Barclays changes view on Indian Rupee after election

Barclays calls the Indian rupee one of its favorite high-yielding emerging-market currencies. The bank now sees the Indian currency at 58 rupees to the dollar in one and three months, compared to 60 previously. 

Barclays said that its more constructive rupee view reflects a combination of supportive factors including, an election result has encouraged portfolio inflows, a narrowing current account deficit and a globally supportive environment for carry trades. 

“Central-bank intervention will likely continue to limit the pace of INR appreciation against the USD, but the large size of portfolio flows implies that modest appreciation is likely to be tolerated by the RBI (Reserve Bank of India), in our view,” said Barclays. 

Barclays continues to think that a renewed bout of INR depreciation is unlikely, given the much-improved fundamental backdrop, led by a markedly smaller current account deficit, higher FX reserves, largely range-bound inflation and enhanced RBI policy credibility.

Rupee was as muscular as 69.22 rupees back in August, and the weak Indian currency at the time was one of the factors – along with gold-import restrictions-- blamed for reduced gold buying in the country, since a weak rupee makes gold more expensive for Indians.

Societe Generale remains bullish on Zinc

Many market participants in the base-metals arena looked favorably upon zinc, said Robin Bhar, metals analyst with Societe Generale. 

“It is anticipated that recent and expected closures of a number of zinc mines over this year and next would lead to a supply crunch underpinning a rally in prices,” said Bhar, outlining factors discussed at a recent zinc conference in Istanbul. Bhar cited closures and expected closures in Canada, Ireland and Australia. 

However, mine closures are the only known certainty. There are many unknowns regarding zinc’s supply/demand fundamentals, such as demand growth, substitution, how much higher prices would incentive new projects and the Chinese mining sector. 

“A supply crunch does look inevitable but it’s likely magnitude and duration is highly uncertain and subject to a variety of factors,” Bhar added.

Chart Of The Day: Global Youth Unemployment

We have some bad news... for Africa: according to the latest data released by the International Labor Organization, your youth unemployment problem is almost as bad as that of Europe.

Maybe more to the point, just what is it about those bracing Mediterranean sea breezes (not to mention mandated Eurozone "political capital" and relentlessly liberating - of one's job - globallization) that makes the young people in the adjoining countries choose to do pretty much anything but work?

Global Nickel market surplus dropped over 50% over the year in March: INSG

According to International Nickel Study Group (INSG), the surplus in global nickel market dropped significantly during the month of March this year. The global nickel market surplus totaled 3,600 tons in March this year. This is 52.6% down when compared with the surplus data during March last year. The global nickel market surplus during March 2013 was 7,600 tons.

The nickel surplus in March dropped when compared with the previous month. The global nickel surplus fell by 25% month-on-month during March. The production of Nickel during the month of February this year exceeded the monthly demand by 4,800 tons.

INSG notes that that the global nickel surplus during the three-month period from January to March this year dropped significantly over the previous year. The surplus narrowed to almost one-third during the initial three-month period of the year. The global surplus of nickel dropped from 38,900 tons during January to March 2013 to 13,400 tons during the corresponding three-month period this year.

The International Nickel Study Group (INSG) - an autonomous, intergovernmental organization established in 1990 and located in Lisbon, Portugal, is responsible for collection and publication of improved and latest statistics on world nickel market.

Declining supply levels likely to propel zinc prices higher

With market deficit set to worsen, the zinc prices may reach new heights in the near future. Analysts see bright chances of zinc outperforming the metal pack as nickel did in 2014. The Russian crisis and the Indonesian ore ban saw nickel prices surging nearly 40% YTD.

The declining supply levels are expected to drive the zinc prices higher. According to BofA Merrill Lynch estimates, the zinc prices are poised for a 15% upside from current levels by 2015. The zinc price is all set to breach $2,400 per tonne as early as next year. The zinc prices have remained almost flat since start of the year at around $2,100 per tonne.

MMG Limited that operates Century Mine in Queensland have already announced that the zinc production from their mines could drop to 465,000 tonnes this year, as against the 488,000 tonnes during 2013 and 515,000 tonnes during 2012. A series of mine closures scheduled for the second half of the year may aggravate the supply deficit.

On the other hand, the global economic recovery has bolstered the demand for zinc. The metal is mainly used for galvanizing purposes by the steel industry. Zinc is also used extensively in battery production industry and automobile industry. According to report released by the International Lead and Zinc Study Group (ILZSG), the apparent demand for zinc in China grew by 7.6% in 2013. Incidentally, China accounts for almost half of the global zinc consumption.

According to industry sources, the zinc output from mines is expected to remain subdued in the near future. On the other hand, global demand for zinc is poised to scale new heights. This could drive the zinc prices much higher, thus making it the star of the base metal pack.

SMART MONEY FLOW VS S&P 500

Google Inc reveals self-driving vehicle prototypes designed in collaboration with several automotive partners

The co-founder of Google Inc. – Mr. Sergey Brin revealed that the company has designed its own self-driving vehicles. The company developed a two-seated prototype that transports passengers at the push of a button.

Mr. Brin said in an official statement, which was cited by Bloomberg: “We took a look from the ground up as to what it would be like if we had self-driving cars in the world. We’ve worked with partners in the Detroit area, Germany and California.”

According to the company’s statement, Google has been working on the project for the past four years. The company revealed that the vehicle prototype lacks a steering wheel, accelerator pedal or brake pedal and basically looks like a gondola on wheels. The owners of such a car will be provided with the opportunity to set a destination address and the vehicle basically will do the rest by driving them there. The top speed disclosed by Google for now is limited to 25 miles per hour.

The company said that it works in collaboration with several automotive partners. For starters, the co-founder Mr. Brin said that Google Inc. has set a goal of manufacturing 100 to 200 test cars. The news comes at a time when there is a campaign aiming to make driverless vehicles more popular in order to make the roads safer.

The design of Google’s driverless cars resembles the one of Fiat 500 or the one of Mercedes-Benz Smart, but it won’t be equipped with a gas pedal, brake, steering wheel and gear shift. The only operations controlled by the driver will be pressing a red “e-stop” button that is intended for panic stops, as well as pressing a start button.

According to one of the analysts working at IHS Automotive – Egil Juliussen – the self-driving vehicles will gain greater popularity over the next twenty years. Mr. Juliussen said that the number of such cars in 2035 is expected to reach 11.8 million, and also projected that almost all cars are to become self-driving by 2050.

Google Inc. was 1.96% up to close at 574.87 dollars per share yesterday, marking a one-year change of +30.34%. According to the information published on CNN Money, the 41 analysts offering 12-month price forecasts for Google Inc. have a median target of 660.00, with a high estimate of 750.00 and a low estimate of 525.00. The median estimate represents a +14.81% increase from the last price of 574.87.