasing structures or create government-backed trading mechanisms to facilitate the arrangement.

The bigger problem is that such a framework could inhibit development of the wider Venezuelan oil sector.

By granting NABEP and the US government privileged commercial terms, Washington risks creating a two-tiered market in Venezuela.

Companies competing with NABEP, including Chevron, currently the largest US producer operating in the country, would be placed at a structural disadvantage because they would have to buy and sell crude at prevailing market prices while a favoured competitor would enjoy privileged market access.

Investors may question whether future projects will compete on economic merit or political connections, and whether the rules of the game may change along with the leadership in Washington and Caracas.

That is precisely the kind of market distortion that oil companies considering multi-billion-dollar investments tend to avoid.

Chevron and several other international energy companies are this week expected to sign agreements to develop new projects in Venezuela.

Those investments are based on the country’s current hydrocarbon framework, which was revised to attract foreign capital after Maduro’s ouster.

But this new source of uncertainty could significantly dampen investment appetite at precisely the moment Venezuela is attempting to reestablish itself as a major oil producer.

HERE TODAY, GONE TOMORROW

Regenerating Venezuela’s oil industry will be no easy feat.

The country’s oil production collapsed following years of underinvestment, operational mismanagement and corruption after the sector’s nationalisation in 2007, a downturn compounded by US sanctions.

Output has fallen from roughly 3.5 million bpd in the 1990s to about 1 million bpd today.

Production is initially likely to recover to around 1.5 million bpd within the next two years, according to ROI estimates, as investment gathers pace and existing fields are revived.

That would constitute just over 1 percent of global supplies today.

Moreover, Venezuelan output is forecast to reach 2.3 million bpd by 2035 and exceed 3 million bpd by 2050, according to consultancy Rystad Energy, with most of the growth coming from the resource-rich Orinoco Belt.

Yet expanding production is only part of the challenge.

Decades of neglect have left the country short of the processing facilities, pipelines, storage terminals, export capacity and power infrastructure required to support a large-scale output recovery.

Many facilities today lie in complete disrepair, requiring reconstruction from scratch or costly refurbishments.

Rebuilding those assets will require tens of billions of dollars and, crucially, the participation of multiple international companies willing to commit capital over several decades.

Introducing a new layer of political uncertainty into Venezuela — a country that has nationalized foreign oil assets twice in recent decades — could make securing the necessary financing more difficult or expensive.

A plan designed to accelerate the recovery of one of the world’s largest oil endowments could thus slow it down instead.

Revenue from Taiwan’s semiconductor chip sector is expected to soar 40 percent this year, a top industry official said Wednesday, driven by skyrocketing demand for artificial intelligence technology.

The island is a global powerhouse in the manufacturing of chips that are used in everything from smartphones to electric vehicles, with nearly all of the most advanced ones made there.

Taiwan’s dominance of the critical sector has been a source of friction with the United States, with President Donald Trump accusing it of stealing the American chip industry and pressuring Taiwanese companies to build more on US soil.

“We are in a new era of the semiconductor industry from a technology point of view,” Wu Chih-i, president of the Taiwan Semiconductor Industry Association, said at the opening of the SEMICON expo in Taipei, noting AI has pushed the development of new technology. “This year Taiwan’s semiconductor industry performs even better. Our total revenue is projected to be close to US$300 billion. That’s more than 40 percent growth over last year,” Wu said.

However, he added that energy supply, talent and cyber security were “becoming more critical” for the industry and “no single country” could dominate the chip supply chain. “Continuous progress will require even closer semiconductor collaboration between many countries,” Wu said. Governments and tech giants are pouring billions into building data centres that can train and run AI tools such as chatbots, image generators and agents that can execute tasks.

This has turbocharged earnings of companies such as Taiwanese chip giant TSMC and driven global stock markets to all-time highs this year. But there are concerns over when that investment will see a return, and warnings that company valuations have gone too far.

This would be the decade of AI, said Ajit Manocha, the head of SEMI, a global industry association for chip design and manufacturing supply chain.

But Manocha noted that the world was in the “early innings” and there would be “a lot more challenges” with the technology.

“It’s not going to be a straight line,” Manocha told SEMICON.

“We’re going to have to learn how to deal with and navigate through the new opportunities and new headwinds.”

Stocks slumped in Asian trading on Wednesday as a bond market-induced selloff on global markets spilled over into the region, after renewed attacks by the US on Iran pushed oil prices higher.

MSCI's broadest index of Asia-Pacific shares outside Japan tumbled 1.5 per cent as South Korea's KOSPI dropped more than 3 per cent, while the Nikkei 225 was down 2.6 per cent. S&P 500 e-mini futures EScv1 were down 0.1 per cent.

Brent crude futures extended gains into a second day as trading resumed in Asia, rising 1.3 per cent to $95.91 a barrel after the US launched a barrage of airstrikes on Iran on Tuesday, which earlier pushed oil prices to a five-week high.

"The threat of further disruptions to the Strait of Hormuz has brought about renewed anxiety over inflation, driving a selloff in stocks across most major markets and a rout in global bond markets," Westpac analysts wrote.

The yield on the US 10-year Treasury bond hit an intraday high of 4.8122 per cent, its highest level in almost three years, while the yield on the 5-year Japanese government bond rose to 2.295 per cent, its highest level on record.

"September kicked off on a shaky note as developed market government bonds continued to sell off," DBS analysts wrote.

"Brace for a volatile month ahead as high yields cause angst across the asset classes," they added. "If the bond rout does not get stemmed, policymakers would probably have to resort to more aggressive measures to cap yields."

The kiwi dollar was down 0.6 per cent at $0.5855 after the Reserve Bank of New Zealand hiked interest rates by 25 basis points to 2.75 per cent, as expected by markets, though dovish language in the central bank's statement weighed on the currency.

The US dollar index =USD, which measures the greenback's strength against a basket of six currencies, was up 0.1 per cent at 99.79, its highest since Aug 17.

Overnight on Wall Street, the S&P 500 slipped 0.7 per cent and the Nasdaq Composite fell 1 per cent as a surge in government bond yields weighed on equities.

The declines came as data from the Institute for Supply Management released on Tuesday showed US manufacturing activity moderated in August amid a slowdown in new orders, but remained in expansionary territory.

Traders believe that the Federal Reserve is likely to lift interest rates at its next meeting in two weeks, though a hike is not certain.

Fed funds futures are pricing an implied 67 per cent probability of a 25-basis-point increase to benchmark borrowing costs at the US central bank's two-day meeting ending on September 16, compared with a 39.6 per cent chance a week ago, according to the CME Group's FedWatch tool.

Gold was down 0.8 per cent at $4,295.70 an ounce, while bitcoin slipped 0.6 per cent to $76,979.55 and ether was 0.9 per cent lower at $2,397.78.

The Trump administration won backing from all G20 financial leaders except China's on Tuesday to act against "non-market" policies and distortions that cause over-reliance on exports and hinder growth elsewhere.The finance ministers' meeting clearly focused on China, while Washington used a parallel G20 gathering of industry titans and commerce ministers to make the case for a hands-off approach to AI regulation.
US Treasury Secretary Scott Bessent said he had been proven right when he warned other trading partners last year that tougher US tariffs would lead to an influx of Chinese goods diverted to their markets."We believe that non-market-based economies pushing out a never-ending stream of cheap exports is not sustainable," he told a news conference."I think that the fact that 19 countries did want to address this shows the sheer the enormity of the problem."A G20 chair's statement to conclude the meeting said the participants, except China's, agreed that countries should eliminate "non-market policies" that exacerbate imbalances.

"In particular, countries with excessive and persistent external surpluses should remove distortions that constrain domestic consumption and that result in an over-reliance on exports for growth," the statement said.

The two-day meeting of finance chiefs - which saw differences in tone between the US hosts and some European participants - came amid a global bond market selloff on worries over growing debt levels and inflation pressures.

European countries and Canada expressed dismay that Russia, invited by the forum's US hosts, attended for the first time since it invaded Ukraine in 2022.

CHINA'S MASSIVE EXPORT PUSH

China's massive export push has pressured economies across the globe, especially as the United States has imposed high tariffs on Chinese goods and outright bans on some products, such as Chinese vehicles.

With chronically weak demand, China has doubled down on exports of electric vehicles, semiconductors and other goods, and its total exports rose 23.9 percent in July year-on-year, prompting growing calls in Europe for tougher curbs on Chinese imports.

G20 member China has shown little interest in longstanding calls for it to reduce industrial subsidies and rebalance its economy, while its yuan currency remains significantly undervalued by most measures.

China's goods trade surplus with the European Union hit €360.6 billion last year, a 15 percent increase on 2024, and has expanded further this year.

European Economy Commissioner Valdis Dombrovskis said in a briefing that China is a major source of economic imbalances, but said the US and Europe both also had roles to play in evening things out.

In more direct comments, German Finance Minister Lars Klingbeil said the US- and Israeli-led Iran war, together with ongoing US tariff disputes, were also major causes of uncertainty holding back the global economy.

"Uncertainty is poison for economic growth," he said. "The tariff conflicts being pursued by the US, such as the current dispute with Canada, destroy trust."

Britain said it would maintain a pragmatic trade relationship with China, while navigating what it said was the sensitive issue of trying to reduce imbalances.

Canada, which has forged closer economic ties to China since the start of the year, was engaging with China no differently than other G7 countries and with "clear guardrails," its finance minister Francois-Philippe Champagne said.

International Monetary Fund Managing Director Kristalina Georgieva told Reuters she believed China recognized it needed to take action, but they were calling more for coordinated action with others, such as the United States reducing its growing fiscal deficits, which contribute to excessive import demand.
Google News LinkFor all latest news, follow The Daily Star's Google News channel.

Beijing has also leveraged its dominance in processing of critical minerals by placing export restrictions on rare earths in April 2025, a response to US President Donald Trump's tariffs that has also affected non-US companies.

Japanese Finance Minister Satsuki Katayama, speaking late on Monday, said she had told her G20 counterparts that arbitrary export restrictions on critical minerals were harming the global economy. The issue was included in the G20 chair's statement.

"We urge countries to avoid unnecessary export restrictions to ensure global supply chains continue to function normally," it said.

A selloff in global bond markets deepened on Tuesday, with Japan's 10-year bond yield hitting 3 percent for the first time since 1996 - the latest manifestation of investor concern about energy-driven inflation, potential monetary tightening and worsening fiscal conditions.

Treasury officials said Bessent had called for sound monetary policy to anchor inflation expectations and avoid excessive currency volatility during his meeting on Sunday with Bank of Japan Governor Kazuo Ueda.

"I have information that the market doesn't have, and it's my belief that the Japanese government and the BOJ will do the things that will lead to a stronger yen," Bessent told CNBC in an interview.

The remarks, which underline Bessent's recent calls for the BOJ to raise interest rates, were seen by the markets as aimed at bolstering the case for a rate hike at the BOJ's policy meeting on September 17-18.

The Russian economy runs a risk of going "berserk" if it is run ​to focus entirely on the needs of the military-industrial complex, President Vladimir Putin's international development envoy was quoted ‌as saying on Tuesday.

The comments by Boris Titov to business news outlet RBC were a rare sign of concern in Kremlin circles about the increasing pressure on the slowing economy to secure a victory in the 4-1/2-year war in Ukraine.

Titov, appointed in 2024 as Putin's special representative to international ​organisations for achieving sustainable development goals, is a wealthy businessman who used to own Russia's leading producer of sparkling wine. ​He led an influential business lobby and ran for president in 2018.

"Military and civilian economies have ⁠always existed in symbiosis everywhere. Many technical inventions that are useful for all originated within the military-industrial complex. The key ​lies in maintaining balance," Titov told RBC.

Russia has hiked taxes, embarked on property redistribution, welcomed contributions from businesses to finance the ​war, and, most recently, threatened business owners who are not doing enough to protect their facilities from Ukrainian drones.

War hawks and some government officials often refer to the reorganisation of the Soviet economy under dictator Josef Stalin during World War Two as a model, citing the wartime slogan "Everything for the ​front, everything for victory".

'BERSERK' MODE IS TIME-LIMITED, TITOV SAYS

This approach is met with cautious but growing resistance from various sectors.

"This ​is not an economy at all, it's a kind of 'berserk mode' that can only exist for a very limited time, and the necessity of ‌which ⁠should be considered very carefully," Titov said on the eve of a major economic forum that Putin will attend this week in Russia's Far East.

RBC, which conducted the interview, noted that the term berserk derived from mythological Norse warriors who entered a trance-like state, possibly drug-induced, that enabled them to fight ferociously and ignore pain.

The Russian economy is expected to grow at only 0.4% ​this year, and many non-military ​sectors are stagnating or shrinking. ⁠Ukrainian attacks on economic targets such as refineries, online retailers and oil and grain export infrastructure may push this growth rate even lower.

Titov's comments echo a statement by Moscow's technocrat mayor Sergei ​Sobyanin, who argued last month that "killing a normal economy is equivalent to killing the whole ​country".

Andrei Klepach, the ⁠chief economist at the state development bank, lost his job last month after highlighting the economic challenges posed by the war in a public speech.

Russia will hold a parliamentary election this month, from which the only political party calling openly for an end to the war ⁠had been ​barred. Opinion polls show growing fatigue from the war and support for ​a peace settlement.

Such sentiment is being exacerbated by persistent rumours of a large-scale post-election military mobilisation for a final push to seize the whole of the Donbas ​region of Ukraine. The Kremlin has called such rumours a hoax.

US oil company North American Blue Energy Partners will take over some oilfields previously controlled by several Chinese companies ​and a Russian firm, two US officials told Reuters on Monday.

The takeover will be part of a sweeping oil production agreement that President ‌Donald Trump announced with Venezuela, they said.

The projects were among 14 contracts newly granted to US-backed North American Blue Energy Partners, according to the officials. NABEP was previously owned by US oil tycoon Harry Sargeant and is now controlled by Venezuelan businessman Alejandro Betancourt.

"Venezuela is blessed with an abundance of natural resources, hardworking people and untapped potential," Betancourt said in a statement, confirming the deal. "This ​transaction will unleash that potential to the great benefit of both Venezuelans and Americans."

NABEP said it will have operating control of the business and the ​US government will have holding rights to a 35% stake in the company, alongside "preferential access" to 20% of the company's production ⁠at cost.

The White House said NABEP has also granted the US Department of State the right of first refusal to purchase the remaining 80% of its production.

Last ​week, Trump announced that the US had secured access to some 64 billion barrels of Venezuela's proven oil reserves through a partnership with private business.

The arrangement gives US companies a ​foothold in some of Venezuela's strategically important oil assets while displacing Chinese and Russian interests that have long played a major role in the country's energy sector. It also gives Washington a direct role in determining who produces and sells Venezuela's oil, as the Trump administration seeks to reshape the country's oil industry and bring its vast reserves closer to US economic and geopolitical ​interests.

The US will also have veto power over NABEP's board and directors and has stipulated that a majority of the board must be American citizens, the White House ​added.

NABEP is expected to control a total of 17 projects in Venezuela that it plans to develop and ultimately use to supply oil to the US Fourteen of those projects will ‌be newly ⁠granted by the Venezuelan government, the officials said.

Five of the 14 fields have been operated by Chinese companies under a model promoted by then-President Nicolas Maduro, while one was previously operated by a Russian company, the officials said.

Two of the projects have been operated by China Concord Resources, which was sanctioned by the US in 2019 for Iran-related activity. Another project was operated by Sinopec and another by China National Petroleum Corp, the officials said.

"Not only are we opening up new opportunities for the US government ​to benefit and for US operators to ​benefit, we are opening up the ⁠United States as the market for this oil which was previously being sent to China," the official said.

Two other projects were operated by affiliates of Alex Saab, a former close associate of ousted Venezuelan President Nicolas Maduro who is currently being held ​in US custody, the officials said.

Another oilfield was linked to a nephew of Maduro's wife, Cilia Flores, the officials said.

Trump ​told reporters earlier on ⁠Monday that the US was taking out "millions and millions of barrels of oil" that is currently being shipped to refineries in Texas and Louisiana, among other locations. He is to meet oil and gas retailers and refineries on Tuesday.

The officials said talks between Venezuela's interim authorities and representatives of the 2015 National Assembly are aimed at restoring a measure of ⁠constitutional order ​and addressing legal questions surrounding the country's transition.

The Trump administration views the 2015 assembly as the last ​Venezuelan legislative body elected and operating under the country's constitution, although it has no formal governing power.

One official said reaching an agreement with the 2015 assembly could provide a constitutional and legal basis for ​the broader transition, including economic decisions such as the revival of Venezuela's oil industry.

India’s economy grew at a faster pace than expected in the April to June quarter, official data showed on Monday, quelling fears that the Iran war would derail growth in Asia’s third-largest economy.

Gross domestic product rose 7.8 percent in the three months through June from the same period a year earlier, helped by a robust services sector, according to data from the statistics ministry. While this was down from a revised 8.6 percent recorded in the previous quarter, it was still above market expectations of 7.3 percent growth.

“Growth was led by services, but a key upside surprise came from manufacturing, which grew 9.2 percent,” Teresa John of Nirmal Bang Institutional Equities told AFP.

Prime Minister Narendra Modi called the figures a “herculean feat”, noting that it came despite “oil price shocks and supply chain issues”.

“Doomsayers were doomed and India bloomed... yet again!” the premier said in a post on X.

Monday’s reading cements India as the world’s fastest growing major economy, and is a shot in the arm for Modi’s government, which has been grappling with political setbacks and a series of delicate policy challenges.

The year kicked off on a strong note for India, with robust economic growth and progress on a much-delayed interim trade deal with the United States. That momentum, however, quickly stalled with a stalemate in talks with Washington. The Iran war has also raised energy costs as well as India’s import bill, stoking inflation.

New Delhi depends heavily on imports for its oil and gas needs, making it particularly vulnerable to the global energy shock caused by the conflict. Initial assessments of the Mideast turmoil prompted India’s central bank to cut growth projections for the current fiscal year. The projections were later revised slightly upwards.

The Indian government has so far shielded citizens from the worst of the war’s economic impact with limited and staggered fuel price hikes.

But analysts warn that this may not hold given renewed tensions in the Mideast and consistently elevated global crude prices. Modi has had to face rising anger in recent months over government accountability, education and a lack of well-paying jobs for the millions of graduates that join the workforce every year.

Weeks of massive student protests forced the resignation of education minister Dharmendra Pradhan in July over a national exam scandal and have placed Modi on weaker political footing ahead of key state elections next year.

Policymakers have also struggled to prop up the Indian rupee, which has been under pressure due to a range of factors including fears of a higher current account deficit and foreign investors dumping Indian shares.

India’s central bank and finance ministry have launched a flurry of steps to woo dollar inflows -- including a deposit scheme for non-resident Indians that has brought in over $65 billion as of late-August.

But this has done little to salvage the sinking rupee, which after recovering has continued to see sustained pressure.

China’s installed solar energy capacity has surpassed that of coal-fired power for the first time, the national energy body said Tuesday, hailing the milestone.

China, the world’s largest emitter of greenhouse gases that drive climate change, has pledged to peak carbon emissions by 2030 and achieve carbon neutrality by 2060.

“As of the end of July this year, China’s installed solar power capacity reached 1.286 billion kilowatts,” the National Energy Administration (NEA) said.

“For the first time, photovoltaic installed capacity surpassed coal-fired power, becoming the largest power source category in China,” it added.

China, the world’s largest emitter of greenhouse gases that drive climate change, has pledged to peak carbon emissions by 2030 and achieve carbon neutrality by 2060
The country’s coal-fired power installed capacity, the energy body said, stood at 1.285 billion kilowatts.

Solar generation rose 15.5 percent on-year in the first seven months of 2026 to 802.4 billion kilowatt-hours, about one-eighth of the country’s total, the NEA said in another statement. It did not detail in these statements what the total generation of coal-powered energy was for the first seven months of this year.

The NEA said China’s installed solar power capacity and power generation “have maintained a steady trend of rapid growth”, with it playing an “increasingly prominent role” in guaranteeing electricity supply and driving the energy transition.

Coal has been China’s key power generation source for decades and a key driver of its planet-warming emissions.

But the country’s coal-fired power generation fell by nearly two percent in 2025, despite rising energy demand in the world’s largest emitter, data reviewed by AFP showed in February. It marked the first decline in six years, with some analysts saying it was the first time on record that coal generation dropped at the same time as power demand rose.

China has seen an explosive growth in its renewable installation, with coal’s share in its energy mix edging down in recent years.

The country installed a record 315 gigawatts of solar power and 119 gigawatts of wind power capacity last year -- over 80 percent of total newly installed power generation capacity, according to the China Electricity Council.

Sri Lanka’s inflation hit a 38-month high of 8.0 percent as prices of food and other essentials rose across the board, the government’s statistics office said on Monday.

The annual inflation rate in August compared with 7.3 percent last month and 1.2 percent a year ago, according to the Department of Census and Statistics.

“This month’s inflation was mainly driven by increases in the price index for transport, housing, water, electricity, gas and other fuels,” the department said.

Sri Lanka has hiked fuel prices by about half since the Middle East war triggered a surge in global energy prices in the import-dependent nation.

The island recorded deflation of 0.3 percent in July 2025, and prices have risen steadily since then.

Sri Lanka has warned that any prolonged conflict in the Middle East could threaten its fragile economic recovery from the meltdown of 2022, when the country ran out of foreign exchange to finance essential imports.

The government told the International Monetary Fund (IMF), which approved a $2.9 billion bailout for Colombo in March 2023, that sustained high energy prices could undermine efforts to recover from the country’s worst economic crisis.

Under the IMF-backed reforms, Sri Lanka is required to ensure cost recovery in fuel and electricity pricing while limiting subsidies that strain public finances.

Sri Lanka defaulted on its $46 billion foreign debt in 2022. Colombo has been drawing down the IMF bailout loan to stabilise the country since then.

Oil prices rose more than 3.5 percent on Monday after the US attacked an Iranian island in the Strait of Hormuz and Tehran said it had retaliated, as their conflict extended into its sixth month.

Brent crude futures were up $3.15, or 3.58 percent, to $91.25 a barrel at 0903 GMT, while US West Texas Intermediate crude was up $2.96, or 3.55 percent, to $86.36.

US forces struck two launchers on Iran’s Larak Island in the Strait of Hormuz on Sunday, the first known American strikes on the country since late July.

In response, Iran attacked two US air bases in Jordan, Iranian media reported on Monday, citing Iran’s Revolutionary Guards.

“Renewed military strikes in the Middle East and concerns of further oil supply disruptions have lifted oil prices,” said UBS analyst Giovanni Staunovo, adding that markets will now focus on whether the situation de-escalates or not.

US President Donald Trump said in a social media post on Sunday that Iran’s energy hub of Kharg Island was being “blown to smithereens”, but there was no evidence the island was under attack.

The post, which included an AI-generated video, provided no further details. Iran denied any attack on the island and said oil operations were continuing.

Efforts to negotiate an end to the conflict remain stalled as mediators seek to reopen the Strait of Hormuz, through which a fifth of global oil supplies passed before the war began at the end of February.

Part of the sharp market reaction reflected thin trading volumes due to a UK public holiday, said Saxo Bank analyst Ole Hansen.

Shipping data showed the number of visible commodity vessels transiting the strait over the weekend fell to five a day, highlighting caution among operators concerned about attacks on shipping.

The United Kingdom Maritime Trade Operations agency said on Sunday that a tanker had been struck by a projectile while entering the strait on Saturday.

US Treasury Secretary Scott Bessent told Reuters on Sunday that the US was likely to impose new secondary sanctions on Iran every week.

Despite Monday’s rally, Brent and WTI were still on track to post modest losses for August after falling more than 4 percent last week, their first weekly declines in three weeks.

Trump also said on Sunday that oil secured under a recently struck deal with Venezuela would be used to replenish the US Strategic Petroleum Reserve, which has fallen to near its lowest level in 44 years.

The dollar inched lower on Monday, but remained near a roughly two-week high, as markets ramped up bets on a rate hike after hawkish remarks from Federal Reserve Chair Kevin Warsh and renewed Gulf tensions, while the yen traded near the closely watched 160-per-dollar level.

The US central bank will “have work to do” if policymakers do not get the confidence they need that inflation is heading down to 2 percent, Warsh said on Friday, in his clearest indication yet that further tightening may be needed to curb price pressure. The comments fuelled bets on a September rate hike.

Markets raised the implied probability of a move next month to 58 percent, while yields on interest-rate-sensitive 2-year US Treasury notes held just below a more than one-month high.

“Warsh’s prepared remarks seemed designed to lift rate-hike expectations, rebalance the September debate towards the hawks and rebuild his inflation-fighting credibility,” Elwin de Groot, head of macro strategy at Rabobank, said.

“Warsh delivered an important signal: the Fed is not relying on tighter financial conditions alone and remains willing to tighten further if underlying inflation stalls,” he added.

Investors are now turning their focus to upcoming US data, particularly Friday’s nonfarm payrolls report and next week’s consumer inflation figures, both of which could shape expectations ahead of the September Fed meeting.

The euro edged up roughly 0.11 percent to $1.1597, while sterling inched higher to $1.3543. Both currencies remained on track for their second consecutive monthly gains.

The dollar index , which measures the US currency against six major peers, was down 0.11 percent to 99.53 after hitting 99.73 on Friday, its strongest since August 17.

Even so, the index was still on track for a second consecutive monthly decline, as US Treasury bond-buyback plans earlier in the month revived debasement trades.

Elsewhere, renewed tensions in the Gulf drove oil prices higher, with Brent crude futures last up 2.5 percent on the day to $90.21 a barrel. US forces struck Iran’s Larak Island on Sunday, marking the first known American strikes on Iran since late July.

US President Donald Trump said in a social media post that Iran’s energy hub of Kharg Island is being “blown to smithereens” although there was no evidence that the island was under attack.

John Ternus takes over as Apple’s chief executive on Tuesday, inheriting a company that towers over the smartphone market but trails its rivals in artificial intelligence.

One of his biggest challenges will be balancing the company’s dependence on China while parrying acute political pressure from the White House.

The handover ends Tim Cook’s 15-year run, replacing the operations specialist who built Apple’s supply chain with the engineer who built its hardware.

Ternus, 51, joined Apple’s design team in 2001 and worked his way up to senior vice president of hardware engineering, reporting to Cook.

He leads the engineering teams behind Apple’s entire product lineup, including the iPhones that generate most of the company’s revenue.

He gets barely a week to settle in, with Apple holding its annual iPhone event on September 9, where it is expected to unveil its first foldable handset.

“Tim Cook left the house in phenomenal order,” said Dan Ives, partner and senior managing director at investment firm Yorkville Ives & Co.

“But now it’s about Ternus defining the AI chapter.”

Ives expects the new chief executive to lean into what he knows.

“There’s no reason to fix what’s already working,” he said, predicting Ternus will concentrate on hardware innovation while leaving Cook’s supply chain intact.

Some analysts had argued software chief Craig Federighi was the more logical pick for a company scrambling to catch up on AI.

Carolina Milanesi, an analyst at Creative Strategies, said that misreads how consumers actually adopt technology.

“Consumers are still buying hardware first, and it’s going to be like that for a long time,” she said. “You’re not going to discover the value of AI if you’re not interested in the hardware.”

Ternus earned a bachelor’s degree in mechanical engineering from the University of Pennsylvania and worked as an engineer at Virtual Research Systems before joining Apple.

Inside the company he is credited with driving a push to make products more durable, reliable and resilient, and with design work that cut their carbon footprint.

The harder question is what kind of leader he becomes.

“Even people that know him now don’t know him as a CEO,” Milanesi said.

“You might know him as the head of engineering, but once you’re CEO, things change. Your responsibility is bigger, your power is bigger. You’re dancing a different kind of dance.”

Nowhere is that gap wider than in the geopolitical role Cook excelled at, courting both Beijing and Donald Trump’s White House to protect a supply chain that runs largely through China.

Apple’s manufacturing operation is among the most complex in corporate history, a web of hundreds of suppliers and assembly lines that Cook painstakingly built over decades.

Cook in recent years began shifting some of the work elsewhere -- iPhone assembly to India, other production to Vietnam -- but the diversification has been gradual with China, one of Apple’s biggest consumer markets, still anchoring the system.

Complicating matters, Trump has repeatedly demanded Apple build iPhones on American soil, threatening tariffs on those made overseas.

Cook avoided the heaviest blows of Trump’s trade war by cultivating the president directly, making US investment commitments and political donations -- all while also keeping Beijing onside.

The tricky political terrain will be new for Ternus.

“He knows Apple Park like the back of his pocket in terms of hardware,” Ives said of Ternus. “But on the global stage -- that’s probably one of the biggest areas where he’s going to have to learn on the job.”

Cook is not going far. He becomes executive chairman of Apple’s board on the same day, with a mandate the company has said includes engaging policymakers around the world.

“That was really clever,” said Milanesi, arguing the arrangement frees Ternus from a role Cook has handled alone for years.

The September 9 iPhone event will be the first public measure of the handover.

A foldable iPhone would be the most significant redesign in years, and Ternus will be its face -- eight days into the job.

“This is a moment that they created for him,” Milanesi said.