Asia’s growth trimmed; UK inflation eases off slightly: Economic wrap

Asia’s growth trimmed; UK inflation eases off slightly: Economic wrap
Supply chain disruptions are one of the factors affecting growth in Asia
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Updated 20 October 2021

Asia’s growth trimmed; UK inflation eases off slightly: Economic wrap

Asia’s growth trimmed; UK inflation eases off slightly: Economic wrap

In its new regional outlook, the International Monetary Fund cut its growth forecast for Asia in 2021 to 6.5 percent, compared to the 7.6 percent it speculated in April. 

The international organization cited supply chain disruptions, inflation fears and a rise in Covid-19 infections as factors that could hamper growth in the region.

However, the 2022 growth forecast has been upwardly tweaked to 5.7 percent — up from the 5.3 percent April forecast.

Meanwhile, China is expected to grow by 8 percent this year and 5.6 percent in 2022.

UK inflation eases

The UK’s annual inflation rate tapered off to 3.1 percent in September 2021 down from its nine-year high of 3.2 percent in August, data from the Office for National Statistics revealed. 

Transport prices rose by 8.4 percent, helping fuel some of the country’s inflationary pressures. Conversely, rises in restaurants and hotels costs eased to 5.1 percent in September compared to 8.6 percent in August.

Month-on-month inflation also decreased to 0.3 percent in September — down from 0.7 percent in August.

In addition, the yearly core inflation rate, which excludes price changes in volatile items like food and energy, reached 2.9 percent in September, falling from 3.1 percent in the previous month.

German producer prices

Germany’s annual rise in producer prices climbed to 14.2 percent in September, according to official data.

Surging energy prices, last year’s low base effects and the current supply chain problems all meant that the country experienced its highest increase since October 1974.

Energy costs leapt by 32.6 percent while prices of intermediate goods rose by 17.4 percent.

This was accompanied by a month-on-month 2.3 percent increase in producer prices in September.

Japan’s trade deficit

The Japanese trade balance recorded a deficit of JPY622.8 billion ($5.44 billion) in September, compared to a JPY667.4 billion ($5.83 billion) surplus in the same month of last year, official data showed. This is the second consecutive month in which a deficit was posted for the country. 

Japanese imports leapt to a 34-month high of JPY7,463 billion ($65.19 billion) in September as it increased by an annual rate of 38.6 percent. Energy imports soared by 90 percent while purchases of electrical machinery jumped by 33.2 percent. Australian imports experienced the highest increase, climbing by 99.5 percent.

Meanwhile, the country’s exports jumped by 13 percent year-on-year to JPY6,841 billion ($59.76 billion) in September 2021. This was fuelled by a 23.7 percent increase in machinery exports. Exports of chemicals also rose considerably, growing by a 27.4 percent yearly rate.

Fed to hold on rates

A majority of economists expect the Federal Reserve to wait until 2023 before raising its rates, a survey conducted by Reuters showed.

Surveyed economists think that the biggest risk facing the US economy in the coming period is rising inflation.

China’s FDI 

Based on China's commerce ministry data, foreign direct investment (FDI) inflows to the country surged by 19.6 percent in the first nine months of 2021, when compared to the same period of the last year, to reach $134.7 billion.


SAMI launches JV with French firm to build aerostructure components in Kingdom

SAMI launches JV with French firm to build aerostructure components in Kingdom
Updated 20 min 39 sec ago

SAMI launches JV with French firm to build aerostructure components in Kingdom

SAMI launches JV with French firm to build aerostructure components in Kingdom

JEDDAH: The Saudi Arabian Military Industries, a wholly owned subsidiary of the Public Investment Fund, on Saturday launched a joint venture with French company Figeac Aero and the Saudi Arabian Industrial Investments Co., Dussur, to build a high-precision manufacturing facility in the Kingdom to produce aerostructure components, SAMI said on Saturday.

The company said that the joint venture’s revenue would reach $200 million by 2030 and the ownership would be divided among the two countries. Fifty-one percent would be owned by Saudi Arabia and 49 percent by France.

SAMI also signed an agreement with Airbus to form a joint project specialized in military aviation services and maintenance, the statement said. As per the deal, the Kingdom would own 51 percent of the joint venture with the European planemaker holding the other 49 percent.

 


Egypt to increase cotton gins capacity, says official report

Egypt to increase cotton gins capacity, says official report
Updated 04 December 2021

Egypt to increase cotton gins capacity, says official report

Egypt to increase cotton gins capacity, says official report

RIYADH: Egypt aims to increase cotton gins capacity to 4.4 million kantars annually up from 1.5 million kantars, according to a government report issued on Saturday.

A kantar is the official Egyptian weight unit for measuring cotton. It corresponds to the US hundredweight, and is roughly equal to 99.05 pounds, or 45.02 kg. It is equal to either 157 kg of seed cotton or 50 kg of lint cotton.

The Egyptian government is trying to breath a new life into the country’s textile industry, which contributes almost 3 percent to the gross domestic product, employs one-third of the industrial labor and generates exports worth $2.6 billion annually. 

According to reports, the country’s cotton production rose by 30 percent during 2021.

Egypt increased the cultivated area this year to 236,000 feddans (one feddan equals 1.038 acres or 0.42 hectare) compared to 182,000 feddans last year.

In its annual report on Egypt’s cotton on March 31, 2021, the US Department of Agriculture said that “cotton area harvested in Egypt was forecast to increase seven percent to 70,000 hectares (ha), from 65,000 ha in MY 2020/21.” It added that Egypt’s production is estimated to increase to 250,000 bales this year compared to 215,000 bales in the previous year.


Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated
Updated 04 December 2021

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

NEW YORK: Bitcoin shed a fifth of its value on Saturday as a combination of profit-taking and macro-economic concerns triggered nearly a billion dollars worth of selling across cryptocurrencies.

Bitcoin was 12 percent down at 0920 GMT at $47,495. It fell as low as $41,967.5 during the session, taking total losses for the day to 22 percent.

The broad selloff in cryptocurrencies also saw ether, the coin linked to the ethereum blockchain network, plunge more than 10 percent.

Based on cryptocurrency data platform Coingecko, the market capitalization of the 11,392 coins it tracks dropped nearly 15 percent to $2.34 trillion. That value had briefly crossed $3 trillion last month, when bitcoin hit a record $69,000.

The plunge follows a volatile week for financial markets. Global equities and benchmark US bond yields tumbled on Friday after data showed US job growth slowed in November and the omicron variant of the coronavirus kept investors on edge.

Justin d'Anethan, Hong Kong-based head of exchange sales at cryptocurrency exchange EQONEX, said he had been watching the increase in leverage ratios across the cryptocurrency markets as well how large holders had been moving their coins from wallets to exchanges. The latter is usually a sign of intent to sell.

“Whales in the crypto space seem to have transferred coins to trading venue, taken advantage of a bullish bias and leverage from retail traders, to then push prices down,” he said.

The selloff also comes ahead of testimony by executives from eight major cryptocurrency firms, including Coinbase Global CFO Alesia Haas and FTX Trading CEO Sam Bankman-Fried, before the US House Financial Services Committee on Dec. 8.

The hearing marks the first time major players in the crypto markets will testify before US lawmakers, as policymakers grapple with the implications of cryptocurrencies and how to best regulate them.

Last week, the US Securities and Exchange Commission (SEC) rejected a second spot-bitcoin exchange-traded fund proposal from WisdomTree.

Data from another platform Coinglass showed nearly $1 billion worth of cryptocurrencies had been liquidated over the past 24 hours, with the bulk being on digital exchange Bitfinex.

A plunge in bitcoin funding rates — the cost of holding bitcoin via perpetual futures which peaked at 0.06 percent in October — also showed traders had turned bearish.

The funding rate on cryptocurrency trading platform BitMEX fell to a negative 0.18 percent from levels of 0.01 percent for most of November.


Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom

Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom
Updated 6 min 16 sec ago

Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom

Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom

JEDDAH: A group of leading Saudi and French companies are holding discussions at an investment forum in Jeddah as French President Emmanuel Macron is set to meet with Crown Prince Mohammed bin Salman today during his official trip to the Gulf region, where he is visiting Saudi Arabia, the UAE and Qatar between Dec. 3 and 4.

The forum is opened by Khalid Al Falih, Minister of Investment, Saudi Arabia and Franck Riester, Minister Delegate for Foreign Trade and Economic Attractiveness.

Represenatives of French companies and banks including EDF Renewables, Engie, Sanofi, and BNP Paribas are meeting with chairmen and CEOs of leading Saudi firms including ACWA Power, Banque Saudi Fransi, Riyad Bank, and Saudi Military Industries Co. Officials from the Public Investment Fund and Royal Commission of AlUla among others are also participating in the forum. 

 

Below is the agenda for the one-day forum where a some memorandum of understanding are expected to be signed:  


Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4
Updated 03 December 2021

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

RIYADH: Saudi Arabia will start implementing the mandatory application of the first phase of e-invoicing “fatoorah” on Saturday Dec. 4, Argaam reported.

An e-invoice, according to regulations, is a tax invoice that is issued electronically by each taxpayer subject to value-added tax in the Kingdom

The first phase requirements consist of ensuring that there is a technical e-invoicing solution compatible with the relevant requirements. This means no handwritten invoices or invoices written through text editors or number analysis applications on computers.

A fine of SR5,000 ($1,332) will be applied for not issuing and saving the invoices electronically.

The fine for not including the QR Code in the e-invoice and not reporting any malfunction in the issuing of the e-invoice to the authority starts with a warning. The fine for violating the deletion or modification of e-invoice starts from SR10,000.

The second phase of e-invoicing will be implemented in a phased manner, starting from January 1, 2023, to establish integration between e-systems of taxpayers and the authority’s regulations, Argaam said.