Government & Agencies

China’s multi-layered property crisis explained

21 Jul 2022

Homeowners in the world’s second-largest economy are refusing to pay mortgages on unbuilt homes. In this Viewsroom podcast, Breakingviews columnists describe how government deleveraging policy destabilised the sector – and President Xi Jinping’s unpalatable options for fixing it.

Italy puts itself in a lonely, risky limbo

20 Jul 2022

Prime Minister Mario Draghi lost backing from key coalition parties in a confidence vote, likely prompting elections. The lack of a reform-minded government will hurt growth just as Italy faces a gas crisis. It also imperils its access to ECB bond buying and European Covid funds.

Capital Calls: Royal Mail, Europe’s chip champion

20 Jul 2022

Concise views on global finance: Britain’s postal provider is eyeing a potentially messy separation, but a nationalisation would make more sense; shares of ASML, which provides cutting-edge machines for chipmaking, look more appealing despite inflation and geopolitical worries.

Solar twine holds creaking Texas grid together

19 Jul 2022

Power in the Lone Star state has held up, despite record demand and past blackouts. Regulatory actions, like forcing plants to stay online, help, but they carry some costs and risks. The rapid growth of solar offers more durable aid, if not a solution.

Capital Calls: Hasbro’s inflation transformation

19 Jul 2022

Concise views on global finance: The Monopoly maker is scrambling to offset input cost increases and a stronger dollar – but while these pressures might be temporary, increased prices to consumers will last.

Putin gas assault is a survivable test of EU unity

19 Jul 2022

Moscow’s key pipeline to Germany is offline for repairs, stoking fears Russia may cut off all its gas for good. That would mean soaring energy costs and a big economic contraction. But the worst outcome, where Germans hoard gas and splinter the European Union, looks less likely.

Review: The cat and mouse game of Russia sanctions

15 Jul 2022

In “Freezing Order”, investor Bill Browder describes lobbying to suspend the assets of those responsible for the death of his Russian employee. Moscow used economic interests and U.S. lawyers to undermine the sanctions. The same tactics threaten the response to the Ukraine war.

Draghi’s exit is bad news for Italy and the euro

14 Jul 2022

The ex-ECB chair has quit as Italy’s premier and may struggle to form a new executive. Early elections risk producing a less euro-friendly government amid a spiralling gas crisis. Without Draghi’s cover, Italy’s large sovereign debt looks more vulnerable to market turbulence.

Guest view: A platform for climate collaboration

14 Jul 2022

Finance ministers and central bankers face inflation and stagnating growth. The climate crisis could dwarf these hardships. If structured well, G20 Country Platforms can help to unlock private capital to meet the challenge, writes United Nations climate envoy Mark Carney.

Japan’s post-Abe future, Europe’s currency problem

14 Jul 2022

The assassination of former Prime Minister Shinzo Abe is an end of an economic era. In this Viewsroom podcast, Breakingviews columnists debate how his party’s success could bring about big spending. Also, the euro’s decline is a problem for central bank chief Christine Lagarde.

Spain’s ropey bank tax will have European copycats

13 Jul 2022

The country’s left-wing government is raiding banks for 1.5 bln euros a year. Taxing lenders based on their future benefits from rising interest rates represents shaky logic. But with inflation soaring across Europe, such populist measures will become more enticing.

Saudi can win two ways in global energy reshuffle

13 Jul 2022

U.S. President Joe Biden will plead for more oil on his visit to the kingdom. Riyadh may be tempted to say no. But with China and India buying cheaper Russian crude, diverting shipments could boost selling prices. Close ties could also unlock more western capital for Saudi.

Finland’s Uniper hit best seen as defence spending

12 Jul 2022

Helsinki wants Berlin to rescue the ailing German energy group, but limit the hit to Finnish owner Fortum. Germany doesn’t agree. Finns would be better off seeing any dilution from a forthcoming capital hike as part of the cost of de-Russifying. Like the cost of joining NATO.

Health adds new letter to ESG for food groups

12 Jul 2022

Government crackdowns on junk food marketing will hurt sales for companies like Frosties maker Kellogg. And investors are increasingly pushing consumer groups to use independent criteria to show how healthy their grub is. Tougher scrutiny will mean a valuation slap for laggards.

What an honest British prime minister would say

11 Jul 2022

Conservative politicians who helped precipitate Boris Johnson’s downfall are now vying to replace him. Several have spoken about the need for honesty, integrity and realism. If they mean what they say, they should start with these five points, says Hugo Dixon.

Japan’s Kishida inherits growing China headache

11 Jul 2022

The Prime Minister’s party increased its majority in Sunday’s election after former leader Shinzo Abe was shot. It’s now easier for Fumio Kishida to crank up defence spending and attack waning competitiveness. The former will anger China’s leaders; the latter will amuse them.

Unlike markets, real U.S. economy is blasé on Fed

8 Jul 2022

Employers added a robust 372,000 jobs in June. Stocks fell on worries that would spur a more hawkish central bank in its inflation fight. But consumers are still spending and businesses are short of workers. The more oblivious they appear, the more it pushes the Fed to be severe.

Shinzo Abe’s assassination leaves Japan undone

8 Jul 2022

The polarising politician who dragged the country out of decades of deflation was gunned down in the street on Friday. His Abenomics agenda will outlive him, as most of the challenges he tried to solve endure. Without Abe’s charisma, however, tackling them may get harder.

Chinese stimulus requires morale booster

8 Jul 2022

Local governments may front-load $220 bln of bond sales to help fill an estimated $1 trln funding gap. Infrastructure outlays have been restrained so far; officials worry wasteful investment will hurt their careers. Getting them to spend means reducing punishment for bad choices.

Boris Johnson exit is beginning of end for Brexit

7 Jul 2022

Campaigning to quit the EU propelled the outgoing prime minister to high office; his three-year tenure showed the costs of that decision. The UK still faces lasting economic and diplomatic damage. But the idea of using Brexit to realign British society will depart with Johnson.