Headlines

Britain's accounting watchdog plans to strengthen "significantly" its audit firm governance code, it said on Thursday, after a number of issues around audits of UK firms in recent years, Reuters reported. The Financial Reporting Council's code applies to the Big Four accounting firms - Deloitte, EY, KPMG and PwC - and to other firms auditing FTSE 350 companies, the FRC said in a statement. In future it will also apply to firms which audit other types of public interest entities, the FRC said.

Centerra Gold Inc.’s units on Wednesday filed a motion in a U.S. Bankruptcy Court seeking penalties of $1 million a day against the Kyrgyzstan government, related to the seizure of the Canadian company’s Kumtor gold mine, Reuters reported. Centerra Gold said in May, its Kyrgyzstan units Kumtor Gold Co. (KGC) and Kumtor Operating Co. (KOC) commenced bankruptcy proceedings in a U.S. court following nationalization of the miner’s Kumtor gold mine by the former Soviet republic.

South Korea became the first major Asian economy to raise interest rates Thursday, with more hikes in the pipeline as its central bank indicated that financial risks pose a bigger threat to the economy than the latest virus outbreak, Bloomberg News reported. Governor Lee Ju-yeol said the quarter-percentage-point hike to 0.75% still left rates in an accommodative position that supports the economy. He added that the current delta wave is having less of a negative impact on growth as consumers adjusted behavior to the new normal of the pandemic.

Afghanistan's banks, critical to the country's recovery from crisis, are facing an uncertain future say its bankers, with doubts over everything from liquidity to employment of female staff after the Taliban swept to power, Reuters reported. Banks were expected to reopen imminently, a Taliban spokesman said on Tuesday, after they were closed for some ten days and the financial system ground to a halt as the Western-backed government collapsed amid the pullout of U.S. and allied troops.

A majority of Brazil’s Supreme Court justices have voted to uphold the constitutionality of a law granting the central bank formal autonomy, a key piece of legislation considered by investors as a victory for monetary policy making in Latin America’s largest economy, Bloomberg News reported. Eight justices voted in support of the law on Thursday, and two against.

Sweden’s Finance Minister Magdalena Andersson, the frontrunner to replace the outgoing prime minister, said a robust economic recovery leaves room for an expansionary budget in the upcoming election year, Bloomberg News reported. The Harvard-educated Andersson could become the first woman leader in the largest Nordic economy that’s coped with the pandemic much better than most rich peers, helped by robust state finances. Yet she would face a fragmented political system where agreements on changes needed to keep the welfare state afloat are increasingly difficult.

The French government plans changes to its state-backed financing program for small firms that was designed to fuel investment after the worst of the Covid-19 crisis as it’s met with little success, Finance Minister Bruno Le Maire said, Bloomberg News reported. The financial instruments, known as participative loans, were meant to ween small companies off a reliance on debt by offering a product that has some of the advantages of equity.

Brazil's Supreme Court will debate on Wednesday whether a law to establish the autonomy of the central bank, insulating it from political interference, is constitutional or not, Reuters reported. The law does not change the way the bank sets interest rates but distances it from politics by setting fixed four-year terms for its governor and directors that will no longer coincide with the presidential election cycle. Far-right President Jair Bolsonaro signed the measure into law in February, but two left-wing parties have questioned whether it violates the country's constitution.

The finance minister Nirmala Sitharaman on Wednesday announced that she has asked state-run banks to step up lending and hold outreach programmes or loans melas across India from October to lend to desirable borrowers, in order to give momentum to the stimulus package. Sitharaman said that it was too early say that there is lack of credit demand in the economy, the Economic Times of India reported. “This year too sometime in October, there will be a credit outreach in every district of the country,” the finance minister said.

Thailand is less vulnerable to any spike in global bond yields stemming from policy normalization by the U.S. Federal Reserve due to its low reliance on external sources for debt financing and its high foreign reserves, the Bank of Thailand chief said, Bloomberg News reported. Bond yields in Thailand would be less exposed to “another taper tantrum” than those in some other emerging economies, Governor Sethaput Suthiwartnarueput told a virtual conference Wednesday organized by the Stock Exchange of Thailand.