Headlines

Argentina’s international reserves have tumbled to their lowest since 2016 as the central bank drains its coffers to defend the increasingly beleaguered peso, Bloomberg News reported. The currency tumbled 13% in parallel markets last month to a record low as a historic drought sapped key crop exports, fueling a dollar shortage at the same time that inflation accelerates past 100%.

Saudi Arabia's central bank on Wednesday increased its repo rate by 25 basis points to 5.75% and its reverse repo rate also by 25bps to 5.25%, it said in a statement. Saudi Arabia, whose currency is pegged to the U.S. dollar, followed the U.S. Federal Reserve's decision to raise interest rates by a quarter of a percentage point. Read more.

The Qatar Central Bank said on Wednesday that it will continue with the current interest rates for the deposit, lending, and repo rates after assessing current monetary requirements, Reuters reported. "Qatar Central Bank aims to maintain the current interest rates at an appropriate level to support sustainable economic growth," it said in a statement. Read more.

Cash-strapped Indian airline Go First filed for bankruptcy proceedings on Tuesday, blaming "faulty" Pratt & Whitney engines for the grounding of about half its fleet, Reuters reported. The move marks the first major airline collapse in India since Jet Airways filed for bankruptcy in 2019, and underscores the fierce competition in a sector dominated by IndiGo and the entry of newer operators such as Akasa Air.

A Japanese hotel chain, once at the center of a bidding war between US private equity firms Blackstone Inc. and Lone Star Funds, faces a reckoning with its creditors, Bloomberg News reported. Unizo Holdings Co. became the first Japanese company to default on its bonds in six years when it filed for a court-supervised restructuring in April. The firm, which has hotels and office buildings, said it didn’t have the money to pay debt worth 10 billion yen ($72.8 million) maturing in May. Several of the country’s regional banks warned they may not get repaid.

KWG Group Holdings Ltd. securities tumbled Tuesday after the firm became the latest Chinese developer to default, even as new-home sales gain steam nationally, Bloomberg News reported. The company didn’t pay 212 million yuan ($31 million) of principal due Friday on bank and other borrowings, it said in a Hong Kong stock exchange filing that night. The delinquency triggered 31.2 billion yuan of debt becoming repayable on demand.

Underlying inflation in the euro area eased for the first time in 10 months, backing the case for the European Central Bank to slow the most aggressive interest-rate hiking campaign in its history later this week, Bloomberg News reported. Consumer prices stripping out volatile items like fuel and food costs rose 5.6% from a year ago in April — down from March’s record 5.7% advance and in line with the median estimate in a Bloomberg poll of economists. The headline inflation rate, meanwhile, ticked up to 7% — a touch more than the 6.9% analysts anticipated and still far above the 2% target.

Australia’s central bank signaled further policy tightening ahead after unexpectedly raising interest rates by a quarter-percentage point on Tuesday, sending the currency and bond yields surging, Bloomberg News reported. The Reserve Bank increased its cash rate to 3.85%, the highest level since April 2012, in a decision predicted by only nine of 30 economists. Money markets rapidly revised up expectations for further moves and are now pricing in a rate of just under 4% by October, from around 3.6% before today’s decision.

Australia's biggest landlords and developers played down concerns about inflated commercial property valuations at a conference on Tuesday, while acknowledging economic uncertainty was making investors and renters more cautious, Reuters reported. Commercial real estate prices are a major concern for investors globally as public markets price the impact of a slowing economy and the growth of remote work, while owners, especially unlisted players, resist major changes.

Bank of Japan Governor Kazuo Ueda said on Tuesday the downside risks to Asia's economy were smaller than those to other parts of the world, partly due to the region's resilience to U.S. and European banking sector woes, Reuters reported. His remarks underscore optimism over the outlook for Asia's economy, which has a big influence on Japan's fragile recovery due to its proximity and huge market size.