Aurelia Butler

Hello and welcome to the working week.September is the month when the hopes raised by a restful summer break, at least for those in the northern hemisphere, can be dashed by the disappointments of the turn in the weather and darker days ahead. So it could prove this week with the news agenda.Apple hopes that the shine on its latest product launch event this week will not be scuffed by the party poopers in Beijing, who have cracked down on government officials’ iPhone use. The buzz surrounding the iPhone 15, to be unveiled on Tuesday, was meant to help Apple finally unseat Samsung as the world’s largest handset maker. However, China generates about a fifth of the iPhone maker’s revenue.The key economic event of this week will be the European Central Bank’s interest rate decision on Thursday, which is on a knife-edge. Eurozone inflation, at 5.3 per cent, is too far off the ECB’s 2 per cent target for the central bankers to halt rate rises, especially with oil prices on the up and wages rising rapidly. However, recent data pointing to a sharp economic downturn could tip the balance towards a pause this time.Clothes retail is a theme this week among the earnings reports with heavyweights H&M and Inditex. Will the late summer sun raise a smile or have these high street bellwethers got burnt? If these market leaders cannot beat the post holiday blues we might as well all shut up shop.We are also heading into a series of significant anniversaries. Monday marks 50 years since the coup in Chile that brought General Augusto Pinochet to power and 22 years since the US 9/11 attacks.However, Monday’s National Day celebrations in Catalonia, a focus for independence rallies, will be of particular concern for Madrid’s politicians this week because of the hardline separatist party Together for Catalonia’s kingmaker role in the formation of Spain’s next government. Junts, as the party is known in Catalan, wants to use its sway to secure wider official use of the region’s language and, more controversially, an amnesty for people facing criminal charges over the last push for independence. Spain’s acting prime minister Pedro Sánchez would no doubt welcome an autumnal cooling of temperatures this week, at least in the emotionally charged political debate.What is your priority for the Week Ahead? Email me at [email protected] or if you have received this in your inbox, hit reply.One more thing . . . The Moules family, like many others, was focused on the return to school last week, with one young member starting A level studies and another preparing for GCSE exams. You can help get your kids’ year off to an excellent start by asking your school or secondary education college to sign up for free access to the FT for students aged 16-19 and teachers. Apply here for a free online subscription. Also, sign up for the Schools Digest newsletter, featuring subject-specific articles selected by our teacher advisers. If you’re a teacher and want to suggest articles/essay questions, please email [email protected] economic and company reportsHere is a more complete list of what to expect in terms of company reports and economic data this week.MondayEU: European Commission’s summer interim economic forecastUK: Bank of England chief economist Huw Pill speaks at the Kent Invicta Chamber of CommerceResults: Oracle Q1, Vistry Group H1TuesdayApple holds its annual media event to launch new products in CupertinoOpec September Oil Market ReportGermany: Zew Economic Sentiment ReportUK: September employment dataResults: Associated British Foods trading update, Fever-Tree Drinks FY, IQE H1, The Gym Group H1, Wickes H1WednesdayIEA September Oil Market ReportEU: monthly industrial production figuresUK: revised July GDP figureUS: September consumer price index (CPI) inflation rate dataResults: Inditex H1, Redrow FY, Tullow Oil H1ThursdayEU: European Central Bank interest rate announcementUK: RICS House Price BalanceUS: August retail sales figuresResults: Adobe Q3, IG Group Q1 trading update, John Lewis Partnership H1, Kier Group FY, M&C Saatchi H1, THG H1, Trainline H1 trading updateFridayNovartis holds extraordinary shareholders meeting to vote on Sandoz spin-offRupert Soames becomes chair of medical technology company Smith+Nephew, succeeding Roberto Quarta.China: August retail sales and industrial production figuresFrance: September CPI and harmonised index of consumer prices (HICP) inflation rate dataUK: August insolvency statistics for England and WalesUS: August industrial production figures plus September University of Michigan consumer sentiment surveyResults: H&M Q3 sales updateWorld eventsFinally, here is a rundown of other events and milestones this week. MondayBangladesh: French president Emmanuel Macron arrives in Dhaka for a state visit, after attending the G20 summit in New DelhiChile: 50th anniversary of military coup that ousted President Salvador Allende and put general Augusto Pinochet in powerNorway: local electionsSpain: National Day of CataloniaUK: TUC Congress for trade union leaders continues in LiverpoolUS: 22nd anniversary of the 9/11 attacks on the USTuesdayUK: Scotland vs England 150th anniversary match between the two football sides, recognised by Fifa as the world’s oldest international, at Hampden ParkWednesdayEU: European Commission president Ursula von der Leyen delivers her 2023 EU State of the Union address at the European parliament in StrasbourgThursdayUK: 60th anniversary of Northern Irish footballer George Best making his debut for Manchester United, as a 17-year-old at Old TraffordFridayRosh Hashana celebrations begin this evening to mark the Jewish New YearFrance: French air traffic controllers begin nationwide strike over inflation and wages revaluation. The walkout is expected to cause flight chaos amid the Rugby World Cup tournament, and could affect flights departing from other countries that cross French airspaceUK: London Fashion Week beginsSaturdayGermany: the 188th annual Oktoberfest, Bavarian beer festival and funfair begins in MunichUK: start of the 21st London Design Festival, an annual citywide showcase that includes architecture, furniture, graphic design, multimedia technology, fashion and fine art.SundayAustralia: Philip Lowe steps down as Reserve Bank of Australia governor. He will be succeeded by Michele Bullock following her appointment by Treasurer Jim Chalmers in JulySpain: 78th La Vuelta a España, aka Tour of Spain, cycling race finishes in Madrid More

Italy’s prime minister Giorgia Meloni has said Rome wants to forge stronger ties with China, even as it considers pulling out of Beijing’s controversial Belt & Road Initiative in the coming months.“The issue is how to ensure a partnership that can be mutually beneficial, regardless of the choices we make on the BRI,” Meloni said in a press conference on Sunday in New Delhi, at the end of the G20 summit.Meloni met Chinese Premier Li Qiang on the margins of the summit to discuss the future of Italian-Chinese relations, as her government reconsiders Italy’s participation in President Xi Jinping’s flagship foreign policy initiative.Italy’s 2019 decision to sign-up to the BRI — the only G7 nation to have joined the Chinese trade and infrastructure scheme — dismayed Rome’s western allies, especially Washington, and Meloni has in the past called the move, which was made by a previous government, “a mistake”. Italian officials say Rome is now seeking to extricate itself from BRI without provoking Chinese wrath or retaliation, and to find alternative ways to deepen economic ties. Meloni signalled her government’s intent to recalibrate relations with Beijing in June, when it restricted Chinese chemical giant Sinochem’s shareholder rights in the Milan-listed tyremaker Pirelli, citing national security concerns. Meloni noted the “friendly and constructive atmosphere” of her weekend talks with Li, saying several European countries that never joined the BRI had nevertheless “managed to forge more beneficial relationships with China than we did”.She reiterated her intent to visit China, but said dates would not be fixed until the countries had reached an understanding on their bilateral co-operation and “how to strengthen it”. China’s state news agency Xinhua said Li had told Meloni that Beijing hoped Italy would “provide a fair, just and non-discriminatory business environment for Chinese companies”. The report made no specific mention of Pirelli. China has been trying to persuade Italy not to pull out of the BRI, with foreign minister Wang Yi telling his visiting Italian counterpart Antonio Tajani last week that over the past five years their bilateral trade had increased to nearly $80bn from $50bn.Wang also told Tajanai that “China and Italy should adhere to the right way of getting along with each other”, with mutual respect and trust, despite geopolitical tensions, Xinhua reported. In an article on Tajani’s visit, the state-run China Daily quoted an analyst blaming the US for pressuring Italy to withdraw from the BRI. Italy’s BRI membership will be automatically renewed for five years in 2024, unless Rome formally notifies Beijing of its intent to pull out in the coming months. Michele Geraci, who as a former under-secretary in Italy’s ministry of economic development advocated for Rome’s joining up to the BRI, has publicly argued that Meloni’s government has no real strategy to deal with Beijing and that Italian companies and citizens who work with China would pay a heavy price if Rome pulls out of the programme.Meanwhile, EU council president Charles Michel, who met with Li separately in New Delhi, said afterwards that there was a “shared interest” in holding a EU-China summit before the end of this year, but that “high-level sectoral dialogues” were necessary to prepare for it.Additional reporting by Henry Foy in New Delhi More

The National Administration of Financial Regulation (NAFR)said on its website that the risk weighting for CSI300 Index constituents would be reduced to 0.3 from 0.35, while that for stocks listed on Shanghai’s tech-focused STAR Market would be cut to 0.4, from 0.45.A lower risk weighting frees up more capital for insurers to invest. In addition, the watchdog reduced the risk weighting it assigns to investments in Real Estate Investment Trusts (REITs), which in China channel money mainly into infrastructure projects.It also set a relatively low risk weighting for private equity investments in China’s strategic and emerging sectors.China has unveiled a slew of measures to boost investor confidence and revive its stock market. They include halving stamp duty on stock trading and slowing the pace of initial public offerings (IPOs). More

NEW DELHI (Reuters) -The G20 summit in New Delhi ended on Sunday as India handed over the bloc presidency to Brazil, while both the U.S. and Russia praised a consensus that did not condemn Moscow for the war in Ukraine but called on members to shun the use of force.Indian Prime Minister Narendra Modi asked the group’s leaders to hold a virtual meeting in November to review progress on policy suggestions and goals announced at the weekend.”It is our responsibility to look at the suggestions that have been made to see how progress can be accelerated,” he said in a statement.On Saturday, the group adopted a Leaders’ Declaration that avoided condemning Russia for the war but highlighted the human suffering the conflict had caused and called on all states not to use force to grab territory. The consensus came as a surprise. In the weeks leading to the summit, sharply differing views on the war had threatened to derail the meeting, with Western nations demanding members call out Moscow for the invasion and Russia saying it would block any resolution that did not reflect its position.Foreign Minister Sergei Lavrov, the head of the Russian delegation, said the summit was a success for India as well as the Global South, the world’s developing countries.The Global South’s position in the talks helped prevent the G20 agenda from being overshadowed by Ukraine, he told a press conference. “India has truly consolidated G20 members from the Global South.”White House national security adviser Jake Sullivan told reporters the summit declaration “does a very good job of standing up for the principle that states cannot use force to seek territorial acquisition or to violate the territorial integrity and sovereignty or political independence of other states”.Germany and Britain have also praised the resolution, but Ukraine said “it was nothing to be proud of”.French President Emmanuel Macron said on Sunday that the G20, which was founded to solve international economic issues, was not necessarily the place to expect diplomatic progress on the war in Ukraine.However, he said the G20 declaration was not a diplomatic victory for Russia.”This G20 confirms once again the isolation of Russia. Today, an overwhelming majority of G20 members condemn the war in Ukraine and its impact,” Macron told a press conference after the closing ceremony of the summit.Japan’s Prime Minister Fumio Kishida said: “Russia’s invasion of Ukraine is something that could shake the foundation of cooperation at G20.”Also, that is having a major impact on the global economy through such developments as continued increases in food and energy prices.” Russia’s 2022 invasion of Ukraine has left tens of thousands dead, displaced millions and sown economic turmoil across the world. Moscow, which says it is conducting a “special military operation” there, denies committing any atrocities. WALKING BAREFOOTThe summit also admitted the African Union, which includes 55 member states, as a permanent member of the G20, underlining the bloc’s inclusivity of more developing countries.Addressing food security concerns, Lavrov said Russia would return to the Black Sea (NYSE:SE) deal that lets Ukraine export grain if Moscow’s demands were met. Moscow pulled out of the agreement in July over what it called a failure to meet its demands to implement a parallel agreement easing rules for its own food and fertiliser export.The summit document had called for the safe flow of grain, food and fertiliser from both Ukraine and Russia.Russia, Ukraine and Turkey are going to continue to discuss the grain deal, Turkish President Tayyip Erdogan said, saying that reviving the agreement was “not hopeless”. On Sunday, world leaders, including U.S. President Joe Biden, German Olaf Scholz, British Prime Minister Rishi Sunak, French President Emmanuel Macron and Japan’s Fumio Kishida, visited the memorial of Indian independence hero Mahatma Gandhi.Most of the leaders were barefoot as they walked to the site where Gandhi was cremated following his assassination in 1948 by a Hindu extremist. Biden later left for Vietnam, missing the last session of the summit. The White House said it was not aware of him having any talks with Lavrov or Chinese Premier Li Qiang, who led their country’s delegations at the summit.Chinese President Xi Jinping and Russia’s Vladimir Putin both skipped the summit.”This was one of the most difficult G20 summits in the almost twenty-year history of the forum … it took almost 20 days to agree on the declaration before the summit and five days here on the spot,” Svetlana Lukash, the Russian G20 government negotiator, was quoted as saying by Russian news agency Interfax.”This was not only due to some disagreements on the Ukraine subject, but also due to differences in positions on all key issues, primarily the issues of climate change and the transition to low-carbon energy systems…”A European Union official, who did not want to be identified, said on Sunday the Ukraine war was the most contentious issue in the negotiations.”Without India’s leadership it would not have been possible,” the official said, adding that Brazil and South Africa also played a crucial role in bridging differences. 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NEW DELHI (Reuters) – Leaders of the world’s 20 big economies ended a summit in the Indian capital on Sunday overcoming deep divisions over the war in Ukraine to produce a consensus document and move forward on issues such overhauling institutions like the World Bank. They also formally admitted the African Union to the bloc to make the grouping more representative. SOFTER LANGUAGE ON UKRAINE WAR G20 nations agreed that states cannot grab territory by force and highlighted the suffering of the people of Ukraine, but avoided direct criticism of Russia for the war. The declaration was seen as an apparent softening from the position that the G20 took last year when it condemned Russia for the war and demanded that it withdraw from Ukraine. Diplomats said Russia would never have accepted an outright condemnation and that it was still a successful outcome because everyone including Russia committed themselves to not seizing territory by force. Host India along with Brazil, Indonesia and South Africa, played a key role in avoiding a fracturing of the G20 over the Ukraine conflict, officials said, reflecting the growing power of the Global South developing nations in the group. AFRICAN UNION INSIDE THE CLUBThe 55-member African Union was formally made permanent member of the G20, on par with the European Union, in order to make the grouping more representative. Until now only South Africa was a member of the G20. The entry of the AU would provide greater voice to the Global South within the G20 where the G7 countries have long played a dominant role. The move also came after the BRICs, another group dominated by China and Russia, was expanded to include Saudi Arabia and Iran among other nations which was seen as an attempt by Beijing to make it a possible alternate to the G20.U.S., SAUDI, INDIA JOIN HANDS FOR TRANSPORT CORRIDORLeaders of the United States, India and Saudi Arabia among others announced plans to set up rail and ports links between the Middle East and South Asia and eventually to Europe which U.S. President Joe Biden said was a “real big deal.”The Biden administration is seeking to counter China’s Belt and Road push on global infrastructure by pitching Washington as an alternative partner and investor for developing countries at the G20 grouping.But there were no details about financing or a time frame for the project that involved laying down railway lines in the Middle East and then connecting them to India by port.INCREMENTAL PROGRESS ON CLIMATE CHANGE The G20 leaders agreed to pursue tripling renewable energy capacity globally by 2030 and accepted the need to phase-down unabated coal power, but stopped short of setting major climate goals. The group did not provide any plan to amend existing policies and targets in order to achieve the target of ramping of renewables. It also said $4 trillion a year would be needed to pay for a green energy transition but did not lay out any pathway to it. The deliberations of the G20 were being closely watched ahead of the COP28 U.N climate summit in the United Arab Emirates later this year. MODI BOOSTS STANDING AS INDIA’S BIG MOMENT ARRIVES For Indian Prime Minister Narendra Modi, the leadership of the G20 has been a year-long opportunity to showcase India as an influential diplomatic and economic power, and drive investment and trade flows into the world’s most populous country. It has also provided him a platform to boost his standing at home as he seeks a third term in office in elections in the next several months. Modi’s image has been on G20 billboards across the capital and in the vast and swanky new conference venue. To his supporters the successful outcome of the summit showed India’s big moment had arrived. More

For the first time in more than a year, the European Central Bank’s decision of whether to raise interest rates at its meeting on Thursday is resting on a knife-edge.Having already raised its benchmark deposit rate from minus 0.5 per cent last summer to 3.75 per cent as it tackled the biggest surge in inflation for a generation, the ECB now seems to be approaching the peak of its policy tightening.Investors’ doubts over whether the central bank will raise interest rates for the 10th consecutive time have intensified amid widespread signs of an impending economic downturn, including weaker business confidence and falling German industrial production.The ECB will also publish new quarterly forecasts after its meeting on Thursday, which most economists expect to include a weaker outlook for growth and a slight increase to its inflation expectations for this year and next year.“As forward looking growth data has been identified as having disappointed lately, we expect this to be sufficient to justify staying on hold next week,” said Peter Schaffrik, global macro strategist at RBC Capital Markets.Derivatives markets are pricing about a 35 per cent chance of the ECB raising its deposit rate to 4 per cent on September 14.However, with eurozone inflation of 5.3 per cent in August still running well above the ECB’s 2 per cent target, there are many economists who believe another — and almost certainly final — rate rise is still possible.“It is a very close call, but still too high inflation, a focus on actual rather than on predicted developments, and the fear of stopping prematurely will tilt the balance towards a final rate hike,” said Carsten Brzeski, global head of macro research at ING. Martin ArnoldDid US inflation accelerate in August? US headline inflation is expected to have jumped in August, with core inflation nevertheless slowing, which could add to the pressure on the Federal Reserve to keep interest rates higher for longer. The Bureau of Labor Statistics on Wednesday releases the latest inflation data, with economists polled by Bloomberg forecasting a year-on-year rate of 3.6 per cent. That would mark an increase in the headline figure from 3.2 per cent in July, and the highest level since May. The acceleration is expected to be in part due to higher energy prices, Barclays analysts argue, with core inflation — which strips out the volatile food and energy sectors — expected to have slowed to 4.3 per cent in August, from 4.7 per cent in July. The core monthly rate is expected to be steady at 0.2 per cent. The acceleration in the headline yearly figure is also attributable to less favourable base effects — headline inflation peaked in June last year, and the year-over-year rates for June and July this year reflected a change from the very strong numbers in the middle of last summer. Barclays analysts argue that a CPI release in line with their expectations — 3.7 per cent headline and 4.3 per cent core — would align with another 0.25 percentage point increase in interest rates from the Fed. Positioning in the futures market suggests that investors more broadly do not expect the Fed to raise interest rates at the bank’s September meeting and see a roughly 50 per cent chance of another increase by November. Kate DuguidWill UK wage growth ease?Investors will scrutinise UK labour market data after Bank of England governor Andrew Bailey this week signalled the central bank may not deliver any more rate rises, despite market expectations of two more 0.25 percentage point increases. Economists polled by Reuters expect annual pay growth to have eased to 7.6 per cent, which would provide the Bank of England with some breathing space after figures last month showed that annual pay growth excluding bonuses had hit a record high in the three months to June at 7.8 per cent. The Bank of England’s Monetary Policy Committee watches wages growth closely for signs of persistent price pressures, and monitors the overall tightness of the labour market. Speaking to the Treasury select committee on Wednesday Bailey acknowledged that so far wage rises had been faster than the committee had anticipated but added this might soon change. Markets are currently pricing in an 80 per cent probability that the Bank of England will deliver a 0.25 percentage point rate increase on September 21 to 5.5 per cent. If wages data are weak, analysts say that would make a further rate increase less likely. Mary McDougall More

Headline inflation in July was 36.5% and in June 35.7%, both also all-time highs.High money supply growth over the last two years has led prices to climb rapidly and triggered three devaluations since March 2022. Many Egyptians have seen their living standards slide.Core inflation, which strips out volatile items like food and fuel, eased slightly to 40.4% from 40.7% in July and 41% in June, the central bank said.Month-on-month, prices rose 1.6% in August, down from 1.9% in July and 2.08% in June, CAPMAS said.Analysts said the gradual month-on-month decline could be a positive sign. “It is tentatively a sign that prices are consolidating at these levels,” said Allen Sandeep at Naeem Brokerage.These included a 21.6% month-on-month increase in vegetable prices and a 5.8% increase in tobacco product prices, while meat fell 2.5% and bread and cereals 1.1%, according to analysts.The median forecast of 14 analysts polled last week had shown annual urban consumer inflation rising to 37.1% in August. The previous high of 32.95% was recorded in July 2017. More