Headlines

The eurozone is expected to remain in deflation over the coming months, partly because of the recent appreciation of the euro, European Central Bank president Christine Lagarde has warned, the Financial Times reported. Headline annual inflation is “expected to remain negative over the coming months” after slipping into deflation in August for the first time in four years, Ms Lagarde told the European Parliament’s committee on economic and monetary affairs on Monday.

The High Court has granted permission to the Irish arm of fashion retailer New Look to pay a tax bill of nearly €2.7 million, as the company puts together a survival plan amid financial losses due to the Covid-19 pandemic, The Irish Times reported. Mr Justice Denis McDonald made the order after New Look said its tax affairs needed to be up to date before it could avail of the Employment Wage Subsidy Scheme (EWSS) for workers. Monday’s hearing was in advance of an application by the company, for hearing on Tuesday, to have an examiner appointed.

Argentina will make interest payment due on dollar and euro-denominated “Par” bonds on Wednesday this week, the country’s Economy Ministry said in a statement on Monday, closing off an unresolved issue from its recent major debt revamp, Reuters reoprted. The government had failed to restructure a small number of bonds, including the Pars, as part of an otherwise successful $65 billion foreign debt restructuring, which saw 99% of eligible debt exchanged at the end of last month.

More than 1,000 family-run coach businesses across the UK face being forced into bankruptcy and having their vehicles repossessed, according to their trade body, the Financial Times reported.

For the U.K.’s indebted pub companies, a new 10 p.m. curfew doesn’t just dent sales, it weighs on their debt loads too, Bloomberg News reported. Bonds issued by Stonegate, the heavily leveraged owner of the Slug & Lettuce, Walkabout and Yates’ chains, have fallen to the lowest since they were sold in July. A risk gauge on the company’s debt indicates investors see a 57% likelihood it will default in five years, according to ICE Data Services. Bonds of other large pubcos Marston’s Plc and Mitchells & Butlers Plc have also slid as investors fret.

South Africa’s National Treasury wants strict conditions attached to any guarantees it provides for loans to the country’s embattled state airline, according to two people familiar with the matter, Bloomberg News reported. Treasury and Department of Public Enterprises officials met Saturday to discuss ways to restart South African Airways, the people said, asking not to be identified because the talks are private. Representatives of two South African banks attended the talks, they said. SAA halted operations and sought bankruptcy protection in December.

Carmakers including Jaguar Land Rover and Nissan Motor Co. have joined with lenders to create a network to protect the industry’s supply chain from succumbing to Covid-19 and a no-deal Brexit, Bloomberg News reported. Under the so-called safe harbor plan, suppliers in financial difficulty can lean on carmakers for improved payment terms, and lenders will be called upon to step in with financial assistance, according to the Society of Motor Manufacturers and Traders, which is organizing the network.

Singapore’s central bank is in talks with lenders about extending the nation’s debt moratorium program beyond Dec. 31 to provide extra relief for borrowers hit by the fallout from the coronavirus pandemic, according to people with knowledge of the matter, Bloomberg News reported.

The full extent of the coronavirus pandemic-inflicted damage on Philippine companies and the local financial system will only begin to manifest itself over the next couple of years, as there is always “a lag time before you see the dead bodies,” INQUIRER.net reported. As such, banks and their large corporate borrowers will likely need to enter into contentious and difficult negotiations in the medium term to rehabilitate loans that would otherwise go into default as a result of the ongoing public health crisis. “[Banks’] problem loans have almost doubled in July. Was that the peak?

Bondholders are facing “significant losses” as Zambia battles to bring its debt under control, according to Moody’s Investors Service, Bloomberg News reported. They’re now asking: who’s next? The southern African country this week asked for a six-month interest-payment holiday to give it “breathing space” for a debt restructuring, a move that may buy it time but won’t do anything to solve its longer-term debt problems, Moody’s said.