Oct 23 (Reuters) - Code Agriculture (Holdings) Ltd :
* CHIN WAI KEUNG RICHARD HAS RESIGNED AS AN EXECUTIVE DIRECTOR
* MAO SONGTAO HAS BEEN APPOINTED AS AN EXECUTIVE DIRECTOR Source text for Eikon: Further company coverage:
Oct 23 (Reuters) - Code Agriculture (Holdings) Ltd :
* CHIN WAI KEUNG RICHARD HAS RESIGNED AS AN EXECUTIVE DIRECTOR
* MAO SONGTAO HAS BEEN APPOINTED AS AN EXECUTIVE DIRECTOR Source text for Eikon: Further company coverage:
The company said financial authorities in Singapore and China had approved the deal and was in line with its aim to expand in the rapidly growing Greater Bay Area in China. In September, DBS received approval from China's securities regulator to form a joint venture securities company in which it would have a controlling stake, allowing DBS to engage in brokering, investment consulting, securities underwriting and sponsorship in the country. Earlier on Tuesday, Reuters exclusively reported DBS was among a clutch of banks looking to bid for parts of Citigroup's consumer business in Asia.
(Bloomberg) -- The aggressive rebound in global economic growth still isn’t enough for most of the world’s central banks to pull back on their emergency stimulus.In Bloomberg’s quarterly review of monetary policy covering 90% of the world economy, the Federal Reserve, European Central Bank and Bank of Japan are among the 16 institutions set to hold interest rates this year.The outlook suggests officials still want to guarantee the recovery from last year’s coronavirus recession by maintaining ultra-low borrowing costs and asset-buying programs. That may require them to accept any accompanying bounce in inflation.Six central banks, most of them in emerging markets, are still predicted to hike, including Brazil, Russia and Nigeria. Turkey is the only one of those monitored which is forecast to cut borrowing costs this year.What Bloomberg Economics Says:“For advanced economies, continued virus uncertainty, deep labor market scars, and a recognition that past decisions erred on the side of deflationary preemption will conspire to keep policy looser for longer. In many emerging markets, currency stress means central banks don’t have that luxury.”--Tom Orlik, chief economistHere is Bloomberg’ quarterly guide to 23 of the world’s top central banks:GROUP OF SEVENU.S. Federal ReserveCurrent federal funds rate (upper bound): 0.25%Bloomberg Economics forecast for end of 2021: 0.25%A key question for Fed Chair Jerome Powell and his colleagues is when to start talking about scaling back their massive bond purchases if the economy continues to recover as they expect.Officials have vowed to keep buying $120 billion of Treasuries and mortgage-backed bonds every month until they see “substantial further progress” on inflation and employment. That test could be met sooner than anticipated if the U.S. labor market continues to perform as it did in March, when a better-than-expected 916,000 new jobs were added.Powell has so far avoided putting any time frame around when he thinks it’ll be appropriate to slow bond buying, but promises to give investors plenty of advance warning. The Fed has also signaled it expects to keep rates near zero through 2023.Officials at their meeting in March maintained that dovish message, according to a record of their discussion released on April 7, while Powell continues to stress the recovery remains incomplete and uneven.Part of its hesitancy to talk publicly about bond purchases stems from harsh experience: The Fed wants to avoid a repeat of the 2013 taper tantrum, when unexpected news that it was thinking about slowing bond buying roiled financial markets and hurt the economy.What Bloomberg Economics Says:“The U.S. economy may be launching into the fastest growth since 1983, but the Fed is firmly resolved to not only maintain the current stance of policy accommodation deeper into the recovery, but also to retract it more gradually under their new outcome-based framework for achieving its dual mandate. While Fed officials previously talked of seeing the ‘whites of the eyes’ of inflation before responding through policy tightening, the new framework is more akin to waiting to see inflation’s coattails -- as the central bank is prepared to endure a ‘transitory’ overshoot of their 2% inflation target.”--Carl RiccadonnaEuropean Central BankCurrent deposit rate: -0.5%Bloomberg Economics forecast for end of 2021: -0.5%The ECB has pledged to keep financing conditions for governments, companies and households “favorable” until the coronavirus crisis phase is over, using its 1.85 trillion-euro ($2.2 trillion) Pandemic Emergency Purchase Program to keep bond yields low, and dishing out ultra-cheap loans to banks.PEPP is due to run until at least the end of March 2022 and while policy makers say they won’t spend the full amount unless needed, most economists expect them to do so. The euro-area recovery has been delayed by a slow vaccination rollout, and ECB President Christine Lagarde has repeatedly warned of the dangers of ending support too early.The scene is set for a vibrant debate toward the end of the year on when and how to scale back emergency aid and what should replace it. In the meantime, the ECB is urging governments to hurry up with their 800 billion-euro joint recovery fund.What Bloomberg Economics Says:“The ECB will continue buying bonds through its Pandemic Emergency Purchase Program throughout 2021. We expect acquisitions to be front-loaded in 2Q to tackle the rise in government borrowing costs before reverting to a slower pace for the remainder of the year.”--David PowellBank of JapanCurrent policy-rate balance: -0.1%Bloomberg Economics forecast for end of 2021: -0.1%The Bank of Japan is likely to be keep its main policy settings on cruise control after its biggest policy review since 2016 in March. The review gave the BOJ more scope to reduce its asset buying after a fine-tuning it characterized as a shoring up of its stimulus framework for the longer term.Despite fears of inflation elsewhere in the world, a quarterly outlook report in April is expected to show that the BOJ doesn’t see price growth reaching a stable 2% before Governor Haruhiko Kuroda steps down in April 2023. That will help back up the institution’s argument that it had to take a more flexible approach to policy.Investors and economists will closely scrutinize how the changes will affect the BOJ’s market operations including its pace of bond and ETF buying, and how quickly it will step in to stop any jumps in 10-year yields after clarifying that its target range reaches up to around 0.25%.BOJ watchers will also be looking to see if the bank extends its special pandemic funding measures from the current September expiry date. With bankruptcies falling and bank lending growing, there appears little reason to add to the measures supporting businesses. Still, with only about 1% of the population vaccinated in early April, uncertainties for the economy remain with virus cases ticking up again in some major cities.What Bloomberg Economics Says:“The BOJ is preparing to shift from emergency pandemic support back to its long-elusive goal of 2% inflation. Adjustments to its yield curve control and ETF purchases add flexibility and endurance. It will be a protracted fight -- even the BOJ sees inflation falling short of target over its three-year forecast horizon. It’s set to stay on hold for the time being -- though it may need to accommodate more JGB issuance if the government steps up fiscal stimulus this summer.”--Yuki MasujimaBank of EnglandCurrent bank rate: 0.1%Bloomberg Economics forecast for end of 2021: 0.1%Bank of England Governor Andrew Bailey is firmly on the fence about whether his next move is to administer another dose of stimulus or monetary tightening to the U.K. economy. Financial markets already have priced out the prospect of negative rates, moving gilt yields and the pound higher than they were a year ago.After the worst recession in three centuries, the U.K. is headed for a sharp rebound after one of the world’s most successful coronavirus vaccination programs. Debate at the central bank is about whether the recovery will absorb all the workers left out of a job during the crisis and push up inflation, or leave scars that require further care.While the latest data including a boom in house prices suggest upside risks, companies are increasingly concerned that Britain’s exit from the European Union has choked back trade, leaving the prospect of a painful restructuring of the economy after the pandemic clears. At the institution’s next decision on May 6, policy makers will weigh whether to ease the pace of bond-buying, which at 4.4 billion pounds ($6 billion) a week would, unless adjusted, deliver more than the target for 150 billion pounds of stimulus this year.What Bloomberg Economics Says:“The year started with speculation rife that the BOE could take the historic step of reducing rates below zero. While the central bank looks like it will formally adopt negative rates as a tool in 3Q, a rapid rollout of the vaccine and a fiscal boost in the budget have greatly reduced the chances of them being used. We expect the BOE to stay on hold for the remainder of the year, emphasizing its higher-than-usual bar for tightening policy.”--Dan HansonBank of CanadaCurrent overnight lending rate: 0.25%Bloomberg Economics forecast for end of 2021: 0.25%The Bank of Canada is signaling it will be one of the first Group of Seven central banks to start paring back monetary policy support as the nation’s economic recovery from the Covid-19 crisis accelerates.Analysts anticipate next steps to pare bond purchases will come as early as a policy decision on April 21, while a so-called taper in the U.S. isn’t expected until next year.Canada’s central bank has been buying a minimum of C$4 billion ($3.2 billion) in government bonds each week, accumulating more than C$250 billion of the securities over the past year. That pace is likely no longer warranted with an outlook that appears to improving dramatically by the week, helped by a recovery in commodity prices and a robust housing market.The central bank, however, has sought to ease any worries of an imminent change to its benchmark overnight rate -- currently at 0.25%. Officials have pledged to keep it there until economic slack has been fully absorbed -- expected well after the quantitative easing program ends.What Bloomberg Economics Says:“A positive reassessment of the growth outlook will drive only a limited shift in BoC communications in April. The labor market is still a long way from full recovery, a factor that will increasingly dominate thinking about the inflation mandate. In turn, a near-term pickup in prices will be treated as transitory. Nonetheless, an announcement to reduce QE purchases at the April meeting would be consistent with prior communications, even if a rate hike is still more likely to be an early-2023 event, in our view.”--Andrew HusbyBank of Canada DashboardBRICS CENTRAL BANKSPeople’s Bank of ChinaCurrent 1-year best lending rate: 3.85%Bloomberg Economics forecast for end of 2021: 3.85%The PBOC cut lending rates and deployed various quantitative tools to inject liquidity into the pandemic-hit economy last year, on top of asking banks to increase loans. That helped to shore up growth but also pushed debt levels to a record high, fueling concerns of property bubbles and financial risks. With the economy’s recovery now well on track, the central bank is seeking to rein in its stimulus without derailing that rebound.The PBOC is likely to normalize policy by moderating credit expansion rather than hiking rates, economists say. Officials have said they want to match the growth in money supply and credit with the expansion in nominal GDP this year, and stabilize the debt-to-GDP ratio. The PBOC recently asked banks to curtail loan growth for the rest of 2021 to keep new advances at roughly the same level as last year.What Bloomberg Economics Says:“Robust growth, yet with pockets of weakness, suggest little need to the central bank to move the rate either way in 2021. In the meantime, the central bank will continue to tamp down on credit growth in a gradual taper to head off financial risks. It’s also likely to keep up targeted support for small private companies -- an area of persistent weakness in the recovery.”--Chang Shu and David QuReserve Bank of IndiaCurrent RBI repurchase rate: 4%Bloomberg Economics forecast for end of 2021: 4%India’s central bank formally embarked on the path of QE in early April, pledging to buy an assured amount of sovereign bonds this quarter as it fights to keep borrowing costs low and support a recovery in Asia’s third-largest economy. While the RBI already had been buying government securities in the secondary market, April’s meeting marked the first time the central bank committed upfront to buy a specified amount.Hamstrung by underlying price pressures that could gather pace in coming months, Governor Shaktikanta Das and five other members of the monetary policy committee voted to keep the repo rate unchanged at 4%. However, Das pledged to maintain a dovish stance if economic conditions deteriorate as a number of provinces including Maharashtra, home to the financial capital of Mumbai, grapple with lockdowns amid a fresh wave of Covid-19 cases.What Bloomberg Economics Says:“The RBI is likely to look through above-target inflation in the near term, with its primary focus on securing a durable recovery in growth. We see it holding the repo rate at 4% through the fiscal year ending March 2022. Sovereign bond purchases in its new QE program will be its main easing tool in the quarters ahead and should help tamp down longer-term yields to keep borrowing costs low to support the economy.”--Abhishek GuptaCentral Bank of BrazilCurrent Selic target rate: 2.75%Bloomberg Economics forecast for end of 2021: 5.5%Brazil’s central bank has begun paring back monetary stimulus as inflation surges despite a new wave of the pandemic that threatens the economic recovery. Policy makers raised the benchmark Selic rate by 75 basis points in March, the most in a decade, and signaled that a second move of the same magnitude is on the way at their next decision in May.Despite the institution’s assurances that price shocks are temporary, futures traders are betting even bigger hikes are in the pipeline. Driven by higher fuel costs, annual inflation blew past the upper limit of the central bank’s target range in March, hitting a four-year high.What Bloomberg Economics Says:“Recent actions and communications suggest the BCB will try to right the fiscal wrong with monetary policy. Fiscal uncertainties were an important driver of the currency meltdown in the first quarter; their likely persistence suggests that the real may remain misaligned with Brazil’s robust external fundamentals. In the meantime, the BCB is set to continue to raise the policy rate, fearful of the inflationary impacts of the weaker currency, and regardless of economic slack. The real may close the year at 5.30 per U.S. dollar, and the Selic at 5.5% -- still below the neutral rate (estimated to be 6% to 7%).”--Adriana DupitaBank of RussiaCurrent key rate: 4.5%Bloomberg Economics forecast for end of 2021: 5.5%The Bank of Russia surprised markets by starting its rate-hiking cycle earlier than expected. The inflation spike proved to be more prominent than policy makers thought before, Governor Elvira Nabiullina said after the board raised the key rate by 25 basis points in March and signaled more increases. The central bank will start publishing forecasts for the key-rate range starting their next meeting on April 23.The ruble dropped in value after the U.S. imposed sanctions on Russian sovereign ruble bonds at the primary market. It recovered some of the losses but the risk of additional steps is weighing on the currency. The U.S. has also warned of “consequences” if jailed opposition leader Alexey Navalny dies. These heightened geopolitical tensions are providing another argument for a bigger rate hike this week.Inflation peaked in March at the level last seen in late 2016, fueled by food prices and the weaker ruble. President Vladimir Putin made the cost of living a political issue when he told the government in December to put caps on prices of certain goods. Since then, Russia increased export duty on grain and negotiated with producers to set limits on some food staples. All administrative steps to curb prices are distorting the market signals and Russia needs to move away from that, Nabiullina said recently.What Bloomberg Economics Says:“Spiking inflation and a swift rebound in demand caught the Bank of Russia by surprise. Higher yields and fresh sanctions are layering on risk. Policy makers have turned hawkish, signaling significant tightening in 2021. We expect a steady pace of quarter-point hikes in the near term, which will give the central bank some room to maneuver in the second half of the year.”--Scott JohnsonSouth African Reserve BankCurrent repo average rate: 3.5%Bloomberg Economics forecast for end of 2021: 3.5%The South African central bank’s next move will be to tighten as it projects inflation will tick up to around the 4.5% mid-point of its target range. Still, the timing of the first hike is uncertain.The implied policy rate path of the MPC’s quarterly projection model in March indicated two increases of 25 basis points in the second and fourth quarters of 2021. Last week, Governor Lesetja Kganyago said the central bank is in no rush to take the benchmark back to where it was before the pandemic and that it would likely maintain an accommodative monetary policy stance to support the economy as long as the inflation outlook gives it room to do so.Forward-rate agreements, used to speculate borrowing costs are pricing in only one 25 basis point increase by year-end. Most economists are less hawkish and see the rate remaining at its record low until the end of 2021.What Bloomberg Economics Says:“The coronavirus is likely to keep spreading until there’s a significant ramp up in the governments vaccination program. As such, the economy is will remain fragile and highly unpredictable this year. This, together with the benign inflation outlook should keep rates on hold this year.”--Boingotlo GasealahweMINT CENTRAL BANKSBanco de MexicoCurrent overnight rate: 4%Bloomberg Economics forecast for end of 2021: 4%Mexico’s central bank held its benchmark rate at 4% in March, amid an inflation surge that is leading many economists to predict its monetary easing cycle has drawn to a close. Led by rising fuel costs, consumer prices rose 4.67% last month from a year earlier, jumping above the ceiling of the institution’s target.Governor Alejandro Diaz de Leon still didn’t close the door to additional rate cuts, saying that officials will continue taking a data-dependent approach to monetary policy. Consumer prices, he said, have been pressured by supply shocks, a weaker peso, and a shift in demand for goods instead of services, but the Mexican economy is likely to have a negative output gap “for some time.”Banxico, as the bank is known, expects annual inflation to peak during the second quarter, before slowing toward the end of the year.What Bloomberg Economics Says:“We expect Banxico to hold its benchmark rate at 4% in 2021. The rate remains high relative to peers and previous economic downturns, but resilient high inflation due to lingering shocks offset disinflationary pressure from ample economic slack and limit room for more accommodation.”--Felipe HernandezBank IndonesiaCurrent 7-day reverse repo rate: 3.5%Bloomberg Economics forecast for end of 2021: 3.75%Rising global bond yields have all but shut Bank Indonesia’s window for further easing this year. Governor Perry Warjiyo is turning his attention to preserving the country’s interest-rate differential from the U.S. to stem foreign outflows and protect the battered rupiah, which he considers “very undervalued.” Targeted macroprudential measures, such as the recent relaxation of home and auto loan rules, will likely be Warjiyo’s main lever to revive bank lending and aid growth.The central bank insists it won’t unwind monetary support for the economy anytime soon, with demand and inflation still weak. The institution also has signaled that when it is time to tighten, it could focus on restricting liquidity before raising rates.That will be one less thing for investors to worry about as they keep an eye on growing political pressure for BI to work more closely with the government. President Joko Widodo has called for the central bank’s mandate to be expanded to include employment and economic growth, even as he pledged to respect BI’s autonomy.What Bloomberg Economics Says:“Bank Indonesia appears limited in its ability to cut rates further this year, even though still-sluggish domestic demand is likely to justify more easing. Instead, heavy capital outflows -- linked to U.S. reflation and concerns about new constraints put on BI’s independence -- may require rate hikes to support the rupiah, instead of more concerted FX intervention that depletes reserves. Other measures would likely be deployed to counter the drag on domestic demand.”--Tamara HendersonCentral Bank of TurkeyCurrent 1-week repo rate: 19%Forecast for end of 2021: 16%Installed after President Recep Tayyip Erdogan abruptly fired his market-friendly predecessor following a bigger-than-expected rate increase, new Governor Sahap Kavcioglu is under pressure to reduce borrowing costs to boost growth.Turkey’s central bank left its benchmark rate unchanged in Kavcioglu’s first monetary policy meeting. While the decision matched market expectations, the institution omitted an earlier pledge to keep monetary policy tight and even deliver additional hikes if needed. Although Kavcigolu has said he would not rush to loosen the stance he inherited, the changes in the rates statement prompted further speculation that cuts might be imminent.Meantime, Erdogan, who holds the unorthodox view that high rates cause inflation, continues to express his determination to both reduce price growth and reduce borrowing costs to single digits.What Bloomberg Economics Says:“The recent firing of the central bank governor sends a clear message about the direction of policy: growth at all costs will be pursued. But rising U.S. yields, higher oil prices and lira depreciation will prevent rate cuts in the short term. If global conditions warrant tightening, it’ll be delivered through the backdoor.”--Ziad DaoudCentral Bank of NigeriaCurrent central bank rate: 11.5%Bloomberg Economics forecast for end of 2021: 13%The Nigerian central bank is inching closer to hiking its benchmark rate for the first time since July 2016. In March, three of nine MPC members who attended the policy-setting meeting voted to tighten by at least 50 basis points, a shift from January when the panel was unanimous in its decision to hold.Governor Godwin Emefiele said at the time the central bank can only effectively shift to taming inflation that’s at a four-year high once the recovery of Africa’s largest economy from last year’s recession has reached a comfortable level. Since then the International Monetary Fund has increased its projection for the country’s 2021 output growth to 2.5% from 1.5%. That would be the fastest expansion since 2015.A rebound in oil prices could improve the prospects for growth further, giving the central bank room to focus on taming inflation, even if it’s only from the second half of the year. Higher rates will also help support the naira, which was devalued twice in 2020.What Bloomberg Economics Says:“Nigeria’s inflation rate continues to surge, and has been stuck above the central bank target range for the past five years. However, the Central Bank of Nigeria has overlooked the recent uptick, choosing instead to support the economy with a 200 basis point rate cut. We expect it to hike rates again this year, when the recovery has gathered pace and the policy focus shifts back to inflation.”--Boingotlo GasealahweOTHER G-20 CENTRAL BANKSBank of KoreaCurrent base rate: 0.5%Bloomberg Economics forecast for end of 2021: 0.5%The Bank of Korea is expected to maintain a long hold as its optimism over the economy is tempered by continued uncertainty over the outlook and a slow vaccine rollout. The central bank sees faster-than-previously expected growth in the mid-3% range as exports surge on global tech demand and recoveries in China and the U.S. But Governor Lee Ju-yeol has played down talk that a tightening of policy is anywhere near the horizon.Keeping the BOK cautious is a renewed uptick in domestic virus cases. The resurgence is pushing the government to consider ramping up public restrictions on activity. A shortage of vaccines is also making it increasingly unlikely that the country will achieve its goal of herd immunity by year-end. If things take a turn for the worse, the central bank doesn’t have much room to go the other way and reduce its benchmark rate further after 75 basis points of cuts last year. Rising household debt poses a risk to the country’s financial stability and Lee has said the rate is already near its lower bound.For the time being, standing pat appears the institution’s best option for safeguarding the recovery while ensuring financial imbalances don’t accumulate further. The majority of economists surveyed by Bloomberg see the BOK holding its policy rate at the current level until the third quarter of next year.What Bloomberg Economics Says:“The Bank of Korea has likely reached the end of its easing cycle. While uncertainties surrounding the pandemic remain high, South Korea’s economy is poised to rebound in 2021 and the central bank remains concerned about growing financial risks. The BOK has cautioned that the government’s large borrowing plans could lead to bond market imbalances, but it will continue using ad-hoc bond purchases to contain yields rather than shift to QE.”--Justin JimenezReserve Bank of AustraliaCurrent cash rate target: 0.1%Bloomberg Economics forecast for end of 2021: 0.1%With the RBA targeting unemployment in the low 4% range and pledging rates won’t rise until inflation has sustainably returned to the 2-3% target, monetary stimulus will be in play for some time.The central bank has reinforced the economy’s rapid recovery by holding down borrowing costs through a firm defense of three-year debt -- its variant of yield curve control. That has also helped weaken the currency a touch in combination with QE that targets 5-10 year securities outside the YCC framework.Key decisions over whether to roll over the yield target to the November 2024 maturity, and whether to extend QE when the current round expires in September/October will likely be influenced by the economy’s resilience to a withdrawal of government stimulus.While the RBA has also said it will “carefully” monitor surging home prices, any action to stem gains is likely to come from tighter bank lending rules, not monetary tightening.The RBA has learned from its experience in 2009, when it led the world in raising rates. This time round it will wait for other major economies to move first to avoid renewed currency strength choking off the expansion.What Bloomberg Economics Says:“Last year was a consequential one for the RBA -- it ventured into yield curve control and QE. This year it will be less active, focused more on fine tuning. A pressing task will be to curb appreciation in the local currency. Another, working with other regulators to reinstate macro prudential policy restraints to restrain a resurgent housing market. Labor market slack is set to damp inflation, and keep the cash rate unchanged, for several years yet.”--James McIntyreCentral Bank of ArgentinaCurrent rate floor: 38%Bloomberg Economics forecast for end of 2021: 38%Argentina has relied on a mix of orthodox and unconventional policies to maintain its currency market relatively calm. While largely refraining so far this year from the mass money printing of 2020, policy makers have amplified price controls and slowed a crawling peg depreciation in a bid to cool inflation, currently around 40% a year. In order to absorb liquidity, the central bank has allowed financial institutions to pile into its short-term debt, with the amount of outstanding repo notes rising to over 1.5 trillion pesos ($16.2 billion) from 125 billion pesos a year ago.Monetary policy in the medium term remains clouded by the uncertainty surrounding negotiations with the IMF. The government has indicated a deal is unlikely to happen before mid-term elections in October, and Central Bank President Miguel Pesce has stayed on the sidelines of talks. While foreign reserves have slightly rebounded this year, they hover near a four-year low. The government’s strict currency controls, once labeled temporary measures, have no expiration date in sight.What Bloomberg Economics Says:“The IMF will probably require Argentina to adjust its policies in exchange for an Extended Fund Facility deal. Until then, however, we expect the BCRA to stay put. The policy rate will likely be on hold at 38% even as inflation accelerates, and the peso will likely depreciate at a pace slightly below inflation. Once a deal is struck -- likely after the October mid-term legislative elections -- the BCRA will probably bring real rates to positive territory and to reduce the currency misalignment.”--Adriana DupitaG-10 CURRENCIES AND EAST EUROPE ECONOMIESSwiss National BankCurrent policy rate: -0.75%Median economist forecast for end of 2021: -0.75%The SNB’s monetary policy consists of negative rates and currency-market interventions.In light of the small local bond market, the strategy is the most effective, SNB President Thomas Jordan has said. Data also indicate the intensity of interventions has diminished in recent months, as the franc dropped versus the euro.Having slumped the most in decades due to the pandemic, the Swiss economy is due to return to its pre-crisis level in the latter half of this year. Still, inflation also remains weak.Sveriges RiksbankCurrent repo rate: 0%Bloomberg Economics forecast for end of 2021: 0%Sweden’s central bank remains focused on bond purchases to keep rates low and stabilize markets. Still, Some policy makers are highlighting the option of a rate cut to stimulate demand and restore confidence in the Riksbank’s 2% inflation target.The central bank kept rates unchanged at its last meeting, and maintained its QE program at 700 billion kronor ($82 billion). Policy makers agreed that it was too soon to discuss withdrawing monetary support despite signs of economic stabilization and an uptick in consumer prices.Governor Stefan Ingves has signaled he prefers QE to rate cuts, and said last month he sees no risk of above-target inflation “in the foreseeable future.” Meanwhile, the property market soaring to record price levels is an increasing worry for Ingves, who said Sweden’s high level of household debt “will become problematic sooner or later.”What Bloomberg Economics Says:“A rebound in global trade is benefiting export-oriented Sweden and the economy has recouped more of the pandemic loss than expected by Riksbank. Short-term risks from new virus measures and a weak outlook for inflation due to modest wage growth still means policy makers won’t be in any hurry to withdraw support. The Riksbank has extended its bond-buying scheme until end-2021. We expect Ingves to stay on hold as the recovery takes shape.”--Johanna JeanssonNorges BankCurrent deposit rate: 0%Bloomberg Economics forecast for end of 2021: 0.25%Norway’s central bank is expected to be the first among wealthy western nations to tighten policy after its economy took a smaller hit than most in 2020. Its March forecast implies that the likelihood of a rate increase is split 50/50 between September and December.While soaring house prices signal financial imbalances are building up, Governor Oystein Olsen has said substantial uncertainty still remains regarding the recovery.Norway’s economic resilience has been boosted in part by an effective lockdown strategy and billions of dollars in government support backed by the country’s $1.3 trillion sovereign wealth fund. Still, restrictions to fight the spread of the more contagious strains of Covid-19 this year have hampered the recovery, with a deeper contraction in the first two months than the central bank had forecast.What Bloomberg Economics Says:“A quick rebound from the pandemic slump, sharply rising house prices and above target inflation during the past year give the central bank reason to think about leaving zero rates behind. But not yet. We expect extended virus restrictions to weigh on domestic demand until late in the second quarter. Norges Bank will likely wait until 4Q before lifting off.”--Johanna JeanssonReserve Bank of New ZealandCurrent cash rate: 0.25%Bloomberg Economics forecast for end of 2021: 0.25%New Zealand’s red-hot housing market has been driving the outlook for monetary policy this year after the government changed the RBNZ’s remit, forcing it to take house prices into account. After an initial flurry of bets that the central bank could start raising rates in 2022, the emerging consensus is that the cash rate will stay at its record low for longer. That’s partly because a raft of new government measures to cool the property market have taken the pressure off the RBNZ to act.While New Zealand’s successful handling of the pandemic initially enabled its economy to stage a V-shaped recovery, it now faces the possibility of a double-dip recession as its closed border hurts its tourism sector. The opening of a long-awaited travel bubble with Australia in April may help alleviate the pain, but support for the economy is still needed to ensure the recovery stays on track this time. Governor Adrian Orr has also made clear he wants to see a sustained inflation pickup before he considers removing stimulus.What Bloomberg Economics Says:“The RBNZ looks set to keep rates on hold this year. It’s likely to use other tools -- the Funding for Lending program and asset purchases -- if needed to add more support or to sustain maximum downward pressure on the currency. Its immediate attention is likely to remain on surging house prices, which have elevated financial stability risks. It’s already taken macro prudential policy steps, alongside government measures to rein in investor demand. The risks lie with further macro prudential tightening over 2021.”--James McIntyreNational Bank of PolandCurrent cash rate: 0.1%Median economist forecast for end of 2021: 0.1%Poland’s central bank intends to keep its benchmark rate at a record low until at least early next year, when the term of the Monetary Policy Council ends.The economy shrank for the first time in nearly three decades in 2020, and offficials responded by introducing a QE program and reducing the key rate from 1.5% in three steps between March and May.The EU’s biggest eastern economy is set to rebound this year, though the outlook has recently become more uncertain on the third wave of the pandemic.Even as neighboring central banks in the Czech Republic and Hungary are seen taking a less accommodative approach, their policies “play no role whatsoever” in monetary policy in Poland, according to Governor Adam Glapinski.Czech National BankCurrent cash rate: 0.25%Median economist forecast for end of 2021: 0.5%The Czech central bank has been telegraphing monetary tightening for over half a year but the prolonged coronavirus crisis is set to delay the first rate increase until the third quarter.Government programs to protect jobs are driving wages up and deferred consumption is set to fuel inflation once shops and services reopen after one of the world’s deadliest Covid-19 outbreaks. Still, policy makers agreed in March that a “longer-lasting pandemic-induced downturn” will probably mean a slower pace of monetary tightening than outlined in the institution’s forecast, which assumed three rate hikes for this year.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The dollar rose on Tuesday as interest rates in the United States moved in a tight range and a drop in oil prices hit crude-linked currencies. After touching its lowest level in nearly seven weeks, the dollar index against major currencies rose 0.2% to 91.204 in the afternoon in New York. The currency and yield declines have come as evidence mounted that the Federal Reserve would be slower about tightening monetary policy than it had appeared to the market, analysts said.
(Bloomberg) -- The head of Vitol Group, the world’s biggest independent oil trader, expects crude demand to come roaring back this year and next as the world emerges from the pandemic.Demand for crude will increase by 7 million to 8 million barrels a day by the end of 2022, up from current levels, and producers will be stretched to meet that surge, Vitol Chief Executive Officer Russell Hardy said in an interview.“We will need all eight cylinders to get through 2022,” Hardy said. “We believe $70 to $75 a barrel is an entirely sensible outcome for the third quarter,” he said, making a rare specific call on oil prices.It’s a bullish call for a solid recovery in global petroleum use after the pandemic caused demand for jet fuel, diesel and gasoline to collapse. Vitol handled more than 7 million barrels of crude and products a day in 2020, giving it keen insight into fluctuations in global supplies and demand.Global oil demand remains about 3.5 million barrels a day below pre-pandemic levels, Hardy said. Consumption should rebound by year-end as Covid-19 vaccines continue to be rolled out, lockdowns are lifted and travel for leisure and business resumes.“The gap is slowly closing as economies reopen and Eastern growth takes us higher,” Hardy said. Still, he cautioned that a recent spike in Covid-19 cases in India and other virus hotspots could derail the recovery.Hardy sees demand for jet fuel continuing to lag a rebound in other petroleum products, with demand still expected to be about 1.5 million barrels a day below pre-pandemic levels by year-end. The shortfall in aviation fuel consumption will be offset by a similar sized 1.5-million-barrel a day increase in use for other oil products, such as petrochemicals used in plastics, Hardy said.Storage GlutOil traders and producers rushed to fill up tanks on land and at sea a year ago as the pandemic and government-imposed lockdowns crimped demand. The price of a key U.S. oil benchmark briefly traded below zero as there was nowhere to store the excess oil. This week, West Texas Intermediate futures are trading at around $64 a barrel.Energy traders made huge gains last year storing cheap crude in tanks or ships they owned or leased and selling forward futures contracts at higher prices. Vitol earned around $3 billion in profit in 2020, according to people familiar with its accounts, the best financial result in its history. The closely-held company doesn’t disclose its annual earnings.Hardy said more than half of the 1 billion barrels of excess oil stocks squirreled away in response to the market collapse in 2020 have already been drained. The excess inventory draw downs should be largely completed by the end of the third quarter of this year, even with planned production increases by OPEC. About 2 million barrels a day are currently being drawn down and that pace will continue through June, July and August, according to Hardy.After collapsing a year-ago, crude has roared back amid a recovery in Asia, positive vaccine news and the lifting of lockdowns in some countries. International benchmark Brent has gained about 30% in 2021 as investors bet the re-openings will stoke consumption and keep draining inventories.Call on OPECHardy said the Organization of Petroleum Exporting Countries and its allies will have to step up production to meet the expected increase in demand even with “leakage” from U.S.-sanctioned Iran contributing about 1.5 million barrels a day of supply.“That’s going to come from OPEC because there is no other massive expansion coming because there is generally capital discipline across the West,” Hardy said, suggesting hobbled U.S. shale production won’t be able to significantly respond.OPEC+ has decided to revive just over 2 million barrels a day of the 8 million barrels of production it’s been keeping offline. The supply will be returned in stages over the three months to July. The producer group is discussing downgrading next week’s full-scale ministerial meeting, delegates said, a signal the coalition may stick with plans to gradually revive oil production.“OPEC will be in charge for the second half of the year,” Hardy said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- The first sign of trouble came last week: A small group of investors circulated a letter lambasting Barclays Plc for helping to raise hundreds of millions of dollars to build two privately owned prisons in Alabama -- two years after the bank publicly vowed to cut financing ties with the for-profit industry.Before long, the initial marketing efforts for the municipal-bond sale showed signs of sputtering. A socially responsible business group threw the London-based bank out in protest, and students and activists in Alabama began an email campaign to derail the financing.Together, the outcry turned what was supposed to be a relatively routine deal into an embarrassing black eye for the investment banking giant.It also marked a rare victory for activists and investors focused on environmental and social causes in the $3.9 trillion municipal securities market, where it is highly unusual for a bank to pull out of a deal just before it’s sold.“It’s absolutely a huge, unprecedented step forward,” said Christina Hollenback, founding partner of Justice Capital, which was part of a group of investors that sought to derail the bond offering. “It’s sending a really strong message to the finance industry overall.”ESG CloutThe bank’s decision is a sign of the growing power of investors focused on financing projects that advance social and environmental causes. With billions of dollars flowing into so-called ESG funds, that’s created a lucrative new line of business that banks are eager to court.The prison business has long been targeted by activists who say the profit-motive gives an incentive to cut costs, hurting rehabilitation efforts.The disparities in the broader criminal justice system have also drawn renewed scrutiny since the Black Lives Matter movement was galvanized by the killing of George Floyd by a Minneapolis police officer, whose trial is wrapping up this week. In Alabama, those disparities are especially evident: Black people make up over half of the inmate population, about twice their share of the overall state population, according to state and U.S. Census figures.Biden to Order Justice Department to End Private Prison UseThe $634 million bond sale was set to raise money for a CoreCivic owned company, Government Real Estate Solutions of Alabama Holdings LLC, to finance the new prisons that it’s building for the Alabama Department of Corrections. The state is planning to lease and run the facilities.State-run FacilitiesBarclays initially defended its role in the bond sale, saying it was not at odds with its decision in 2019 to cut off new financing for private prison companies since the facilities would be run by the state. Bloomberg News was first to report Barclays’ involvement in the deal earlier this month.CoreCivic and Alabama officials said the project would alleviate overcrowding in the state’s prison system and improve conditions for inmates. The state was sued by the U.S. Department of Justice in December for failing to protect male prisoners from violence and unsanitary conditions. The new facilities are intended to help remedy that.Both said the project will move forward even though the financing has been temporarily derailed. On Monday, KeyBanc Capital Markets, another manager, also said it was resigning from the transaction.“The reckless and irresponsible activists who claim to represent the interests of incarcerated people are in effect advocating for outdated facilities, less rehabilitation space and potentially dangerous conditions for correctional staff and inmates alike,” said Amanda Gilchrist, a spokesperson for CoreCivic.Key Alabama lawmakers urged Governor Kay Ivey to scrap the deal all together. Steve Clouse, a Republican who chairs the budget committee in the state’s House of Representatives, said it would be better for the legislature to authorize a bond sale for the state to build and own the prisons, AL.com reported.Deal StrugglesThe deal’s woes began last week when investors from firms including Justice Capital, Trillium Asset Management and AllianceBernstein LP signed onto a letter that asked investors not to purchase the securities because the purpose was to perpetuate mass incarceration. The letter cited the “historically incompetent” management of prisons by the state.The publicly offered portion of the deal struggled to gain traction as Barclays sought to sell the securities last week, despite a strong influx of cash into the municipal-bond market. That portion of the debt sale was downsized by about $200 million and the bank increased the yields being offered on the sale in an effort to lure buyers.Some investment firms declined to participate because they didn’t want to purchase bonds being sold for prison projects, citing concerns with environmental, social and governance risks or certain investment mandates that their firms or funds have, according to people familiar with the deal who asked not to be identified.Others had broader concerns. The bonds were being sold through a Wisconsin agency called the Public Finance Authority, which rents out its access to issue municipal debt to businesses all over the country and has a high default rate compared to other issuers. On Monday, PFA, which had been brought in by Barclays as the conduit for the sale, also said it would no longer be part of the transaction.Private OfferingStill, there was strong demand for a debt offering that would have been privately placed with investors, according to a person familiar with the matter. That portion of the sale was estimated at $215.6 million based on initial bond documents.Then on Thursday, the American Sustainable Business Council and partner organization Social Venture Circle, which represents 250,000 businesses to advocate for responsible practices and policies, announced that they would rescind Barclays’ membership in the group. Then a coalition of activist groups, including Alabama Students Against Prisons and Communities Not Prisons, began emailing people who work at Barclays in an effort to scuttle the deal.On Monday, Barclays capitulated. “While our objective was to enable the State to improve its facilities, we recognize that this is a complex and important issue,” the bank said in a statement. “In light of the feedback that we have heard, we will continue to review our policies.”(Updates with lawmakers call to end the lease-financing project in the fourteenth and fifteenth paragraphs.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- China Huarong Asset Management Co.’s dollar bonds sank Tuesday after Reorg Research reported regulators are considering options for the company that include restructuring the debt of its offshore unit.A debt restructuring is one of several options under discussion and a decision is far from finalized, according to the report, which cited people familiar with the matter. Reorg is a New York-based provider of credit data and analytics. Almost all of China Huarong’s $22 billion in dollar bonds are issued or guaranteed by China Huarong International Holdings Ltd., the offshore unit.A representative for Huarong couldn’t immediately be reached for comment when contacted by Bloomberg.The company’s 5.5% bond maturing in 2025 fell 9.4 cents to 78 cents on the dollar as of 6:10 p.m. in Hong Kong, Bloomberg-compiled prices show. A 4.5% perpetual note slumped 6.6 cents to 72.4 cents.The declines follow a three-day rally in the firm’s dollar bonds that accelerated Friday after China’s financial regulator said that the bad-debt manager was operating normally and had ample liquidity. The statement, made after a regular briefing in Beijing, were the first official comments since the company jolted Asian credit markets by missing a deadline to report preliminary earnings on March 31.“There’s very little clarity from China Huarong and regulators over the fate of offshore investors so the bonds are still vulnerable to big swings,” said Owen Gallimore, head of credit strategy at Australia & New Zealand Banking Group in Singapore.A potential restructuring or default for China Huarong would be the nation’s most consequential since the late 1990s. Any signs that Beijing is rethinking its support for a central, state-owned firm like China Huarong would have deep repercussions for the broader dollar bond market. The company is majority owned by China’s Ministry of Finance and is deeply intertwined with the nation’s $54 trillion financial industry.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Gulf Energy Development Pcl, Thailand’s biggest power producer by market value, offered to acquire Intouch Holdings Pcl that control’s the nation’s largest mobile phone operator for as much as 169 billion baht ($5.4 billion). Intouch shares surged the most in more than two years.The Bangkok-based company, controlled by billionaire Sarath Ratanavadi, offered to buy 2.6 billion shares, or about 81% of Intouch, that it doesn’t already own at 65 baht each, it said in an exchange filing. The offer price is 11% higher than Intouch’s close on Friday. While Intouch shares jumped 7.7% on Monday, the most at close since January 2019, Gulf Energy tumbled 1.5% to close at a five-month low.Gulf Energy will also tender for 100% of Advanced Info Service Pcl, Thailand’s biggest mobile phone company controlled by Intouch, at 122.86 baht each. The Advanced Info offering will be subject to Gulf Energy securing at least 50% of Intouch, it said.With the acquisition of Intouch, Gulf Energy may be targeting rising demand for 5G services as a new source of growth, according to Danai Tunyaphisitchai, an analyst at Phillip Securities (Thailand) Pcl. Still, the sell-off in Gulf Energy showed that some investors are concerned about possible large borrowing to finance the takeover, he said.Sarath, 56, Thailand’s second-richest person, has expanded his 10-year-old energy company into deep-sea port, tollway and telecommunication businesses as well as power projects in Vietnam, Oman and Germany. Acquisitions of Intouch and Advanced Info will generate long-term benefits from their potential and cash flows as Thailand’s leading telecommunication companies, Gulf Energy said.Satellites, E-commerce“Intouch has a very strong business platform from mobile phones, satellites to e-commerce that can add value to our energy and infrastructure business,” Smith Banomyong, Gulf Energy’s chief of asset management and investment, told reporters. “Digital technology is considered another key infrastructure that all businesses require now.”Gulf Energy’s proposed acquisition of Intouch would be Thailand’s third-biggest buyout deal, according to data compiled by Bloomberg. Singapore Telecommunications Ltd. is the biggest shareholder of Intouch after acquiring 21% stake from Temasek Holdings Pte in 2016, while Singtel also owns about 23% of Advanced Info, according to stock exchange data. Singtel views its stakes in Intouch and Advanced Info as strategic investments and the company believes in the long term outlook of the business, it said in an exchange filing. The company is reviewing its strategic options to ensure that shareholders of Intouch and Advanced Info get full benefit of the intrinsic value of the businesses, Singtel said.Bank LoansSarath, Gulf Energy’s chief executive officer, has a net worth of about $9 billion, most of which comes from his and his family’s stake in the power producer, according to Bloomberg Billionaires Index.Gulf Energy will finance the acquisitions of Intouch and Advanced Info from cash flow and bank loans, according to the company’s statement. The company has secured about 160 billion baht of loans to finance the purchase, Smith said. Shareholders will hold a meeting on June 25 to consider the proposed acquisitions.Most of Intouch’s earnings come from Advanced Info and Thaicom Pcl, the nation’s biggest satellite operator. It also invests in technology startups. Gulf Energy will request the regulator to waive a mandatory requirement to make tender offer for Thaicom, it said.Thaicom shares surged 9.2%, while Advanced Info rose 0.9% in Bangkok trading.(Updates with comment from Gulf executive in sixth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Stocks have rebounded from lows in an incredibly short time. For novices who are investing for the first time this past year, it's all they know.
Libya’s state-owned NOC has declared force majeure on crude exports from the eastern Marsa el-Hariga terminal.
(Bloomberg) -- Asian stocks looked set to track a decline in U.S. equities as rising virus cases around the world led to renewed concern about their economic impact, overshadowing a batch of solid corporate results. Bonds rose.Futures pointed lower in Japan, Australia and Hong Kong. U.S. contracts dipped, with Nasdaq 100 futures underperforming. Earlier, the S&P 500 fell for a second day extending its slide from an all-time high, with investors showing caution ahead of the brunt of the earnings season. European shares slumped. Treasuries rallied with the 10-year yield dropping to its lowest level in more than five weeks. The dollar advanced and oil prices retreated.After rising to record highs, stocks find themselves under pressure from a renewed surge in Covid-19 case around the world, raising the prospect of new lockdowns and hampering the economic recovery. In Toronto, health authorities will order workplaces to close if they have more than five confirmed cases of Covid-19 as the city struggles to contain a surge in variant cases.“Earnings season is ramping up, and there’s this concern about how the multinationals will give their guidance in view of the fact that we haven’t drawn a line under Covid yet,” said Fiona Cincotta, senior financial markets analyst at City Index. “That is just starting to unnerve investors. Demand for riskier assets has come off.”Among earnings, International Business Machines Corp. climbed after reporting its largest revenue growth in 11 quarters, while United Airlines Holdings Inc. paced a selloff in travel stocks on a bigger-than-expected loss. Netflix Inc. plunged in postmarket trading as its first-quarter subscriber growth fell short of the average analyst estimate.Read: Stumble in Stocks Lacks Easy Explanation for Wall Street PunditsHere are some key events to watch this week:EIA crude oil inventory report on Wednesday.European Central Bank rate decision and President Christine Lagarde briefing on Thursday.U.S. releases new home sales data Friday.These are some of the main moves in markets:StocksS&P 500 futures fell 0.1% as of 7.40 a.m. in Tokyo. The S&P 500 decreased 0.7%. The Nasdaq 100 dipped 0.7%Nikkei 225 futures fell 1.9%Australia’s S&P/ASX 200 Index futures dropped 1.2%Hong Kong’s Hang Seng Index futures slid 1.3%CurrenciesThe yen traded at 108.11 per dollarThe offshore yuan was at 6.4982 per dollarThe Bloomberg Dollar Spot Index advanced 0.2%The euro was little changed at $1.2033BondsThe yield on 10-year Treasuries fell four basis points to 1.56%CommoditiesWest Texas Intermediate crude fell 0.3% to $62.46 a barrelGold was at $1,778.45 an ounceFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Carry traders blindsided by bouts of dollar strength are looking beyond the currency to fund their bets -- even if it means giving up some returns.Borrowing dollars to buy assets in higher-yielding currencies, a usually profitable strategy in emerging markets, proved loss-making in the first quarter as U.S. yields surged. That pushed money managers including Fidelity International and AMP Capital to cut dollar-short positions and fund their arbitrage with euro or yen, given the low interest rates in those currencies.While that helped traders protect their carry returns, it also underscored the need to have a broad basket of funding currencies to tide over dollar volatility. Now, even as the dollar weakens again and Treasury yields moderate, they continue to finance part of their emerging-market investments with other currencies.“Having a diversified basket of funding currencies against emerging-market long carry positions has the advantages of lower risk and an overall better Sharpe ratio on the trade versus one that’s funded solely out of the U.S. dollar,” said Nader Naeimi, the head of dynamic markets at AMP in Sydney. “I am happy to stick with a diversified basket.”Returns DichotomyA Bloomberg index of carry-trade returns from eight developing-nation currencies, funded by short positions in the greenback, fell 3.1% in the first quarter, the first decline in a year.Meanwhile, a strategy that involves borrowing the lowest-yielding currencies to invest in higher-yielding assets jumped 3.4% in the first three months of the year.At the core of this divergence was the dollar’s resurgence. A near-consensus call at the end of last year for a weaker U.S. currency came undone as the prospects for a sharp recovery in the world’s largest economy drove 10-year Treasury yields up by the most since 2016. With an accelerated vaccine rollout and unprecedented fiscal stimulus, the rebound is set to outpace its developed peers.While the Federal Reserve has been reluctant to push back against higher yields, the European Central Bank has ramped up bond-buying and the Bank of Japan has pledged to keep the yield curve stable and low.Beyond DollarWhile the start of the second quarter has flipped that trade -- dollar-funded carry trades are outperforming again with a 2.2% return this month -- traders still bet on volatility in the U.S. currency. So last quarter’s tactical dash into the euro and yen as funding currencies is now morphing into a strategic choice to reduce dollar dependency.Fidelity International, which sees carry opportunities in Brazilian real and Ghanaian cedi, prefers “to diversify the funding of these positions away from exclusively using the U.S. dollar,” said Paul Greer, a money manager in London at the firm, which oversees about $700 billion.“In the near term, we think the dollar will appreciate against G10 peers as the U.S. continues to demonstrate global leadership on growth recovery,” he said. “Looking further ahead, we expect the dollar to resume its medium term trend of depreciation, which should be supportive of the EM carry trade.”The U.S. currency has strengthened against 17 of 22 emerging-market currencies this year. In comparison, the euro has dropped against nine of the same group and the yen is weaker against 18 of those currencies.Investors looking for interest-rate arbitrage in emerging markets need not necessarily go to Japan or Europe to raise funds. There are plenty of low-rate currencies within the developing world that can do the job.Greer of Fidelity uses the Polish zloty and Hungarian forint as carry-funding currencies. Alessio de Longis, the New York-based head of tactical asset-allocation solutions at Invesco Ltd., drives his wagers with short positions in the currencies of South Korea, Taiwan, Chile and the Czech Republic. His basket is gaining this year, even though his long positions included some of the world’s worst-performing currencies such as the Brazilian real and Turkish lira.World’s Worst Currencies Pay Off for Debt Veteran at Invesco Even those who continue to fund their carry trades mostly with the dollar are turning wary of that strategy.”It’s been pretty painful,” said Edwin Gutierrez, head of emerging-market sovereign debt at Aberdeen Standard Investments in London. “The second quarter could be more of the same.”(Updates carry return funded by short-dollar positions in ninth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The student debt burden among older Americans is growing at an alarming rate.
(Bloomberg) -- UiPath Inc., an automation software maker, and its shareholders raised more $1.3 billion in an initial public offering, pricing the shares above a marketed range, according to people familiar with the matter.The company and investors sold almost 24 million shares on Tuesday for $56 each, said the people, who asked not to be identified because the information wasn’t public yet.The IPO shares had been marketed at $52 to $54, a range that the company elevated on Monday from $43 to $50. UiPath had planned to sell about 9.4 million shares while shareholders including its chairman, Accel and Alphabet Inc’s investment fund, were offering 14.5 million, according to the company’s filings.At $56 a share, the company will have a market value of $29 billion based on the outstanding shares listed in its prospectus filed with the U.S. Securities and Exchange Commission. Including employee stock options and restricted stock units, that valuation would rise to more than $31 billion.A representative for UiPath declined to comment.Started in an apartment in Romania with 10 people in 2005, UiPath now has a presence in close to 30 countries, Chief Executive Officer and co-founder Daniel Dines wrote in a letter to investors. “Starting a company from a small place with no market has a hidden advantage: It forces you to think globally from day one,” he wrote.Dines, who is also chairman, owns all of UiPath’s Class B shares, which represent 88.2% of the voting power in the company, the filing shows.UiPath, now based in New York, said in July that it was valued at $10.2 billion in a funding round, up from a valuation of $7 billion in a previous round in 2019.UiPath reported a net loss of $92 million on $608 million revenue in the 2021 fiscal year ending Jan. 31. Its net loss narrowed from $520 million a year ago thanks to foreign exchange gains. It had $336 million in revenue a year earlier.The offering is being led by Morgan Stanley and JPMorgan Chase & Co.. UiPath‘s shares are expected to begin trading Wednesday on the New York Stock Exchange under the symbol PATH.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Overstock CEO Jonathan “JJ” Johnson says he's hoping that one day tZero, a much smaller trading platform that offers some services similar to Coinbase, will be a legitimate rival to the crypto behemoth that just listed on the Nasdaq Inc. last Wednesday with a valuation that briefly hit around $100 billion.
The DOGE frenzy appears to have spread to decentralized finance, where several imitator tokens have chalked up staggering single-day gains.
China will suspend the ability of foreign investors to trade if they cause serious market volatility through massive capital flows in a short period of time, a senior Chinese regulatory official has said. "Many people are asking whether foreign ownership will affect the stability of our stock market," said Fang Xinghai, vice-chairman of the China Securities Regulatory Commission, at the Boao Forum for Asia on Monday. "What if massive amounts of foreign capital come in and go out? I can tell you that we will take precautionary measures." Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team. Fang Xinghai, vice-chairman of the China Securities Regulatory Commission, says regulators are wary about the potential for market disruption by foreign hedge funds. Photo: Simon Song alt=Fang Xinghai, vice-chairman of the China Securities Regulatory Commission, says regulators are wary about the potential for market disruption by foreign hedge funds. Photo: Simon Song> "We had a provision when we designed the Stock Connect that if a foreign investor comes in and causes significant volatility in the stock market, we can temporarily stop it from trading," he said. Stock Connect has a daily quota restricting the maximum net value of cross-boundary trading flows, with daily "northbound" flows into China limited to 52 billion yuan (US$7.9 billion) and "southbound" flows to Hong Kong capped at 42 billion yuan. Besides Stock Connect, foreigners can also invest in China A-shares via the Qualified Foreign Institutional Investor and RMB Qualified Foreign Institutional Investor programmes. Fang's comments come as foreign investors have increased their purchases of Chinese stocks, encouraged by liberalised rules last year that gave more leeway to overseas funds to repatriate their dividends and capital gains from the world's second-largest stock market. Following the easing of rules last year, a survey by Standard Chartered released last month showed 59 per cent of respondents would increase their allocations of Chinese assets in the coming 12 months. Foreign investors bought a net 16.3 billion yuan worth of Chinese A-shares via Stock Connect on Monday, the second highest net purchases this year, after having bought a net 24.7 billion yuan last week, exceeding the 18.7 billion for the month of March as a whole, according to the official Securities Daily. Driven by declining short-term interest rates and upbeat corporate earnings, the A-share market is expected to "continue to rebound", said Southwestern Securities in a note. But if capital was to start flowing out on a massive scale, there is a risk the Chinese currency would depreciate and trigger further capital outflows. This happened on a modest scale in February and March, with the yuan's exchange rate against the US dollar dropping more than 1 per cent as a result. Last month, FTSE Russell, the global index, data and analytics provider, added China A-Shares to the FTSE MPF Index Series, the core equity benchmarks used by the Mandatory Provident Fund industry. China's domestic equities had already joined MSCI's benchmark indexes in 2017. At the end of last month, foreigners owned 5 per cent of Chinese A-shares, still a "relatively low" level, said Fang. "With more foreign capital coming in recent years, our stock market has been running much smoother, as foreign capital is playing a more important role in market pricing ... We will continue to create conditions to lure more foreign investments," said Fang. Chinese authorities have a "clear view" about the priorities of foreign investors and are not worried about individual investors, whose proportion of overall stock ownership is very small and will not affect the financial stability, Fang said. The country also welcomes foreign mutual funds, pension funds and insurance companies, which have the highest proportion of A-shares among foreign investors. But Chinese regulators are wary about the potential for market disruption by foreign hedge funds and so their operations will be watched closely, said Fang. "Once massive volatility is caused by some investors, their trading will be suspended to prevent further volatility," he said. This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.
Metal detectors and security checks may soon be a thing of the past. Evolv Technology, an AI security screening company, already uses its platform at amusement parks, concert halls and stadiums across the country to provide safety for large crowds. IPO Edge and The Palm Beach Hedge Fund Association will host a live fireside chat […]
A group of Democratic Senators, led by Elizabeth Warren (D-MA) and Raphael Warnock (D-GA), sent a letter urging the Education Department (ED) to restore defaulted student loans to on-time status amid the ongoing payment pause, Yahoo Finance has learned.
Business owners around Minneapolis, where the Derek Chauvin trial has been held, have been on edge over the last year.
Just last Friday, the S&P 500 had closed at a record high. This week, the index can’t seem to find its footing.