Headlines

Embattled developer Country Garden faces a new round of voting by creditors to extend several debt maturities on Monday, having avoided default at the last minute twice already this month to bring some respite to the crisis-hit Chinese property sector, Reuters reported. The voting, due to conclude by 10 p.m. Hong Kong time (1400 GMT), will have onshore creditors decide on approving a proposal by Country Garden to extend repayments of eight onshore bonds by three years. The latest voting comes after the country's largest private developer on Sept.

China’s credit demand improved, deflationary pressures eased and the yuan rallied, adding to a recent trickle of signs that the economy and financial markets may be stabilizing after a sharp downturn, Bloomberg News reported. The strong credit data published Monday showed recent steps to bolster the real estate market may be starting to lift household demand for mortgages, while corporate loans also picked up. The yuan gained after the central bank escalated its defense of the currency.

China's financial regulator on Sunday reduced the risk weighting it attaches to insurance companies' holdings of blue-chip shares and tech stocks, encouraging them to invest more in the country's lagging stock market, Reuters reported. The National Administration of Financial Regulation (NAFR) said on its website that the risk weighting for CSI300 Index constituents would be reduced to 0.3 from 0.35, while that for stocks listed on Shanghai's tech-focused STAR Market would be cut to 0.4, from 0.45. A lower risk weighting frees up more capital for insurers to invest.

China's central bank is tightening its scrutiny of bulk dollar purchases by domestic firms, three sources with direct knowledge of the matter said on Monday, at a time when the Chinese currency faces mounting depreciation pressure, Reuters reported. Companies that need to purchase $50 million or more will now need approval from the People's Bank of China (PBOC), which convened a meeting with some commercial banks over the weekend on the matter, the sources said. "The approval process will be extended," said one of the sources.

The European Commission cut its outlook for the euro-area economy, predicting it will be dragged down this year by a contraction in Germany, Bloomberg News reported. Output in the 20-nation currency bloc will rise by 0.8% in 2023, compared with an earlier forecast for 1.1% growth, according to updated projections published Monday by the European Union’s executive arm. Next year’s outlook was lowered by the same amount, to 1.3%. The region’s biggest economy is largely to blame. Germany, which had been expected to grow in 2023, is now facing a decline of 0.4%.

The European Central Bank will remove a capital surcharge on some lenders after they addressed shortcomings in their leveraged finance businesses, Bloomberg News reported. “Some banks have fixed the problems and will see the capital add-on go away,” Andrea Enria, who chairs the ECB’s Supervisory Board, said in an interview in Frankfurt. “Others have not and will keep it for a bit longer.” Enria didn’t name any of the banks involved.

Canadian Housing Minister Sean Fraser is keeping a wide range of options on the table as he looks to make a dent in a national housing shortage, the CBC reported. "There's a range [of incentives] that we're considering right now. Some could include potential tax incentives for builders to build. Some could include other low-cost financing arrangements," Fraser said in an interview on Rosemary Barton Live that aired Sunday.

Turkey’s current account swung back to a wider deficit than forecast in July after a rare surplus the previous month, as surging gold imports added to a deteriorating trade gap, Bloomberg News reported. The shortfall was $5.5 billion, compared with a revised surplus of $651 million in June and a deficit of $3.5 billion in July 2022, according to central bank data published on Monday. The median estimate in a Bloomberg survey of analysts was for a gap of $4.5 billion in July.

Indian edtech titan Byju’s has made a surprise repayment proposal to lenders, in which the firm has offered to pay back its entire $1.2 billion term loan in less than six months, Bloomberg News reported. The company is offering to repay $300 million of the distressed debt within three months if the amendment proposal is accepted and the remaining amount in the subsequent three months, said the people, who asked not to be identified because the discussions are private. Byju’s is in talks with private equity funds and strategic investors to sell some of its overseas units to fund the repayment.

Bank of England policy maker Catherine Mann signaled she’s likely to support further interest-rate increases to combat inflation, warning that investors are pricing in an ever larger premium into UK assets to account for future price shocks, Bloomberg News reported.