Headlines

Growing worries about defaults at Chinese property developers triggered a rout in their shares and bonds on Tuesday with fresh credit rating downgrades and uncertainty about the fate of cash-strapped China Evergrande Group sapping investor sentiment, Reuters reported. Once China's top-selling developer, Evergrande is facing one of the country's largest-ever debt restructurings as it wrestles with more than $300 billion in liabilities, including nearly $20 billion in offshore debt.

Australia’s central bank kept its monetary settings unchanged, betting there’s enough stimulus to foster an economic recovery ahead of a gradual reopening of Sydney and Melbourne as vaccination rates climb, Bloomberg News reported. Reserve Bank Governor Philip Lowe kept the cash rate at 0.1% -- as expected -- at Tuesday’s meeting. Lowe cut weekly bond purchases to A$4 billion ($2.9 billion) last month, while pushing out their next review to mid-February to help cushion the economic impact of lockdowns along the nation’s east coast.

In Germany, where one in four jobs depends on exports, the crisis gumming up the world’s supply chains is weighing heavily on the economy, which is Europe’s largest and a linchpin to global commerce, the New York Times reported.

The United Kingdom's 25-year-old model of importing cheap labour has been up-ended by Brexit and COVID-19, sowing the seeds for a 1970s-style winter of discontent complete with worker shortages, spiralling wage demands and price rises, Reuters reported. Leaving the European Union, followed by the chaos of the biggest public health crisis in a century, has plunged the world's fifth-largest economy into a sudden attempt to kick its addiction to cheap imported labour.

Business growth across Europe remained strong last month but elevated inflationary pressures put a dent in demand while ongoing supply issues constrained activity, issues which are likely to continue, a survey showed on Tuesday, Reuters reported. Although many restrictions imposed to contain the coronavirus pandemic have now been lifted in the region, firms are suffering from shortages of staff, raw materials and transport.

State prosecutors in the state of Minas Gerais have filed a lawsuit seeking 2.5 billion reais ($457 million) from miners Vale, Samarco and BHP related to a tailings dam disaster in 2015, according to a statement on Tuesday, Reuters reported. Prosecutors allege that the companies have not fulfilled the obligations outlined in a settlement agreed in 2018, in which the miners agreed to pay damages to the people affected by the disaster. The companies did not immediately respond to requests for comment.

As China Evergrande Group edges closer to a massive restructuring, Beijing has stepped up efforts to limit the fallout, signaling it’s willing to prop up healthy developers, homeowners and the real estate market at the expense of global bondholders, Bloomberg News reported. In the last week alone, Chinese authorities have dispatched top financial regulators to nudge the country’s massive banks to ease credit for homebuyers and support the property sector. They also bought out part of Evergrande’s stake in a struggling bank to limit contagion.

Chinese property developer Fantasia Holdings Group Co Ltd missed a debt payment deadline on Monday in the latest sign that distress is spreading from embattled China Evergrande and through the real estate sector, Reuters reported. Fantasia said that $206 million was due on Oct. 4 and that it did not pay, in a statement to the Hong Kong stock exchange. The company had said as recently as Sept. 20 that it had "sufficient working capital and no liquidity issue." With a market value of $415 million, Fantasia is a minnow.

France and Spain on Monday called for a coordinated European response to the surge in global energy prices to protect Europe's poorest citizens, the competitiveness of its businesses and its 2050 plan to cut greenhouse emissions, Reuters reported. The call, along with ideas shared by European Union governments during talks between euro zone finance ministers in Luxembourg, would complement the European Commission's work to address the energy price spike, the chairman of the meeting said.

Ireland does not expect Britain to trigger a clause in Northern Ireland's fraught post-Brexit trading deal to unilaterally jettison some of its terms, Foreign Minister Simon Coveney said, Reuters reported. Prime Minister Boris Johnson said on Friday that it was possible the British government would trigger "Article 16" if the European Union did not make appropriate concessions to ease the burden of trading restrictions on Northern Ireland.