ARGENTINA
IMF to reopen office
The IMF on Monday said it has decided to reopen an office, six years after leaving. The decision came days after Buenos Aires reached a deal with the IMF on the money supply, interest rates and an exchange-rate framework. In exchange for these measures, the fund agreed to speed up payment of a US$50 billion loan granted in June to Latin America’s third-largest economy. IMF economist Trevor Alleyne is to be the fund’s representative in Buenos Aires. He has overseen IMF missions in countries such as Nigeria, Zambia, Jamaica, Peru, Venezuela and Ecuador.
UNITED KINGDOM
Wages rise most since 2009
Wages are growing at their fastest pace in almost a decade, suggesting that the economy is continuing to operate with little slack. Average earnings excluding bonuses rose 3.1 percent in the three months through August, the most since January 2009, the Office for National Statistics said yesterday. Unemployment held at a 43-year low of 4 percent. While wage growth remains below its pre-crisis average, muted productivity means that even a modest pickup could fuel inflation as companies raise prices to protect their margins. Bank of England officials in August raised interest rates, although Brexit uncertainty means no further increases are expected before March next year.
INDIA
Q3 home sales rise 9%
Home sales rose 9 percent across the nation’s seven biggest cities in the third quarter, boosted by low-budget apartments, Anarock Property Consultants Pvt said. The highest sales were recorded in Mumbai and Pune, which accounted for about 27 percent of purchases across the cities, the real-estate broker said in a report. The National Capital Region, which covers Delhi and surrounding areas, and Hyderabad posted the lowest growth, with a 2 percent increase from the second quarter, the data showed. The third quarter is usually a slow period for the housing market because of the 15-day shraddh period, which is considered inauspicious for buying property.
BANKING
BoA blames risk avoidance
Bank of America Corp (BoA) blames some of its investment bank’s earnings miss on avoidance of riskier loan deals as shadow banks get tougher. However, since leveraged lending traffic cops stopped handing out tickets for infringing their guidance months back, this seems like a self-imposed limit. The US administration has long been telegraphing a loosening of rules on how banks arrange and syndicate leveraged finance debt. US Comptroller of the Currency Joseph Otting in February said that banks could do leveraged lending however they want, as long as it does not affect their soundness. After getting that green light, many Wall Street underwriters got more aggressive in pursuit of profit.
ENERGY
Drax to buy Iberdrola plants
Drax Group PLC agreed to buy some of Iberdrola SA’s power plants for £702 million (US$926.52 million), boosting its clean energy assets. The acquisition involves pumped storage, renewable hydro and gas-fired power assets and would increase the utility’s generation capacity by more than 60 percent to about 6.6 gigawatts, CEO Will Gardiner said yesterday. Once the deal is completed it would also help boost the company’s already-growing dividend by about 8 percent, he said. Drax has already rebuilt its facility in north Yorkshire, England, to fuel four of its six coal units with biomass.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure