Aurelia Butler

China’s key activity indicators showed the economy unexpectedly slowed in July, raising the heat on policymakers to ramp up measures to cope with headwinds including a resurgence of local COVID-19 cases and a slowing global economy.China will consolidate its economic recovery and keep economic operations within a reasonable range, state media quoted the cabinet as saying after a regular meeting chaired by Premier Li Keqiang.”At present, the economy continues to recover its development trend, but there are still small fluctuations,” the cabinet was quoted as saying.”It is necessary to strengthen targeted financial and monetary policies to support the real economy, further consolidate the foundation of economic recovery, maintain the economic operation within a reasonable range,” it said.Policy insiders and analysts told Reuters that China’s central bank (PBOC) is set to take more easing steps, though it faces limited room to manoeuvre due to worries over rising inflation and capital flight.China is widely expected to lower its benchmark lending rates on Monday, a Reuters survey showed.China will improve its market-based interest rate regime and support a rebound in effective credit demand, the cabinet said, adding that authorities will lower financing costs for enterprises and credit costs for consumers.It also said China would extend an exemption of purchase taxes on “new energy” vehicles to the end of 2023 as part of the measures to boost domestic consumption. More

LONDON (Reuters) – The U.S. dollar index surged on Friday and was on track for its biggest weekly gain since April 2020 on safe-haven demand, as investors worried about a further economic slowdown after Federal Reserve officials reiterated the need for higher rates. The dollar index rose 0.5% to 108.01, its highest since July 15. The gauge is on track for a 2.2% rally this week, which would be its best weekly performance in more than two years. Sterling tumbled 1% to $1.1839 on the day and was set for its biggest weekly decline against the dollar since September 2020, as worries around Britain’s economic slowdown intensified.The euro, down 0.4% to $1.0053, was on course to decline 2% since last Friday, which would be its worst week since July 8. “The U.S. dollar is again on the front foot this morning supported by another round of hawkish Fed speak … the overall tone of Fed officials suggests that the Fed still has a lot of work to do to contain inflation,” said Jane Foley, head of FX strategy at Rabobank in London. St. Louis Fed President James Bullard, San Francisco Fed colleague Mary Daly and Kansas City Fed President Esther George all said continuing to hike rates in a bid to fight inflation would be reasonable.Weakening Chinese data this week and an energy crisis in Europe are raising fears of further economic slowdown, which have also hit European currencies and supported safe-haven flows, Foley added. “We expect another break below parity,” she said. [FRX/]British consumer sentiment in August fell to its lowest since at least 1974, a survey showed, as households feel “a sense of exasperation” about soaring costs as inflation hit double digits.INFLATION WORRIES Official data also showed Britain borrowed more than expected in July, underscoring the challenge facing the country’s next prime minister over how to provide more support to consumers.Money markets now expect the Bank of England to raise interest rates to almost 4% by March. [IRPR]European Central Bank board member Isabel Schnabel fueled inflation worries by saying consumer prices could still accelerate in the short term. Yet despite the Fed chorus on the need for higher rates, the odds of another supersized 75 basis point hike next month have receded to 45% in money markets.Fed Chair Jerome Powell will update the market on his views at the annual Jackson Hole symposium on Aug. 25-27.Against Asian currencies, the greenback was up 0.8% to 137.02 yen, after touching its highest since July 27. China’s yuan slipped to its lowest since September 2020 at 6.8168 per dollar in onshore trading after the central bank set a much-weakened midpoint guidance, with traders expecting further downside due to an economic slowdown.In cryptocurrencies, bitcoin fell 8.7% to $21,437. Ether was down 7.75% to $1,700. “Weakness has seeped into the crypto sphere as speculators retreated from highly risky assets amid expectation that higher interest rates were set to linger for much longer,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown. More

The Sept. 15 summit, dubbed “United We Stand,” will bring together officials, faith leaders and civil rights groups and feature a keynote speech by Biden, who will put forward a shared vision for a more united America, White House Press Secretary Karine Jean-Pierre said in a statement. “Even as our nation has endured a disturbing series of hate-fueled attacks, from Oak Creek to Pittsburgh, from El Paso to Poway, from Atlanta to Buffalo, Americans remain overwhelmingly united in their opposition to such violence,” Jean-Pierre said. Biden, a Democrat, is seeking to highlight his recent legislative wins, including a gun safety law he signed in June, ahead of November midterm congressional elections.Most forecasters give Republicans a strong chance of taking the House and see the Democrat-controlled Senate as up for grabs. Republican control of one or both chambers could thwart much of Biden’s legislative agenda for the second half of his four-year term. More

Benchmarks are used by asset managers to pick investments for clients, helping to channel millions of euros into sustainable funds and projects, but the criteria behind them vary widely, leading to claims of “greenwashing”.The absence of clear labelling “raises questions on the inclusion of firms with a negative environmental or social impact in these benchmarks,” the European Securities and Markets Authority (ESMA) said in a statement on Friday.ESMA was responding to a public consultation from the EU’s executive European Commission on updating rules for benchmarks.Specifying minimum methodology standards should underpin an EU quality label, ESMA said.”Further, ESMA believes that the introduction of an EU ESG benchmark label would be an extra supporting tool against greenwashing.”Compilers of ESG benchmarks based outside the EU should comply with EU rules and supervision if they want investors inside the bloc to use them, in order to minimise the risk of greenwashing and regulatory arbitrage, the watchdog said.The commission is expected to set out proposed changes to the rules in due course, which would likely need approval from the European Parliament and EU states. More