BANKING
Boost expected in the US
The US banking sector is set to see a flurry of deals next year, Ernst & Young LLP said on Tuesday. Transactions are to be fueled by easing regulations and a US tax overhaul, which has helped lenders build up a war chest to spend on acquisitions and technology, the financial advisory firm said in a report. The value of mergers and acquisitions in the US financial services sector has this year more than doubled to US$196.5 billion, from US$82.3 billion last year, the report showed.
FOREIGN EXCHANGE
Pound makes a comeback
The pound rallied yesterday as the market judged that British Prime Minister Theresa May might survive a threat to her leadership. Sterling recovered from a 20-month low and gilts fell after May said that she would contest a vote of no confidence and many of her Cabinet ministers came out in support of her. Options betting on overnight pound-US dollar volatility soared to the highest since June last year, ahead of the vote yesterday evening. Sterling climbed 0.4 percent to US$1.2539 by 9:27am in London after touching US$1.2478, the lowest since April last year. It gained 0.3 percent against the euro to £0.9034 per euro.
CHINA
Firms’ default risk soars
Default risk for companies has climbed to the highest in 13 years as Beijing seeks to rein in its post-crisis construction boom, Moody’s Analytics said. The research group’s measure of expected default frequency has risen above early-warning levels for about 25 percent of corporate borrowers. China has already seen a record pace of bond defaults this year, a consequence in part of policymakers’ efforts to reduce leverage in the financial system. While the economy remains in relatively firm shape, the country is now at a pivotal juncture, the firm said in a report.
SOUTH AFRICA
Inflation accelerates to 5.2%
The nation’s inflation rate jumped to the highest level since May last year as surging transport costs continue to weigh on the economy. Consumer prices rose 5.2 percent from a year earlier, compared with 5.1 percent in October, Statistics South Africa said in a statement yesterday. The median estimate of 17 economists surveyed by Bloomberg was for 5.1 percent. The unexpected acceleration in inflation might ease criticism of the central bank’s decision to raise interest rates last month as the headline number moves further away from the midpoint of its target range. Fuel prices jumped 19 percent over the past 12 months after the rand weakened against the US dollar.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last