September, 2018

• 4 September

  We may be facing textbook emerging-market crisis

  

  Emerging-market stresses have been building since at least 2013. Investors may have forgotten the effect of the ‘taper tantrum’ on the so-called Fragile Five – Brazil, India, Indonesia, Turkey and South Africa – a term coined by Morgan Stanley to describe their vulnerability to capital outflows. Monetary accommodation, lower current-account deficits and growth disguised the underlying challenges, attracting more capital ...

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• 4 September

  China’s SUV makers steer towards trouble

  

  Unlike their American peers’ unceasing love for gas guzzlers, Chinese consumers are getting over them. The country’s carmakers should recalibrate. Auto stocks have been the worst-performing sector in China as sales slide and foreign carmakers stake claims to a bigger share of the world’s largest market. Earnings last week didn’t give investors too much to bet on. Sales of Chinese ...

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• 4 September

  Prediction markets look smarter than peer review

  

  When they’re asked to make bets, social scientists have a surprising knack for predicting which of their colleagues’ papers are full of baloney. This is in contrast to the notoriously bad job social scientists have apparently been doing evaluating papers through traditional peer review. In a series of attempts to test the health of the field, a high proportion of ...

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• 4 September

  Bank Indonesia to beef up tools in battle to save rupiah

  

  Bloomberg Indonesia’s central bank is intensifying its fight to protect the nation’s currency and bonds with a slew of measures that includes more hedging tools. Bank Indonesia plans to soon introduce overnight index swaps and interest-rate swaps to widen its pool of hedging tools for investors, exporters and banks. The central bank will also start offering a one-month tenor foreign-exchange ...

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• 4 September

  Australia holds key rate as sliding currency stimulates growth

  

  Bloomberg Australia kept interest rates at a record low on Tuesday, as it has for the past two years, while a currency sliding towards 70 US cents offers the prospect of additional stimulus for the economy. As expected, Reserve Bank Governor Philip Lowe left the cash rate at 1.5 percent, a stance he expects will eventually tighten the labour market ...

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• 4 September

  ING to pay $900 million to end Dutch money-laundering probe

  

  Bloomberg ING Groep NV agreed to pay 775 million euros ($900 million) to settle an investigation by the Dutch prosecutor into issues including money laundering and corrupt practices in one of the biggest fines ever given to the country’s banks in a criminal case. The lender acknowledged “serious shortcomings” in executing customer due diligence policies to prevent financial crime at ...

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• 4 September

  Lloyds to slim down commercial-banking arm to reduce costs

  

  Bloomberg Lloyds Banking Group Plc is planning to reorganise its commercial bank and eliminate some senior management positions to cut costs at one of its biggest divisions, people with knowledge of the company’s plans said. David Oldfield, a veteran at the bank and head of the commercial unit since last year, is leading the push to simplify the structure and ...

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• 4 September

  Sabadell’s UK TSB chief Pester exits after IT meltdown

  Bloomberg The chief executive officer of Banco de Sabadell SA’s British unit is leaving as the lender continues to struggle with the meltdown of its IT system earlier this year. Paul Pester will step down after seven years with the UK arm, known as TSB Banking Group. Richard Meddings, the current non-executive chairman of TSB, temporarily takes on an executive ...

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• 4 September

  It’s tough to make money in India, says airline group

  

  Bloomberg India may be the world’s fastest growing major aviation market, but it is difficult for airlines to make money as excessive taxes and poor infrastructure choke the industry, according to the International Air Transport Association. While jet fuel accounts for about 24 percent of a carrier’s average costs globally, it is 34 percent in India, making domestic airlines even ...

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• 4 September

  UK consumers plan to spend less, says report

  

  Bloomberg Britons are planning to rein in their spending after splurging during the summer heatwave. With worries growing over rising prices and higher interest rates, a third of consumers say they intend to spend less, Barclaycard said in a report published on Tuesday. The warning comes after households made the most of the sweltering summer months, with the value of ...

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