US Business

Canadian province begins landfill search for murdered Indigenous women

Excavation began on Wednesday at a Canadian landfill site where police believe the bodies of two murdered Indigenous women are buried, the Manitoba provincial government said. Jeremy Skibicki, 37, was found guilty in July of killing four Indigenous women, whose bodies he is believed to have dumped in various locations. Two of his victims, Morgan Harris and …

Canadian province begins landfill search for murdered Indigenous women Read More »

Bank of Canada cuts rates, says fight against inflation ‘worked’

Canada’s central bank cut its key interest rate by half a point Wednesday, reducing it to 3.75 percent and offering borrowers further relief as it claimed the battle against inflation had proven successful.Canada had held its benchmark rate steady for almost a year at 5.0 percent, the highest level in two decades, before initiating a …

Bank of Canada cuts rates, says fight against inflation ‘worked’ Read More »

US, Canada warships pass through Taiwan Strait

A US and a Canadian warship have passed through waters separating Taiwan and China, a week after Beijing held large-scale military drills in the sensitive passage.The United States and its allies regularly cross through the 180-kilometre (112-mile) Taiwan Strait to reinforce its status as an international waterway, angering Beijing.China’s Communist Party has never ruled Taiwan, …

US, Canada warships pass through Taiwan Strait Read More »

‘Validation’ for Sikh activists after Canada slams Indian tactics

Ottawa’s accusations this week detailing a deadly Indian campaign against its Canada-based critics may have further derailed bilateral relations — but to Sikh activists, the striking disclosures brought validation.Canada has accused India of orchestrating the 2023 killing in Vancouver of 45-year-old naturalized Canadian citizen Hardeep Singh Nijjar, a prominent campaigner for “Khalistan,” the fringe separatist …

‘Validation’ for Sikh activists after Canada slams Indian tactics Read More »

US charges Indian agent over alleged plot to kill Sikh separatist

An Indian intelligence official has been indicted for his role in a foiled plot to kill a Sikh separatist leader in the United States, the Justice Department said Thursday.Vikash Yadav, 39, who remains at large, is charged with conspiracy to commit murder-for-hire and money laundering, the department said.Yadav is the second Indian national to be …

US charges Indian agent over alleged plot to kill Sikh separatist Read More »

Stock markets fall, yen rallies after BoJ policy move

Markets fell Tuesday and the yen rallied after Japan announced a surprise tweak to its ultra-loose monetary policy, just as traders were fretting that central bank efforts to tame inflation will tip economies into recession.

Sentiment was also being weighed down by a spike in Covid infections in China as officials roll back many of the strict containment measures that have been in place for almost three years.

A so-called Santa rally appears to be eluding investors, with the mood dampened by last week’s warnings from the Federal Reserve and European Central Bank that they will likely push interest rates higher than expected next year.

The remarks dealt a blow to a short rally across equities that had been fuelled by data showing inflation coming down.

Adding to the selling pressure were comments from former New York Fed chief William Dudley, who told Bloomberg Television that any sign of optimism in markets could make monetary policymakers tighten even more.

Tokyo sank more than two percent after the Bank of Japan adjusted its parameters for controlling bond yields, in a shift away from its long-running dovish stance of keeping rates ultra-low to boost the struggling economy.

Inflation in Japan has risen sharply this year, with the consumer price index in October at 3.6 percent, the highest in four decades, though bank boss Haruhiko Kuroda and other officials have said that would be temporary, citing a lack of strong demand and wage rises.

The move sent the yen to 132.30 per dollar, its strongest level since August.

The Japanese unit has been hobbled this year by the BoJ’s determination to stick to its loose monetary policy — hitting a 32-year low of around 150 to the dollar in October — even as the Fed ramped up borrowing costs. 

– No Santa rally –

“This was bound to happen with inflation rising in Japan, it’s just happened sooner than many thought,” Amir Anvarzadeh, of Asymmetric Advisors, said. “It could spark money flowing back into Japan.”

Hong Kong, Shanghai, Sydney, Seoul, Singapore, Wellington, Taipei, Mumbai, Jakarta and Bangkok were also in the red.

London, Paris and Frankfurt all sank at the open.

“Those who were in the camp of a year-end rally are now second-guessing their investment thesis,” said JC O’Hara of MKM Partners.

“The markets may have placed a little too much faith in Santa Claus and the rally he typically brings.”

With few catalysts to drive trade, investors are winding down for the Christmas break, though they are keeping a close eye on developments in China, which is suffering a sharp jump in Covid cases.

Officials in recent weeks have started to move away from their rigid zero-Covid policy of lockdowns and mass testing following widespread protests.

And while the shift has been welcomed as a much-needed boost to the world’s number-two economy, there is growing anxiety about the immediate impact on businesses and the healthcare system.

“A massive China reopening bounce is giving way to a reality check as investors come to grips with numerous zero-Covid offramp economic and medical issues that China is simply unprepared to handle,” said SPI Asset Management’s Stephen Innes.

“Especially if the predicted 10 million-plus daily Covid cases hit the healthcare system later this month.”

Still, the expected pick-up in demand from the China reopening continues to support commodity prices, with both main oil contracts up more than one percent, extending Monday’s gains.

The impact of Covid and weaknesses in the country’s vast property sector led the World Bank on Tuesday to slash its China growth forecasts to 2.7 percent this year, from 4.3 percent predicted in June. It also revised its forecast for next year from 8.1 percent down to 4.3 percent. 

– Key figures around 0820 GMT –

Tokyo – Nikkei 225: DOWN 2.5 percent at 26,568.03 (close)

Hong Kong – Hang Seng Index: DOWN 1.3 percent at 19,094.80 (close)

Shanghai – Composite: DOWN 1.1 percent at 3,073.77 (close)

London – FTSE 100: DOWN 0.7 percent at 7,312.94

Dollar/yen: DOWN at 132.39 yen from 136.95 yen on Monday

Euro/dollar: UP at $1.0623 from $1.0610 

Pound/dollar: DOWN at $1.2146 from $1.2148

Euro/pound: DOWN at 87.44 pence from 87.31 pence

West Texas Intermediate: DOWN 0.2 percent at $75.07 per barrel

Brent North Sea crude: DOWN 0.3 percent at $79.58 per barrel

New York – Dow: DOWN 0.5 percent at 32,757.54 (close)

Japan central bank tweaks monetary policy, yen strengthens

Japan’s central bank tweaked its longstanding monetary easing programme on Tuesday, in a surprise move that saw the yen strengthen quickly against the dollar and prompted falls on Tokyo bourses.

The change marks a rare shift of gears for the dovish central bank, which has largely left its policy intact even as counterparts in other major economies hike rates to tackle inflation.

After a two-day policy meeting, the bank said it would widen the band in which it would allow rates for 10-year Japan government bonds to move, saying it would “improve market functioning”.

“The Bank will expand the range of 10-year JGB yield fluctuations from the target level: from between around plus and minus 0.25 percentage points to between around plus and minus 0.5 percentage points,” it said in a statement.

The move saw the yen strengthen rapidly against the dollar, with the greenback falling from a daily high of 137 yen to 133 yen within minutes of the decision.

The announcement came during the morning break in Tokyo trade, but the key Nikkei 225 index plunged as it reopened, falling as much as three percent before recovering slightly.

Few had anticipated the shift, with all 47 of the economists surveyed by Bloomberg ahead of the decision saying they expected no change in policy.

The bank left the rest of its longstanding loose monetary programme intact, including its years-old inflation target of two percent.

Governor Haruhiko Kuroda, whose term ends next spring, has for years struggled to steer the world’s third largest economy towards sustained two percent inflation, seen as necessary for growth.

Prices in Japan have risen sharply this year, with the consumer price index in October at 3.6 percent, the highest in four decades.

But Kuroda and the central bank consider the increases temporary, citing a lack of strong demand and wage rises.

Speaking to reporters on Tuesday afternoon, Kuroda insisted the shift “is not the first step of an exit strategy”.

“Once the price stability target draws closer, the monetary policy board will discuss strategies toward the exit and will make information public accordingly,” he said.

– ‘A sense of policy flexibility’ –

Still, the BoJ has come under pressure to move away from its ultra-loose policy as central banks in other major economies hike interest rates to tackle inflation.

The resulting differential has seen the yen nosedive about 20 percent against the dollar this year.

Hideo Kumano, chief economist at Dai-ichi Life Group, said the decision showed the bank recognised its existing policy was no longer tenable.

“It has been unrealistic to try to cap the long-term yield with the fixed-rate bond-buying operations at 0.25 percent,” he told AFP.

“It seems to me that the bank wanted to create a little bit of a sense of policy flexibility or room for policy choices and pass the baton to the next governor,” he added.

Kuroda’s term ends in April, and over the weekend reports suggested Japan’s government could work with his successor to move away from the longstanding two-percent price target.

The bank’s decision Tuesday sent shockwaves through Asian markets, with stocks falling on regional bourses as investors digested the news.

“In reality, the long-term rate will become 0.5 percent. It will reduce the rate gap between Japan and the US,” said Kumano.

But Kuroda was at pains to insist “this is not a rate hike”.

Saisuke Sakai, chief economist of Mizuho Research & Technologies, said the move would help address the weaker yen caused by the growing gulf between US and Japanese central bank policy.

But “unlike rate hikes by the Fed and European central banks aimed at cooling down overheated economies… this is aimed chiefly at stabilising market function,” he told AFP.

“Japan’s economy has not recovered to the pre-pandemic level yet, in contrast to the US economy,” he noted.

Ghana labour unions call for strike over local debt swap

Ghana’s main unions on Monday called for a nationwide strike from next week in protest against the inclusion of workers’ pensions in a local debt swap programme as part of the terms for an IMF credit.

A top cocoa and gold producer, Ghana has oil and gas reserves but its debt payments are high and its revenues weak. 

Like the rest of Africa, it has been hit by economic fallout from the global pandemic and the Ukraine war. 

Two weeks ago, the west African nation offered investors a domestic debt swap to ease a crunch in payments. 

But labour unions refuse to have pension funds included in the exchange.

The unions met in the capital Accra on Monday and told reporters they had called a strike to compel the government to heed their demand.

“We have decided firmly that because the government has refused to grant us our request that all pension funds must be exempted from the domestic debt exchange programme, all workers of Ghana are going to strike on 27 December 2022,” said Yaw Baah, secretary general of Trades Union Congress.

“We will be on strike until our demand has been granted,” he said.

Baah called on workers to stay at home.

“We will stay at home until the government acts. That is straight forward and very simple,” he said. 

“We won’t sit down for the vulnerable people to suffer because somebody has made mistakes.”

Labour unions present at the press conference included the Ghana National Association of Teachers (GNAT), the Ghana Medical Association, the University Teachers Association of Ghana (UTAG), the Ghana Registered Nurses and Midwives Association and the Teachers and Educational Workers Union (TEWU).

The government has so far not responded to the strike threat.

The West African state is facing an economic crisis, with inflation at more than 50 percent and its cedi currency down sharply, hit by the adverse effects of the global pandemic and Ukraine conflict. 

The crisis forced President Nana Akufo-Addo’s government to reverse its position earlier this year and seek International Monetary Fund help as economists warned of a default on debt payments.

Ghana and the IMF have agreed on a three-billion-dollar credit, but the fund’s board has yet to approve the deal.

Ghana on Monday announced it was suspending payments on part of its foreign debts.

Close Bitnami banner
Bitnami