Government & Agencies

Far-right’s vote win is a loss for German economy

2 Sep 2024

PM Olaf Scholz’s coalition parties got trounced in regional elections, with the extreme right-wing AfD winning more than 30% in Thuringia and Saxony. That could prompt Berlin to double down on fiscal discipline and tighten immigration rules, deepening the country’s growth woes.

China GDP hiccup would have long-term aftershocks

2 Sep 2024

This year’s growth target of “around 5%” faces headwinds. It’s now more a planning tool, so a miss might not seem as consequential as when the goal was all but compulsory. But a slowdown would probably prompt new policies to keep alive 2035 plans like doubling per-capita income.

Raw economics will trump migration’s sour politics

2 Sep 2024

Nearly 900 mln people would like to live in another country, but most can’t move due to political and social opposition to foreigners. These attitudes are hard to shift. But deepening demographic crises mean a migration-fuelled boost to labour supply is critical for growth.

India’s food inflation debate will get spicier

2 Sep 2024

Governor Shaktikanta Das shot down an idea from New Delhi to strip food costs from the central bank's price target. Ignoring the item would allow the RBI to trim rates and combat slowing GDP growth. It would also hurt the poor. As inequality rises, so will pressure to bend.

UK’s housing mess requires costly fix

29 Aug 2024

PM Keir Starmer has pledged to build many more houses. Yet homebuilders’ shares are not pricing in a boom. Private players may prefer to sell fewer, pricier properties. More government funds would help, at the risk of further squeezing Britain’s finances.

Shipping rates yet to signal a calmer Middle East

22 Aug 2024

The US is pushing hard for an Israel-Hamas peace deal. But shipping executives expect rates to stay high this year as vessels avoid the Red Sea. While only a rough gauge of regional tensions, the freight experts may be more accurate forecasters than ceasefire optimists.

China’s ammo export curb is more a green defence

19 Aug 2024

Beijing is restricting overseas sales of antimony, a metalloid it dominates production of that's also a key ingredient for weapons. Realpolitik alone would explain it. But the People’s Republic also needs the supply-constrained element for its rapid production of solar panels.

The ECB is running out of time to revive euro zone

16 Aug 2024

The bloc’s GDP rose by a steady 0.3% in the second quarter. But business surveys and sentiment data suggest growth is flagging. Inflation is sticky so European Central Bank chief Christine Lagarde may be reluctant to cut rates decisively. But waiting risks impairing the recovery.

Short seller sharpens a divide in India’s market

16 Aug 2024

Hindenburg Research says Madhabi Puri Buch’s past stake in an Adani-linked fund makes the chair of the securities regulator unfit to probe the tycoon’s empire; her response kept stocks calm. Locally, she is seen as tough. Outsiders watching the saga will be more sceptical.

Iran danger marks return of oil’s risk premium

13 Aug 2024

Conflict in Gaza and tit-for-tat attacks in the Middle East have desensitised markets to possible supply shocks. A US warning of imminent retaliation against Israel changes that. Despite weaker demand, oil prices reflect the dangers of infrastructure and tankers becoming targets.

Drahi-for-Bharti swap gives BT partial relief

12 Aug 2024

French mogul Patrick Drahi is offloading a 25% stake in the British telco worth about $4 bln to India’s Bharti. BT CEO Allison Kirkby can stop worrying about her indebted shareholder. Alongside Deutsche Telekom and Mexico’s Carlos Slim, her share register still looks crowded.

Flying PIIGS nations stir rethink in Europe’s core

12 Aug 2024

Former crisis economies like Spain, Greece and Italy have outpaced France and Germany by up to 20% since the pandemic. Lower exposure to manufacturing, a tourism boom and Brussels funds all helped. The role reversal may push Berlin to tolerate looser fiscal and monetary policy.

Putin’s hostage deal is chilling for C-suites

9 Aug 2024

The exchange of 24 prisoners between Russia and the West marked the first time a convicted murderer was swapped for journalists or dissidents jailed to serve as barter currency. If these practices become a habit, businesses will have to rethink where they deploy staff.

UK financial watchdog’s H2O thwack has a downside

8 Aug 2024

The fund group will repay 250 mln euros after the FCA said it bought esoteric bonds and didn’t declare conflicts. The deal gets money to investors quicker than if a fine had been levied. But, at just a fraction of what some clients are claiming, the settlement risks looking soft.

UK riots present ‘gilet jaune’ threat to Starmer

8 Aug 2024

Britain’s anti-immigration riots pose a big challenge to new PM Keir Starmer. Spending his limited budget on prisons and police is his best hope of avoiding future violence. If he fails like France’s Emmanuel Macron did with anti-tax protesters, his premiership may never recover.

US election crimps fixes for energy, weed and more

6 Aug 2024

Presidential contests can bury unglamorous issues in dire need of attention. Take power lines: legislation awaits to help the huge queue of energy projects, equal to more than doubling US capacity, hook up to the grid. Despite broad agreement, the election cycle stymies progress.

Thames Water fix is a stretch, but possible

6 Aug 2024

The indebted UK utility’s struggles to raise the 3 bln pounds it needs imply impending doom. But while the details are tricky, there remains scope for the UK to offer guarantees or find a way to haircut creditors. A new investor armed with these could yet make a decent return.

Bangladesh becomes global firms’ next big unknown

6 Aug 2024

Protests may ease now Prime Minister Sheikh Hasina has fled. But her ouster after 15 years of iron-fist rule leaves the economically struggling country of 170 mln vulnerable. Companies like H&M and Inditex that depend on it for garment-making face an anxious time ahead.

Airlines’ margins head to lower cruising altitude

2 Aug 2024

Carriers from $2 bln Air France-KLM to $7 bln Lufthansa reported healthy demand in the first half of 2024. But earnings are falling as expenses bite. With the switch to sustainable aviation fuel threatening to push costs ever higher, investors are bracing for smaller margins.

Oil is an imperfect gauge of Middle East risk

31 Jul 2024

Brent crude prices rose 2.5% after senior Hezbollah and Hamas leaders died in strikes blamed on Israel. Oil traders have grounds to see the danger of a wider war as limited, but automated trading may increasingly act to muffle any concerns. It’s hard to tell which is right.