Business | The Economist

The Federal Reserve has said it will start scaling back its bond buying program this month at a rate that suggests it will end entirely next June. The central bank introduced the regime at the start of the pandemic, but is now more concerned with the prospect of sustained inflation.

Christine Lagarde has once again tried to play down market expectations of an interest rate hike in the euro zone next year. The president of the European Central Bank reiterated his view that although consumer prices have risen rapidly, the outlook for inflation remains subdued.

The of the euro zone the economy grew 3.7% in the third quarter, year-over-year GDP increased 4.9% on the same basis). Annual inflation in the money block climbed to 4.1% in October, a 13-year high, on the back of rising energy prices.

Hit by an energy crisis, Gas prices in Europe yo-yo amid conflicting news from Russia, which provides about two-fifths of the EUis imported gas. Gazprom appeared to be following Vladimir Putin’s order to start stockpiling gas for Europe, after replenishing its stocks for Russia. But the state-owned company again refused to reserve the pipeline capacity needed to transport the gas.

Microsoft outmoded Apple become the most valued company in the United States, reaching a market cap of over $ 2.5 billion, after Apple’s quarterly earnings disappointed investors. by Tesla The share price faltered when Elon Musk said the company had yet to sign a deal to sell 100,000 electric cars to Hertz. The recent announcement of the deal had pushed Tesla’s market value to over $ 1 billion.

Swiss credit announced a major restructuring following the heavy losses it suffered as a result of its exposure to Archegos Capital Management, which collapsed dramatically at the start of the year. The Swiss bank is about to close its prime brokerage activity, which provided financing to hedge funds, and will refocus on wealth management.

Jes Staley has resigned as chief executive of Barclays as UK regulators are said to be open to questioning whether he had fully disclosed his ties to Jeffrey Epstein. Epstein committed suicide in 2019 after being accused of sex trafficking underage girls. Mr Staley wants to challenge the conclusion of regulators, which the board says would make his job impossible. Barclays noted that the investigation “makes no finding that Mr. Staley saw or was aware of any of Mr. Epstein’s alleged crimes.”

Steel plan

America and the European Union have resolved a trade dispute over steel and aluminum. Donald Trump introduced tariffs on European steel in 2018 under the pretext of protecting US national security; the Biden administration will now accept European imports under a quota system. In return the EU will not impose retaliatory tariffs on a wide variety of US products. The two sides are working on deals to produce durable steel to curb what Joe Biden has called “dirty steel” from China.

Facebook changed its name to Meta, a new branding that showcases the company’s other social media apps, Instagram and WhatsApp, and downplays the Facebook name. One of the first decisions of the new parent company was to cease facial recognition on Facebook photos and videos due to regulatory uncertainty surrounding the technology, although this is to keep the algorithm behind it.

Dell has completed its spin off of VMware into a separate software company, a business it acquired through its merger with CEM in 2016. When the spin-off was announced in April, Michael Dell, the eponymous founder of the IT company, said that while VMware’s revenues are strong, “the market doesn’t seem to like a hardware-software combination.” .

Kakao Pay’s Initial Public Offering in Seoul was a resounding success. South Korea’s largest mobile payment service provider is backed by Ant Group, a Chinese fintech company founded by Jack Ma. It had to delay its IPO by two months when South Korean regulators fear a bubble , began to scrutinize the Initial Public Offering valuations of technology companies.

A page turner

The US Department of Justice has launched a lawsuit to arrest Penguin Random House’s acquisition project of Simon & Schuster for antitrust reasons. The lawsuit claims that a merger would give Penguin control of nearly half of the best-selling book publishing rights market.

The same day as the COP26 summit began in Glasgow, Saudi Aramco reported quarterly net profit of $ 30.4 billion, its biggest three-month profit since its Initial Public Offering in 2019. PA, Chevron and ExxonMobil also posted strong profits, the oil majors benefited from soaring oil prices.

This article appeared in the The World This Week section of the print edition under the headline “Business”