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Global Oil Prices Plunge Sharply
International Desk
16 Oct 2024, 09:53
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Global oil prices have fallen by more than 4%.
On Tuesday (October 15), the price of West Texas Intermediate (WTI) dropped by $3.33, or 4.5%, settling at $70.50 per barrel. Meanwhile, Brent crude fell by $3.28, or 4.2%, to $74.18 per barrel.
Both benchmarks hit their lowest levels earlier in the day, with prices dropping by at least $4.
The decline in oil prices is attributed to Israel’s announcement not to strike Iran’s oil facilities, along with forecasts of weak demand.
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Gold Climbs to Record Highs in World Market
Gold hit a new all-time high (ATH) of $2,777, breaking all previous records in the world market. For the first time in the world market, the price of one ounce of gold exceeded 2,777 dollars.
On Wednesday (October 30) until 9:30 am, the price of one ounce of gold in the spot market was 2,777.78 dollars.
Traders are turning to gold as a safe-haven investment amid the Middle East conflict, volatility in the labor market, the Ukraine war, and rising odds for a Trump victory in US elections. Due to these reasons, the price of gold in the world market is on an upward trend, according to Reuters.
Bank of America, one of the leading investors in the world's financial sector, considers gold to be the most ideal investment at the moment. Michael Widmer, an expert from Bank of America recently said, "Gold is ideal for investment in the current situation. Gold is best suited to mitigate investor risk at the moment, especially as inflation and government debt continue to rise.
Predicting the continuation of the rising trend of gold prices, Bank of America said that the price of gold will rise to three thousand dollars per ounce by the first half of 2025.
Meanwhile, to deal with the inflation situation, the central banks are more inclined to buy gold to maintain the value of their currency, according to various international media. Currently, 10 percent of the world's central banks' reserves are gold. Which is just 3 percent of their total reserves even a decade ago.
From June this year, gold prices started to increase at an unusual rate. Last June 7, the price of gold per ounce was 2,293 dollars. After that, the price increased gradually, on October 18, the price of gold per ounce was 2,700 dollars for the first time in the world market. In less than a week, the price of gold per ounce increased to $2,750.
If the price increases in the world market, it affects the country's market as well. So the price can be adjusted in the country's market as well at any time.
Bangladesh Jewellers Association (BAJUS) determines the price of gold in the country's market. As such, Bajus last adjusted the price of gold in the country's market on October 22. The organization fixed the price of 22-carat gold at Tk1,41,951 after increasing the price by Tk1,890.
Besides, the price of gold was fixed at Tk1,35,501 per bhori of 21-carat, Tk1,16,138 per bhori of 18-carat, and Tk95,423 per bhori of traditional method gold. It came into effect on October 23 last.
It should be noted that the price of gold has been adjusted 44 times in the country's market so far this year. Among them, the price was increased 27 times and decreased 17 times. In 2023, the price was adjusted 29 times.
World Bank Pledges $1 Billion to Bangladesh's Export Development Fund
The World Bank will provide $1 billion to the Export Development Fund (EDF) in Bangladesh. Bangladesh Bank’s Executive Director and spokesperson, Husne Ara Shikha, confirmed this on Wednesday (October 30), citing Governor Dr. Ahsan H. Mansur.
She mentioned that Dr. Mansur, along with economic, trade, and science and technology advisor Salehuddin Ahmed, visited Washington, D.C., this month to attend the IMF and World Bank’s annual meetings. Upon his return, the governor shared the news of this loan from the World Bank.
Officials at the central bank stated that, as part of the IMF’s conditions for a $4.7 billion loan, the EDF fund size has been significantly reduced over the past year. The fund, which was at $7 billion during the COVID period, has recently decreased to $2.5 billion.
According to Bangladesh Bank, the EDF was established in 1989 with an initial $3.872 million. When foreign exchange reserves surged during COVID, the EDF was increased to $7 billion in 2022. However, the subsequent economic situation, with rampant money laundering and the dollar shortage after the Ukraine war in February 2022, led to a shortage. Abdur Rouf Talukder then took over as the new governor of Bangladesh Bank.
Governor Talukder emphasized reducing the EDF, which was lowered to $4.77 billion in May, $4.6 billion in June, $3.21 billion in July, and $2.91 billion by August after the change of government. By September, it further declined to $2.77 billion and has continued to decrease since.
It was reported that lending from the EDF was paused mid-last year to meet the IMF’s conditions for the $4.7 billion loan, and later resumed on a limited scale.
Sources indicate that approximately $600 million has been tied up with the top 40 companies, including Bismillah, Crescent Group, and Beximco, with around $250 million owed by just eight groups.
EU Agency Finds Banned Chemicals in Some 6% of Cosmetics
A pilot enforcement project found that around 6% of inspected cosmetic products contained hazardous substances banned under European regulations, the European Chemicals Agency said in a statement on Wednesday.
The ECHA said that national enforcement agencies in the 13 European Economic Area (EEA) member states — including Germany — checked almost 4,500 cosmetic products, and found banned substances in 285 of them.
The investigators were looking for a series of chemicals banned or restricted under a pair of EU regulations, the POPs Regulation banning persistent organic pollutants, and the REACH Regulation on the registration, evaluation, authorization, and restriction of chemicals.
Offending chemicals found 'mainly looking at the ingredients list'
The ECHA said that its pilot project had for the most part used a very simple methodology for tests carried out between November 2023 and April 2024.
"The inspections were mainly done by checking the ingredients list — measures that can be easily used also by consumers," it said.
"Consumers should be aware that the restricted substances were found in different types of cosmetic products, from various sellers and at all price ranges," it said.
Enforcement agencies had taken some first steps to remove the non-compliant products from the market, the ECHA said.
"In most cases, the first step was issuing a written advice guide to suppliers on how to comply with the law. At the time of writing the report, investigations were still ongoing in about half the cases," the ECHA said.
Pencil eyeliners and lipliners, conditioners and hair masks among the items
The Helsinki-based organization was primarily seeking indications of the presence of perfluorooctanoic acid (PFOA), long-chain perfluorocarboxylic acids (PFCAs) and related substances, and cyclic siloxanes D4 and D5.
It said it often found perfluorononyl dimethicone, which degrades into PFOA and PFCAs, in pencil and crayon eyeliners and lipliners — and that D4 and D5 were often present in conditioners and hair masks.
"PFOA and siloxanes, D4 and D5, break down slowly in the environment and build up in humans and other species. PFOA is not only persistent in the environment but also toxic to reproduction and suspected of causing cancer. D4 is also suspected of damaging fertility," the ECHA said.
Faria Yasmin Named Chief Business Officer of ACI Foods
ACI Foods & Commodity Brands has promoted Ms. Faria Yasmin to Chief Business Officer. She will oversee three companies—ACI Foods Limited, ACI Pure Flour Limited, and ACI Edible Oils Limited—and six business divisions: Flour, Lentil, Rice, Foods, Edible Oils, and Foods Export.
With a distinguished 24-year career, including nine years as Business Director at ACI, Faria has been instrumental in driving the growth of ACI’s food and commodity segments.
Ms. Faria’s extensive experience spans leadership roles at Nestlé Bangladesh, Marico Bangladesh, Bangladesh Edible Oil Limited, and Reckitt Benckiser Bangladesh & Sri Lanka.
A graduate of Dhaka University's Institute of Business Administration with a BBA and MBA in Marketing, she is known for her strategic vision and commitment to excellence.
Dhaka's Decision on Garment Exports Leaves Delhi Concerned
Bangladesh has halted the export of garments through India’s air and sea ports. Instead, Dhaka is now routing these products through the Maldives to various destinations worldwide, resulting in significant revenue losses for Delhi.
Indian media outlet LiveMint reported this on Saturday, November 2, citing relevant Indian officials.
Deepak Tiwari, Director General of MSC Agency (India), one of India’s largest cargo carriers, informed the outlet that Bangladesh is no longer using Indian airports for garment exports. Consequently, the revenue India previously earned from these shipments is now lost.
Additionally, officials at India’s seaports revealed that Bangladeshi garment products are first being sent to the Maldives before being airlifted to destinations worldwide. These products include apparel from global brands like H&M and Zara.
Officials noted that Bangladesh, the world's second-largest apparel exporter, previously shipped billions of dollars worth of goods globally via India, generating substantial revenue for India. By bypassing India, Bangladesh's new export route may weaken commercial ties between Dhaka and Delhi, potentially jeopardizing collaborative opportunities in logistics and infrastructure projects.
However, an Indian government official expressed confidence that a mutually beneficial solution will be found to safeguard India’s interests.
Another official pointed out that a significant portion of the garments Bangladesh exports are produced in Indian-owned factories or infrastructure within Bangladesh, which Delhi is also closely monitoring.
Industry expert Arun Kumar suggested that Bangladesh's decision may stem from frustration over a lack of control over their supply chain and delays in shipments through Indian ports.
He added that this new route provides Bangladesh with strategic advantages and improved reliability—crucial for the strict deadlines of the international apparel market. By reducing dependence on Indian ports, Bangladesh is gaining more control over its supply chain.
Arun Kumar also emphasized that garment products are perishable in nature; if shipments don’t arrive on time, orders are canceled.
A representative from India’s Apparel Export Promotion Council stated that India will not be significantly affected by Bangladesh’s decision, as Indian ports are already quite busy. In fact, they had previously urged the Indian government to restrict the export of Bangladeshi garments via Indian ports.
Another official clarified that this halt on garment exports through India has no connection with the political situation involving Sheikh Hasina’s government.
In the 2023 fiscal year, Bangladesh exported garments worth $46.49 billion. In the 2024 fiscal year, garment exports dropped by 4.34%, totaling $44.47 billion. In an effort to avoid delays and increase exports, Dhaka began routing shipments via the Maldives in March 2024.
Gold Price Drops in World Market, May Impact Bangladesh As Well
On October 30, the price of gold per ounce exceeded 2,777 dollars for the first time in the world market, breaking all previous records and creating history. The gold price has decreased in the world market at this time.
On Sunday (November 3) at 11 o'clock in the spot market, the price of gold per ounce was 2,736.41 dollars.
Gold prices are said to have eased slightly as the impact of the US election and tensions in the Middle East eased somewhat.
Bangladesh Jewelers Association (BAJUS) determines the price of gold in the country's market. Those associated with the organization said that the price of gold has fallen in the world market, which may reduce the price of gold per ounce at any time. If the price falls in the global market, it affects the local market as well. Therefore, the price can be adjusted in the country's market at any time.
According to BAJUS, the last price on October 30, gold of 22 carats was fixed at Tk1,43,526 per bhori, which is the highest in the history of the country. Apart from this, 1,37,005 taka for 21-carat gold, Tk1,17,433 for 18-carat, and Tk96,520 for traditional method gold has been fixed.
Remittances Reach $2.30 Billion in October
Since the fall of the Awami League government in the student uprising on August 5, the flow of expatriate income or remittances has been on the rise. As a result, remittances to the country reached $2.30 billion in October.
Central Bank Spokesperson and Executive Director Husne Ara Shikha confirmed the matter to the media on Sunday (November 3).
According to the sources of the central bank, remittances of $1.97 billion came in the month of October 2023. Accordingly, remittances have increased by 16.75 percent in one year. As of October 30 BPM6 system, the foreign exchange reserves of the country are 19.87 billion dollars.
In the two months of August and September, $4.63 billion of remittances came to the country. In September alone, remittances came in at $2.40 billion.
Remittance flows increase when the country faces a shortage of foreign exchange needed to import fuel, fertilizers, and commodities needed by the private sector.
According to financial experts and bankers, remittance flows have increased due to two reasons. First, under-invoicing of import bills has reduced significantly. Earlier this process used to divert large sums of money but recently it has been regulated.
Secondly, money laundering through informal channels like hundi has reduced significantly. As a result, the demand for dollars in hundi decreased and more dollars started coming in through government channels.
