Stressed Beijing will buck Fed’s tightening trend 17 Jan 2022 China's reported output grew 8.1% in 2021, well above target, but activity slowed sharply at the end of the year. Monetary easing has been restrained by debt concerns, but the central bank surprised markets with a rate cut on Monday. Low inflation and a strong yuan give room for more.
Biden’s bank cop choice will draw heat 14 Jan 2022 The U.S. president named Sarah Bloom Raskin to lead supervision at the Federal Reserve. She has slammed watchdogs as laggards on climate risks. The Fed has downplayed tying bank capital reserves to global warming. But if Raskin gets through the Senate, that could become a goal.
EDF is latest utility in energy crisis hurt locker 14 Jan 2022 The state-controlled French group’s shares dived after the government ordered it to sell cheap nuclear power to smaller rivals. It’s no surprise France is shielding consumers from high wholesale prices in an election year. EDF won’t be the last European energy provider to suffer.
Covid-19 victory lap leaves Beijing exhausted 14 Jan 2022 China gloated over its pandemic control and took advantage of economic stability to launch risky crackdowns on tech and property. Now mini-outbreaks are prompting fresh lockdowns as an export boom looks set to slow. In 2022, malaise could prove harder to manage than disease.
EU greenwash laxity could see it build back worse 13 Jan 2022 Europe’s green taxonomy is meant to direct billions of euros towards clean energy so a post-virus continent can “build back better”. Yet political fudges mean gas and nuclear count as sustainable. Worse, the tool’s new draft contains loopholes that could make it dirtier still.
Everyone wins in India’s telecoms debt reset 12 Jan 2022 New Delhi is set to become Vodafone Idea’s top owner via a $2.2 bln debt-for-equity swap. The deal saves India’s No. 3 operator, spares its lenders and averts a duopoly. With the government on side, raising tariffs and securing outside investment will be easier too.
Kazakh oligarch shakeup may give foreigners a shot 12 Jan 2022 President Tokayev needs to consolidate power after unrest and raise cash to placate his citizens. Billionaires allied to his predecessor are obvious targets. Since he lacks a go-to gang to take over mining assets, he may favour gradual redistribution and more external investment.
Citadel Securities is a double bet on volatility 11 Jan 2022 Ken Griffin’s market maker has opened up to outside capital with a $1.2 bln investment from Sequoia and crypto firm Paradigm. Citadel is a bet that demand for seamless trading in bumpy markets will continue – and that politicians’ inability to agree on regulation will too.
Capital Calls: Crocs knows how to pandemic 11 Jan 2022 Concise views on global finance: The rubber-clogs maker’s sales are going gangbusters, and it has used lockdown success smartly to expand with a trendy acquisition.
Sri Lanka debt pain will go from China to Wall St 11 Jan 2022 The poster child for Beijing’s “debt-trap diplomacy” is asking for easier repayment terms amid a worsening financial crisis. Defaulting on U.S. dollar bonds may be a better option. That would help Colombo kick a credit addiction as worrying as its growing dependence on China.
Capital Calls: SEC, UK housing, Marijuana 10 Jan 2022 Concise views on global finance: The U.S. watchdog wants more private company transparency; The UK government’s decision to hit housebuilders with a four billion pound repair bill has lessons; and cannabis producer Tilray gives a glimpse of its life after its merger with Aphria.
China’s next debt crisis will be municipal 10 Jan 2022 Local government investment vehicles owe $8 trillion, over half national GDP, and are big dollar bond issuers. Collapsing property sales and Omicron stress are squeezing them. Beijing may let some default; others might try to dump assets in a weak market. It could get ugly.
Boris Johnson has Europe’s biggest energy headache 7 Jan 2022 Customers across Europe are braced for higher utility bills, prompting governments to divide the pain between users, suppliers and the state. But Britain faces the biggest hike and has done the least to cushion the blow. That makes the prime minister’s position more perilous.
Pricey oil gives Kazakh investors emergency cover 7 Jan 2022 Russia sent troops to quash a revolt in its neighbour. Even if President Tokayev keeps his job, energy majors like Chevron and Shell will fear fallout from the unrest. With the state reaping the rewards of oil at $80 a barrel, there’s less incentive to renegotiate their terms.
Walmart gets taste of the Lotte treatment in China 7 Jan 2022 Officials lambasted the U.S. retailer for network security problems, in what looks like blowback over allegations that Xinjiang-made products were yanked from shelves. The South Korean chain was hounded out of China by similar methods. Worst case, Walmart could share that fate.
U.S. safe-haven risks shift one year after riots 6 Jan 2022 Inflation, supply chain snafus, and an overextended workforce threaten the U.S. economy. And divisions that spurred violence remain. But by many markers, the greenback is stronger than last year. In a world that remains in pandemic, the U.S. currency keeps a grip on its top spot.
Reheated French grocer deal is still unappetising 6 Jan 2022 Auchan may launch a second bid for $16 bln Carrefour. Roping in private equity would allow it to pay in cash, a more palatable dish for its rival’s shareholders than last year’s offer. Job losses and shaky strategic logic mean the French state will be hard to convince.
Capital Calls: HSBC and China, Dr. Martens 6 Jan 2021 Concise views on global finance: The Asia-focused lender has a chance to take greater control of its mainland brokerage after recent positive noises from Beijing; buyout firm Permira picks a good time to offload shares in the $5 bln bootmaker.
Dissent endures for Hong Kong shareholders 6 Jan 2022 The buyer of camera components maker Yorkey Optical lifted its offer by 14% after pushback from activist investor David Webb while minority owners thwarted tycoon Joseph Lau’s attempt to take his Chinese Estates private. Small financial victories carry greater meaning these days.
Kazakh gas revolt is timely canary in the coalmine 5 Jan 2022 The central Asian state’s government has fallen after it removed a price cap on liquefied petroleum gas. Kazakhs have a host of local grievances other than energy costs. But commodity spikes will also cause fireworks in European states unless politicians cushion the blow.