Headlines

The Bank of England is likely to keep interest rates on hold until the middle of next year rather than raising them sooner, following a gloomier outlook for the global economy, according to the economic forecaster CEBR, The Guardian reported. The Centre for Economics and Business Research now believes a rise in May or August 2016 is more likely than one in February, its previous prediction. Signs of a global economic slowdown have been growing in recent weeks, especially in the world’s second-largest economy China and emerging markets.

Saudi Arabia has withdrawn tens of billions of dollars from global asset managers as the oil-rich kingdom seeks to cut its widening deficit and reduce exposure to volatile equities markets amid the sustained slump in oil prices, the Financial Times reported. The Saudi Arabian Monetary Agency’s foreign reserves have slumped by nearly $73bn since oil prices started to decline last year as the kingdom keeps spending to sustain the economy and fund its military campaign in Yemen.

A tax bill for about €150 million, mainly arising from unpaid income tax owed by the former Anglo Irish Bank, is likely to be appealed by the special liquidators to the Irish Bank Resolution Corporation, the State-owned entity into which Anglo was subsumed, the Irish Times reported. The massive tax bill, thought to be one of the largest ever submitted to a State- owned body, arises in the main from the interpretation of rules in relation to income tax and straddles the period before and after the former bank was nationalised.

Norway’s central bank cut interest rates to a fresh record low as it battled to overcome a slump in oil prices that has hit the economy of western Europe’s biggest petroleum producer harder than during the financial crisis, the Financial Times reported. Norges Bank cut its overnight deposit rate, the amount that banks earn by parking their spare cash at the central bank, by 25 basis points to 0.75 per cent and warned that more cuts were possible.

International financial institutions, led by the World Bank, are patching together a $1 billion financing package to help Ukraine and its energy giant OAO Naftogaz to fill up its natural gas-storage facilities and avoid shortages in the conflict-ridden country and the rest of Europe over the winter, The Wall Street Journal reported.

Europe must urgently confront a growing mountain of bad loans if there is to be a revival in bank lending that is essential to the continent’s economic recovery, the International Monetary Fund said Thursday, The Wall Street Journal reported. In the years following the financial crisis, a rising number of businesses and households around the world found it difficult to meet interest payments on their debts. But the IMF said the problem of nonperforming loans, as those debts are known, has become particularly acute in Europe.

Shinzo Abe has vowed to boost the size of Japan’s economy from Y491tn to Y600tn and said his programme of reforms was entering a new, second stage, the Financial Times reported. The Japanese prime minister was speaking after his Liberal Democratic party elected him, unopposed, to a second three-year term as its leader, making him one of the few postwar premiers to head a durable government.

When Mark L. Hart III, a hedge fund investor based in Texas, makes an investment bet, he does it in the style of his home state: big time, the International New York Times DealBook blog reported. Since 2007, his winners have included high-risk, high-return wagers that the United States housing market would collapse and that Greece would go bankrupt. But Mr. Hart’s most audacious gamble to date may well be the one he is making on China.

Volkswagen AG is facing billions in fines after admitting it rigged U.S. emissions tests, but it likely has the financial wherewithal to handle the monetary hit, The Wall Street Journal The CFO Report blog reported. The German car maker could pay more than $18 billion in fines from U.S. environmental regulators and also faces a U.S. criminal investigation related to the scandal that has roiled the company. European officials are also calling for an investigation.

Ukraine says it will halt paying off its external debt on Wednesday, facing the risk of a technical default. The list of non-payments doesn’t include the $3 billion owed to Russia, RT.com reported. The debt to Moscow is due in December which Russia has insisted it wants in full. According to a document published on the website of the Ukrainian government, the restructuring applies to the $3 billion Eurobonds purchased by Russia. However, payments on them have not been suspended. The list included seven issues of Ukrainian government bonds.