(Reuters) – Sri Lanka’s consumer price inflation reached minus 0.7% year-on-year in October after easing to minus 0.2% in September, official data showed on Thursday, as the island nation continued its economic rebound. The National Consumer Price Index captures broad retail price inflation and is released with a lag of 21 days every month.

By Padraic Halpin and Amanda Ferguson

DUBLIN/BELFAST (Reuters) – Sinn Fein’s polling collapse from government-in-waiting to likely also-rans at an Irish election next week looks set to rob Irish nationalists of a potentially transformative moment in their pursuit of a united Ireland.

Earlier this year the party appeared on the brink of power in Dublin for the first time, placing it in government on both sides of the Irish border and ramping up preparations as it sought to force London to hold a referendum on a united Ireland within a decade.

But a fracturing of the party’s electoral coalition – in large part due to anger among traditional working class voters at its relatively liberal attitude to immigration – appears to have closed the path to power at the Nov. 29 election.

That could shelve – for the foreseeable future – Sinn Fein’s plans for an Irish government minister for reunification, unity planning by both a parliamentary committee and a citizens’ assembly and a “diplomatic offensive” to promote the goal at the United Nations and across the EU.

“An Irish government led by Sinn Fein would change the dynamics of this quite dramatically … Sinn Fein are an absolutely vital part,” said Colin Harvey, a human rights law professor at Queen’s University, Belfast, and board member of Ireland’s Future, a group that promotes debate around unity.

“But I think it’s essential to underline that this won’t be taken forward by any one political party. It needs to be a wide, broad and deep political and civic coalition.”

In campaigning in Dublin, there were precious few signs of such a coalition being built south of the border.

On a two-hour Sinn Fein canvass in one of its working class Dublin strongholds of Donaghmede – part of a constituency where it scored the highest vote of any party nationwide in the 2020 election – Reuters did not hear unity raised on one doorstep.

Instead unaffordable housing costs and under-resourced state services dominated discussions.

“It (Irish unity) has in the past been something me and my friends and people my age have spoken about, I don’t think with everything else going on right now it’s number one priority,” said 30-year-old teacher Deirdre Ní Chloscaí, walking by Dublin’s main thoroughfare of O’Connell Street.

LOW PRIORITY

While a commitment to Irish unity is a historical touchstone of Sinn Fein’s main rivals in the Republic, they have left the subject as little more than a footnote in their election manifestos.

Prime Minister Simon Harris’ Fine Gael devoted less than a page to Northern Ireland in its 124-page plan and favours a continuation of the outgoing coalition’s much more gradual path to unity – in part by investing some of Ireland’s huge budget surplus in Northern Ireland, where finances are more strained.

Harris’ main coalition partner, Fianna Fail, has gone a touch further, promising to engage with other parties on how potential proposals concerning unity could be developed and pledging to invest another 1 billion euros in cross-border projects.

An opinion poll on Sunday put Fine Gael and Fianna Fail on a combined 43%, suggesting they could again reach a majority with a third, smaller party. Both have ruled out governing with the left-wing Sinn Fein, who were on 18%.

That is a sharp change from a year ago when Sinn Fein was on course to be by far the largest party at 35%, and either bypass their centre-right rivals or leave little choice but for one of them to act as a junior partner.

UNDERLYING TRENDS

Sinn Fein insists that the only poll that matters is that on election day – and that irrespective of the result, broad trends are set to deliver a united Ireland.

“We have committed to putting the reunification question at the very heart of government,” Sinn Fein leader Mary Lou McDonald told Reuters. “But this is the direction of travel quite irrespective of who is in government.”

Despite the relative lack of interest, a large majority of voters south of the border support the ending of British rule in Northern Ireland in polls.

While polls show a comfortable majority in Northern Ireland favour remaining in the UK, the gap has narrowed slightly since Britain’s departure from the European Union put unity higher on the agenda in a region where a clear majority voted to remain in the EU with the Republic of Ireland.

Other trends have also steadily moved the dial in favour of unity, from Sinn Fein becoming the first nationalist party to lead the regional power-sharing government, to 2021 census data showing Catholics – who are more likely to support unity – outnumbered Protestants for the first time.

Under the terms of the 1998 Good Friday peace agreement, the British government is obliged call a referendum if it appears likely that a majority would back a united Ireland.

“The scale of change has been so profound, especially north of the border, that the truth is the question is now live,” McDonald said.

By Uditha Jayasinghe

COLOMBO (Reuters) – Sri Lanka expects the IMF to announce a staff level agreement on its third review of the country’s bailout programme on Friday, President Anura Kumara Dissanayake told the first sitting of the new parliament.

Once IMF executive board approval is given, a further tranche of about $337 million in funds is expected to be released to Sri Lanka.

Dissanayake’s Marxist-leaning National People’s Power (NPP) coalition won a record 159 seats in the 225-member parliament in a general election last week.

A delegation from the International Monetary Fund is in Colombo for the third review of its $2.9 billion programme and will hold a press briefing on Saturday.

Dissanayake also outlined plans to complete a $12.5 billion debt restructuring with bondholders in December.

Sri Lanka will enter into individual agreements with bilateral creditors including Japan, China and India needed to complete a $10 billion debt restructuring, he added.

“Our economy is hanging by a thread. This economy cannot absorb any shocks. We have to think deeply and in detail about the policy decisions we take. The moment we obtained power our priority was to build confidence and reassure stakeholders,” he told lawmakers.

“We need to do much more to put the economy on a stable path.”

A nation of 22 million, Sri Lanka was crushed by a 2022 economic crisis triggered by a severe shortage of foreign currency that pushed it into a sovereign default and caused its economy to shrink by 7.3% in 2022 and 2.3% last year.

The president will have to present an interim budget in the next few weeks, as well as find ways to reduce taxes and increase welfare, which were his key election pledges, without derailing the IMF programme.

Sri Lanka is expected to grow 4.4% in 2024, according to World Bank data, for the first time in three years.

(Reuters) – Federal Reserve Bank of New York President John Williams sees inflation cooling and interest rates falling further, he told Barron’s in an interview published on Thursday.

Two percent is the inflation rate that can best balance the central bank’s employment and price stability goals, Williams told Barron’s.

LONDON (Reuters) -Britain borrowed more than expected in October, according to official data that showed the scale of the challenge facing finance minister Rachel Reeves who says she will fix the public finances as well as increase spending sharply.

In October alone, public sector net borrowing stood at 17.4 billion pounds ($22.0 billion), the Office for National Statistics said on Thursday.

That was higher than a median forecast of 12.3 billion pounds in a Reuters poll of economists.

It was the second-biggest October borrowing total since records began in 1993.

In the first seven months of the tax year, borrowing totalled 96.6 billion pounds, 1.1 billion pounds higher than in the same period a year earlier.

($1 = 0.7908 pounds)

By Naveen Thukral and Renee Hickman

SINGAPORE/CHICAGO (Reuters) – Wheat growers in several exporting countries are reluctant to sell their crops with prices near four-year lows, traders, farmers and millers say, leaving flour makers with dwindling supplies and vulnerable to any potential upswing in prices.

Typically grain processors buy wheat three to four months in advance. But millers in Asia, including Indonesia, the world’s No. 2 wheat importer, are currently covered for about two months, and in the Middle East, most grain processors only have up to 45 days of supplies, two millers and a trader said.

The limited supply held by flour makers reduces their buffer against any production shortfalls that would trigger a rally in world prices, with global reserves already projected to reach a nine-year low, and fuel food inflation.

Farmers are hoarding their crop as global wheat prices have slumped to their lowest since 2020 on solid output in Australia and Argentina and on improved growing conditions in major exporting regions including the U.S. and Black Sea region.

Wheat sales in Australia, the world’s fourth-biggest wheat exporter, are running at half the pace of last year at 500,000 tons contracted for November shipment.

At the same time, farmers in the U.S. and parts of the Black Sea region are storing grains gathered earlier this year in silos, hoping for higher prices, industry players said.

“Farmers are not happy with the current price being offered to them,” said a grains trader at an international trading firm in Singapore. “Farmer selling is very slow and it is not just Australia where the harvest is going on, it is the same situation in several exporting countries.”

FARMERS HOLD OUT

In the physical market, Black Sea wheat with 12.5% protein is being offered at $265 a metric ton, including cost and freight (C&F) to Asia, down from $275 a couple of weeks ago. New-crop Australian Premium White wheat is quoted near $280 a ton, C&F, down from $290.

“Prices have come off pretty dramatically. And personally, yeah, I am not selling any wheat at the current stage,” said Cordell Kress, a farmer from Rockland in the northwestern U.S. state of Idaho.

“If you are not needing money right away, it is kind of just, store it or hold on to it and hope for better prices or some other problem in Russia or Australia that will cause our prices to go up here domestically.”

Kress grows primarily soft white and hard red spring varieties of wheat.

In Australia, farmers are selling other crops instead. 

“You have very strong sales of chickpeas for cash flow, and now we are getting strong sales of canola into the current prices,” said Rod Baker at Australian Crop Forecasters in Perth.

TIGHT SUPPLY AHEAD

Along with lack of supply from farmers, high interest rates have deterred millers from stocking up on wheat, leaving them exposed if prices rise.

“Lower supply cover does leave us vulnerable, but with high interest rates it doesn’t make sense to hold large stocks,” said one Dubai-based purchase manager at a flour mill in the Middle East.

Even with robust southern hemisphere production, global wheat stockpiles are projected by the U.S. Department of Agriculture to shrink to a nine-year low by mid-next year.

“Wheat crops in the northern hemisphere still have to go through crucial development stages, any issues with the weather until harvest in July can trigger a rally in prices, given how tight the inventories are,” said Ole Houe, director of advisory services at IKON Commodities in Sydney.

In a slight reprieve for millers, attractive interest rates have prompted Russian farmers, who had been withholding their crops, to change tack and sell crops so they can deposit money in banks.

But top wheat exporter Russia might be running out of supplies. Moscow’s grain export quota, to be in place from February to June, could be nearly three times smaller than the 29 million tons a year earlier.

By Sethuraman N R and Bharath Rajeswaran

(Reuters) -Shares of Adani Group companies lost about $28 billion in market value in morning trade on Thursday after U.S. prosecutors charged the billionaire chairman of the Indian conglomerate in an alleged bribery and fraud scheme.

Gautam Adani’s flagship company Adani Enterprises (NS:ADEL) tumbled 23%, while Adani Ports, Adani Total (EPA:TTEF) Gas, Adani Green, Adani Power (NS:ADAN), Adani Wilmar (NS:ADAW) and Adani Energy Solutions, ACC (NS:ACC), Ambuja Cements (NS:ABUJ) and NDTV fell between 20% and 90%.

Adani group’s 10 listed stocks had a total market capitalisation of about $141 billion at 0534 GMT, compared to $169.08 billion on Tuesday.

U.S. authorities said Adani and seven other defendants, including his nephew Sagar Adani, agreed to pay about $265 million in bribes to Indian government officials to obtain contracts expected to yield $2 billion of profit over 20 years, and develop India’s largest solar power plant project.

Adani Green in a statement on Thursday said the U.S. Justice Department had issued a criminal indictment against board members Gautam Adani and Sagar Adani and the Securities and Exchange Commission had issued a civil complaint against them.

The U.S. Justice Department also included Adani Green board member Vneet Jaain in the criminal indictment, it said.

Adani Green’s units had decided not to proceed with the proposed U.S.-dollar denominated bond offerings due to developments, it added.

“Investors will shy away from Adani Group stocks … and that’s what this sharp selling is signifying,” said Saurabh Jain, assistant vice president of retail equities research at SMC Global Securities.

“This could hurt the credibility of the group and maybe borrowing costs will rise,” he said.

The indictment comes nearly two years after U.S. shortseller Hindenburg Research alleged that Adani had improperly used tax havens and was involved in stock manipulation, allegations the conglomerate denied.

Also in early Asian trading on Thursday, Adani dollar bonds slumped, with prices down 3c-5c on bonds for Adani Ports and Special Economic Zone [US00652MAJ18=TE]. The falls were the largest since the Adani Group came under a short-seller attack in February 2023.

($1 = 84.4000 Indian rupees)

TOKYO (Reuters) – Tariff hikes under the new Trump administration do not shift the inflation outlook in Europe, ECB policymaker Francois Villeroy de Galhau said on Thursday, urging the European Central Bank to keep its options open.

“The balance of risks on growth and inflation is … shifting to the downside, and possible U.S. tariffs are not expected to alter significantly the inflation outlook in Europe,” Villeroy said in a speech in Tokyo.

By Leika Kihara

TOKYO (Reuters) -Bank of Japan Governor Kazuo Ueda said on Thursday central banks must be mindful that technological advances, such as in the area of artificial intelligence (AI), could bring new risks to financial stability.

The growing use of online banking and social media has heightened the risk that concern over a bank’s credit status could spread rapidly and trigger a rush of deposit withdrawals, Ueda said.

The rise of generative AI also brings specific challenges such as data protection concerns, he added.

“As financial services grow more diverse and complex, the channels of risk transmission have become less transparent, and current financial regulations may not be fully equipped to manage new types of financial services,” Ueda said.

“This environment underscores the need for operational resilience, including robust management of cybersecurity and third-party risks,” he said in a speech at the Paris Europlace Financial Forum in Tokyo.

Ueda said it was crucial for central banks and other authorities to monitor evolving financial intermediation functions, encourage relevant entities to establish sound governance, and build management frameworks to address new risks.

“A regulatory and supervisory framework that adapts to technological advancements is also essential,” he added.

A look at the day ahead in European and global markets from Ankur Banerjee

The prospect of slowing sales growth at AI juggernaut Nvidia (NASDAQ:NVDA) and simmering worries over geopolitical tensions are keeping investors on edge but bitcoin keeps marching upward, undeterred, towards $100,000 on bets that Trump 2.0 will be crypto-friendly.

Futures indicate that European stock markets are set for a subdued open as investors digest Nvidia’s projection of its slowest revenue growth in seven quarters. For investors used to the AI darling blowing past all estimates, the numbers proved disappointing.

The forecast will likely weigh on suppliers and the broader markets given Nvidia’s place at the centre of all things AI, which has driven most of the market gains in recent months.

With few economic readings due during the European session, the region’s tech stocks, which had already fallen to three-and-a-half-month lows this week, will likely weigh down the markets on Thursday.

Indian conglomerate Adani Group was in the spotlight after its chairman Gautam Adani was indicted in New York over his suspected role in a $265 million bribery scheme, according to U.S. prosecutors.

The fallout for the Adani empire, which was rocked by a short-seller attack in February 2023, was immediate, with shares in the conglomerate’s listed companies tumbling between 10% and 20%. Its dollar bonds also fell.

In the currency markets, the dollar remained on the front foot, with the dollar index hovering close to a one-year high touched last week.[FRX/]

The dollar has been on the rise since Donald Trump’s decisive victory early this month as investors expect his proposed tariffs will likely be inflationary, keeping U.S. rates higher for longer.

The talk of the town though remains bitcoin, which is up about 40% in the two weeks since the election as investors expect the Trump administration to set friendlier regulations for the crypto sector.

The biggest cryptocurrency touched a record high of $97,798 in Asian hours, with $100,000 not far off.

Key developments that could influence markets on Thursday:

Economic events: France business climate for November; euro zone consumer confidence flash for Nov

(By Ankur Banerjee in Singapore; Editing by Edmund Klamann)