SOVEREIGN DEBT
Fitch holds UK at ‘AA’
The Fitch ratings agency on Friday affirmed the “AA” long-term debt rating and negative outlook for the UK and the Bank of England, where they have been since June. In the wake of the surprise vote in June to exit the EU, which touched off fears of slower growth, prompting a cut in the debt rating from “AAA,” Fitch said recent political events suggested Britain would likely seek to control immigration from the EU and reject the jurisdiction of the European Court of Justice. Those developments create uncertainty about the economy and new investment, Fitch said.
AUTOMAKERS
Airbags hit Tesla, McLaren
Cars produced by US electric automaker Tesla Motors Inc and Britain’s McLaren are now included in the sprawling safety recall for defective Takata Corp airbags, the US Department of Transportation said on Friday. The two auto brands appeared on a new list issued by the department’s National Highway Traffic Safety Administration (NHTSA), bringing the total of brands subject to the recall to 19. As of Dec. 2, the department said 12.5 million of the passenger and driver-side airbags had been fixed and the NHTSA has issued an amended order to continue an accelerated recall.
MACROECONOMICS
Germany rising: Bundesbank
Europe’s largest economy, Germany, is “on a sound upward path” for faster-than-expected growth this year and next year, but remains at risk from US president-elect Donald Trump and Brexit, Bundesbank President Jens Weidmann said in a statement accompanying the semi-annual report on Friday. The economy should expand by 1.8 percent over the two years, the central bank’s forecasters predict, upping their previous forecasts of 1.7 percent growth this year and 1.4 percent next year. However, a shrinking pool of people in employment will sap domestic consumption in the following years, while increased energy prices will also cut the amount consumers have in their pockets to spend, it said.
MACROECONOMICS
Brazil inflation rate plunges
Brazil’s inflation rate fell sharply last month, official data showed on Friday, giving the central bank more breathing room as it seeks to accelerate the pace of interest rate cuts. The annual IPCA inflation rate fell to 6.99 percent from 7.87 percent in October, said national statistics institute IBGE. The monthly rate came in at 0.18 percent. That was well below the average forecast in a Bloomberg poll of economic analysts of 0.27 percent.
MINING
Sibanye to buy Stillwater
The company that owns Montana’s largest mining complex announced on Friday that it will be acquired by a South African company for US$2.2 billion in a deal that requires US government approval. Sibanye Gold Ltd will buy Littleton, Colorado-based Stillwater Mining Co under a merger agreement expected to close in the second quarter of next year, Stillwater chief executive officer Mick McMullen said. Sibanye also will assume US$500 million of Stillwater’s debt. The deal was approved unanimously by Stillwater’s board of directors, of which former Montana Governor Brian Schweitzer is chairman. The two-term governor and other board members will resign when the deal closes.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to