Aurelia Butler

“Ships sailing under an aggressor flag will have no place in the Klaipeda port,” Lithuanian Transport Minister Marius Skuodis told BNS, referring to the country’s main port.The ban would affect ships sailing under Russian flag or with any other connections to Russia, its people or companies, BNS reported. More

MOSCOW (Reuters) – Russia’s Central Bank Governor Elvira Nabiullina said Russia’s economy had come up against an extreme situation, something she said they had all hoped would not happen, in an video address to the bank’s staff aired on Wednesday.Nabiullina said the bank was doing everything possible to help Russia’s financial system and central bank cope with any shocks. More

Moscow is blocking foreign investors, who hold tens of billions of dollars worth of Russian stocks and bonds, from exiting after its invasion of Ukraine triggered a wave of economic sanctions and a haemorrhage of assets.The Bank of Russia said on Wednesday it had banned coupon payments for foreign investors holding rouble-denominated sovereign debt, known as OFZs, and Russian companies were also barred from paying dividends to overseas shareholders. It did not specify how long the curbs, which don’t apply to local investors, would last.”They have no problem with paying OFZs because they can print roubles, but they seem to have decided that foreigners won’t get the money,” said Paul McNamara, investment director at asset manager GAM Investments.”We can argue the toss about whether that is a default or not, but it doesn’t really matter because this stuff is under Russian law so they can pay them if they want to or not pay them if they can’t.”Russia was due to pay a 6.5% coupon on Wednesday on an OFZ due to mature in February 2024 while the next payment on hard currency debt, coupons on two Eurobonds, is due on March 16.Major asset managers such as Vanguard, BlackRock (NYSE:BLK), Ashmore and Fidelity held the February 2024 bond, according to data from the Refinitiv eMaxx database, based on filings for the end of January.Russian banks and companies had $391 billion in outstanding external debt as of Oct 1, according to Dmitry Polevoy, head of investment at Locko-Invest. “Issuers are eligible to take decisions on paying dividends and making payments on other securities,” the central bank said in a statement on Wednesday. “But actual payments … towards foreign clients will not be made. This applies to OFZs as well.”The National Settlement Depositary (NSD), the Russian system for overseeing the sale of securities, said it was limiting payment options on Russian securities for foreign individuals and companies, as well as a right to transfer such assets, in line with a central bank request.The world’s biggest settlement systems, Euroclear and Clearstream, are no longer accepting Russian assets, effectively shutting off an exit route for overseas investors.Belgium-based Euroclear said in a note on Tuesday that the NSD had blocked its accounts as a result of the central bank measures.”To the extent legally permissible, you should wire out any remaining long balances in roubles as soon as possible,” it said.Clearstream also informed its customers on Tuesday evening that the NSD has blocked all securities held on Clearstream Banking’s FNH Account until further notice.Foreigners held around 3 trillion roubles ($28 billion) worth of OFZs out of a total market of 15.5 trillion roubles, according to central bank data, and nearly $20 billion, or 51%, in sovereign Eurobonds. Foreigners held 19.7 trillion roubles in Russian shares as of July, 1, or around a third of the total market capitalisation at that time. Moscow has kept the stock market shut this week to help stem losses.In a matter of weeks, Russia has gone from a lucrative, oil-rich investment destination to a financial pariah. The rouble has plunged to record lows, and in London, depository receipts for Russia’s biggest bank Sberbank and gas giant Gazprom (MCX:GAZP), once Moscow’s top blue chips, have lost over 90% of their value.($1 = 108.6820 roubles) More

UK house prices rose again in February, defying higher mortgage rates and surging inflation to increase the most in cash terms since 1991.The Nationwide House Price Index climbed at an annual rate of 12.6 per cent in February, up from a record January rise of 11.2 per cent. The price of a typical UK home is now £29,162 more than a year ago — the largest year-on-year increase recorded by the lender.Robert Gardner, Nationwide’s chief economist, said a combination of “robust demand and limited stock of homes on the market” had kept upward pressure on prices, despite inflation reaching a 30-year high and pushing borrowing costs upward.“The continued buoyancy of the housing market is a little surprising, given the mounting pressure on household budgets from rising inflation . . . the squeeze on household incomes has led to a significant weakening of consumer confidence,” he said.The month-on-month increase in house prices for February was 1.7 per cent.he average price of a home in the UK is now £260,230 — and has increased more than £44,000 since February 2020, before the start of the pandemic.Gardner said the uncertain economic outlook, particularly with war in Ukraine further denting confidence and inflation expected to rise, would mean house price growth would slow in the year ahead.“Housing affordability has already become more stretched, in part because house price growth has been outstripping earnings growth by a wide margin since the pandemic struck,” he said.“The price of a typical home is now equivalent to 6.7 times average earnings, up from 5.8 in 2019.” More

Australia’s economy is bigger than it was before the pandemic following a strong rebound in the fourth quarter of last year, when consumers emerged from lockdown to spend heavily over Christmas. Gross domestic product grew 3.4 per cent in the final three months of 2021, in stark contrast to a 1.9 per cent contraction in the third quarter, when restrictions introduced to quell an outbreak of the Delta variant threatened to push the country into recession.With an election due to be called after the budget this month, Josh Frydenberg, Australia’s treasurer, attributed the rebound to the government’s financial policies. He said the spread of Omicron and the war in Ukraine would not derail the economic performance.“Australians and Australia are world beaters,” said Frydenberg. “We have one of the highest vaccination rates in the world, one of the lowest mortality rates in the world and now, unquestionably, one of the strongest economic recoveries in the world.” Australia introduced some of the strictest global lockdown rules in 2020, including closing its borders. Restrictions were reimposed in 2021 after the emergence of the Delta variant.Gareth Aird of Commonwealth Bank said that Australia’s economy was now larger than before the pandemic after GDP growth hit its equal strongest quarterly growth rate since March 1976. Consumers, who have accumulated A$250bn (US$181bn) of savings since the start of the pandemic, drove the recovery. Spending on hotels, cafés and restaurants rose 24 per cent in the quarter while expenditure on recreation and culture grew 17 per cent. Clothes and footwear sales were up more than 40 per cent.Josh Williamson, an analyst at Citigroup, said that consumers had offset declining business and public sector investment. “The only reason the economy managed to finish the year so strongly was because household consumption increased by a massive 6.3 per cent,” he said.“Stated differently, households contributed 3.2 percentage points to the 3.4 percentage points of growth in the fourth quarter.” 

Exports fell by 1.5 per cent with lower coal, metals and mineral fuels shipments offsetting robust growth in cereals. Paul Bloxham, an economist with HSBC, warned that the impact of the Omicron variant would weigh on first quarter numbers. “Nonetheless, retail sales still rose in January and falling Covid-19 case numbers, as well as rising mobility indicators, suggest first-quarter GDP will slow, not fall,” he added.The GDP data came in below forecasts from the Reserve Bank of Australia, which has yet to raise interest rates despite above-target inflation. The Reserve Bank of New Zealand has raised rates three times in the space of six months to curb inflation. Williamson said that the war in Ukraine would probably make central banks more dovish and did not expect the cash rate to rise in Australia until August. More