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Now "it's like 'plus-10' and then China," he added, with the latter down to providing half of Industry West's products and being trimmed more. China recorded its first-ever quarterly deficit in foreign direct investment in July-September, suggesting capital outflow pressure. But for the first time in the four decades since China opened up to foreign investments, executives are now also concerned about long-term growth prospects. Primavera Capital founder Fred Hu cites mounting macroeconomic uncertainty, a "murky capital market outlook," and lingering concerns over past regulatory crackdowns on high-growth industries such as technology and education. Despite the challenges, foreign investment flows are not unidirectional.

Persons: Jordan England, Nicholas Lardy, England, I'm, Li Qiang's, Li, Michael Hart, Noah Fraser, Fred Hu, Hu, Joe Cash, Ellen Zhang, Kane Wu, Eduardo Baptista, Don Durfee, Kripa Jayaram, Marius Zaharia, Jamie Freed Organizations: China, Reuters, Peterson Institute for International Economics, LONG, Conference Board, China International, Canada China Business Council, Reuters Graphics, Primavera Capital, Tech, Thomson Locations: China, BEIJING, HONG KONG, Southeast Asia, Eastern Europe, Mexico, England, Florida, Washington, Beijing, consultancies, U.S, Asia, Australia, Europe, Hong Kong

☆ Take Five: Warming up this winter
▼ + stars: | 2023-11-24 | by ( ) www.reuters.com time to read: +6 min

1\BUCK UP, IT'S DECEMBERThe dollar is heading for its weakest monthly performance for a year, with a loss so far of 2.7%. On Thursday, China releases official manufacturing PMI data, which last month showed an unexpected contraction, killing momentum for an economic recovery. COP28 gets underway in Dubai and securing an agreement on how to tackle global warming and, crucially, how to pay for it looks as difficult as ever for the near 200 countries and institutions attending. Reuters Graphics5\THE ECB'S BALANCING ACTEuro zone inflation data on Nov. 30 may well confirm a trend of price rises moderating. Policymakers remain wary of any hopes for rate cuts spilling over into increased bank lending and household spending, renewing inflationary pressures.

Persons: Lewis Krauskopf, Kevin Buckland, Naomi Rovnick, Marc Jones, Amanda Cooper, it's, Joshua Roberts, Sultan Ahmed Al Jaber, Christine Lagarde, Pasit Kongkunakornkul, Sumanta Sen, Kripa Jayaram, Vineet Sachdev, Prinz, Toby Chopra Organizations: BUCK, IT'S, Federal Reserve, Reuters, REUTERS, COP28, World Bank, European Central Bank, Thomson Locations: China, Dubai, Lewis, New York, Tokyo, London, Washington , U.S, UAE

☆ Take Five: Black Friday is (almost) here
▼ + stars: | 2023-11-17 | by ( ) www.reuters.com time to read: +6 min

REUTERS/Kamil Krzaczynski/File Photo Acquire Licensing RightsNov 17 (Reuters) - U.S. retailers are gearing up for Black Friday, marking the start of the shopping season that follows the Thanksgiving holiday, while business activity data should gauge the temperature elsewhere. 1/ BARGAIN HUNTINGThe crucial holiday shopping season kicks off with Black Friday on Nov. 24 at a time when investors are questioning whether the consumer-driven U.S. economy can remain resilient. This year's Black Friday comes as Americans grapple with soaring interest rates and inflation that, while easing, remains above the Federal Reserve's 2% target. Already, data for October showed U.S. retail sales fell, pointing to slowing demand, although the decline was less than expected. As long as that's not the case, pressure is on the Kishida cabinet since a weak yen is unpopular politically.

Persons: Kamil Krzaczynski, Lewis Krauskopf, Kevin Buckland, Naomi Rovnick, Dhara Ranasinghe, Karin Strohecker, There's, PIMCO, Rishi Sunak, David Cameron, Jeremy Hunt, Hunt, bode, Sergio Massa, Javier Milei, Pragmatist Massa, Prinz Magtulis, Sumanta Sen, Kripa Jayaram, Pasit, Mark Potter Organizations: Walmart, REUTERS, Black, Nvidia, Insider Intelligence, European Commission, PMI, Fed, European Central Bank, Reuters Graphics Reuters, DOWNING STREET, Labour, gilts, Natwest, Reuters, Bank of Japan, Peronist, Thomson Locations: Chicago , Illinois, U.S, Argentina, Lewis, New York, Tokyo, London, Britain, Japan, Egypt, Taiwan, South Africa, India

Liu got the librarian job after a government-led campaign to secure temporary work for graduates, which analysts describe as a short-term solution to preserve social stability in a slowing economy with little on offer for young Chinese. Such "welfare jobs," as they are known in China, include roles as receptionists, office administrators, security guards and community workers. Various government institutions offer such jobs every year, but they had usually drawn applications from disadvantaged groups, such as elderly or disabled people. But state media editorials have also encouraged young graduates to take lower skilled jobs. Reuters GraphicsThe total take-up of short-term jobs and internships remains unknown, but social media posts commenting on the selection process and discussing career options are frequent and analysts expect such roles will be in demand in a slowing economy.

Persons: Peter Liu, Liu, Wang Jun, joblessness, Mao Zedong, Chen, Graphics Liu, Kripa Jayaram, Ellen Zhang, Shri Navaratnam Organizations: Reuters, Human Resources, Social Security, Huatai Asset Management, Graphics, Beijing, Thomson Locations: BEIJING, HONG KONG, Beijing, Henan, China, Chongqing

Lending data from China's central bank offers a glimpse of government priorities: as of the end of September, outstanding loans to the troubled property sector fell 0.2% year-on-year but lending to the manufacturing sector jumped 38.2%. This time, the government's focus is narrower, targeting high-tech and "advanced manufacturing", a goal laid out in 2021 in the 14th five-year plan. It grew 11.3% in the first nine months of 2023 year-on-year, compared with 6.3% for overall manufacturing investment, according to data from China's National Bureau of Statistics. For example, Guangdong province has increased lending to both high-tech and advanced manufacturing by about 45%, state media reported. During the first half of 2023, outstanding loans to the high-tech manufacturing sector in the eastern province of Shandong jumped 67%.

Persons: Jens Eskelund, Eskelund, Xi Jinping, Joe Biden, Frederic Neumann, Neumann, Tao Wang, Wang, Fu, Lu Zhengwei, Siyi Liu, Kripa Jayaram, Robert Birsel Organizations: Rights, European Chamber of Commerce, Asia Pacific Economic Cooperation, U.S, Reuters Graphics, overcapacity, HSBC, UBS, China's National Bureau of Statistics, Rystad Energy, EV, China Passenger Car Association, Bank, Industrial Bank, Thomson Locations: Suqian, Jiangsu province, China, CHINA, Rights BEIJING, Europe, Beijing, San Francisco, Xi, Asia, Guangdong province, Shandong, Dongguan, Shanghai

☆ Take Five: That rate cut trade
▼ + stars: | 2023-11-10 | by ( ) www.reuters.com time to read: +5 min

REUTERS/Brendan McDermid/File Photo Acquire Licensing RightsLONDON, Nov 10 (Reuters) - Markets are keen to trade rate cuts and big central banks are pushing back, shining a new light on upcoming data in that tug of war. Traders, anticipating roughly three quarter-point Fed rate cuts next year, will now turn their attention to Tuesday's inflation data to confirm their view on the outlook. A sharper cooling could fan the peak rate talk, fuelled by October's employment report, which pointed to an easing in labor markets. Reuters Graphics Reuters Graphics3/ ONCE BITTENThe robust dollar suddenly appears vulnerable to the push and pull in the market's Fed rate cut bets. The data could also help justify, or challenge, recent remarks from BoE chief economist Huw Pill that mid-2024 could be the time for rate cuts.

Persons: Brendan McDermid, Lewis Krauskopf, Kevin Buckland, Danilo Masoni, Alun John, Dhara, Jerome Powell, Ping, Powell, Rishi Sunak, Sunak, BoE, Huw Pill, Sumanta Sen, Pasit, Riddhima Talwani, Prinz Magtulis, Jayaram, Dhara Ranasinghe, Tomasz Janowski Organizations: New York Stock Exchange, REUTERS, Traders, Reuters, Beijing, Reuters Graphics Reuters, Bank of England, Thomson Locations: New York City, U.S, China, New York, Tokyo, Milan, London, Washington, September's, Germany, Europe, ITALY, Italy

☆ Analysis: Traders bet ECB will be first big central bank to cut rates
▼ + stars: | 2023-11-03 | by ( Yoruk Bahceli | ) www.reuters.com time to read: +5 min

A view shows the logo of the European Central Bank (ECB) outside its headquarters in Frankfurt, Germany March 16, 2023. With investors confident that big central banks are likely done raising rates, focus has switched to when rate cuts will start. Traders now price in over an 80% chance of a 25 basis-points (bps) ECB cut by April, which had been fully priced for July last week. Piet Christiansen, chief analyst at Danske Bank, said the expectations for ECB rate cuts now reflected a "doom and gloom" scenario. He added the ECB would need to cut rates at least as much as traders expect next year.

Persons: Heiko Becker, BoE, Shamik Dhar, Christine Lagarde, Piet Christiansen, Lagarde, Goldman, Gurpreet Gill, Dario Perkins, Yoruk, Sumanta Sen, Kripa Jayaram, Dhara Ranasinghe, Emelia Organizations: European Central Bank, REUTERS, Traders, ECB, Fed, Federal Reserve, Bank of England, BNY Mellon Investment, Treasury, Reuters, Danske Bank, Asset Management, Lombard, Thomson Locations: Frankfurt, Germany, United States, Europe, U.S, Britain, Israel

☆ Take Five: You (may) have arrived at your destination
▼ + stars: | 2023-11-03 | by ( ) www.reuters.com time to read: +5 min

No wonder markets see a 70% chance that the Fed's brutal 20-month tightening cycle is over and that rate cuts could begin as soon as June. So watch closely to see if the top central bankers push back against the cut chatter until inflation is truly tamed. Shekel, gold, oil response to the war5/RACE DAY RATE HIKEThe famous Melbourne Cup horse race runs on Tuesday, but some of the shortest odds are on an Aussie central bank rate hike over in Sydney that day. Three-year and 10-year Australian government bond yields have hit their highest since 2011, though backed off slightly on the Fed's hold. The Australian dollar has also rallied strongly against its New Zealand counterpart as rate expectations diverge.

Persons: Marc Jones, Dhara, Kevin Buckland, Tom Westbrook, Lewis Krauskopf, BoE, Horton, Walt Disney, Mittal, shekel, Antony Blinken, Jordan, Luci Ellis, Kripa Jayaram, Riddhima Talwani, Gareth Jones Organizations: Federal Reserve, Fed, ECB, FX, Bank of Japan, Reuters, eBay, Nvidia, UBS, ABN Amro, Allianz, Friday, U.S, Melbourne Cup, Westpac, New Zealand, Thomson Locations: Australia, Gaza, Here's, London, Tokyo, Singapore, New York, Britain, U.S, Europe, Commerzbank, Israel, Gaza City, Iran, Sydney

☆ Big central banks hit pause, with rate cuts far off
▼ + stars: | 2023-10-26 | by ( ) www.reuters.com time to read: +5 min

On Oct. 23, Fed Chair Jay Powell said a strong economy and tight jobs market could warrant more rate rises. Interest rate futures show traders believe the BoE will not cut rates, now at their highest since 2008, until at least June 2024. "The Governing Council’s past interest rate increases continue to be transmitted forcefully into financing conditions," the ECB said, adding it would follow a "data-dependent" approach and future decisions would be based on incoming data. Prime Minister Jonas Gahr Stoere told parliament last week interest rates may have peaked. Reuters Graphics Reuters Graphics8) AUSTRALIAThe Reserve Bank of Australia held rates steady at 4.1% for a fourth meeting in October.

Persons: Jonathan Ernst, Jay Powell, BoE, Jonas Gahr Stoere, Michele Bullock, Naomi Rovnick, Harry Robertson, Alun John, Yoruk Bahceli, Samuel Indyk, Chiara Elisei, Kripa Jayaram, Pasit, Riddhima, Sumanta Sen, Vineet, Amanda Cooper, Giles Elgood Organizations: . Federal, REUTERS, European Central Bank, Federal Reserve, Bank of England, UNITED, Reuters, Reserve Bank of New Zealand, BRITAIN, Bank of Canada, BoC, ECB, Norges Bank, Reuters Graphics Reuters, Reserve Bank of Australia, Bank of Japan, Thomson Locations: Washington, Japan, hawkish, dovish, NORWAY, SWEDEN Sweden, SWITZERLAND, Swiss, Gaza, JAPAN

High funding needs and central banks removing support are increasing pricing uncertainty for investors, Sophia Drossos, hedge fund Point72 Asset Management's chief economist, said. Spending plans lacking credibility were seen as most likely to spark market turmoil. I suspect not by default, but when markets start reflecting their worries in Treasury prices, by a political crisis and a potentially ugly adjustment," the former IMF chief economist said. "We need more investment, not less," said King's College London professor Jonathan Portes, Britain's cabinet office chief economist during the financial crisis. Not enough reforms are being implemented, OECD chief economist Clare Lombardelli warned.

Persons: Andrew Kelly, Peter Praet, Praet, Sophia Drossos, Daniel Ivascyn, Claudio Borio, Olivier Blanchard, Ray Dalio, Janet Yellen's, Yellen, Jim Leaviss, Giancarlo Giorgetti, Daleep Singh, Joe Biden, Britain's, Yellen's, Jonathan Portes, Clare Lombardelli, Moritz Kraemer, Yoruk Bahceli, Maria Martinez, Leigh Thomas, Giuseppe Fonte, Nell Mackenzie, Naomi Rovnick, William Schomberg, Jan Strupczewski, Dan Burns, Elisa Martinuzzi, Riddhima Talwani, Jayaram, Emelia Sithole Organizations: Financial, of, REUTERS, Institute of International Finance, Reuters, European Central Bank, ECB, Bank for International, Peterson Institute for International Economics, Associates, U.S . Treasury, Wall, Economy, Britain's Treasury, Congressional, Britain's, Institution, Reuters Graphics ACT, King's College London, Labour Party, OECD, Graphics, Thomson Locations: of Manhattan , New York City, U.S, Italy, Britain, United States, Europe, Ukraine, Berlin, Paris, Rome, London, Brussels, Washington, Marrakech

High funding needs and central banks removing support are increasing pricing uncertainty for investors, Sophia Drossos, hedge fund Point72 Asset Management's chief economist, said. Spending plans lacking credibility were seen as most likely to spark market turmoil. I suspect not by default, but when markets start reflecting their worries in Treasury prices, by a political crisis and a potentially ugly adjustment," the former IMF chief economist said. Italy's 2.4 trillion-euro debt pile is the focus in Europe, where the IMF has said high debt leaves governments vulnerable to crisis. "We need more investment, not less," said King's College London professor Jonathan Portes, Britain's cabinet office chief economist during the financial crisis.

☆ Take Five: War and peace of mind
▼ + stars: | 2023-10-13 | by ( ) www.reuters.com time to read: +5 min

[1/2] Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 28, 2023. U.S. retail sales increased more than expected in August as a surge in gasoline prices boosted receipts at service stations. Bar chart with data from LSEG I/B/E/S show the projected year-over-year growth in Q3 2023 earnings of S&P 500 industries. There have been reports the government is looking to increase its budget deficit to meet this year's 5% growth target. That said, inflation is still over three times the BoE's 2% target and growth isn't exactly stellar.

Persons: Brendan McDermid, Kevin Buckland, Lewis Krauskopf, Naomi Rovnick, Karin Strohecker, Amanda Cooper, Goldman Sachs, Johnson, Philip Morris, It's, Banks, Amundi, BoE, it's, Sumanta Sen, Prinz Magtulis, Vineet, Pasit, Jayaram, Mark Potter Organizations: New York Stock Exchange, REUTERS, Hamas, Bank of America, Johnson, Netflix, Philip Morris International, Investors, HK, Law, Justice, Reuters, The Bank of England, Thomson Locations: New York City, U.S, Israel, Palestinian, China, Britain, Tokyo, New York, London, LSEG, Beijing, Europe's, Brussels, Europe

The ramifications for global markets are significant, with Washington and Beijing's determination to loosen dependence on each other fraying long-established supply chains. Many central banks target 2% inflation; market gauges of traders' long-term U.S. and European inflation expectations are running higher , . Anna Rosenberg, head of geopolitics at the Amundi Investment Institute, said Sino-U.S. tensions, provide a "new lens" through which to analyse emerging markets' growth prospects. But the performance of big U.S. tech stocks and global share indices are vulnerable to signs of Chinese retaliation. With China underperforming global stocks, investors are split on how to approach this market.

Persons: Dado Ruvic, Joe Biden, Goldman Sachs, Wouter Sturkenboom, Laura Alfaro, Anna Rosenberg, Christopher Rossbach, J, Stern, Carole Madjo, Wendy Liu, Baird, Patrick Spencer, Naomi Rovnick, Kripa Jayaram, Riddhima, Vineet, Sumanta Sen, Pasit, Louise Heavens Organizations: REUTERS, EMEA, APAC, Northern Trust, Reuters, Research, Harvard Business, Amundi Investment Institute, INDIA RUSH, Barclays reckons, EU, Apple, China, Barclays, JPMorgan, Thomson Locations: West, China, Washington, Western, Germany, Northern, Europe, FRIENDSHORING Washington, Vietnam, Mexico, Mongolia, Philippines, Sino, U.S, India, Beijing, COVID, CHINA

☆ China's auto workers bear the brunt of price war as fallout widens
▼ + stars: | 2023-09-05 | by ( ) www.reuters.com time to read: +9 min

Millions of auto workers and suppliers in China are feeling the heat as an electric vehicle price war forces carmakers to shave costs anywhere they can. State-run China Automotive News estimates there are over 100,000 auto suppliers in the country. Suppliers typically negotiate prices once a year, but many have been pressed to lower prices on a quarterly basis in 2023, two senior executives at auto suppliers said. And in June, a group of small suppliers wrote to state-owned Changan Automobile to push back against 10% price reductions. Three months later, he told Reuters that price cuts had been more aggressive in 2023 than in previous years.

Persons: Aly, Mike Chen, Chen, carmakers, Tesla, George Magnus, Elon Musk, Mike Chen's, Li Auto, Liu, Changan Automobile's, Chen Yudong, They've, Zhang Yan, Brenda Goh, Kripa Jayaram, Marius Zaharia, David Clarke Organizations: SAIC Volkswagen, REUTERS, Rights, Shanghai, SAIC, Volkswagen, VW, Oxford University's China, China Passenger Car Association, Tesla, GM, HK, Changan Automobile, Mitsubishi Motors, Toyota, Hyundai, China Automotive, Automobile, EV, Reuters, Thomson Locations: Shanghai, China, China's, Beijing, Shenzhen, Hefei, Chongqing, Chery's, Qingdao

"There is a significant risk in the short term of financial crisis or other degree of economic crisis that would carry very substantial social and political costs for the Chinese government. By the time the global financial crisis hit in 2008-09, it had already met most of its investment needs for its level of development, economists say. To keep growth high, China in the 2010s doubled down on infrastructure and property investment, at the expense of household consumption. China has since backed away from major financial market liberalisation while plans to rein in state behemoths and introduce universal social welfare never quite materialised. "But at the same time there's a great fear of the short-term political and social risk, especially of provoking an economic crisis."

Persons: Xi Jinping's, William Hurst, Chong Hua, there's, Max Zenglein, We're, Logan Wright, Alicia Garcia Herrero, Hurst, Liangping Gao, Kevin Yao, Kripa Jayaram, Marius Zaharia, Sam Holmes Organizations: Development, University of Cambridge, International Monetary Fund, Asia Pacific, China's, Reuters Graphics, Thomson Locations: BEIJING, China, Japan, Beijing, Natixis

Analysts see this as an emerging new trend of trade regionalisation in the eastern and western hemispheres - each dominated by one of the superpower - that could pose risks to global growth. This "will likely contribute to increased regionalisation of international trade, which would raise inflation and hamper growth for other countries caught in the crossfire." China has also applied to join the Comprehensive Progressive Trans-Pacific Partnership, one of the world's largest free trade agreements. To join this Pacific trade axis, though, China needs the approval from all member countries, including U.S. allies. "And both of those countries value trade with the U.S. under their North American framework more than they value trade with China."

Persons: Gina Raimondo, Elizabeth Frantz, Neil Thomas, Donald Trump, Joe Biden, Raimondo, Trump, William Hurst, Joe Cash, Kripa Jayaram, Marius Zaharia, William Mallard Organizations: . Commerce, Capitol, REUTERS, Southeast Asia, Analysts, Asia Society Policy Institute, Higher, Census, Reuters, Canada Agreement, Comprehensive, Pacific, U.S, University of Cambridge, Thomson Locations: Washington , U.S, China, Washington, Canada, Mexico, Beijing, Southeast, decouple, U.S, Japan, South Korea, Australia, New Zealand, Pacific

Many economists have called on China to boost its social safety net to rebalance the economy. Yao was unswayed and would prefer consumer vouchers, which some local governments in China have issued, but in amounts too small to matter at a macro level. Local governments, while cash poor, are asset rich. Michael Pettis, senior fellow at Carnegie China, estimates that if Beijing forces local governments to transfer 1-1.5% of GDP to households, China could maintain current growth. "One of the really big conflicts is likely to be between Beijing and the local governments over how to allocate the various adjustment costs.

Persons: Erin Yao, Juan Orts, Orts, Tokyo's, Yao, joblessness, Jens Eskelund, Wang Jiliu, Wang, Michael Pettis, Laurie Chen, Kripa Jayaram, Marius Zaharia, Sam Holmes Organizations: Fathom Consulting, Communist Party, Reuters Graphics, European Chamber of Commerce, Carnegie China, Thomson Locations: BEIJING, HONG KONG, China, Beijing, United States, Hainan

☆ Bank of England caught between inflation fight and recession risk
▼ + stars: | 2023-08-02 | by ( William Schomberg | ) www.reuters.com time to read: +5 min

A woman carrying a Union Flag umbrella stands near the Bank of England in the City of London, Britain, July 30, 2023. Analysts and investors are mostly expecting a quarter-point increase in Bank Rate, taking it to a 15-year high of 5.25%. But they also say they must quash an inflation rate that is the highest among major economies. INFLATION THREATBritish consumer price inflation fell by more than expected in June to 7.9% in annual terms, down sharply from 8.7% in May. Reuters GraphicsHOUSING MARKETThe most obvious impact of the increase in the BoE's Bank Rate from 0.1% in December 2021 to the current 5.0% has been in the housing market.

Persons: Adams, BoE, Andrew Bailey, Bailey, GfK, Sumanta Sen, Kripa Jayaram, Vincent Flasseur, Tomasz Janowski Organizations: Flag, Bank of England, City of, REUTERS, Analysts, Reuters, Nationwide, Halifax, insolvencies, Reuters Graphics LABOUR, Reuters Graphics Reuters, Reuters Graphics, Thomson Locations: City, City of London, Britain, BoE's, England, Wales, Germany

Financial firms and their regulators have cut salaries and bonuses after China's top graft-busting watchdog vowed to eliminate "Western-style hedonism" in the $57 trillion sector. "Wage cuts will intensify deflationary risks and reduce willingness to spend," said Zhaopeng Xing, ANZ's senior China strategist. Reuters GraphicsWEAK BARGAINING POWERUnilateral wage cuts are illegal in China, but complex salary structures offer ways around that. Shao, who sold make-up in the eastern city of Suzhou and only gave her surname for privacy reasons, had a choice to leave her company or accept a 50% wage cut. Their bargaining power ... is weakened so they tend to accept wage cuts," said Aidan Chau, researcher at Hong Kong-based rights group China Labour Bulletin.

Persons: Yao, Zhaopeng Xing, ANZ's, Unit's Xu Tianchen, Zhaopin, Shao, Aidan Chau, Xu, he's, Xiangrong Yu, Ellen Zhang, Marius Zaharia, Liangping Gao, Kripa Jayaram, Kim Coghill Organizations: Communist Party, Financial, Economist, Reuters, Workers, China Labour Bulletin, Reuters Graphics Reuters, Citi, Graphics, Thomson Locations: China, BEIJING, HONG KONG, Hefei, Suzhou, Hong Kong, Shanghai, Beijing

Euro zone interest rates have risen 400 basis points in the last year to 3.5%, their highest in 22 years, and are now close to peaking as headline inflation cools and the economy weakens. 1/ How much will the ECB hike rates? "The ECB will hike again and anything else would be a major surprise," said RBC Capital Markets global macro strategist Peter Schaffrik. Reuters Graphics Reuters Graphics3/ When does the ECB expect core inflation to fall? Euro zone business activity stalled in June as a manufacturing recession deepened and a previously resilient services sector barely grew.

Persons: Silvia Ardagna, Peter Schaffrik, Christine, Lagarde, Massimiliano Maxia, Reinhard Cluse, Ruben Segura, BofA, Philip Lane, BofA's Segura, Naomi Rovnick, Stefano Rebaudo, Vincent Flasseur, Sumanta Sen, Pasit, Kripa Jayaram, Catherine Evans Organizations: European Central Bank, Barclays, ECB, Capital, Reuters, Allianz Global Investors, U.S . Federal, Reuters Graphics Reuters, UBS, Bank, Thomson Locations: Cayuela, Europe, London, Milan

☆ UK economy shows strains and gains, complicating Bank of England's job
▼ + stars: | 2023-07-12 | by ( William Schomberg | ) www.reuters.com time to read: +5 min

But the BoE is also aware that the economic impact of its 18-month campaign of rate hikes has yet to be felt fully. Below is a summary of key measures of the economy that the BoE will be watching before its next announcement on interest rates on Aug. 3. INFLATION THREATBritish consumer price inflation held at 8.7% in annual terms in May, down from a peak of 11.1% last October but the highest among the Group of Seven advanced economies. Reuters GraphicsINSOLVENCIESThere are signs that companies, especially smaller ones, are struggling as borrowing costs rise and the economy barely grows. Reuters GraphicsGraphics by Sumanta Sen, Kripa Jayaram and Vincent Flasseur; Editing by Paul SimaoOur Standards: The Thomson Reuters Trust Principles.

Persons: BoE, GfK, Sumanta Sen, Kripa Jayaram, Vincent Flasseur, Paul Simao Organizations: Bank of England's, Reuters Graphics Reuters, Nationwide, Halifax, Reuters, insolvencies, Wales, Reuters Graphics LABOUR, Thomson Locations: BoE's, Britain, England, Germany

Reuters GraphicsIndia is among the world's top exporters of services, doubling its share in global services trade to over 4% from 2% in 2005, according to WTO estimates. Sunil Talati, president of government-aided Services Export Promotion Council, said total services exports could overtake goods exports in the next five years to $750 billion. A report by Knight Frank consultancy last week said demand for office space has risen sharply in smaller cities, driven by expanding operations of global accounting and multinationals, pushing up rents by up to 10%. Domestic accounting firms are also moving to smaller towns and raising wages. "With the Big Four and other global firms coming to our cities, we are going even deeper to open offices in smaller cities."

Persons: Ernst & Young, Diksha Mehta, Debasish Mishra, PwC, Padmaja Alaganandan, Narendra Modi, Sunil Talati, Swagatika Parmanik, Knight Frank, Kshitij Patel, Shah, Manoj Kumar, Kripa Jayaram, Sam Holmes Organizations: Business, Diksha, Reuters Graphics India, Deloitte, KPMG, Export Promotion Council, Reuters, PwC, IBM, Manubhai, Shah LLP, Thomson Locations: BHUBANESWAR, India, Mumbai, Delhi, Bengaluru, Jaipur, Vadodara, Kochi, Chandigarh, Patiala, Australian, Europe, New Delhi, Asia, Odisha, Bhubaneswar, Gujarat, Ahmedabad

☆ What could break as interest rates rise?
▼ + stars: | 2023-06-29 | by ( ) www.reuters.com time to read: +5 min

Sweden, where rates rose again on Thursday, is one to watch with most homeowners' mortgages moving in lockstep with rates. Reuters Graphics2/ REAL ESTATE: PART 2Having taken advantage of the low rates era to borrow aplenty and buy up property assets, the commercial real estate sector is grappling with higher debt refinancing costs as rates rise. "The single most important thing is interest rates. But not just interest rates; what it is equally important is the predictability of rates," said Thomas Mundy, EMEA head of capital markets strategy at real estate firm JLL. "If we were settled on an interest rate, real estate prices could adjust.

Persons: Richard Portes, Thomas Mundy, Banks, Florian, Ielpo, Jerome Powell, Markus Allenspach, Julius Baer, Nick Kraemer, Wagner, Vladimir Putin's, Putin, Tina Fordham, Chiara Elisei, Naomi Rovnick, Nell Mackenzie, Karin Strohecker, Vincent Flasseur, Kripa Jayaram, Sumanta Sen, Pasit, Dhara Ranasinghe, Alison Williams Organizations: International Monetary Fund, Reuters, Federal, Finance, London Business School, Lombard, Federal Reserve, Casino, Sweden's SBB, Fordham Global Foresight, Thomson Locations: Britain, Norway, Russia, Sweden, lockstep, London's, City, RUSSIA, Ukraine

Most economists expect another modest 10 bps LPR cut in the second half - on top of a 25 bps cut in banks' requirement ratio (RRR). The PROC last cut the RRR - the amount of cash that banks must hold as reserves -- in March, by 25 bps. Each 5 basis points LPR cut could reduce pre-tax profits of major banks by as much as 1.8%, China Merchants Securities said in a report. "A small rate cut is a useful painkiller for symptoms but cannot alleviate the real problem," said Gary Ng, Asia Pacific senior economist of Natixis. On Friday, China's cabinet discussed policy measures to support the economy.

Persons: COVID, NIM, Wang Yifeng, Wang, Gary Ng, China's, Zhang Ming, Zhang, Morgan Stanley, Kevin Yao, Ziyi Tang, Kripa Jayaram, Sumeet Chatterjee Organizations: People's Bank of China, Reuters, Everbright Securities, China Merchants Securities, Asia Pacific, stoke, Chinese Academy of Social Sciences, Thomson Locations: China, BEIJING, Beijing, Asia

☆ China cuts lending benchmarks to revive slowing demand
▼ + stars: | 2023-06-20 | by ( ) www.reuters.com time to read: +4 min

REUTERS/Thomas Peter/FILE PHOTOSHANGHAI/SINGAPORE, June 20 (Reuters) - China cut its key lending benchmarks on Tuesday, the first such reductions in 10 months as authorities seek to shore up a slowing economic recovery, although concerns about the property market meant the easing was not as large as expected. The one-year loan prime rate (LPR) was lowered by 10 basis points to 3.55%, while the five-year LPR was cut by the same margin to 4.20%. The People's Bank of China (PBOC) lowered short- and medium-term policy rates last week. "There is no need to roll out all policy measures all at once." Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages.

Persons: Thomas Peter, Julian Evans, Pritchard, Xing Zhaopeng, Xing, China's, Bruce Pang, Jones Lang LaSalle, Winni Zhou, Tom Westbrook, Kripa Jayaram, Sam Holmes Organizations: Central Business, REUTERS, Capital Economics, Reuters, Mainland Properties, People's Bank of China, ANZ, Jones, Graphics, Thomson Locations: Beijing, China, SHANGHAI, SINGAPORE, outpacing

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