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☆ Explainer: What to expect from Nigeria's new president Bola Tinubu
▼ + stars: | 2023-05-29 | by ( Macdonald Dzirutwe | ) www.reuters.com time to read: +4 min

LAGOS, May 29 (Reuters) - Nigeria's new president Bola Tinubu faces a litany of problems, including widespread violence, double-digit inflation and industrial-scale oil theft. Tinubu says he will build on Buhari's public infrastructure programme to create jobs and remove legal limits on government spending. Tinubu says he will reduce corporate tax to attract investment and plug tax loopholes to boost revenue. Tinubu says he will set up a surveillance unit to protect the country's pipelines and attract new investors with tax incentives. Tinubu wants to recruit more soldiers and police officers, while paying and equipping them better.

☆ Why China and Japan are praying the US won’t default
▼ + stars: | 2023-05-25 | by ( Laura He | ) edition.cnn.com time to read: +8 min

China and Japan are the largest foreign investors in American government debt. China was the largest foreign creditor to the United States for more than a decade. The falling value of Treasuries would lead to a drop in Japan and China’s foreign reserves. “If the United States defaults on its debt, it will not only discredit the United States, but also bring real financial losses to China,” it said. Analysts say Beijing has shown little willingness to fully integrate with global financial markets.

☆ Americans flocked to Portugal for cheaper, more peaceful lives, but newcomers also brought crowds and drove up the cost of living
▼ + stars: | 2023-05-24 | by ( Jordan Pandy | ) www.businessinsider.com time to read: +10 min

Americans have been moving to Portugal for years, and the pandemic accelerated the trend further. The Bagbys are part of a wave of Americans who have moved to Portugal, a country roughly the size of Indiana. "It's a very reasonable cost of living," Zaretsky told Insider. Zaretsky paid 600,000 euros for the house in Portugal after selling her Austin, Texas, home for $676,000. Portugal has a strong tourism economy, and its shoulder season draws large crowds, making the petite coastal country feel tight.

☆ Indian rupee poised to weaken after central bank pulls 2,000-rupee notes
▼ + stars: | 2023-05-22 | by ( Nimesh Vora | ) www.reuters.com time to read: +2 min

MUMBAI, May 22 (Reuters) - The Indian rupee is expected to open weaker against the U.S. dollar after the central bank said it will withdraw the highest value currency note from circulation. Non-deliverable forwards indicate rupee will open at around 82.80-82.84 to the dollar, compared to 82.66 in the previous session. On Friday, the Reserve Bank of India said it will withdraw its highest denomination 2,000-rupee note from circulation. "Rupee would come under pressure" alongside the fall in the cost of carry (the forward premiums), Goenka said. "Conducting sell/buy swaps (on USD/INR) would address cash dollar shortage and suck out rupee liquidity and could offer respite."

☆ Asian stocks inch up on US debt ceiling hopes, Nikkei hits 33-year high
▼ + stars: | 2023-05-19 | by ( Ankur Banerjee | ) www.reuters.com time to read: +5 min

Australia's S&P/ASX 200 index (.AXJO) rose 0.66%, while Japan's Nikkei (.N225) continued its ascent, rising to its highest since August 1990, during the country's so-called bubble era. Futures indicated European stocks were set to open higher, with Eurostoxx 50 futures up 0.44%, German DAX futures up 0.41% and FTSE futures up 0.23%. China's blue-chip CSI300 Index (.CSI300) rose 0.20%, while the Shanghai Composite Index (.SSEC) was up 0.13%, having reversed from earlier losses. Hawkish rhetoric from Fed speakers continued with Dallas Fed President Lorie Logan and St. Louis Fed President James Bullard saying inflation was not cooling fast enough to allow the Fed to pause its interest-rate hike campaign. Against a basket of currencies, the dollar rose 0.029% and was wedged near a two-month high.

☆ Erdogan's election lead leaves Turkey's opposition reeling and an economy on the brink
▼ + stars: | 2023-05-19 | by ( Natasha Turak | ) www.cnbc.com time to read: +9 min

Since neither candidate won more than 50% of the vote, however, the election will go to a runoff on May 28. They also reveal that despite Turkey's current economic turmoil, tens of millions of Turks still see Erdogan as their only viable leader. Supporters of Turkish President Recep Tayyip Erdogan celebrate at the AK Party headquarters garden on May 15, 2023 in Ankara, Turkey. Still, Kilicdaroglu's 44.9% of the vote is notable as the highest any opposition candidate ever received, said Orcun Selcuk, an assistant professor of political science at Luther College in Iowa, on Twitter. "The opposition clearly did not meet the expectations but it would be a misjudgment to say that opposition coordination failed.

CNN —At first glance, the idea of a former NFL legend and a former US Women’s National Team star wanting to bring “global eyeballs” to an English soccer club might seem an unusual ambition. Its inhabitants have also been hit particularly hard by the UK’s cost of living crisis, which hasn’t been lost on JJ Watt and his wife, Kealia. “Burnley is a special club. “All I want to do is help tell their story. “The success of the football club this year has given such a boost to Burnley and the surrounding area.

As doubts grow about the strength of its economic recovery, foreign money has left China's markets and the currency has fallen 4% against the dollar since late January. Analysts at Nomura and Societe Generale say the yuan could soon head for 7.3, which as last plumbed in November. Reflecting that, the trade-weighted CFETS basket against which the People's Bank of China (PBOC) manages the currency, has dropped to 99 from 100 in February. THE CHEAP CURRENCYBecky Liu, head of China macro strategy at Standard Chartered Bank, expects the yuan will continue to depreciate. "The interest rate gap remains wide, so many hedge funds continue to use yuan as a funding currency," Liu said.

"A longer timeframe shows that foreign investors have been net sellers of Japanese equities by a considerable margin. We think long-term investors remain lightly positioned," they wrote last week in a note "Upside risks in Japanese equities". Non-residents sold nearly $4 billion of Chinese stocks in April, according to the Institute of International Finance, the first outflow in six months. Bank of America's monthly fund manager surveys show that "long" Chinese equities was the most crowded global trade in January. That has been scaled back significantly and investors have reduced their net overweight position in Chinese stocks, but they are still comfortably net overweight.

☆ Turkish lira hits record low as bonds steady after post-election rout
▼ + stars: | 2023-05-18 | by ( ) www.reuters.com time to read: +2 min

LONDON, May 18 (Reuters) - Turkey's lira weakened to a record low against the dollar on Thursday, after incumbent Tayyip Erdogan's lead in presidential elections surprised markets, while the nation's sovereign dollar bonds steadied after a three-day post-election rout. The cost of insuring the country's debt against default fell slightly, but equity markets and banking stocks endured fresh losses in afternoon trading. The lira weakened to a record low of 19.8050 to the dollar by 1904 GMT, bringing its losses since the election to more than 1%. The 2045 bond gained close to one cent to trade at just over 70 cents on the dollar by 1300 GMT, Tradeweb data showed. Credit default swaps, which measure the cost of insuring the country's debt against default, narrowed by 8 basis points (bps) by mid afternoon, to 684 bps, data from S&P Global Market Intelligence showed.

☆ Debt conundrum gives Italy weak hand in EU talks
▼ + stars: | 2023-05-18 | by ( Lisa Jucca | ) www.reuters.com time to read: +6 min

After inflation hit 40-year highs in the West last year, global rate-setters, including the European Central Bank, launched a dramatic series of interest rate hikes. Unless there is a sudden series of interest rate cuts, the cost of servicing Italy’s debt could stay well above 4% of GDP for years. To fight that, Meloni’s government will have to shrink the public deficit and bring Italy back to the healthy pre-pandemic habit of keeping a primary budgetary surplus excluding debt interest payments. As long as Italy’s debt is not spiralling out of control, markets won’t worry too much. Yet even if Meloni chooses a milder approach, Italy’s unresolved debt challenge risks giving her a weak negotiating hand in Brussels.

"Global debt is now $45 trillion higher than its pre-pandemic level and is expected to continue increasing rapidly," said the IIF in its quarterly Global Debt Monitor. The report partly focused on the effects of last year's rapid rise in rates in some bank balance sheets. The IIF voiced its concern that tighter lending practices among smaller banks would hurt some businesses and households harder. "Shadow banks now account for more than 14% of financial markets, with the majority of growth stemming from a rapid expansion of U.S. investment funds and private debt markets." "With the interest rate differential between EMs and mature markets diminishing, EM local currency debt is less appealing for foreign investors," the IIF said.

☆ Asian shares muted, US debt ceiling talks weigh on risk appetite
▼ + stars: | 2023-05-17 | by ( Ankur Banerjee | ) www.reuters.com time to read: +4 min

SINGAPORE, May 17 (Reuters) - Asian shares were subdued on Wednesday and the dollar hovered around a five-week peak as investors remained risk averse, with the U.S. debt ceiling talks and a mixed set of economic data weighing on sentiment. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was down 0.09% in choppy trading, with Australia's S&P/ASX 200 index (.AXJO) down 0.45%. Democratic President Joe Biden and top congressional Republican Kevin McCarthy edged closer to a deal to avoid a looming U.S. debt default Tuesday. After an hour of talks, McCarthy, the speaker of the House of Representatives, told reporters the two sides remained far apart on an agreement to lift the debt ceiling. Against a basket of currencies, the dollar rose 0.01% to 102.61, inching closer to the five-week high of 102.75 it touched on Monday.

☆ 'Foreign investors are back': Japan stocks surge to their highest since 1990
▼ + stars: | 2023-05-17 | by ( Jihye Lee | ) www.cnbc.com time to read: +4 min

The firm noted that foreign investors bought a net 2.1 trillion yen ($15.4 billion) worth of Japanese stocks in April – adding that Japan's corporate sector remains the largest net buyer of Japanese stocks, with a volume of 1.1 trillion yen year-to-date. Central bank focusSociete Generale strategists added that their overweight position on Japanese equities remains unchanged. The Japanese yen traded at slightly weaker levels to 136.43 against the greenback on Wednesday. "Keep an overweight position on Japan equities, unhedged, and biased to banks, financials, and value," they wrote. "Specifically, we note the solid fundamentals compared with stocks on overseas markets, and we also think that expectations for structural changes/reforms could push Japanese equities up even further," wrote Japan equity strategist Kazunori Tatebe.

☆ Indian rupee to resume decline as yuan slides to 7/dollar
▼ + stars: | 2023-05-17 | by ( Nimesh Vora | ) www.reuters.com time to read: +2 min

MUMBAI, May 17 (Reuters) - The Indian rupee is expected to decline on Wednesday after the Chinese yuan dropped to its lowest level this year to the U.S. dollar. Non-deliverable forwards indicate that the rupee will open at around 82.28-82.30 to the U.S. dollar, compared with 82.2050 in the previous session. The offshore yuan, bogged down by the resurgent dollar, dropped below 7 to the dollar for the first time this year. U.S. retail sales rose 0.4% month-on-month in April, with control retail sales up by a robust 0.7%. 15** NSDL data shows foreign investors sold a net $43.2mln worth of Indian bonds on May.

"Global debt is now $45 trillion higher than its pre-pandemic level and is expected to continue increasing rapidly," said the IIF in its quarterly Global Debt Monitor. The report partly focused on the effects of last year's rapid rise in rates in some bank balance sheets. "Shadow banks now account for more than 14% of financial markets, with the majority of growth stemming from a rapid expansion of U.S. investment funds and private debt markets." But for others access to markets has been harder or non-existent on either tighter spreads as rates rose in developed markets or fast-rising borrowing costs. "With the interest rate differential between EMs and mature markets diminishing, EM local currency debt is less appealing for foreign investors," the IIF said.

A Reuters poll of economists estimates annualized GDP growth of 0.7% in the first three months of 2023, rising sharply from just 0.1% October-December and the fastest since the 4.7% of April-June 2022. If indicators from Japan have been underwhelming, they've been alarming from China, the world's second-largest economy. Another batch of Chinese economic data fell short of expectations on Tuesday, slamming Chinese financial assets and cementing the view that Beijing will have to inject fiscal or policy stimulus into the sputtering economy. Since Russia invaded Ukraine in February last year demand for Chinese debt has evaporated, casting extra doubt over the yuan's ability to gain reserve currency status. Here are three key developments that could provide more direction to markets on Wednesday:- Japan GDP (Q1)- China house prices (April)- Australia wage growth (Q1)By Jamie McGeever;Our Standards: The Thomson Reuters Trust Principles.

☆ China's security crackdown could signal new realities for foreign investors
▼ + stars: | 2023-05-16 | by ( Clement Tan | ) www.cnbc.com time to read: +6 min

Last Monday, state broadcaster CCTV singled out a consulting company for not complying with China's national security laws. "It may seem a paradox," said Chong Ja Ian, an associate professor at the National University of Singapore who studies Chinese foreign policy. So much of what is now regarded as national security or state secrets is not sufficiently defined or classified. This includes passing a data security law in 2021 on the protection of information involving national and economic security and on issues of important public interest. "To have multiple companies involved now in this crackdown and the restriction of financial data to foreigners, it appears that Chinese security departments are on to something larger."

☆ What’s a President to Do When a Nation’s Capital Is Sinking? Move It.
▼ + stars: | 2023-05-16 | by ( Hannah Beech | ) www.nytimes.com time to read: +38 min

A new capital city for a place with such disparities and diversity presents both a challenge and a chance for reinvention. Moving the Seat of Power From Java to Borneo Detail area Malaysia Nusantara Borneo Java Sea Indonesia Jakarta Java Indian Ocean Detail area Malaysia Nusantara Borneo Java Sea Indonesia Jakarta Java Indian Ocean Indonesia’s new capital, Nusantara, will be about 800 miles from the current capital, Jakarta. It cannot be overnight, it’s not like Aladdin comes with his genie,” said Bambang Susantono, the head of the Nusantara Capital City Authority. We have to prove that this will be a self-propelling city.” — Bambang Susantono, head of the Nusantara Capital City AuthorityCritics of I.K.N. Indonesia’s capital city faces sinking land and rising seas.

Foreign holdings of Italian government paper increased in February after 10 consecutive monthly declines, according to Bank of Italy data. "This is a magic moment for Italian bonds," he told Reuters. The share of Italian government debt held by foreign investors fell to below 20% at the end of 2022 from around 50% before the 2008 financial crisis, Bank of Italy data shows. The Italian Treasury has already taken steps to shore up demand for its bonds as the ECB retreats, by boosting purchases among domestic households and companies. Together, Italian families and firms now hold around 215 billion euros, or 9%, of Rome's debt, UniCredit's Cazzulani said, the highest level since mid-2015.

ORLANDO, Florida, May 15 (Reuters) - China's yuan faces significant long-term obstacles to becoming a global reserve currency of any great import, but the biggest challenge in the near term is the fact that nobody wants to buy Chinese bonds. Reuters ImageReuters Image"It is very hard to create a reserve currency, without attractive reserve assets. Exante Data's figures show foreign investors bought a net $558 billion of Chinese bonds between 2010 and 2021. But in a pool of $12 trillion global reserves, of which nearly 80% is denominated in dollars and euros, these are very small numbers. Reuters ImageRESERVE STATUSAny currency that has designs on attaining international reserve status must meet several criteria and fulfill several roles.

☆ Indian rupee to see more losses on dollar spike and higher U.S. yields
▼ + stars: | 2023-05-15 | by ( Nimesh Vora | ) www.reuters.com time to read: +2 min

MUMBAI, May 15 (Reuters) - The Indian rupee is expected to weaken on Monday, adding to last week's losses, tracking a rally on the dollar index and higher U.S. yields on worries surrounding U.S. inflation. The dollar index climbed 0.6% on Friday to reach its highest level in a month and the two-year U.S. yield was back to nearly 4%. Renewed worries over the inflation outlook in the U.S. pushed yields higher and supported demand for the dollar. "Their assessments of whether recent labour market and inflation data support pausing in June or not will be scrutinised," ANZ said in a note. India's inflation data was "supportive" of the rupee in the medium term, the trader said.

Long stuck in the shadow of Erdogan and his Islamist-rooted AK Party (AKP), opposition leader Kilicdaroglu has flourished on the campaign trail with polls showing he has a slight lead. Kilicdaroglu said a fundamental problem of Turkey's foreign policy during the tenure of Erdogan's AKP was the exclusion of the foreign ministry in the policy making process. 'PEACE-ORIENTED FOREIGN POLICY'"We would pursue a peace-oriented foreign policy that prioritises Turkey's national interest. Before entering politics, Kilicdaroglu worked in the finance ministry and then chaired Turkey's Social Insurance Institution for most of the 1990s. A year after losing a mayoral run in Istanbul, he was elected unopposed as party leader in 2010.

☆ Turkey's Erdogan faces toughest test yet in landmark election — with high stakes for the world
▼ + stars: | 2023-05-12 | by ( Natasha Turak | ) www.cnbc.com time to read: +9 min

He came to prominence as mayor of Istanbul in the 1990s, and was celebrated in the first decade of the new millennium for transforming Turkey's economy into an emerging market powerhouse. But recent years have been far less rosy for the religiously conservative leader, whose own economic policies have triggered a cost-of-living crisis. Now, given a recent downturn in support for Erdogan, some fear he may play dirty to ensure his hold on power. The stakes are high for the entire country and, more broadly, global geopolitics – and the mood on the ground is tense. Mustafa Kamaci | Anadolu Agency | Getty Images"I'm very concerned that [Erdogan] may deploy underhanded tactics, cheating and even violence," Ibish said.

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