Headlines

Chinese banks are putting bad loans up for sale at a record pace, as regulators push for faster disposal of sour debts amid rising consumer defaults during an ailing post-COVID economic recovery, Reuters reported. Issuance this year of securities backed by non-performing loans (NPLs) is set to jump about 40% from a year ago to a record, data from a ratings agency showed, as lenders rush to offload distressed assets linked to mortgage, credit card and consumer borrowings.

China's state planner on Monday said it aimed to stimulate private investment with a greater effort in 2024 and continue to enhance the "positive" economic recovery trend, Reuters reported. China would expand consumption of renewable energy, the National Development and Reform Commission said in a statement, adding that it would actively and steadily promote carbon peak and carbon neutrality.

Germany's economy is likely to shrink again slightly in the current fourth quarter, the country's central bank said Monday, while a survey showed business confidence retreating unexpectedly, the Associated Press reported. Europe’s biggest economy contracted by 0.1% in the third quarter after growing by the same amount in the previous three-month period, according to official figures.

Ethiopia's only international government bond slipped in price on Monday after credit ratings agency S&P Global Ratings downgraded it to "Default" after the east African country failed to make a key 'coupon' payment, Reuters reported. The $1 billion bond, which matures in December 2024 with a full principal repayment known as a bullet payment, dipped 0.4 cents on the dollar to 66.5 cents having jumped roughly 10% since the start of the month.

Mexico's central bank could weigh a rate cut in the first quarter of 2024, the bank board's governor said in an interview published on Monday, Reuters reported. "Inflation has dropped significantly, but we need to be cautious," central bank governor Victoria Rodriguez said in an interview with local outlet El Financiero. "When downward (rate) adjustments occur, we are anticipating them to be gradual." Mexico's annual inflation hit 4.32% in November, ending a nine-month slowing streak and still above the bank's target of 3% plus or minus one percentage point.

Bank of Israel Governor Amir Yaron urged government leaders and lawmakers to maintain responsible fiscal policies during the war with Palestinian militant group Hamas, as Prime Minister Benjamin Netanyahu promised to boost defense spending, Reuters reported. Speaking on Sunday at an inauguration for his second five-year term as central bank chief, Yaron said that Israel needs to adapt its economic policy to the war since investors, ratings agencies, financial markets and the public "are currently keeping a close eye on policy in Israel".

Multi-trillion dollar non-banking finance saw its first major retreat last year since the global financial crisis in 2009, with the shrinkage due to higher interest rates hitting asset valuations, a global watchdog said on Monday, Reuters reported. Non-banks, such as investment funds and insurers, have come under closer regulatory scrutiny after the sector, less regulated than banks in parts, grew sharply after the financial crisis as money shifted from the more heavily regulated lenders.

Russia’s central bank on Friday increased its key interest rate by 1 percentage point, to 16 percent, as it continued to battle what it called “high inflationary pressures,” the New York Times reported. The rate increase was the fifth in a row since the central bank began its current cycle of monetary tightening in July, when the rate was 7.5.

The number of companies in England and Wales declared insolvent in November was 21% higher than a year earlier, government figures showed on Friday, adding to the pattern of higher corporate failures as the Bank of England raises interest rates, Reuters reported. The Insolvency Service, a public body, said there were 2,466 registered company insolvencies during the month. The BoE raised rates 14 times between December 2021 and August this year, taking Bank Rate from 0.1% to 5.25%.

Ministers will announce a 6.5% increase in the funding for local councils in England in a desperate attempt to stop them going bankrupt, the Guardian reported. Michael Gove, the communities secretary, will announce the £64bn support package on Monday, less than a fortnight after he was warned that an unprecedented number of councils are likely to declare themselves bankrupt.