FT News Briefing The world’s biggest mining project finally gets off the ground
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Jan 12, 2024 The U.S. and U.K. launch military strikes against Houthi rebels in Yemen, stirring geopolitical tensions. Meanwhile, inflation rates are raising questions about interest rate cuts. In an exciting twist, a massive $20 billion mining project in Guinea finally kicks off after 27 years of delays. This project aims to produce high-quality iron ore, essential for greener steelmaking, tackling both economic and environmental issues. The discussion also touches on Argentina's staggering inflation and the changing landscape of global mining.
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Conflicting Inflation Signals
- December's US annual inflation ticked up slightly to 3.4%, exceeding expectations.
- However, the overall trend still shows decreasing inflation, creating a disconnect between market predictions and policymakers' statements.
Rate Cut Uncertainty
- The December report makes March rate cuts less likely, but not impossible.
- The Fed wants to see inflation sustainably at 2% before cutting rates, prioritizing caution.
Simandu's Long Road
- Rio Tinto's Simandu iron ore project in Guinea has faced numerous setbacks over 27 years, including coups and corruption allegations.
- The project involves two mines, a 550km railway, and a port, with a total cost of $20 billion.