Aurelia Butler

Lending in the euro zone has come to a standstill as the ECB embarked to its longest and steepest ever series of interest rate hikes in a bid to bring down high inflation.Lane said he remained confident the euro zone’s economy could avoid a credit crunch as companies were not bracing for a recession. “We remain fairly optimistic that this is not that type of episode,” he told an event in Ireland. “And so the soft landing scenario, we think (there is) still a good case for it.”Inflation in the euro zone is falling fast and the economy has begun contracting, data showed this week.Combined with a collapse in credit creation, this meant the ECB had almost certainly finished raising its key rate, which is at a record high of 4%.Commenting on market expectations for the ECB to cut that rate next year, Lane said 4% was “not a forever rate” and it was “not normal”.Speaking earlier on Thursday, ECB policymaker Klaas Knot described the current level of rates as “a good ‘cruising altitude’ where they can remain for some time”.Lane said signs that wage growth for new hires was slowing, as shown by the Indeed Wage Tracker, boded well for inflation to come back to the ECB’s 2% target by 2025.But he warned about a new “energy shock” aggravated by war in the Middle East.”A benign momentum dynamic (in energy inflation) reversed in the last few months,” Lane said. “We have a new energy shock, oil prices have gone up quite a bit, gas prices have gone up quite a bit and now that’s interacting with the war.” More

The decision was taken by six out of nine members of the rate-setting committee, who saw signs of a weakening economy and easing inflation pressures. Inflation was recorded at 6.7 percent in September, triggering the necessity for a sustained restrictive monetary policy to tackle what the committee described as “more deeply embedded inflation persistence”.Governor Andrew Bailey acknowledged the efficacy of current rates in reducing inflation but emphasized that it must hit their 2 percent targets. The bank’s outlook anticipates economic stagnation over the next two years, with inflation projected to be slightly higher than previously forecasted in 2024 and 2025. It is expected to decelerate to 3.4 percent by the end of next year.Despite the economic downturn, three committee members noted growing household incomes and positive economic output indicators, proposing a quarter-point rate hike. This proposal came after a previous meeting where five members voted to hold rates.This article was generated with the support of AI and reviewed by an editor. For more information see our T&C. More

That helped the company, one of the largest electricity producers in the United States, to cushion the impact of soaring costs driven by higher interest rates.Operating earnings in its transmission and distribution unit, which includes Ohio Power, rose to $206 million for the quarter, from $165 million last year. The company had filed for a rate case increase in Ohio earlier this year that went into effect in June. A rate case is the formal process used to determine what customers need to pay for the electricity, natural gas, private water and steam services provided by regulated utilities. Its sales volumes declined, however, due to storms in certain territories such as Michigan and Tennessee. “We’ve added nearly 30,000 new residential customers in our service territory this year, which has helped offset lower average usage in the residential segment,” said CEO Julie Sloat. The Columbus, Ohio-based company reported an adjusted profit of $1.77 per share for the quarter ended Sept. 30, beating analysts’ average estimate of $1.70 per share, according to LSEG data.The utility firm narrowed its full-year adjusted operating earnings forecast to between $5.24 and $5.34 per share, from an earlier outlook of $5.19 to $5.39. More

CEO Rajesh Kumar highlighted the overall financial stability but pointed out room for improved financial inclusion. This comes as new account originations increased among semi-urban and rural consumers, as well as younger age groups between 18 and 30 years old. Conversely, there was a 4% decrease in new-to-credit consumers.Small-ticket personal loans of less than Rs 50,000 have been closely monitored due to their potential as an indicator of financial stress. Accounting for approximately 25% of total origination volumes since January 2022, these loans have seen an uptick among credit-active consumers, particularly those with more than four credit products.The report also noted a decline in balance-level serious delinquencies for credit cards and personal loans. However, early vintage delinquency trends on consumption loan products saw an increase in the fourth quarter of 2022 compared to 2019. This underscored the need for robust underwriting processes and credit risk management to maintain the health of the retail credit market.This article was generated with the support of AI and reviewed by an editor. For more information see our T&C. More

Malaysia is long known to be a manufacturing hub, and is now hoping to move up the value chain on well-established industries such as energy and electricals. “We need to look at the right kind of investment. Because some of the investment does not bring in the kind of spillover that we want,” Tengku Zafrul Aziz told Reuters in an interview.Malaysia is eyeing new areas such as carbon capture, usage and storage because it has a lot of oil wells, and supplying components for electric vehicles (EVs), Tengku Zafrul said. EVs are a “natural progression” for Malaysia, which has an established electrical and electronics industry, especially in semiconductor chips, he said.”That’s why we are pushing very hard because we supply many of the components to the car,” Tengku Zafrul said. Each electric vehicle is estimated to have over 1,400 chips. Even in the semiconductor industry, Malaysia wants to develop beyond assembly and testing, he said. The country is a major player in the semiconductor industry, accounting for about 13% of global testing and packaging. “We want to move to front end, which is integrated circuit design and wafer fabrication,” he said. Malaysia is also eyeing the aerospace, petrochemicals, digital economy and pharmaceutical industries for foreign investments.Tengku Zafrul said he will be meeting with potential investors in the United States next week, ahead of meetings with leaders of the Asia-Pacific Economic Cooperation (APEC). More

Stay informed with free updatesSimply sign up to the More