Aurelia Butler

The 30.6% median forecast of 13 economists would be the highest since May 2003 – with forecasts ranging from 26.4% to 37.3%.Inflation, which was around 20% in recent months, has been driven by a lira slide to record lows after the central bank slashed its policy rate by 500 basis points since September, under pressure from President Tayyip Erdogan. The month-on-month rise in prices was seen at 9%, according to the median, with forecasts ranging from 5.5% to 14.6%.The central bank has said temporary factors were driving prices higher and forecast that inflation would follow a volatile course in the short term.The recent lira slide was reversed late on Monday last week when Erdogan announced a scheme to protect lira deposits against currency volatility and state-backed market interventions triggered a 50% surge in the currency’s value.Inflation has been in double digits and well above emerging market peers for most of the last four years, eating into Turks’ earnings and hitting support for Erdogan.According to the Turk-Is trade union confederation, food prices rose 25.75% month-on-month in December. That represented an annual rise of 55%, up from 27% in November, marking the largest rise in food inflation since 1987.The central bank’s year-end inflation forecast was 18.4% in a report published in late October. The government predicted end-2021 annual inflation of 16.2%.There could be double-digit monthly inflation in December as lira depreciation drives food, core goods and energy prices, said Gedik Yatirim economist Serkan Gonencler, adding that the lira rebound could prompt price cuts.”However raw materials purchased with higher costs, a possible New Year increase in energy prices and services inflation could limit the decline in inflation in January,” he said.”Inflation could follow a rising trend with the delayed impact of the FX rates after January.”Four economists who responded to a Reuters question forecast annual inflation would fall to 24.85% by the end of next year.The Turkish Statistical Institute is scheduled to announce December inflation data at 0700 GMT on Jan. 3. More

Good morning. Companies raised a record $12.1tn this year by selling stock, issuing debt and inking new loans, as a torrent of central bank stimulus and the rapid recovery from the pandemic propelled global markets. With a few days left of 2021, the cash haul is already up almost 17 per cent from 2020, itself a historic year, and almost a quarter above the take in 2019 before the coronavirus crisis, according to Financial Times calculations based on Refinitiv data.The ferocious pace of fundraising underscores just how easy financial conditions are in many parts of the world, most notably the US, where more than $5tn was raised.“It’s been a really blockbuster year,” said Chris Blum, a BNP Paribas banker who helps finance leveraged buyouts. “We anticipate it will continue into next year. Every year you kinda think markets will go down from this frantic pace but it will still be robust.”Dozens of 10 and 11-figure loans were signed, including ones to fund Discovery’s merger with AT&T’s WarnerMedia unit and the freight rail operator Canadian Pacific’s takeover of rival Kansas City Southern. And investors in the roughly $10tn US corporate bond market lapped up deal after deal.Three more stories in the news1. US cuts Covid isolation period to five days to ease Omicron disruption: US health officials have slashed the recommended isolation period for people who have Covid-19 as parts of the country’s economy struggle with severe staff shortages brought on by the Omicron wave. The US Centers for Disease Control and Prevention now says infected people need only to isolate for five days, as long as their symptoms are clear by then, then wear a mask around others for a further five days. 2. US stocks rise in post-holiday trading: US stocks rose in thin post-Christmas trading yesterday with energy stocks leading the rally, and technology stocks also ratcheting higher. Analysts are querying whether the favourable market conditions that drove Wall Street to all-time highs this year will continue into 2022.3. China increases scrutiny of companies seeking overseas listings: China has said that domestic companies must gain approval before listing overseas if they operate in sectors deemed off-limits to foreign investors, closing a loophole for the country’s tech groups to raise capital in the US without undergoing regulatory scrutiny at home. “The days of freewheeling overseas listings are gone,” said Li Chengdong, founder of Dolphin, a Beijing-based consultancy.

Chinese ride hailing app Didi Chuxing listed on the New York Stock Exchange in June, but said it would reverse course following opposition from Beijing © AP © AFP via Getty Images

Coronavirus digest Xi’an officials tightened lockdown measures and launched another round of mandatory testing for its 13m residents amid China’s worst Covid-19 outbreak in almost two years.France will require working from home for all eligible employees for at least three days a week and ban large indoor gatherings as it seeks to curb a wave of infections.Boris Johnson has opted against new restrictions in England before New Year’s Eve despite the rising number of cases over the Christmas weekend.What else we’re readingApple Watch’s failure to integrate The challenge of integrating technology into healthcare is partly why the Apple Watch, which launched in 2015 and is worn on the wrists of more than 100m people, has largely failed to fulfil its promise that “the future of health is on your wrist”.Iran-US: faltering nuclear talks enter dangerous phase Our big read looks at the mistrust between Tehran and Washington, which is deeper than ever. Now, with Iran enriching uranium at its highest-ever levels and the language hardening on all sides, experts warn that the next nuclear crisis could be just months away — despite talks resuming yesterday. The most brilliant bookshops in the world In October we published a list of FT writers’ favourite bookshops. Here are the nominations that readers thought we missed, from New York to London, Seoul, São Paulo and beyond.

‘A holdover from a different city’: City Lights in San Francisco © Alamy

Our most-read opinion article of the yearThe FT’s most-read opinion article of 2021 was published only a few weeks ago. You may not be surprised to know that it is about coronavirus, and, in particular, Omicron. Don’t miss Anjana Ahuja’s description of the “bumpy journey” ahead, with a new variant that “makes the road a bit icier”. More

Japanese industrial output jumped in November by the largest margin since 2013, providing hope that the country’s automotive sector could finally be moving beyond its semiconductor supply struggles.Industrial production increased 7.2 per cent last month compared with October, significantly exceeding economists’ forecasts. The improvement was driven by a 43.1 per cent month-on-month resurgence in car production, said analysts, who noted that other manufacturers appeared to be rebuilding exhausted inventories more rapidly than expected.Takuji Aida, chief economist at Okasan Securities, said that while overseas parts procurement was stagnant, it appeared that supply chain problems that have afflicted Japanese manufacturers were gradually being resolved.The monthly data released by the Ministry of Economy, Trade and Industry represent Japan’s last major economic release of the calendar year. The November increases followed October’s more modest 1.8 per cent gain from the previous month.The government also issued an upward revision of its overall assessment of industrial production, saying the manufacturing sector was “showing signs of recovery” after having previously rated the situation as “at a standstill”. Analysts at Goldman Sachs, who had forecast a 4.8 per cent increase, noted that the production index had recovered to just below its pre-pandemic level in January 2020. “While monthly production will likely fluctuate amid lingering supply shortages for semiconductors and other components, it appears to be returning steadily to a solid growth track,” wrote Yuriko Tanaka, a Goldman Sachs economist, in a note to clients.Investors reacted positively to the data, with the benchmark Topix closing up 1.37 per cent higher on Tuesday.But while some interpreted the numbers as a potential leading indicator of more sustained gains during the final quarter of the financial year ending in March 2022, others were more guarded. Kazuma Maeda, an economist at Barclays Securities Japan, cautioned that while some automakers expected production to reach last year’s levels this month, “making up for lost production and stockpiling inventories will require more production than usual”.

“It’s unclear how much production can be increased given the potential impact of the Omicron variant on the supply chain,” Maeda added, echoing a warning from Meti, and noting that China’s economic slowdown and weaker orders could hit Japan’s overall production. Takashi Miwa, chief Japan economist at Nomura Securities, added that January could generate a degree of downside risk as the variant spreads. “Some manufacturers have already announced downward revisions to production for December and January, so we should be a bit cautious about what will happen in the fourth quarter,” he said.“That could negatively affect production and tighten the supply side constraints for technology, IT and other industries that depend on semiconductor supplies.” More

The People’s Bank of China (PBOC) in November said it would provide 60% of the loan principal taken out by financial institutions for carbon emission cuts, with a one-year lending rate at 1.75%, without specifying when the lending would be issued.The measure is in line with China’s broader goal to bring emissions to a peak before 2030 and achieve carbon neutrality by 2060, as well as to shelter the economy from the fallout of the COVID-19 pandemic.China’s economy, the world’s biggest after the United States, faces the triple pressure of falling demand, supply problems and weakening expectations, Yi said, reiterating previous official comment.”The macroeconomic market must by stabilised,” he told Xinhua. “In addition, it’s necessary to let shareholders of companies, and local authorities shoulder the responsibility of risk events occurring in the market.”Yi said the PBOC will keep its monetary policy flexible and appropriate, and liquidity ample. To further lighten the pressure on business, which in general can obtain corporate loans with an average interest rate of 5%, a record low, Yi said, the PBOC will increase the quota for re-financing to small businesses as necessary.He also said financial risks were under control and expectations for the property market have improved.”The structural adjustment of the property market is conducive to the formation of a new development model for country’s real estate, and the healthy development of the whole industry,” Yi said. More

NEW YORK (Reuters) – When you order at Chipotle Mexican Grill (NYSE:CMG), you are probably not thinking about the complex supply chain that got your food into your hands.That is Brian Niccol’s job.As Chipotle’s CEO and chair, the buck stops with Niccol when it comes to all those logistics. But Niccol does want you to consider the land and workers needed to make it all happen because without them, you’re not getting that meal.Niccol spoke with Reuters about the real and disturbing implications of disappearing farmers and farmland.Q: Why do you think farming is in such crisis?A: A lot of farms are not transferring generationally and a lot of farmland is being lost to development. We are running a new campaign informing people about this, because we want to make sure land ends up in the hands of farmers.In the last decade alone, the U.S. has lost more than 20 million acres of farmland, and 400 million acres are expected to need new farmers in coming years. If young farmers can’t find affordable land, that’s just not going to happen. We want to make sure government is aware of this, and people are aware because a lot of folks don’t even realize this is happening.Q: The number of farmers has been declining for decades. What does this mean for you?A: We love the idea of supporting small farmers. We want to stay committed to food with integrity and that means responsibly raised animals and organic produce. We need small farmers, and we are committed to buying from them. We also invest in them and give them tools to provide food at scale. This is constantly on our minds, and we hold ourselves accountable.Q: How do you support them specifically?A: One of the biggest things is creating long-term contracts. If you give them a three- or four-year contract, that helps dramatically because they know they have a buyer on the other end, and can invest accordingly. The other thing we do is provide grants for younger farmers who are getting started and need money to plant their first crop or buy their first animals.Q: Everyone is talking about the supply-chain nightmare. Is it giving you constant headaches?A: We have a lot of great partners and have been able to smart forward-buy where we need to, to stay in stock on key items. But it’s not getting any easier, that’s for sure. Between freight and labor challenges, this is a daily discussion.Q: Are there particular menu items that are harder to secure than others?A: So many items are grown and raised right here in the U.S., and we have longstanding relationships with those folks. We knew what to plan for, and we didn’t run into any real problems. Lately the bigger challenges have been associated with building restaurants: There you run into challenges like getting access to HVAC equipment, and buying enough steel to make grills.Q: How has the labor squeeze impacted you?A: There is a real battle going on for labor. I’ve never seen it so tight. That’s why it’s really important to talk about purpose. Another part of it is that you have to have wages right and the ability to grow those wages. We also offer benefits I really love, like debt-free degrees and tuition reimbursement. We have always been a leader on the wage and benefit front.Q: What leadership lessons have you taken away from the COVID era?A: From a management standpoint, you can’t communicate enough in times of uncertainty. You can’t be afraid to say, “This is working” or “This isn’t working.” You have to keep the communication flowing. Be transparent in what you know and what you don’t know, and then ask for feedback because it can’t be just one-way communication.Q: What is your favorite item on the menu?A: Barbacoa (beef). I love it. I get it every which way possible. More