Headlines

Italian manufacturers have reported the first contraction in the sector since 2016, according to an IHS markit survey, in the latest sign of a broader slowdown in the Italian economy, the Financial Times reported. The manufacturing purchasing managers’ index (PMI) for Italy fell to 49.2 in October, the lowest reading in 46 months. The closely-monitored survey had been teetering on the brink in September, when it held at the 50 line that separates expansion from contraction.

The drop in global equities in October was remarkable for its extent, the frequency of consecutive negative days, and the synchronised decline in all the major markets, the Financial Times reported in a commentary. The most likely fundamental trigger for the severity of the equity correction was an increase in investors’ perceptions of downside, or even recessionary, risks to the global economy. Dramatic talk about trade wars obviously exacerbated the drop in confidence.

The South Korean government has attempted to remedy the problem but its roots are deep: the country’s powerful conglomerates and offshore competition are squeezing smaller employers, the Financial Times reported. “Although SMEs account for a small portion of the country’s GDP, their trouble has a big impact on the job market and consumption,” said Lee Sang-jae, an economist at Eugene Investment and Securities. Chinese competition is hollowing out vast tracts of industry that once girded South Korea’s export-led economy.

An “unprecedented” number of price rises from energy suppliers this year has caused UK household energy debt to surge by 24 per cent over the past year, research has found. At this time of year, most households have usually built up credit with their energy supplier, the Financial Times reported. Yet, despite the summer heatwave and warmer than usual autumn temperatures, price increases mean 3m households owe a total of £400m to their energy supplier, according to research by uSwitch, the energy switching service.

Pakistan’s prime minister Imran Khan was welcomed in Beijing with full honours and promises of support but hopes of Chinese help to rescue the country from a looming balance of payments crisis were dented by the conspicuous absence of any concrete announcement of generous aid, the Financial Times reported. Pakistan is seeking its 13th bailout since the 1980s from the International Monetary Fund. An IMF delegation is expected to visit Islamabad this week to begin discussions on a crucially important new loan to help avert crisis.

A group of mostly northern EU countries are lobbying for the eurozone’s bailout fund to be given a greater role in scrutinising national budgets, as fiscal hardliners step up their criticism of Brussels for inadequately policing Europe’s deficit rules, the Financial Times reported. Ten governments including the Netherlands and Ireland want the European Stability Mechanism (ESM) to be given the authority to assess the financial health of eurozone economies, powers that are currently held exclusively by the European Commission. The ESM, set up at the height of the eurozone cr

Investors are bracing for more debt defaults among China’s cash-squeezed real estate developers as funding costs surge and refinancing pressure intensifies. Borrowing costs in dollars for China’s high-yield issuers, most of whom are property developers, almost doubled this year to 11.2 percent, the highest in about four years, ICE BofAML indexes show. To make things worse, the sector faces a record $18 billion bond maturities in both onshore and offshore markets in the first quarter of 2019, Bloomberg News reported.

India's Department of Economic Affairs (DEA) fears significant default from large non-banking finance companies (NBFC) and housing finance companies in the next six weeks if no additional liquidity support is provided to these firms, business news website MoneyControl said here on Friday, Reuters reported. The DEA, in a letter to the Ministry of Corporate Affairs, described the financial situation as "still fragile" when discussing the financial stability impact of the Infrastructure Leasing and Financial Service Ltd's (IL&FS) default, the website said.

Italy’s political tensions with the European Union and the accompanying financial jitters are beginning to take a toll on the Italian economy, the latest data suggest. Italy’s unemployment rate ticked up to 10.1% in September from 9.8% the previous month, the country’s statistics agency said Wednesday, reversing a downward trend throughout this year, The Wall Street Journal reported. And on Tuesday, the statistics agency said gross domestic product was unchanged in the third quarter from the second, the worst showing in almost four years, while business confidence fell in October.

Does the government of Indian Prime Minister Narendra Modi see value in an independent central bank? As New Delhi escalates a confrontation with the Reserve Bank of India, the question has become urgent, The Wall Street Journal reported in a commentary. India risks shredding the reputation of an important financial institution at a time of domestic and global financial uncertainty.