Archives for February 2017

As of Friday, Bitcoin was trading at a record high of 1,219.24, according to Xe.com, which tracks Bitcoin and other currency rates. 

The all-time high was $1,230.68, reached on December 4, 2013, according to Xe.com.

The digital currency’s rate came amid speculation that the US Securities and Exchange Commission (SEC) could approve the establishment of the first Bitcoin exchange-traded fund, Reuters reported.

The SEC is set to decide by March 11 on approval of an exchange-traded fund (ETF) request filed almost four years ago by Cameron and Tyler Winklevoss. An ETF is normally an investment fund traded on stock exchanges, and includes assets such as stocks or bonds. Since 2008, establishment of actively managed ETFs is being authorized by the SEC.

If approved in mid-March, it would be the first Bitcoin ETF issued and regulated in the US. Three separate ETFs tracking the value of bitcoin have been filed with the SEC for approval.

“If approved this would certainly give a dramatic condoning of Bitcoin by the authorities and powers that be,” Charles Hayter, CEO of digital currency analytics firm Cryptocompare, told Reuters.

Austria gets its first bitcoin digital currency ‘bank’

The three-year record also comes after a volatile start of the year, when Bitcoin surged more than 20 percent on the back of large buying interest from China. The currency’s price then nosedived 35 percent amid concerns that Beijing was going to crack down on domestic Bitcoin exchanges trading.

Earlier in February, the People’s Bank of China (PBOC) said it has directed the exchanges not to take part in financial activities such as margin lending or allow money laundering. If such a violation is detected “the circumstance will be serious,” and an inspection team will close down the offending exchange, PBOC said on their website. 

Bitcoin cryptocurrency has no issuing or regulating authority, in contrast to conventional currencies.

The legal status of Bitcoin remains knotty and varies substantially from country to country. While some countries have explicitly welcomed its use and trade, others have banned or restricted it. Critics of Bitcoin warn it becomes increasingly attractive for organized crime.

READ MORE: Beijing threatens to shut down bitcoin exchanges

Various media reports claim that child pornography, murder-for-hire services, and weapons are allegedly available on Darknet market sites that sell in Bitcoin.

In other cases, Bitcoin is being offered to average customers exactly as any other currency. For instance, the first bitcoin ATM was set up in Austria three years ago and was successful enough to inspire the launch of further ones. Vienna now has more than 20 bitcoin-friendly vendors ranging from restaurants, bistros, and bars.

Bitcoin was the best-performing currency in 2016, whose value more than doubled during the year. Its 126 percent rally came on the back of strong demand in China.

Article source: https://www.rt.com/business/378499-bitcoin-currency-price-rising/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

The long haul budget airline revealed the transatlantic flights Thursday, announcing 38 weekly flights from Edinburgh and Belfast in the UK, and Cork, Shannon and Dublin in Ireland, starting this summer.

The flights will serve three destinations on the US east coast with easy access to the New York, Boston and New England areas, according to the airline. These airports – Stewart International Airport, Providence Airport, and Bradley International Airport – carry significantly lower landing charges allowing the airline to offer substantially lower prices for transatlantic routes.

The new routes will be operated on new Boeing 737 MAX aircraft.

“I pay for what I want, you pay for what you want. We don’t pay for what everybody else on the plane wants,” spokesman Anders Lindström told Reuters of the tax-inclusive low fares.

Since 2014 Norwegian has been operating low cost flights from London Gatwick to the US.

READ MORE: Russia’s Aeroflot named world’s most powerful airline brand

American carriers have objected for years to Norwegian Air’s presence in the US market, claiming the company is adding flights that exceed traveler demand resulting in fares being pushed down more widely and a loss in other airlines’ revenue.

They have also accused the carrier, which is an Irish subsidiary of Norwegian Air Shuttle, of using its Irish registration to hire crew on contracts issued by Asian companies.

More than 100 legislators called on President Trump last month to block the flights from Cork and Shannon to Boston, according to the Irish Times. They claimed the service threatened America’s international aviation industry and asked him to revoke the permit until the company changed its business model.

An agreement between the US and the EU, updated in 2011, opened the way for non-EU countries to fly anywhere between the two regions. Iceland’s Wow Air has also taken advantage of this, offering cheap flights between Europe and the US.

Article source: https://www.rt.com/business/378376-cheap-transatlantic-flights-norwegian/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Cashing out? Banks to reveal post-Brexit plans

The new towers will provide 375,000m² of office space which is the equivalent of around 50 football pitches. The French government hopes the skyscrapers will “accommodate the new talent” coming to the city.

According to the Financial Times, Marie-Celie Guillaume, chief executive of Defacto La Defense, the body responsible for managing the financial hub in western Paris, said they wanted to send a “powerful message to businesses that are uncertain about their future in London.”

French presidential candidate Emmanuel Macron said he wants British “banks, talent, researchers, academics” to move to France after Brexit. He described France and the EU as “a very attractive space.”

Since Britain’s vote to leave the European Union, cities like Paris, Amsterdam, Luxemburg and Frankfurt have expressed their willingness to become a new center of international finance. France has even promised to “roll out the red carpet” to City bankers seeking to attract them to Paris.

The UK government said it will fight to maintain the City’s position as an international business hub.

Last month City banks said they were finalizing post-Brexit plans on how much of their business they need to shift to maintain relationships with the remaining 27 EU member states.

HSBC said it was moving 1,000 jobs from its London-based investment bank to Paris. JPMorgan Chase CEO Jamie Dimon said that more than 4,000 of the bank’s 16,000 UK staff could be displaced. He did not specify, however, where they might move.

Senior British and French bankers expressed skepticism Paris could become the new financial hub of Europe. They cited inflexibility of the French labor code, the language barrier, and high taxes.

French financial regulators said in September they were simplifying the process of registering new financial firms in Paris, partly by allowing documents to be filed in English.

Article source: https://www.rt.com/business/378276-uk-paris-brexit-business/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

The move followed last week’s upgrade of the Russian sovereign debt rating from negative to Ba1.

Russia gets top notch grade in emerging markets survey

The list of lenders includes Sberbank, VTB, Bank of Moscow, Russian Agricultural Bank and Gazprombank.

The agency upgraded the baseline credit assessment and adjusted credit assessment (BCA) of Sberbank to Ba1 from Ba2, while the lender’s long-term and short-term counterparty risk assessments were improved to Baa3 from Ba1.

“The upgrade of Sberbank’s BCA and Adjusted BCA to ba1 from ba2 reflects the bank’s demonstrated resilience to banking crises in Russia, as reflected in its lack of need for government support during these times,” the release reads.

Sberbank enjoys a dominant position in all key segments of the Russian banking sector and has an unrivaled countrywide branch network, according to the agency.

“Thanks to its entrenched market position, the bank generated strong recurring earnings, with return-on-average equity of around 20 percent in 2016. Its core customer funding profile has remained strong, with the majority of funding comprising stable and granular individual deposits and the bank displaying low dependence on market funding, which currently stands at around 10 percent of the bank’s total liabilities,” said Moody’s.

The agency also said Sberbank’s asset quality metrics are better than the Russian banking sector average, though weaker than those of global peers.

“Problem loans stood at 9.5 percent of total loans as at 1 October 2016 and were 73 percent covered by loan loss reserves. Moody’s believes that Sberbank’s problem loan ratio has passed its peak and that its asset quality metrics will gradually improve over the course of 2017 thanks to the bank’s disciplined risk management practices,” Moody’s remarked.

Article source: https://www.rt.com/business/378274-moodys-russia-banks-outlook-stable/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Daimler inks deal to open Mercedes-Benz plant in Moscow Region

The plant will produce premium class passenger cars and be completed by 2019. Daimler will localize welding, painting, and assembly of vehicles, as well as logistics in Russia.

“According to the contract, Daimler guarantees to invest at least 15 billion rubles in the project. The investment contract has been signed for nine years. The launch is scheduled for 2019; the plant’s production capacity will be over 20,000 cars a year. The project will create more than a thousand jobs,” Minpromtorg said in a statement.

Russia will contribute to the project by giving government support and will offer a favorable tax environment, the ministry added.

The plant will be built by the newly-created Mercedes-Benz Manufacturing RUS (MBMR) division.

“Russia is a strategically important and rapidly developing market for Mercedes-Benz,” said Mercedes-Benz Cars board member Markus Schäfer. He added that the localization of production will make the company more competitive in the global market.

Minpromtorg deputy head Aleksandr Morozov said the German car producer is investing in Russia despite the short-term deterioration of relations between Moscow and the European Union.

The agreement to build the plant was signed last year during the St. Petersburg Economic Forum (SPIEF). Daimler will start building it next year.

Daimler has long had plans to build a car assembly plant in Russia. The company was considering locations in St.Petersburg or Nizhny Novgorod but decided on Solnechnogorsk, 40 kilometers from Moscow.

The German carmaker will produce the S, E, ML, GL and A class vehicles in Russia.

Article source: https://www.rt.com/business/378266-daimler-russia-invetment-plant/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

France’s Le Pen promises to levy national preference tax on foreign workers

“We believe German equities will be a relative safe haven within the euro zone into the election if uncertainty remains, and a clear winner in the case of a Le Pen win. German stocks strongly outperformed the rest of the region during the sovereign crisis of ’11, when the euro collapsed, and peripheral spreads blew up,” JPMorgan’s analysts said, as quoted by CNBC.

Traders seem to be increasingly concerned over the upcoming elections in the Netherlands, France, and Germany in the light of failing to forecast the effects evoked by Britain’s decision to quit the European Union as well as Donald Trump’s US election victory.

Marine Le Pen, known for her anti-immigration views, currently leads in the latest opinion polls. The National Front leader has pledged to renegotiate the terms of France’s membership in the EU if she is elected president.

German equities are expected to continue to benefit from growing inflation and an improving economy despite political risks caused by the many elections scheduled over the coming months, according to JPMorgan.

READ MORE: ‘Euro is not a currency, it’s a political weapon’ – Marine Le Pen

“Germany is a beneficiary of the global reflation trade, which we think has legs,” the bank’s strategist said, stressing that German stocks seem very attractive to investors on the back of the recent strength in global economic data.

Business activity in the eurozone swelled to its highest level in almost six years, according to data released earlier this week. At the same time, Germany’s composite PMI (Purchasing Managers’ Index) surged to 56.1 this month, reaching a three-year high.

Article source: https://www.rt.com/business/378238-le-pen-victory-german-stocks/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

8 richest people as wealthy as poorest half of the world – Oxfam

There were approximately 13.6 million millionaires in the world at the end of 2016, and their wealth stood at $69 trillion.

According to the report, global wealth migration is accelerating. Last year, around 82,000 millionaires migrated worldwide, which is up from 64,000 in 2015.

An estimated 11,000 millionaires made their way to Australia, making it the number one country for millionaire migrants. The US ranked second with 10,000 wealthy arriving, followed by Canada with 8,000.

The choice of Australia by the wealthy is mainly due to its location. It makes it an excellent base for doing business in emerging Asian countries such as Hong Kong, Korea, Singapore, and Vietnam.

Australia has one of the leading healthcare systems in the world which also makes it an attractive destination.

In 2015, the country announced a “fast-track visa” program for wealthy immigrants looking to invest in Australia, while Sydney City Council implemented strategy for tech sector growth.

When it comes to deciding whether to move and where to live, millionaires are looking mainly for a good education for their children and personal safety, said Andrew Amoils of New World Wealth.

“They want the best schools for their children and to feel safe. Climate, health care and cleanliness all follow those top two,” he said.

The study showed that over the past ten years, total wealth in Australia has risen by 85 percent compared to 30 percent growth in the US and 28 percent growth in the UK.

Every 25th New Yorker is a millionaire – study

“As a result, the average Australian is now significantly wealthier than the average US or UK citizen, which was not the case ten years ago.”

The most millionaires were moving from France, the research found. Around 12,000 millionaires left the country last year. China ranked second in millionaire flight, with 9,000 leaving, followed by Brazil with 8,000.

Millionaires are leaving France because of high taxes on the wealthy as well as rising religious tension, Amoils said. He added that in China, the fleeing rich were being replaced by an ever larger number of new millionaires.

Global wealth is expected to rise by 35 percent over the next decade, the report projected, adding the top performing wealth generating markets will be Vietnam, China, India, Mauritius and Sri Lanka.

Article source: https://www.rt.com/business/378230-millionaires-moving-favorite-countries/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Biggest gasoline glut in 27 years could crash oil markets

However, the increase will come gradually, and a surge is to be expected a few months later, said Citi.

“Oil prices are not likely to stray far from their current $53-58 per barrel range in the near term as record investor net length and bearish inventory data will likely cap prices until more tangible evidence of a tighter market emerges,” Citi’s analysts wrote.

On Wednesday, crude prices were slightly down after the rally on Tuesday with Brent trading at $56.50 per barrel and WTI trading at $54.26.

Citi expects to see a positive result from an OPEC production cut, which reported 93 percent compliance in January. The bank added that heavy refinery maintenance in Asia planned for the spring is also a decisive factor for oil prices.

Another US bank – Goldman Sachs – expects oil inventories to keep falling globally. While stocks are likely to rise in the US, production cuts and strong growth in demand will be more significant, the bank said.

“We do not view the recent US builds as derailing our forecast for a gradual draw in inventories, with in fact the rest of the world already showing signs of tightness. Given our unchanged 1.5 million barrels per day growth forecast for 2017, this higher base demand level should fully offset higher US output,” Goldman said in a note.

“While the production cuts have so far reached a historically high level of compliance at 90 percent [93 percent, according to OPEC], the rebound in US drilling activity has exceeded even our above consensus expectations,” the bank added.

However, the bank warned the data indicates a further improvement in shale productivity and investment in the industry rather than a significant price rise.

Article source: https://www.rt.com/business/378223-oil-prices-surge-citi/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

“At the moment more than 200 Lada Vesta cars have been shipped to Germany. The starting price for a sedan with a manual transmission will be about €12,500 and will reach €13,300 for automatic,” AvtoVAZ said on its website.

According to the company, the vehicle has been specially upgraded for the German market. The vehicles are equipped to reduce harmful emissions to the Euro-6 standard.

Over 2,000 Lada cars were sold last year in Germany which is the second largest export market for AvtoVAZ’s Lada brand.

The carmaker plans to increase exports by 50 percent this year. Lada exported 18,500 vehicles last year.

Russian automaker kicks off exports to China UAE

Earlier this month, AvtoVAZ started exporting vehicles to China and the United Arab Emirates. The company wants to have a slice of the Middle East market.

It already has a stable market share in CIS countries and also exports cars to Germany, Iran, Syria, Egypt, and Hungary. AvtoVAZ intends to expand to the Czech Republic, Mongolia, and South-East Asia.

READ MORE: Russia agrees automobile production in Vietnam

A new assembly line at the manufacturer’s plant in Kazakhstan will make 120,000 vehicles a year. Besides the Lada 4×4, the plant assembles the Lada Granta and Lada Kalina models with plans to build the new Lada Vesta and Lada Xray models.

The largest car manufacturer in Russia and Eastern Europe, AvtoVaz produces nearly one million vehicles a year. In 2012 AvtoVaz created an alliance with Renault-Nissan and started assembling the Renault Logan, Datsun and Nissan Almera models in Russia.

Article source: https://www.rt.com/business/378132-avtovaz-car-sales-europe/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

France’s Le Pen promises to levy national preference tax on foreign workers

Immigration into Austria has been rising, increasing its labor pool mostly with Eastern Europeans due to significantly higher wages and social benefits.

Under a harmonized EU measure, unemployment in Austria is still relatively low at 5.7 percent but keeps rising as the country experiences slower growth.

According to the new plans, Austrian citizens will be given priority for new jobs along with EU nationals already resident in Austria over newcomers from outside the country.

“This has nothing to do with hostility toward foreigners. I do not care about the birth certificate, but I do want to solve a problem we are dealing with in Austria,” Chancellor Christian Kern and chairman of the Social Democratic Party of Austria said in a Facebook message.

The new regulations will allow the government to halve non-wage labor costs for three years starting from July for companies which create new jobs and hire locals changing jobs or registered as unemployed.

According to the government, the reform will cost €2 billion ($2.1 billion) and will help to create 160,000 new jobs.

However, the plan, which could undermine the bloc’s principle of free movement of people, might be opposed by Brussels. The EU executive won’t comment on legislation it has not yet examined, according to a European Commission spokesman, as quoted by Reuters.

READ MORE: More Eastern Europeans working in UK since Brexit vote

Meanwhile, Kern said he was confident of getting the green light from Brussels. Austria has to find creative solutions to apply European regulations to curb unemployment, he said.

Article source: https://www.rt.com/business/378128-austria-reward-businesses-hiring-locals/?utm_source=rss&utm_medium=rss&utm_campaign=RSS