Tue, Sep 04, 2018 - Page 10 News List

World Business Quick Take

Agencies

TURKEY

Lira falls against greenback

The lira fell amid worries that policymakers are not acting fast enough to put a lid on inflation. The US dollar gained as much 2.7 percent against the lira to US$6.7134, ahead of data expected to show consumer prices last month surging 17.6 percent from a year earlier. The central bank, which is to set rates on Thursday next week, has an official inflation target of 5 percent. While policymakers have raised borrowing costs by 700 basis points, that has not been enough to shield the lira from a currency rout that seen it shed more than 40 percent of its value against the US dollar this year.

MANUFACTURING

Unsold goods pile up

Companies in the eurozone are starting to see unsold goods pile up on factory floors after renewed concerns over trade prospects throttled order growth to its slowest pace in two years. A Euro-area purchasing managers’ index for manufacturing last month dropped to 54.6 from 55.1 in July, IHS Markit said on Monday. The report came amid threats by US President Donald Trump to tear up an agreement with the EU to work toward a new trade order without escalating protectionism. “The business mood has become more unsettled during the summer,” IHS Markit chief business economist Chris Williamson said. Risks of new tariffs are hurting sentiment, and “the expansion is looking increasingly uneven.”

PAYMENT SERVICES

Policymaker calls for cards

European Central Bank policymaker Yves Mersch called on Europe to develop its own global card payment services to compete with international peers and as a defense against any further escalation in geopolitical tension. Noting the dominance of California-based PayPal for online payments, as well as the services offered by Alphabet, Apple, Facebook and Amazon, Mersch said that European providers, such as Germany’s Girocard and France’s Cartes Bancaire, are too nationally focused. European banks seemed to have “surrendered” much of the business, with the strong regulatory framework in the EU “exploited” by multinationals, Mersch said.

BEVERAGES

Brewer gets ‘cheapest name’

Thai Beverage PLC has earned the title of the world’s “cheapest alcohol name” at Goldman Sachs, as the Bangkok-based brewer is now the worst performer in its consumer stocks coverage. Still, analysts say a turnaround in its operations next year will give the stock a nice lift. Since losing S$7.3 billion (US$5.3 billion) this year, ThaiBev now trades at 14.9 times of future earnings — below its 10-year average — while the MSCI World Beverages Index trades at 20.1 times, according to data compiled by Bloomberg.

INDONESIA

Rupiah may hit 15,000

Analysts say the rupiah, the currency of Southeast Asia’s biggest economy, is set to breach the level of 15,000 per US dollar for the first time since the depths of the Asian financial crisis in 1998. The rupiah yesterday slid as low as 14,782 as the nation’s trade deficit and reliance on oil imports render it vulnerable to the emerging-market selloff triggered by financial turmoil in Turkey and Argentina. “Fifteen thousand is the next psychological level the rupiah may breach,” said Nick Twidale, chief operating officer at Rakuten Securities in Sydney. The rupiah has tumbled more than 6 percent in the past three months.

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