US, Canada target rate hikes to curb inflationary pressures

US, Canada target rate hikes to curb inflationary pressures
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Updated 27 January 2022

US, Canada target rate hikes to curb inflationary pressures

US, Canada target rate hikes to curb inflationary pressures

Interest rate hikes should be expected across North America after the US Federal Reserve and the Bank of Canada warned about the need to combat mounting inflationary pressures.

Jerome Powell, head of the US institution, said the organization would do whatever is necessary to put the brakes on consumer prices, according to Bloomberg.

He added that interest rate hikes will be expected in March, and that higher-than-projected rate spikes remain a possibility as well.

Powell pointed out that inflation might remain high for some time, and that it could upwardly move even more, explaining that monetary policy must be ready for all these scenarios.

In December, the inflation rate hit 7 percent in the world’s largest economy, a 40-year high.

North of the US, the Bank of Canada, while maintaining its interest rate at 0.25 percent, is anticipated to introduce an increase soon due to rising inflation.

Inflation is set to hover around 5 percent in the first half of this year, but will drop to 3 percent by the end of 2022, the Wall Street Journal reported, citing the central bank.

Last month, consumer prices rose by 4.8 percent — the highest since 1991 — in the North American country.

Moreover, the euro area is also struggling with record highs inflation, and pressure is piling up on the European Central Bank to act and mitigate these effects.

On the other hand, China trimmed its interest rate for the first time in two years to boost its economy which is grappling with COVID-19.


McDonald’s to sell its Russian business, try to keep workers

McDonald’s to sell its Russian business, try to keep workers
Updated 10 sec ago

McDonald’s to sell its Russian business, try to keep workers

McDonald’s to sell its Russian business, try to keep workers
  • Last month, McDonald’s reported that it earned $1.1 billion in the first quarter, down from more than $1.5 billion a year earlier

McDonald’s said Monday that it has started the process of selling its Russian business, which includes 850 restaurants that employ 62,000 people, making it the latest major Western corporation to exit Russia since it invaded Ukraine in February.

The fast food giant pointed to the humanitarian crisis caused by the war, saying holding on to its business in Russia “is no longer tenable, nor is it consistent with McDonald’s values.”

The Chicago-based company announced in early March that it was temporarily closing its stores in Russia but would continue to pay employees. On Monday, it said it would seek to have a Russian buyer hire those workers and pay them until the sale closes.

It did not identify a prospective buyer.

CEO Chris Kempczinski said the “dedication and loyalty to McDonald’s” of employees and hundreds of Russian suppliers made it a difficult decision to leave.

“However, we have a commitment to our global community and must remain steadfast in our values,” Kempczinski said in a statement, “and our commitment to our values means that we can no longer keep the arches shining there.”

As it tries to sell its restaurants, McDonald’s said it plans to start removing golden arches and other symbols and signs with the company’s name. It said it will keep its trademarks in Russia.

The first McDonald’s in Russia opened in the middle of Moscow more than three decades ago, shortly after the fall of the Berlin Wall. It was a powerful symbol of the easing of Cold War tensions between the United States and Soviet Union.

McDonald’s was the first American fast food restaurant to open in the Soviet Union, which would collapse in 1991.

McDonald’s decision to leave comes as other American food and beverage giants including Coca-Cola, Pepsi and Starbucks have paused or closed operations in Russia in the face of Western sanctions.

Corporations from British energy giants Shell and BP to French carmaker Renault have pulled out of Russia, taking a hit to their bottom lines as they seek to sell their holdings there.

Other companies have stayed at least partially, with some facing blowback.

McDonald’s said it expects to record a charge against earnings of between $1.2 billion and $1.4 billion over leaving Russia.

Its restaurants in Ukraine are closed, but the company said it is continuing to pay full salaries for its employees there.

McDonald’s has more than 39,000 locations across more than 100 countries. Most are owned by franchisees — only about 5 percent are owned and operated by the company.

McDonald’s said exiting Russia will not change its forecast of adding a net 1,300 restaurants this year, which will contribute about 1.5 percent to companywide sales growth.

Last month, McDonald’s reported that it earned $1.1 billion in the first quarter, down from more than $1.5 billion a year earlier.

Revenue was nearly $5.7 billion.


Egypt In-Focus — Cairo invites African countries to consolidate position ahead of COP27

Egypt In-Focus — Cairo invites African countries to consolidate position ahead of COP27
Updated 57 sec ago

Egypt In-Focus — Cairo invites African countries to consolidate position ahead of COP27

Egypt In-Focus — Cairo invites African countries to consolidate position ahead of COP27

RIYADH: Egypt is urging its African neighbors to meet ahead of COP27 to coordinate a position on climate and energy. Meanwhile, the new Indian wheat shipment is seen complying with the required standards signaling good news in light of the Russia-Ukraine war. The North African country is also working with Libya to bolster trade ties. 

  • Egypt has invited African countries to attend a session on climate and energy in an attempt to consolidate the continent’s position ahead of the UN climate conference, COP27, to be held in November 2022, local newspaper Egypt Today reported. 
  • The new Indian wheat shipment to Egypt has been reported to be in compliance with the required standards, Egypt Today reported. The North African country has selected India to be its new wheat supplier to curb the effects of the war between Russia and Ukraine. 
  •  Libya’s central bank has announced that it will permit local banks to receive land shipping documents to import Egyptian goods through Musaid crossing. Both countries have agreed to boost trade exchange with each other, Egypt Today reported, citing Mukhtar Al-Tawil, the director of the banking supervision and monetary department at the Central Bank of Libya.
  • The sixth “Egypt Can by Industry” conference is set to tackle artificial intelligence, digitalization, and programming, Egypt Today reported, citing the country’s minister of immigration and Egyptian expatriate affairs. The conference will also discuss the technology industry on a local level, how to deepen it and ways to promote it.

US carrier JetBlue says launched takeover of Spirit Airlines

US carrier JetBlue says launched takeover of Spirit Airlines
Updated 41 min ago

US carrier JetBlue says launched takeover of Spirit Airlines

US carrier JetBlue says launched takeover of Spirit Airlines

New York: The American low-cost carrier JetBlue Airlines announced on Monday a hostile takeover bid for its rival Spirit Airlines.

“JetBlue has filed a ‘Vote No’ proxy statement and commenced an all-cash tender offer,” JetBlue said in a statement, which asks Spirit shareholders to reject a proposed merger with Frontier.


Vodafone shares up 4% after UAE group buys 9.8% stake

Vodafone shares up 4% after UAE group buys 9.8% stake
Updated 16 May 2022

Vodafone shares up 4% after UAE group buys 9.8% stake

Vodafone shares up 4% after UAE group buys 9.8% stake

LONDON: Shares in Vodafone jumped 4 percent in early trade on Monday after the United Arab Emirates-based telecoms company e& revealed it had bought a 9.8 percent stake in the British mobile operator.

Formerly known as Emirates Telecommunications Group, e& said it had no intention of making an offer for the whole of Vodafone and it had spent $4.4 billion to invest at an “attractive valuation” to benefit from a diversification in currencies.

The company said it was fully supportive of Vodafone's board, which has come under pressure from other investors after the group struggled in its mature European markets where competition and regulation have pushed prices lower.

Vodafone Chief Executive Nick Read has vowed to lead a wave of consolidation in Europe to rebuild markets and boost returns but in recent months he has rejected an approach for the group's Italian assets and missed out on a deal between rivals in Spain.

Shares in Vodafone were up 3.1 percent at 121.50 pence at 0732 GMT.

The stock is down around 25 percent since Read moved from the finance director role to the top job of CEO in October 2018.

Paolo Pescatore, an analyst at PP Foresight, said the UAE investment was a strong endorsement of Vodafone's strategy and board, despite the failed attempts to strike deals in major markets.

“The move itself will raise eyebrows and may lead to some tension with other shareholders who are keen to see Vodafone consolidate in key markets,” he said.

“There will now be opportunities for both Etisalat and Vodafone to work more closely to bring greater efficiencies and launch new products in more products globally.” 


Saudi stocks rise as oil prices drop: Opening bell

Saudi stocks rise as oil prices drop: Opening bell
Updated 16 May 2022

Saudi stocks rise as oil prices drop: Opening bell

Saudi stocks rise as oil prices drop: Opening bell

RIYADH: Saudi stocks saw a second day of gains early on Monday as oil prices eased in the first hour of trading.

Brent crude fell 1.08 percent to settle at $109.30 a barrel, and WTI crude fell 1.41 percent to settle at $109.98 a barrel, as of 10:09 a.m. Saudi time.

The Saudi main stock index, TASI, increased 0.38 percent to reach 13,199, while the parallel market, Nomu, gained 0.05 percent to 22,856, as of 10:08 a.m. Saudi time.

Rabigh Refining and Petrochemical Co. led the fallers, down 3.23 percent; Wafrah for Industry and Development Co. climbed 3.58 percent to lead the gainers.

Shares of Saudi insurers declined following poor first-quarter earnings. 

AXA Cooperative Insurance Co. fell 2.77 percent, Al-Etihad shed 2.33 percent, and Tawuinya lost 1.19 percent.

Saudi Azm rose 2.37 percent, after it was approved to establish an office specialized in software development in Poland with SR500,000 capital. ($133,333)

Taiba Investments Co. edged up 1.28 percent, after reporting it turned into profit of SR20 million in the first quarter, supported by post-pandemic recovery.

The financial sector continued to rebound, with Al Rajhi Bank up 0.58 percent and Alinma Bank up 0.80 percent.

Shares of Saudi oil giant Aramco rose 0.12 percent, following its report yesterday that its first-quarter profit rose 82 percent.