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.
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.
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.
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.
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.
From the customer’s perspective, car rental is a straightforward business. The only uncertainty is whether the hire company will charge you for the scratch they discover when you hand back the vehicle. Hertz Global Holdings Inc’s bankruptcy protection filing on Friday last week was a reminder that today even the simplest business models are underpinned by a lot more financial complexity than meets the eye. The proximate cause of Hertz’s demise was of course the sudden collapse in bookings caused by COVID-19 travel restrictions. The company’s monthly revenue last month fell 73 percent year-on-year, a shortfall that even the most resilient
Uber Technologies Inc, Lyft Inc and Airbnb Inc have slashed thousands of jobs. Salesforce.com Inc and Visa Inc are letting employees work remotely for months; Twitter Inc and Square Inc are allowing them to do so for good. For the companies’ hometown of San Francisco, the moves are early signs of a dire blow. In a city with a long history of booms, busts and natural calamities, the COVID-19 pandemic has suddenly upended nearly a decade of prosperity. While municipalities across the US are grappling with economic fallout from the virus, San Francisco stands to take a deeper hit given its high
BULK PURCHASE: The French chain and Hong Kong-based Dairy Farm International reached a deal covering 224 stores, which is expected to be finalized by year’s end Carrefour SA yesterday announced it would acquire Wellcome Taiwan Co (惠康百貨) for 97 million euros (US$108.33 million), and bring all the Wellcome supermarkets (頂好超市) and Jasons Market Place stores nationwide under its banner within 12 months of the deal closing. The France-based hypermarket chain reached an agreement with Hong Kong-based Dairy Farm International Holdings (牛奶國際控股), the pan-Asian retailer that launched Wellcome Taiwan in 1987. The transaction involves 199 Wellcome supermarkets, which have average sales areas of 420m2 and 25 high-end Jasons Market Place stores, which have an average sales area of 820m2, as well as a warehouse in Taoyuan, Carrefour Taiwan (家樂福)
‘ONE-STOP SHOP’: A Miaoli official said that the factory in the Jhunan section of the Hsinchu Science Park would create more than 1,000 jobs and boost prosperity A new high-end IC packaging and testing plant planned by contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) in Miaoli County is expected to start operations in the middle of next year, Miaoli County Commissioner Hsu Yao-chang (徐耀昌) said. Hsu wrote on Facebook that TSMC, the world’s largest pure wafer foundry operator, would invest NT$303.2 billion (US$10.1 billion) to build the plant, the largest-ever single investment in Taiwan. However, TSMC declined to disclose the financial terms of the deal, while a company board meeting on May 12 approved a spending plan worth NT$168.2 billion as part of its investment plans. Construction of the