Money‚ Markets & Macroeconomics

Automakers’ U.S. tariff fight heads down dead end

19 July 2018

The industry argues import duties would force Americans to pay an extra $83 bln a year for new cars. There’s a chance next week’s Trump-Juncker summit will yield a deal. But the U.S. president seems determined to punish countries for past trade wrongs, real or perceived.

Powell could help stiffen Congress’ spine on trade

17 July 2018

The Fed chief told lawmakers U.S. tariffs could threaten wage growth, but said it was unpredictable. Trade policy isn’t the Fed’s remit. Politicians are, though, worried at the early effects – yet they don’t want to anger Trump. A stronger steer from Powell might tip the balance.

EU-Japan pact too tiny to lift Trump trade blues

17 July 2018

A deal between nations that account for nearly a third of world GDP has symbolic value and may save European companies up to 1 bln euros a year in custom duties. But such benefits are dwarfed by the damage the U.S. president could inflict with more tariffs, say on car imports.

Boring Chinese GDP data just got interesting again

16 July 2018

Economic growth clocked in at 6.7 pct in the second quarter from a year ago, down a tick from earlier this year. The figure has been uncannily steady, making it easy to shrug off. As a trade war and deleveraging bite harder, though, overseas investors should pay closer attention.

Hong Kong stock-block will annoy all around

16 July 2018

Beijing won’t let investors trade in foreign issues or ones with super-voting shares on the HKEX. Xiaomi took an early hit and Hong Kong will hold less appeal for the likes of Aramco and tech firms. What may be a kneejerk reaction to reeling Chinese markets also could do damage.

Review: Why governments should give away money

13 July 2018

Handing out cash with no strings attached is an idea that has fired up a bizarre coalition of Silicon Valley techies and development economists. It may not be the silver bullet that some boosters claim. But as a new book argues, it deserves a serious hearing.

French finance has new fizz inside its own bubble

13 July 2018

Parisian bankers have a spring in their step. Jobs are coming to the capital due to Brexit, difficult reforms are underway, and President Emmanuel Macron has a vision of which they are proud. But their country has cleavages that are reminiscent of Britain and the United States.

May at least gains soft-power edge over Trump

13 July 2018

As the U.S. president ripped into the prime minister’s Brexit policy, an annual ranking of nations’ powers of persuasion put the UK back at No. 1. America’s slide to fourth is less surprising. It’s a crumb of comfort for Theresa May, but she will struggle to stay on top in 2019.

Silk Road speed bumps show limit of yuan diplomacy

13 July 2018

There is trouble along Beijing's trillion-dollar trade route. From the Maldives to Malaysia, politicians are calling to review deals, fretting over debt and dependence. Domestic politics are driving the backlash, making it tough to turn economic might into lasting influence.

Viewsroom: Trump’s Supreme Court pick

12 July 2018

The U.S. president has chosen a friend of big business in Brett Kavanaugh. But he faces bigger questions from Senate democrats about executive power. Plus: Commodity giant Glencore faces mounting risks in Washington, and what’s behind the Chinese yuan’s downward slide.

Holding: Brett Kavanaugh means business on speech

12 July 2018

Donald Trump’s Supreme Court pick would allow public companies to cut back on disclosure, internet service providers to discriminate against certain content and cable firms to block rivals’ programming. It’s a First Amendment message investors and consumers won’t want to hear.

Brexit is confronted with its own contradictions

12 July 2018

Theresa May’s exit plan involves the UK sticking to EU goods rules in return for symbolic but uncertain benefits on immigration and trade. Even if Brussels accepts the convoluted customs arrangement, Britain’s parliament may not. A dangerous standoff looms later this year.

U.S. water utilities heading for M&A rapids

11 July 2018

A four-way merger battle has shaken up the highly fragmented industry meeting in Minneapolis this week. California is pushing smaller utilities together, and energy firms are looking at H2O deals, too. With $4.8 trln of water infrastructure spending needed, bigger looks better.

Trade war rouses U.S. from tax-cut stupor

11 July 2018

U.S. levies on another $200 bln in Chinese goods are causing Republican lawmakers and companies to sound the alarm. They could have done so sooner – but were drunk on the president’s tax-cut plan. The timing will make it hard to stop what’s already gone too far.

“Back to the Future” trade war lacks Reagan vision

10 July 2018

Trump is using 1980s tactics to hit China with tariffs. The Gipper used similar levies to curb Japanese chips, computers and TVs. But Reagan also helped kick off global talks that created the WTO. Today’s White House wields only sticks, not carrots that might boost U.S. exports.

Tayyip Erdogan erodes Turkey’s market defences

10 July 2018

The president named his son-in-law as the finance minister in a new cabinet which excludes the man most trusted by investors. That’s a mistake. The self-styled “enemy of interest rates” now has no one to sugercoat policies and rhetoric that are apt to unsettle Turkish assets.

BHP Permian sale hits reset on regional boom

9 July 2018

The mining giant is looking to offload shale assets in the West Texas area. A mooted price of around $10 billion suggests valuations are starting to drop. The Permian’s global clout remains, but until producers can fix pipeline bottlenecks, a more measured approach makes sense.

Boris Johnson exit makes UK pound more binary bet

9 July 2018

Sterling fell after the foreign secretary resigned. Prime Minister Theresa May may have a freer hand to negotiate a less economically damaging Brexit. Or she, the negotiations, and the economy could fall victim to political infighting. There’s little middle ground for the pound.

May’s Brexit plan faces battle on three fronts

9 July 2018

The resignation of two cabinet ministers emboldens hardliners who say PM Theresa May’s proposal to quit the EU is too soft. But opposition parties think it’s too hard, while Brussels will demand more concessions. That increases the chances Brexit will be chaotic – or be delayed.

White House learns wrong lesson from labor market

6 July 2018

U.S. employers added 213,000 jobs in June, continuing a hot streak. President Trump reckons he has enough of an economic cushion to ratchet up trade wars with China and Europe. Yet firms are already delaying investment and facing higher costs. The buffer may dissipate.