Headlines

Pakistan pledged to pay its sovereign debt obligations this year as it treads close to a possible default with foreign-exchange reserves covering less than a month of imports, Bloomberg News reported. “Come what may, we will be paying off all of our anticipated payments this year,” Commerce Minister Syed Naveed Qamar said in an interview in Washington Tuesday. The government will fulfill its international financial obligations, Finance Minister Ishaq Dar said in a statement the same day.

The Reserve Bank of India (RBI) is likely intervening in both the offshore and onshore markets to shield the rupee from the fallout of investors lifting their expectations on the U.S. Federal Reserve's terminal rate, traders said on Wednesday, Reuters reported. The rupee has fared much better against the dollar than other emerging market currencies since the blowout U.S. jobs report on Feb. 3 raised bets of a higher-for-longer rate regime. Since then, the rupee has fallen 1.2%.

South Africa is offering a total of 13 billion rand ($710 million) in tax incentives to businesses and individuals to encourage investment in renewable energy projects and offset the impact of higher fuel and food prices, Bloomberg News reported. Africa’s most industrialized economy is experiencing its worst bout of power rationing yet, with outages occurring for more than 200 days in 2022 and every day this year, because the state power utility can’t meet demand from its old and poorly maintained plants.

New Zealand’s battle with inflation had shown signs of easing before Cyclone Gabrielle wrecked homes, downed power lines and washed away roads after making landfall earlier this month, the Wall Street Journal reported. Now, officials at the South Pacific country’s central bank are assessing how the rebuilding effort could complicate their campaign to bring price pressures under control.

Markets may have overshot in recent days when placing bets on the peak for European Central Bank interest rates, according to Governing Council member Francois Villeroy de Galhau, Bloomberg News reported. The ECB is “in no way” obliged to raise borrowing costs at every meeting between now and September, with the deposit rate already at a level that restricts the euro-zone economy, the Bank of France Governor told the Les Echos newspaper. The Bank of France confirmed Villeroy’s comments to Bloomberg.

Germany’s government is in talks to pay more than €20 billion ($21 billion) for the local unit of power grid operator TenneT Holding BV in a deal that could mark the starting point for a consolidation of the country’s power grids, Bloomberg News reported. Officials are hashing out the structure of a potential deal with Dutch state-controlled TenneT, and negotiations could take several months, according to the people, who asked not to be identified because the information is private. The deal would come on top of an equity need of about €15 billion to upgrade the net.

Egypt looked to raise $1.5 billion through the sale of its first Islamic debt, as the North African nation wrestles with a foreign-currency crunch, Bloomberg News reported. The wheat importer’s $400 billion economy is exposed to the shockwaves of Russia’s invasion of Ukraine. It has devalued its currency three times since March and sought aid from the International Monetary Fund. The final guidance price for the three-year dollar sukuk was at 11.125% area (+/- 1/8th) on Tuesday, according to a term sheet seen by Bloomberg.

Canadian inflation pressures eased in January, leaving the Bank of Canada some room to hold interest rates at current levels next month even after a blockbuster jobs report, Bloomberg News reported. The consumer price index rose 5.9% from a year ago, Statistics Canada reported Tuesday in Ottawa, slower than the 6.1% gain expected in a Bloomberg survey of economists and down from 6.3% in December. On a monthly basis, the index rose 0.5% in January, versus expectations of 0.7%.

Europe’s biggest economies beat expectations as business activity returned to growth, boosting the chances they can stave off recessions, Bloomberg News reported. Gauges of private output in Germany and France both signaled expansion in February after pullbacks in January, while the UK’s purchasing managers’ index showed the first positive reading in six months — jumping to 53 from 48.5. In the 20-nation euro zone, activity rose at the fastest pace since May 2022.

When China’s private real-estate developers started sliding into distress more than a year ago, the government encouraged state-owned property companies to step in and take over their ailing peers’ projects and assets, the Wall Street Journal reported. That call has gone largely unheeded—a big reason why the country’s housing market remains in the doldrums. State-backed property companies have considered and ultimately decided against acquiring a great number of projects started by private developers.