Macro Snapshot — German economy sees growth in Q1; Investment banks cut China’s growth outlook

The German economy grew in the first quarter, in line with expectations, despite difficult economic conditions caused by the war in Ukraine and the pandemic, data showed on Wednesday.
The German economy grew in the first quarter, in line with expectations, despite difficult economic conditions caused by the war in Ukraine and the pandemic, data showed on Wednesday.
Short Url
Updated 25 May 2022

Macro Snapshot — German economy sees growth in Q1; Investment banks cut China’s growth outlook

Macro Snapshot — German economy sees growth in Q1; Investment banks cut China’s growth outlook

RIYADH: The ongoing Russian-Ukraine conflict and virus lockdowns in China continue to affect the global economy with several countries at the risk of recession.

Germany saw only a slight rise in its economic growth whereas Singapore’s gross domestic product also indicated minimal growth. 

Investment banks have slashed China’s growth outlook after COVID-19 disruption. 

US core capital goods orders 

New orders for US-made capital goods rose less than expected in April, pointing to some moderation in business spending on equipment early in the second quarter, and headwinds are growing from rising interest rates and tightening financial conditions.

Orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, increased 0.3 percent last month, the Commerce Department said on Wednesday. 

Spanish April industrial prices rise 

Spanish industrial production prices rose 45 percent in the 12 months through April down from 47 percent in the 12 months period through March as energy prices increases slowed down, National Statistics Institute said on Wednesday.

The price increase slowed down for the first time since February 2021.

INE revised up the year-on-year March increase to 47 percent from a previous 46.6 percent.

German economy sees growth 

The German economy grew in the first quarter, in line with expectations, despite difficult economic conditions caused by the war in Ukraine and the pandemic, data showed on Wednesday.

Europe’s largest economy grew by 0.2 percent quarter on quarter and by 3.8 percent on the year, adjusted for price and calendar effects, the Federal Statistics Office said. A Reuters poll had forecast growth of 0.2 percent and 3.7 percent, respectively.

New Zealand raises cash rate 

New Zealand’s central bank delivered its fifth straight interest rate hike on Wednesday and signaled a much more aggressive tightening path as authorities seek to reduce the second-round effects of runaway inflation.

The Reserve Bank of New Zealand raised on Wednesday the official cash rate by 50 basis points to 2 percent, a level not seen since November 2016. Crucially, a hawkish RBNZ now projects the cash rate will double to 4.0 percent over the next year and remain there into 2024.

Although nearly all economists polled had expected the central bank to hike the cash rate by 50 basis point, its forecast cash rate track was more aggressive than most expected.

Singapore sees 2022 GDP at lower end 

Singapore’s economy expanded more than initially estimated in the first quarter but annual GDP will likely be in the lower half of the government’s forecast range, officials said on Wednesday, citing war in Ukraine and supply chain disruptions.

The Southeast Asian financial hub is often seen as a bellwether for global growth as international trade dwarfs its domestic economy.

Gross domestic product grew 3.7 percent year-on-year in the first quarter, the Ministry of Trade and Industry said, higher than the government’s advance estimate of 3.4 percent but matching analysts’ forecasts in a Reuters poll. 

The MTI maintained its 2022 GDP growth forecast at 3 percent to 5 percent, but said growth is more likely to come in at the lower half of this range, due to uncertainties stemming from the Russia-Ukraine conflict and stringent COVID-19 measures in China.

China growth outlook 

Global investment banks and ratings agencies have slashed their China 2022 GDP growth outlooks, as COVID-19 induced lockdowns and other stringent coronavirus containment measures take a heavy toll on the world’s second-largest economy.

J.P. Morgan and UBS became the latest investment banks to downgrade their Chinese growth projections for 2022 by cutting full-year GDP estimates to 3.7 percent and 3 percent from 4.3 percent and 4.2 percent, respectively, forecast earlier.

A median forecast of nine financial institutions now predicts China’s broad economy to grow 4 percent this year, marking a huge discrepancy from the government’s target of around 5.5 percent. The economy expanded 8.1 percent in 2021.

 

 

(With input from Reuters)


SABB appoints new CEO to lead corporate and institutional banking

SABB appoints new CEO to lead corporate and institutional banking
Updated 10 sec ago

SABB appoints new CEO to lead corporate and institutional banking

SABB appoints new CEO to lead corporate and institutional banking

RIYADH: The Saudi British Bank has appointed Yasser Ali Al-Barrak as its new CEO for corporate and institutional banking from this month.

The appointment of Al-Barrak will take effect on July 1, the bank said in a press statement.

Al-Barrak joined SABB in 2012 and has held many leadership positions, most recently being the general manager of global corporate and institutional banking, the statement said.

“The appointment of Yasser is a testament to the success of career growth plans at SABB, which is a major player in managing our most valuable assets, our people,” said SABB Managing Director & CEO Tony Cripps.

Established in 1978, SABB is an associate of the HSBC Group and a Saudi joint-stock company. It was named Saudi’s best bank for 2022, the statement added.

The bank provides retail, corporate, investment, private, and treasury services and has a paid-up capital of SR20.5 billion ($5.46 billion).


Crypto Moves — Bitcoin slips; Voyager Digital suspends operations

Crypto Moves — Bitcoin slips; Voyager Digital suspends operations
Updated 51 min 10 sec ago

Crypto Moves — Bitcoin slips; Voyager Digital suspends operations

Crypto Moves — Bitcoin slips; Voyager Digital suspends operations

RIYADH: Bitcoin, the leading cryptocurrency worldwide, traded lower on Sunday, falling by 0.93 percent to $19,033.92 at 9 a.m. Riyadh time.

Ethereum, the second most traded cryptocurrency, was priced at $1,057.11, rising by 1.15 percent, according to data from CoinDesk.

Voyager Digital suspends withdrawals and deposits 

To preserve its platform’s value, Voyager Digital on Friday announced it had suspended withdrawals, trading, and deposits, according to Reuters. 

A default notice was issued to embattled hedge fund Three Arrows Capital just days earlier for the fund’s failure to make required payments.

According to Voyager CEO Stephen Ehrlich, the move gives the company more time to consider strategic alternatives with various interested parties while preserving its value.

The company announced that it had hired financial advisers Moelis & Co., Consello Group, and legal advisers Kirkland & Ellis LLP “to support its exploration of strategic alternatives.”

Voyager’s crypto assets are worth $685 million, compared to the more than $1.12 billion it has lent in crypto assets. The company said it lent $350 million and 15,250 bitcoins to 3AC. 

Voyager’s move comes less than a month after Celsius Network suspended withdrawals due to extreme market conditions. Customers of Celsius have not yet been able to withdraw money again.

(With inputs from Reuters)


Saudi mall operator Abdullah Al Othaim cancels IPO plans 

Saudi mall operator Abdullah Al Othaim cancels IPO plans 
Updated 03 July 2022

Saudi mall operator Abdullah Al Othaim cancels IPO plans 

Saudi mall operator Abdullah Al Othaim cancels IPO plans 

RIYADH: Saudi Arabia’s Abdullah Al-Othaim Markets Co. has canceled plans to sell shares of its mall business to the public, the company said in a bourse filing.

The group halted initial public offering plans for Abdullah Al Othaim Investment Co. due to concerns over valuation and market volatility.

Arab News earlier reported that the group had selected GIB Capital to manage an IPO of a 30-percent stake in the Kingdom’s stock market. 

Known as Al Othaim Malls, the firm specializes in the construction, management and operation of shopping malls, entertainment centers, restaurants and cinemas.

 


OPEC secretary general Mohammad Sanusi Barkindo joins Atlantic Council 

OPEC secretary general Mohammad Sanusi Barkindo joins Atlantic Council 
Updated 03 July 2022

OPEC secretary general Mohammad Sanusi Barkindo joins Atlantic Council 

OPEC secretary general Mohammad Sanusi Barkindo joins Atlantic Council 

RIYADH: Mohammad Sanusi Barkindo, secretary general for the Organization of the Petroleum Exporting Countries, will join the Atlantic Council as a distinguished fellow in the Global Energy Center.

Barkindo will take part in the Atlantic Council after the conclusion of his term at OPEC on July 31, according to a statement. 

Serving as OPEC’s secretary general for six years, Barkindo has also played a crucial role in enhancing the cooperation between OPEC and non-OPEC countries on stabilizing oil markets. 

The fellowship at the Atlantic Council comes amid an unprecedented rise in energy prices driven by geopolitical tensions, climate change impacts, and volatile markets.

“Barkindo brings a deep understanding of geopolitics in a volatile world that will further enhance the Atlantic Council’s approach to shaping solutions to global energy-security challenges,” said Frederick Kempe, president and CEO of the Atlantic Council.

The Washington-based center promotes energy security by working alongside governments, industry leaders, civil society, and public stakeholders.

Barkindo said: “I look forward to contributing to the organization’s work on a plethora of energy-related issues, at a time when the world’s eyes are focused on both short- and long-term energy market outlooks.”

 


TASI begins July in green following a dismal June: Opening bell

TASI begins July in green following a dismal June: Opening bell
Updated 03 July 2022

TASI begins July in green following a dismal June: Opening bell

TASI begins July in green following a dismal June: Opening bell

RIYADH: Saudi stocks started their first trading session of July in green, following a dismal performance in June when the market lost 11 percent.

As of Sunday’s opening bell, TASI gained 0.60 percent to reach 11,591, while the parallel market, Nomu, added 0.17 percent to 21,622, as of 10:05 a.m. Saudi time.

This was led by a 3.03 percent gain in one of the Kingdom’s biggest lenders Saudi National Bank and a 0.26 percent gain in oil giant Aramco. 

Etihad Atheeb Telecommunication Co. gained 3.37 percent to lead the gainers, while Bupa Arabia for Cooperative Insurance Co. slipped 2.51 percent to lead the fallers.

In the financial sector, the Kingdom’s largest valued bank Al Rajhi edged up 0.85 percent, while Alinma Bank climbed 0.90 percent.

Al Moammar Information Systems Co. added 2.22 percent, after being awarded SR34 million ($9 million) by Saudi Co. for Comprehensive Technical and Security Control as well as SR21.9 million by King Abdulaziz City for Science and Technology.

Abdullah Al Othaim Markets Co. edged down 0.19 percent, after reporting that it canceled the initial public offering plans for its malls unit.

Oil prices closed Friday with US West Texas Intermediate crude at $108.43 per barrel and Brent crude at $111.63 per barrel.