June 24, 2021

Indonesia to set up its own bullion bank to boost domestic gold trade

Indonesian authorities are currently holding consultations with officials from the central bank and representatives of the mining sector.

“Our exports have gone to transit countries because they have better gold trading systems, either in the form of bullion banks or better bourses than ours,” Lutfi said as quoted by Bloomberg.

“As a gold producing country why would we sell it to transit countries?”

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Indonesia is the world’s tenth biggest gold producer, with the Grasberg mine in Papua holding one of largest reserves across the world. The nation is ranked number one among Southeast Asia’s major gold miners.

According to the minister, Indonesia has to export most of its gold to such countries as Singapore and Australia – hubs for trading rather than consumption.

He added that the country is negotiating trade deals to challenge those “transit countries” with gold-buying countries, including members of the Gulf Cooperation Council.

The latest decision on creating its own bullion bank is part of Jakarta’s broad agenda aimed at pushing the resource-rich nation up the commodities value chain. Under the plan, the government is also taking steps to make copper and nickel miners invest in domestic refining, so that the nation could profit from higher-value products instead of just exporting raw materials.

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An onshore bullion bank able to provide clearing, hedging, trading and vaulting of gold and precious metals, would cut the need to import gold products after they’re certified overseas.

The measure will help to develop the local industry by providing financing opportunities, and let the central bank use gold instruments to manage stability, according to Iskandar Simorangkir, deputy for macroeconomics and finance policy coordination at the Coordinating Ministry for Economic Affairs, as quoted by the agency.

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Article source: https://www.rt.com/business/527371-indonesia-bullion-bank-domestic-trading/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Covid crisis caused wealth inequality & created millions of new millionaires – Credit Suisse

“The repercussions of the Covid-19 pandemic led to widespread rises in wealth inequality in 2020,” the annual Credit Suisse Global Wealth Report states, claiming that the rich reportedly cashed in on surging stocks.

The number of millionaires increased to 56.1 million people, who are reportedly holding 45.8% of the world’s wealth – with 1.7 million of them residing in the US.

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The detailed figures show that 56.1 million individuals around the world had assets worth more than $1 million, with 2020 becoming the first year in which more than one percent of the world’s adults were “dollar millionaires.”

The report admits growth in the wealth gap stems from the “nature of the policy response” to the pandemic by governments and central banks across the world.

“The rise in wealth inequality was likely not caused by the pandemic itself, nor its direct economic impacts, but was instead a consequence of actions undertaken to mitigate its impact, primarily lower interest rates,” it highlights.

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The impact of the Covid-19 pandemic on household wealth, particularly for the poorest, was reportedly worst in states where governments did not grant compensation for wages lost during the series of enforced lockdowns. In the nations where governments managed to introduce furlough schemes, the hit of job cuts and lower business income was softened.

At the same time, the wealthiest groups, who were already sitting on vast holdings of stocks and properties, were relatively unaffected by the economic shutdowns. After being crushed in the first half of 2020, share prices rebounded later in the year, thus boosting the fortunes of wealthier individuals.

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Article source: https://www.rt.com/business/527348-covid-global-wealth-inequality/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

McDonald’s & other fast-food giants push pricy meals instead of dollar menus

In an attempt to increase sales and profits, and to offset rising food costs at the same time, fast-food chains like McDonald’s, KFC, and Wendy’s have started to move away from cheap items on their menus, replacing them with new, pricier meals, Reuters reports.

The strategy, which reportedly lifted year-on-year sales at limited-service restaurants by 11.5% last month, is aimed at paring back $5-and-under ‘value’ items in favor of more expensive $10-to-$30 combination meals.

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Profit margins are also up at several major chains, according to data from Black Box Intelligence.

“Value menu items are not really profit drivers. They’re designed to drive traffic,” BTIG analyst Peter Saleh told the agency, adding that the Covid-19 pandemic also forced fast-food chains to stop developing new items.

KFC reportedly stopped offering ‘$5 Fill Ups’ – a pot pie or chicken dish, with a drink, cookie, and sometimes a biscuit – aimed at individuals in 2020. Instead, the chain promotes family meal deals that cost around $30.

Domino’s Pizza has suspended its half-price pizza promotion for online orders, saying it doesn’t need its ‘Boost Week’ discount to drive store traffic.

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Wendy’s, one of the oldest US chains, has also replaced its value menu, which was introduced in 1989 and included 99-cent items. Instead, it now offers the Spicy Pretzel Bacon Pub which costs $7.

The drastic measures are reportedly imposed by the market, as high commodity costs are forcing franchisees to find ways to maximize profits, according to Credit Suisse analyst Lauren Silberman, who said that many chains increased their margins during the pandemic.

However, this strategy may alienate lower-income customers, including hourly workers, at a time when restaurants are reopening and the government has stopped granting subsidies.

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According to data revealed by NPD Group, about 39% of fast-food visits in May were made by customers with household incomes of $100,000 or more. Those making less than $25,000 comprised about 12% of visits, and people with incomes between $25,000 and $100,000 made up 49% of visits.

Restaurants that remove too many low-price deals may lose core customers that come specifically for those items, according to Mark Kuperman, the chief operating officer at Revenue Management Solutions, a Florida-based pricing adviser to restaurants, as quoted by the agency.

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Article source: https://www.rt.com/business/527337-mcdonalds-pricy-delete-dollar-menus/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Iran kickstarts production at giant offshore oilfield

The Iranian Offshore Oil Company (IOOC) announced it had achieved first oil from the Asmari reservoir of Abuzar oilfield, which is located southwest of the Kharg Island in the Persian Gulf. 

The Asmari reservoir could produce between 6,000 barrels per day (bpd) and 10,000 bpd of crude oil, with the drilling of five to eight wells, Javad Rostami, Head of Petroleum Engineering at IOOC, said. 

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The development of the Abuzar oilfield has so far focused on the Ghar, Bergen, and Dammam reservoirs, Rostami added. 

According to Tehran Times, a total of 107 oil wells have been drilled at the  

Abuzar oilfield so far, of which 90 wells are still in operation. The remaining wells are either offline due to technical issues or have been depleted.  

In recent months, Iran has been ramping up crude oil production in anticipation of a potential lifting of the US sanctions on its oil exports should the ongoing talks result in an agreement for a return of the  and Iran to the so-called nuclear deal. 

Last month, Iranian Oil Minister Bijan Zanganeh said that the Islamic Republic Iran could boost its crude oil production to as much as 6.5 million bpd when the US sanctions on its oil industry are lifted.   

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Iran currently pumps around 2.5 million bpd and last produced close to the 6-million-bpd mark in the early 1970s. 

Meanwhile, the talks in Vienna continued while Iran was electing a new president on Friday. European diplomats told AP on Sunday that more progress had been made in the negotiations but that “we are closer to a deal, but we are not still there.” 

At the same time, Iran’s newly-elected president Ebrahim Raisi welcomed the talks, said they shouldn’t drag out, and warned that they should guarantee Iran’s national interests.

This article was originally published on Oilprice.com

Article source: https://www.rt.com/business/527323-iran-kickstarts-production-giant-oilfield/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

India considers taxing crypto purchases from overseas exchanges

The country’s digital tax, popularly known as the ‘Google tax’, came into effect over a year ago. It is chargeable at a rate of 2% on consideration received by non-residents who operate digital businesses targeting, among other things, the Indian market.

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The equalization levy could apply to the selling price and, therefore, exchanges may need to add it to the cost of the assets, according to Girish Vanvari, the founder of tax-advisory firm Transaction Square, as quoted by the Economic Times.

“The way the new equalization levy is worded and defined, it appears that it will also be applicable on cryptocurrency bought from an exchange not based in India,” he said.

However, analysts have expressed doubt over the feasibility of applying the tax to crypto investing in light of the underdeveloped regulatory framework in relation to cryptocurrencies.

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“In the absence of any guidelines on the treatment of crypto assets, there is ambiguity in how these would be treated under the tax laws and FEMA (Foreign Exchange Management Act),” Amit Maheshwari, a partner at tax consulting firm AKM Global, told the media.

For more stories on economy finance visit RT’s business section

Article source: https://www.rt.com/business/527319-india-crypto-foreign-exchange-tax/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

$4,000 Peloton treadmills require additional $39-per-month subscription after safety update

Initially offered for a whopping $4,295, the company’s high-dollar Tread+ exercise machine previously included a free feature dubbed ‘Just Run’, which allowed owners to use the treadmill without enrolling in a monthly membership program. Because of a recent software change, however, the free offering is no more, with Peloton now forcing customers to pay up for the subscription. That’s unless they want their already-costly purchase to become an oversized paperweight.

The software tweak followed a voluntary recall issued last month, spurred after the Tread+ was involved in dozens of safety incidents, including injuries to several children and one death. A subsequent update to the device added a locking feature to address the safety concerns, but the addition interfered with the ‘Just Run’ offering inadvertently. 

Peloton, for its part, argues that the issue is “due to current technical limitations” and has offered limited memberships to affected customers free of charge, vowing to return the free feature as soon as possible.

“We have waived three months of All-Access Membership for all Tread+ owners, so those without a subscription will need to activate their free 3-month All-Access Membership to enable Tread Lock before they can access Just Run,” the company said in a statement obtained by CBS News.

In separate comments to PC Mag, a company representative later clarified that it is “working on updates to Tread Lock that will allow us to make Tread Lock and Just Run available without a Peloton membership,” though they did not elaborate.

While some owners have reportedly threatened legal action due to the abruptly missing feature, Peloton has also offered full refunds under the conditions of its recall. The company estimated the recall mishap would cost it $165 million, or about three times its total profits for 2020, marking a major blow to the fitness firm.

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Article source: https://www.rt.com/business/527312-peloton-free-feature-recall/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Bitcoin’s plunge below $29,000 wipes out ALL of this year’s gains

The plunge comes a day after the People’s Bank of China, in a further extension of its nationwide crackdown on cryptocurrencies, summoned banks and payment companies and ordered them to stop facilitating crypto transactions.

Bitcoin has lost over half its value since peaking above $64,000 in mid-April.

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According to technical analysts, the next level to watch for support could now be as low as $20,000.

“$30,000 – we’ll see if it holds on the day. We might plunge below it for a while and close above it. If it’s really breached, $25,000 is the next big level of support,” Galaxy Investment Partners CEO Mike Novogratz told CNBC.

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Article source: https://www.rt.com/business/527262-bitcoin-plunge-lowest-since-january/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Google to face another legal challenge as EU launches antitrust probe into its advertising unit

“We are concerned that Google has made it harder for rival online advertising services to compete in the so-called ad tech stack,” European Commission Executive Vice President Margrethe Vestager said in a statement.

Vestager noted that the US corporation was “present at almost all levels of the supply chain for online display advertising,” since it collected data being used for targeted advertising, sold advertising space, and acted as an online advertising intermediary as well.

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The EC is planning to assess the restrictions imposed by Google on the ability of advertisers, publishers and other third parties to access data about user identity and user behavior.

The probe adds to a list of investigations and fines that have occurred in the bloc’s regulatory space over recent years.

Earlier this month, France’s competition watchdog fined Google €220 million ($262 million) for abusing its market power in the online ad industry. In March, the EC fined the company €1.49 billion for breaching antitrust rules by imposing restrictive clauses in contracts with third-party websites that prevented Google’s rivals from placing their search ads on these websites.

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Article source: https://www.rt.com/business/527252-google-ec-antitrust-probe-advertising/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

OPEC+ may boost oil production to ease global supply deficit

Russia is expected to propose that OPEC+ should take steps to reduce a global supply deficit, officials close to the issue told Bloomberg. Other members of the group are reportedly discussing a potential supply hike in August.

The OPEC+ group has been curbing output to bolster global prices for oil, after the pandemic dragged down demand in 2020. Last month, members of the oil alliance led by Russia and Saudi Arabia maintained strong compliance with agreed targets.

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Global crude prices surged above $75 a barrel for the first time in more than two years, as major economies are gradually resuming after a year of pandemic-related freeze. The international benchmark Brent has rallied more than 40% this year.

OPEC and its allies are reportedly in the process of bringing some two million barrels per day back to the market. However, more softening of production curbs is necessary amid rising prices.

Earlier this month, the International Energy Agency (IEA) called on the group and its allies “to open the taps to keep the world oil markets adequately supplied.”

Meanwhile, nuclear talks between Washington and Tehran have dragged on longer than expected, dashing hopes for the return of Iranian crude to global markets.

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Article source: https://www.rt.com/business/527245-opec-crude-output-hike-deficit/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

US demand for Russian caviar surges by 640%

The strongest demand for Russian caviar was recorded in the US, which became a top-10 biggest consumer of the delicacy last year.

“Shipments to the US increased from a modest four tons recorded in 2016 to 28 tons in 2020, marking an enormous growth of 640%,” the bank’s analysts said.

Ukraine, which purchased 604 tons of caviar produced in Russia, topped the ratings, while Belarus became the second-biggest buyer, having imported 176 tons. Meanwhile, Kazakhstan imported 153 tons of Russian caviar, closing out the top three.

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Demand from Moldova and Canada also demonstrated a significant year-over-year growth. In 2020, Moldova imported 64 tons, which was two and a half times more than the previous year, and Canada shipped 19 tons, marking an increase of more than 80%.

Uzbekistan, Azerbaijan, Georgia, and China were also in the top-10 of the biggest importers of Russian caviar in 2020, even though shipments to China had declined by 65% to 15 tons, versus the 42 tons recorded in 2019.

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Article source: https://www.rt.com/business/527232-russia-caviar-us-demand/?utm_source=rss&utm_medium=rss&utm_campaign=RSS