Headlines

Brazilian airline Gol expects its exit of chapter 11 bankruptcy proceedings to involve a $1.5 billion capital injection through the issuance of new shares and refinancing of $2 billion in debt, it said in a securities filing on Monday, Reuters reported. Gol, one of Brazil's largest carriers, filed for bankruptcy protection in the United States earlier this year after struggling with heavy debt and delayed deliveries from planemaker Boeing.

Italy's Benetton family is readying plans to address mounting losses at its eponymous clothing retailer, including parting ways with CEO Massimo Renon after four years, two people close to the group said on Monday, Reuters reported. The board of the clothing group is expected to meet on Tuesday to discuss a net loss of around 230 million euros ($250 million) for 2023 which includes impairments, a source with knowledge of the matter told Reuters. That compares with a net loss of 81 million euros in 2022, when revenues totalled 1 billion euros.

China's latest steps to revive its struggling property market could pose risks to banks operating in lower-tier cities, S&P Global said on Monday, Reuters reported. The measures announced earlier this month such as cutting down payment requirements and removing the floor for mortgage rates are expected to temporarily increase property demand, but the increased leverage could also cause an uptick in mortgage defaults, according to a S&P Global report. Property prices in smaller tier-three cities are expected to decline about 14% through the 2024-2025 period, the report said.

The Reserve Bank of New Zealand has confirmed it will apply new restrictions on mortgage lending in a bid to reduce potential financial instability risks stemming from high household debt and rising home prices, the Wall Street Journal reported. The debt-to-income settings, which will apply from July 1, will allow banks to lend up to 20% of residential loans to owner occupiers with DTI ratios of over six and to investors with a DTI ratio of over seven, the central bank said on Tuesday.

Brazil's central bank chief Roberto Campos Neto said on Monday that policymakers believe inflation expectations should stabilize and improve over time, after recently citing concerns about them deviating from the official target, Reuters reported. "It is generally possible to be optimistic when we look at the reasons (for the unanchoring of inflation expectations)," he said at an event organized by the business group Lide in Sao Paulo.

Doing business in Hong Kong increasingly comes with a new risk: the political cost of upsetting Beijing. Chinese clients recently dropped one big Chicago law firm after it recused itself from a politically sensitive case, the New York Times reported. A former Wall Street banker was muzzled for writing a “Hong Kong is dead” column. And Google was effectively cornered into enforcing a ban on a popular protest anthem. In all areas of life, Hong Kong is hewing closer to mainland China, blurring distinctions that once cemented the city’s status as mostly free from the politics of Beijing.

Pakistan’s new government is hoping to inject some fresh momentum into projects that fall under China’s Belt and Road Initiative, as it tries to boost the country’s troubled economy, Bloomberg News reported. The South Asian nation is looking at joint ventures for renewable energy projects, agriculture collaboration and possibly enticing some Chinese companies to relocate to Pakistan, said Ahsan Iqbal, Pakistan’s federal minister for Planning, Development and Special Initiatives, who also co-heads the committee responsible for the China-Pakistan Economic Corridor, in an interview.

Australian retail sales remained weak in April, highlighting the plight of consumers in the face of elevated interest rates and rising costs, while signaling a sluggish economy for some time yet, the Wall Street Journal reported. Retail turnover rose 0.1% in April, the Australian Bureau of Statistics said Tuesday. Economists had expected a rise of 0.3% for the month. The weak result follows a 0.4% fall in March, and a 0.2% rise in February.

By many measures, London is still a crucial financial hub, where prices are fixed each day for precious metals, trillions of dollars of foreign currency are traded and global insurance contracts are written. But the global competition for investors — among cities like New York, Hong Kong, Dubai and Singapore — is intense.