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      Global Markets Cheer on Better Than Expected Inflation Data

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      A better-than-expected Consumer Price Index report triggered a big surge in stocks and bonds, as investors bet that interest rates will begin to fall.Upbeat investors see Tuesday’s inflation data as a possible turning point in the Fed’s battle against soaring prices.Michael M. Santiago/Getty ImagesGood news for global markets Yesterday’s impressive rally in U.S. stocks and bonds has gone worldwide this morning, as investors see central banks making gains in their fight against inflation. Adding to the good news was a breakthrough in the House last night that could avert a government shutdown.S&P 500 futures signal further gains at the opening bell. The question now is whether this represents a false dawn on inflation, or the start of a durable decline in rising costs — and interest rates.Here’s what’s exciting investors: Yesterday’s cooler-than-expected Consumer Price Index data has shifted discussion in the markets from potential interest rate hikes to cuts, and what that might mean for stocks. President Biden, whose poll ratings have been hurt by inflation, also cheered the numbers.Other promising data points came out this morning. Inflation in Britain fell to its lowest level in two years. And consumer spending and industrial output in China rebounded last month, a hopeful sign for the world’s No. 2 economy.Market optimists have moved up their bets on rate cuts. Futures markets this morning pointed to the Fed starting to lower borrowing costs by May, sooner than previous estimates of closer to the end of 2024.Less aggressive is Mohit Kumar, the chief financial economist at Jefferies, who wrote today that big rate cuts would begin after the presidential election next year. Jefferies predicts the Fed’s prime lending rate going to 3 percent by the end of 2025 from its current level of 5.25 to 5.5 percent.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.We are confirming your access to this article, this will take just a moment. However, if you are using Reader mode please log in, subscribe, or exit Reader mode since we are unable to verify access in that state.Confirming article access.If you are a subscriber, please  More

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      China and US pledge to fight climate crisis ahead of Xi-Biden summit

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      China and the United States have pledged to work together more closely to fight global warming, declaring the climate crisis “one of the greatest challenges of our time”, hours before a key meeting in San Francisco between Joe Biden and Chinese leader Xi Jinping.The announcement further fuels hopes the two nations can mend relations following years of turmoil over issues including trade, human rights and the future of Taiwan.In a joint statement following climate talks in the US, they pledged to make a success of a crucial UN climate summit starting at the end of this month in Dubai.And they recommitted to the 2015 Paris climate accord goals of holding global warming to “well below” 2C, while pursuing efforts to limit the increase to 1.5C.“The United States and China recognise that the climate crisis has increasingly affected countries around the world,” the statement said. “They will work together … to rise up to one of the greatest challenges of our time for present and future generations of humankind.”US and Chinese climate envoys John Kerry and Xie Zhenhua met this month at the Sunnylands resort in California in a bid to restart stalled cooperation.Experts agree that keeping the Paris goals in reach will require an enormous collective effort to slash greenhouse gas emissions this decade.Xi began his first visit to the US in six years on Tuesday. He is due to meet Biden at an undisclosed location in San Francisco on Wednesday morning and then attend the annual summit of the Asia Pacific Economic Cooperation (Apec) forum.Xi’s summit with the US president will be the first face-to-face meeting between the US and Chinese leaders in a year and has been billed by US officials as an opportunity to reduce friction in what many see as the world’s most dangerous rivalry.Xi waved from atop a passenger staircase attached to his Air China plane and then descended to meet US officials waiting on the tarmac, including treasury secretary Janet Yellen and US ambassador to China, Nicholas Burns.He then got into his Chinese Hongqi, or “Red Flag”, limousine and departed the airport for the city, where demonstrations are expected both supporting and protesting against his visit.Less than two hours earlier, US secretary of state Antony Blinken addressed ministers of the 21-member Apec and stressed the US believed in “a region where economies are free to choose their own path … where goods, ideas, people, flow lawfully and freely”.Blinken did not mention China in his remarks, but his language echoed US rhetoric in recent years in which Washington has accused Beijing of bullying smaller countries in the Indo-Pacific and trying to undermine what the US and its allies call the existing “rules-based” order.US trade representative Katherine Tai, who with Blinken opened the Apec ministerial session, said the San Francisco meeting came at a time of “great uncertainty and challenges” for the region. She noted increasing geopolitical tensions, fragile supply chains and a worsening climate crisis.Earlier, Biden said his goal in his talks with Xi would be to improve the relationship with China after a period of strained ties. He said he would seek to resume normal communications between the two superpowers, including military-to-military contacts.White House national security spokesperson John Kirby told reporters Biden and Xi would also talk about the Israel-Hamas conflict in Gaza as well as US efforts to support Ukraine.Democratic senator Ben Cardin wrote to Biden to push for immediate freedom for Mark Swidan, Kai Li and David Lin, whom the US government has classified as wrongfully detained in China. Republicans and other Democrats have also called for their release.“With the holiday season approaching, and the opportunity to start the new year on a more positive note in bilateral US-China relationships, I implore you to secure commitments from president Xi to release these Americans immediately,” Cardin wrote.Cardin also asked for the release and safety of US-based journalists’ family members whom he said are missing, jailed or detained in China due to their connection to the journalists.Economic issues will also be high on the agenda.Biden said the US does not want to decouple from China but wants to change the economic relationship for the better. His administration has made a push to “de-risk” some critical US supply chains from China as the two countries’ economic and military competition has grown.But it has been careful to assure countries in the region, including China, that the US does not seek complete economic separation, a notion that has fueled concerns among Washington’s partners and allies of a superpower showdown that would upend the global economy.The Chinese severed military-to-military contacts with the US after then House of Representative speaker Nancy Pelosi visited democratically governed but Chinese-claimed Taiwan in August 2022.Restoring the contacts is a top US goal to avoid miscalculations between the two militaries.Several hundred mostly pro-China demonstrators carrying Chinese flags gathered outside the Chinese delegation’s hotel ahead of Xi’s arrival in the US.Larger protests, including by rights groups critical of Xi’s policies in Tibet, Hong Kong and toward Muslim Uyghurs, are expected to gather near the summit venue on Wednesday.As Biden arrived in San Francisco, dueling demonstrators greeted his motorcade from the airport. Some waved Chinese flags and held banners calling for “kindly” and “warm” US-Sino ties. Others held signs condemning the Chinese Communist party.With Reuters and Agence France-Presse More

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      Trump’s Deportation Plans for Immigrants

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      More from our inbox:Shocked by Trump’s Vow to Root Out ‘Vermin’Women in China, Loath to Turn Back the ClockBillionaires, Invest in EarthDonald Trump quiere reimponer una política de la era de la COVID-19 de rechazar las solicitudes de asilo: esta vez basando ese rechazo en afirmaciones de que los migrantes son portadores de otras enfermedades infecciosas, como la tuberculosis.Doug Mills/The New York TimesTo the Editor:Re “Trump’s ’25 Immigration Plan: Giant Camps, Mass Deportation” (front page, Nov. 12):After choking on my coffee reading this excellent in-depth piece, I contemplated the America we will live in if these ambitious and aggressive ideas bear fruit.Do the architects of this plan really believe we will have a stronger, safer and more prosperous country by setting up giant immigrant camps and carrying out mass deportations?I am descended from “white” privilege and members of the Daughters of the American Revolution. My family has grown stronger in recent years by the blending of ethnic, cultural and religious origins through marriage and adoption — with Indonesian, Malaysian, Algerian, Romanian, Iranian and Danish heritages combined with Scot Irish and English ones.We have family members who are Jewish, Muslim, Sikh, Buddhist, atheist and agnostic as well as Episcopalian, Quaker and Catholic.The reality is that our economy and society thrive because of our diversity. For that reason, my license plate is framed with the slogan “Make America Great, Welcome Immigrants.”Cynthia MackieSilver Spring, Md.To the Editor:Stating that immigrants are “poisoning the blood of our country,” Donald Trump has offered a vision for another term that includes immediate mass deportations, ending DACA, an even more restrictive Muslim ban, relegating migrants to huge tent cities in Texas and more.I read this with the same dread I felt when articles were written about the possible overturning of Roe v. Wade. Many people thought, “Oh, that won’t happen here.” But it did. It did happen.Donald Trump and Stephen Miller will wreak havoc on everything our country stands for. It will be a daily dose of outrage and horror. Those who aren’t tuned in to this potential for disaster will realize what they were ignoring only when it is too late.The next election may be the most important in our history as a country. Sitting it out or voting third party is not an option. Our country’s future and our quality of life depend on showing up to vote.People need to understand that these are not offhand remarks. Mr. Trump does what he says he’s going to do. He has clearly shown us what he is and who he is: a wannabe dictator.Kathryn JanusChicagoTo the Editor:Donald Trump’s immigration restriction plans contain much that will be to the liking of the American people. As a lifelong Democrat and the son of immigrants who had to wait years for citizenship, I like it myself because 1) huge amounts of taxpayer dollars are going to the support of undocumented immigrants and 2) America faces a crisis of overpopulation, which is already straining our natural resources.I categorically reject the demonization of immigrants, and I also note that Mr. Trump’s policies generally favor the top 2 percent, not the average American. But if President Biden ignores this issue, or keeps doing what he is doing, it will cost him the election.Alan SalyBrooklynTo the Editor:It is worse than hypocritical that the man behind the dark menace of deportation — Stephen Miller — descends from a family of immigrants who escaped the pogroms in Eastern Europe and found refuge in America.As a Jew and the son of Holocaust survivors, I am frankly appalled by Mr. Miller’s harsh and seemingly uncompromising position.America is nothing if not a nation of immigrants. For Mr. Miller to foment an unrestrained assault against immigrants is, if I may use the term, “beyond the Pale.”Edwin S. RothschildMcLean, Va.Shocked by Trump’s Vow to Root Out ‘Vermin’Former President Donald Trump said his political opposition was the most pressing and pernicious threat facing America during a campaign event in New Hampshire on Saturday.Sophie Park for The New York TimesTo the Editor:Re “After Calling Foes ‘Vermin,’ Trump Campaign Warns Its Critics Will Be ‘Crushed’” (nytimes.com, Nov. 13):At a campaign event Saturday in New Hampshire, Donald Trump vowed to “root out the communists, Marxists, fascists and the radical left thugs that live like vermin within the confines of our country.”So often I have heard variations on the poem that begins, “First they came for the Communists …”Did the people attending a Veterans Day event not hear the echo from less than 100 years ago when they or their parents or grandparents went to war to protect democracy against fascists from Germany and Italy who voiced these same goals?It is shocking that a vast support network is prepared to put these plans into effect here if the former president is re-elected in 2024.Bob AdlerNew YorkTo the Editor:People are not vermin. Even the person who compares his political opponents to “vermin” is not vermin; he is a human being.Donald Trump’s despicable speech, however, should make every American recoil in horror that he would use such a dehumanizing tactic toward people who disagree with him. The Republican Party should immediately distance itself from Mr. Trump and his dangerous rhetoric.Anyone who believes that people are vermin should not be elected to any office, from local P.T.A. president on up. Certainly, the highest office in the land should never be in the hands of such a person.Justin Stormo GipsonNewman Lake, Wash.Women in China, Loath to Turn Back the Clock Gilles Sabrié for The New York TimesTo the Editor:Re “China’s Male Leaders Signal to Women That Their Place Is in the Home” (news article, Nov. 3):Although Mao Zedong proclaimed that “women hold up half the sky,” the weight of thousands of years of Chinese culture held back — and continues to hold back — many from attaining their full potential.My mother, born before the 1949 Communist takeover of the government, was prohibited from going to school by her father, but even decades later suffered limited choices, gender discrimination and the societal stigma of having only daughters.Now that Chinese women have tasted power, freedom and independence, they are not going to go back to being merely wives, mothers and caretakers any more than American women, as evidenced by the recent U.S. elections, are going to give up their hard-won reproductive rights to satisfy the wishes of right-wing conservatives.Men on both sides of the globe are going to find that turning back the clock is a lot harder than they thought.Qin Sun StubisBethesda, Md.The writer is a newspaper columnist and author of “Once Our Lives,” a historical saga about four generations of Chinese women.Billionaires, Invest in Earth George WylesolTo the Editor:Re “Space Billionaires Should Spend More Time Thinking About Sex,” by Kelly Weinersmith and Zach Weinersmith (Opinion guest essay, nytimes.com, Nov. 5):Doesn’t it make more sense to address challenges to our future on Earth, a very appealing home for humans, than to try to adapt to hostile, inhospitable planets? We’d likely be better off if Elon Musk and his fellow billionaires would invest their vast sums in things like wind turbines and infrastructure. They might also help advance the human race by promoting development of qualities like compassion, reconciliation and cooperation.Beyond that, the authors make great points about the difficulties of sex and procreation in space. Let’s not forget Earth’s sex appeal!Marjorie LeeWayland, Mass. More

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      Biden expected to meet with Xi Jinping next month for ‘constructive’ talks

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      Joe Biden is expected to meet Chinese leader Xi Jinping on the sidelines of a summit in San Francisco in November for “constructive” talks, the White House said on Tuesday.The comments came days after China’s foreign minister made a rare visit to Washington to pave the way for Xi to meet Biden at the Asia-Pacific Economic Cooperation (Apec) summit.China has not yet confirmed that Xi will come.“We’re aiming to have a constructive conversation, meeting between the leaders in San Francisco in November,” the White House press secretary, Karine Jean-Pierre, said of the long-awaited talks.“That’s what’s going to happen next month in November. We’re having a constructive conversation in San Francisco. I think I just confirmed it,” she added.A senior US administration official told AFP: “There is an agreement in principle to meet in San Francisco in November. We are still working through important details needed to finalize those plans.”Biden and Xi have had no contact since a meeting in Bali in November 2022.Relations have been tense for years between the world’s top two economies as they vie for influence in the Asia-Pacific region and beyond, and as Beijing boosts cooperation with Russia in a bid to reduce US dominance.After Beijing’s top diplomat Wang Yi met senior US officials last week, the White House said that the two sides were “working together towards a meeting”.But the Chinese foreign minister said on Saturday that the road to talks was still “not smooth”.Wang told a Washington event hosted by the Aspen Strategy Group that “both sides hope to stabilize and improve bilateral relations as soon as possible and agreed to work together toward a San Francisco summit between the two heads of state”, state news agency Xinhua reported.“The path to San Francisco is not smooth and cannot be left to ‘autopilot’,” Wang warned, according to Xinhua.The two sides must “eliminate interference, overcome obstacles, enhance consensus and accumulate results”, he said. More

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      DeSantis Says He Will ‘Reorient’ U.S. Foreign Policy to Counter China

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      While the G.O.P. field has largely moved away from the neoconservative policies of George W. Bush, Mr. DeSantis has taken heat for some of his isolationist tendencies, including on Ukraine.Gov. Ron DeSantis of Florida, working to maintain his second-place status in the Republican primary, said Friday that as president he would “reorient” U.S. foreign policy to give clear priority to China while downplaying national security risks posed by conflicts such as Russia’s war on Ukraine.In a speech laying out his approach, Mr. DeSantis cast Beijing as a greater threat to the United States than the Axis powers and the Soviet Union ever were because of its economic might. As commander in chief, he said, he would “prioritize the Indo-Pacific region as the most pressing part of the world for defending U.S. interests and U.S. security.”A less aggressive approach, he argued, would allow China to export its “authoritarian vision all across the world,” creating a “global dystopia.”“They seek to be the dominant power in the entire world, and they are marshaling all their society to be able to achieve that objective,” Mr. DeSantis said. “So this is a formidable threat and it requires a whole of society approach.”Mr. DeSantis’s remarks, delivered in Washington, D.C., at the Heritage Foundation, a conservative think tank, come at a difficult moment for his presidential campaign. Not only is he badly trailing former President Donald J. Trump in the polls, but Nikki Haley, the former South Carolina governor and former ambassador to the United Nations, has successfully positioned herself as a credible alternative to Mr. Trump, puncturing the Florida governor’s argument that the Republican presidential primary is a two-man race.Mr. DeSantis has lately used foreign policy to attack other Republican presidential candidates, rebuking Mr. Trump for his critical comments about Israeli leaders and accusing Ms. Haley — who is attracting growing interest from Republican donors and voters — of being soft on China.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.We are confirming your access to this article, this will take just a moment. However, if you are using Reader mode please log in, subscribe, or exit Reader mode since we are unable to verify access in that state.Confirming article access.If you are a subscriber, please More

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      Aukus will ‘get done’ despite jitters in Congress, Biden tells Albanese at White House meeting

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      Joe Biden has played down congressional jitters over the Aukus nuclear-powered submarine deal and has revealed he assured Xi Jinping that the countries involved are not aiming to “surround China”.The US president welcomed the Australian prime minister, Anthony Albanese, to the White House and insisted he was “confident that we’re going to be able to get the money for Aukus because it’s overwhelmingly in our interest”.“So the question is not if, but when,” Biden said during a joint press conference with Albanese in the rose garden on Wednesday US time (Thursday Australian time).Biden also relayed a conversation he previously had with China’s president about the Aukus security partnership, in which Australia, the US and the UK have pledged to work together on advanced defence capabilities.“When I was asked when we put together the deal, I was asked by Xi Jinping, were we just trying to surround China?,” Biden said“I said, no, we’re not surrounding China. We’re just making sure that the sea lanes remain open, it doesn’t unilaterally to be able to change the rules of the road in terms of what constitutes international airspace and water, space, etc.”Biden and Albanese spoke to reporters after wide-ranging talks at the White House. They pledged to cooperate in numerous fields, including space, with a deal paving the way for launches of US commercial space vehicles from Australia.There was a heavy emphasis on working with Pacific countries amid intensifying competition for influence in the region.The leaders announced plans for the US and Australia to “co‑finance critical maritime infrastructure projects in Kiribati, including the rehabilitation of Kanton Wharf and Charlie Wharf in Tarawa”. They will also assist Pacific countries with banking services and undersea cables.The climate crisis formed a significant part of the talks, with plans to collaborate on battery supply chains “to explore the deepening of both countries’ manufacturing capability and work on battery technology research and development”.In their joint statement, Biden and Albanese acknowledged that “achieving the goals of the Paris Agreement will require rapid deployment of clean energy and decarbonisation technologies, and increased electrification in our countries this decade, alongside the phasedown of unabated coal power”.It was the ninth time Albanese has met with Biden since the May 2022 election, although the earlier meetings mostly occurred on the sidelines of international events.Biden and the first lady, Jill Biden, welcomed Albanese and his partner, Jodie Haydon, to the White House for a private dinner on Tuesday evening but the main diplomatic talks were held on Wednesday.The day began with a welcome on the south lawn of the White House before the two leaders held a formal meeting in the Oval Office.Biden began that meeting by apologising “again for not being able to make my visit to Australia” in May when the Quad summit in Sydney was called off because of debt ceiling negotiations in the US.“Things were a little bit in disarray here and required to be home,” Biden told Albanese.Albanese will be feted at a state dinner later on Wednesday US time (late Thursday morning AEDT).Biden described ties with Australia as “strong” and getting “stronger”, while Albanese said the alliance was based on “a faith in freedom and democracy, a belief in opportunity, a determination to build a prosperous and more peaceful world”.However, seven months after Albanese joined Biden and the British prime minister, Rishi Sunak, in San Diego to announce the Aukus plans, there remains uncertainty over congressional approvals needed for them to succeed.Aukus will require reforms to the US export control system. Congress will also need to authorise the sale of at least three Virginia-class submarines to Australia in the 2030s but some Republicans have raised concerns that will come at the cost of the US’s own needs. Australian-built nuclear-powered submarines are due to enter into service from the 2040s.Standing alongside Albanese on Wednesday, Biden urged Congress to “pass our Aukus legislation this year”.Albanese played down concerns about the deal, saying he regarded the US “as a very reliable partner”.“And I regard the relationship that I have with the president as second to none of the relationships that I have around the world, or indeed domestically, for that matter,” Albanese said.The prime minister said he was “very confident in the discussions that I’ve had with Democrats and Republicans that there is very broad support for the Aukus arrangements”.Albanese said he looked forward to “a constructive dialogue” when he visits China next month, describing such talks as important to build understanding and reduce tensions.Biden and Albanese also discussed the Israel-Hamas conflict. In their joint statement, they said Hamas attacks on Israel “can have no justification, no legitimacy, and must be universally condemned”.While pledging to “support Israel as it defends itself and its people against such atrocities”, the two leaders also called on “all parties to act consistent with the principles of international law and to protect civilians as an utmost priority”.“We are concerned at the humanitarian situation in Gaza and call on all actors to ensure the provision of humanitarian supplies to populations in need,” Biden and Albanese said.“Our two countries support equal measures of dignity, freedom, and self-determination for Israelis and Palestinians alike and we mourn every civilian life lost in this conflict. We continue to support Palestinian aspirations for a state of their own and consider a two-state solution as the best avenue towards a lasting peace.”Albanese announced that Australia would provide an additional $15m in humanitarian assistance for civilians in Gaza. More

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      US orders immediate stop to some AI chip exports to China; Lloyds profits up but lending margins fall – business live

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      Good morning, and welcome to our live, rolling coverage of business, economics and financial markets.The US has ordered the immediate halt of exports to China of hi-tech computer chips used for artificial intelligence, chipmaker Nvidia has said.Nvidia said the US had brought forward a ban which had given the company 30 days from 17 October to stop shipments. Instead of a grace period, the ban is “effective immediately”, the company said in a statement to US regulators.The company did not say why the ban had been brought forward so abruptly, but it comes amid a deep rivalry between the US and China over who will dominate the AI boom.Nvidia said that shipments of its A100, A800, H100, H800, and L40S chips would be affected. Those chips, which retail at several thousand dollars apiece, are specifically designed for use in datacentres to train AI and large language models.Demand for AI chips has soared as excitement has grown about the capabilities of generative AI, which can produce new text, images and video based on the inputs of huge volumes of data.Nvidia said it “does not anticipate that the accelerated timing of the licensing requirements will have a near-term meaningful impact on its financial results”.Lloyds profits up but competition squeezes marginsIn the UK, Lloyds Banking Group has reported a rise in profits even as it said competition was hitting its margins as mortgage rates fall back.Britain’s biggest bank said it made £1.9bn in profits from July to September, an increase compared to the £576m for the same period last year. The comparison has an important caveat, however: the bank has restated its financials to conform to new accounting rules.Net interest margin – the measure of the difference between the cost of borrowing and what it charges customers when it lends – was 3.08% in the third quarter, down 0.06 percentage points in the quarter “given the expected mortgage and deposit pricing headwinds”, it said.The bank did set aside £800m to deal with rising defaults from borrowers, but said that it was still seeing “broadly stable credit trends and resilient asset quality”.The agendaFilters BETAAn EY-linked auditor to the Adani Group is under scrutiny from India’s accounting regulator, Bloomberg News has reported.The National Financial Reporting Authority, or NFRA, has started an inquiry into, S.R. Batliboi, a member firm of EY in India, Bloomberg said, citing unnamed sources.S.R. Batliboi is the auditor for five Adani companies which account for about half Adani’s revenues.Bloomberg reported that representatives for NFRA and the Adani Group didn’t respond to an emailed request for comments. A representative for EY and S.R. Batliboi declined to comment to Bloomberg.China’s economic slowdown is causing worries at home, as well as in Germany and other big trade partners.A series of Chinese government actions have signalled their concern about slowing growth, which could cause problems for an authoritarian regime.Xi Jinping, China’s president, visited the People’s Bank of China for the first time, according to reports yesterday. “The purpose of the visit was not immediately known,” said Reuters, ominously.State media also reported that China had sharply lifted its 2023 budget deficit to about 3.8% of GDP because of an extra $137bn in government borrowing. That was up from 3%. The Global Times, a state-controlled newspaper, said the move would “benefit home consumption and the country’s economic growth”, citing an unnamed official.Germany’s economic fortunes were better than expected in October, according to a closely watched indicator – but whether it’s overall good news or bad depends on who you ask.The ifo business climate index rose from 85.8 to 86.9 points, higher than the 85.9 expected by economists polled beforehand by Reuters.Germany has been struggling as growth slows in China, a key export market, as well as the costs of switching from Russian gas to fuel its economy. You can read more context here:Franziska Palmas, senior Europe economist at Capital Economics, a consultancy, is firmly in team glass half empty. She said:
      The small rise in the Ifo business climate index (BCI) in October still left the index in contractionary territory, echoing the downbeat message from the composite PMI released yesterday. This chimes with our view that the German economy is again recession.
      Despite the improvement in October, the bigger picture remains that the German economy is struggling. The Ifo current conditions index, which has a better relationship with GDP than the BCI, is still consistent with GDP contracting by around 1% quarter-on-quarter. This is an even worse picture than that painted by the composite PMI, which fell in October but points to output dropping by “only” 0.5% quarter-on-quarter.
      But journalist Holger Zschaepitz said it looks like things are improving:UK house prices will continue to slide this year and in 2024 and will not start to recover until 2025, Lloyds Banking Group has forecast.The lender, which owns Halifax and is Britain’s largest mortgage provider, said that by the end of 2023 UK house prices will have fallen 5% over the course of the year and are likely to fall another 2.4% in 2024.Those forecasts, which were released alongside its third-quarter financial results on Wednesday, suggest UK house prices will have dropped 11% from their peak last year, when the market was still being fuelled by a rush for larger homes in the wake of the coronavirus pandemic.Lloyds said the first signs of growth would only start to emerge in 2025, with its economists predicting a 2.3% increase in house prices that year.You can read the full report here:The Israel-Hamas conflict adds another cloud on the horizon for the global economy, according to the head of the International Monetary Fund (IMF).Kristalina Georgieva was at “Davos in the desert”, a big conference hosted by Saudi Arabia.The Future Investment Initiative conference was the subject of boycotts five years ago when Saudi crown prince Mohammed bin Salman allegedly ordered the murder of exiled critic Jamal Khasoggi. The distaste of global leaders has apparently faded since, however.Speaking on the Israel-Hamas conflict, Georgieva said (via Reuters):
      What we see is more jitters in what has already been an anxious world. And on a horizon that had plenty of clouds, one more – and it can get deeper.
      The war has been devastating for Israel and Gaza. Hamas killed more than 1,400 people and took more than 220 people as hostages in an assault on Israel. The health ministry in Gaza, which is run by Hamas, said last night that Gaza’s total death toll after 18 days of retaliatory bombing was 5,791 people, including 2,360 children.The broader economic impacts have been relatively limited, but Georgieva said that some neighbouring countries were feeling them:
      Egypt, Lebanon, Jordan. There, the channels of impact are already visible. Uncertainty is a killer for tourists inflows. Investors are going to be shy to go to that place.
      Reckitt, the maker of Dettol bleach and Finish dishwasher products, has missed sales expectations as revenues dropped 3.6% year-on-year in the third quarter.Its shares were down 2.3% on Wednesday morning, despite it also committing to buy back £1bn in shares.It missed expectations because of the comparison with strong sales in the same period last year in its nutrition division, which makes baby milk powder.Kris Licht, Reckitt’s chief executive, said:
      Reckitt delivered a strong quarter with 6.7% like-for-like growth across our hygiene and health businesses and has maintained market leadership in our US nutrition business.
      We are firmly on track to deliver our full year targets, despite some tough prior year comparatives that we continue to face in our US Nutrition business and across our OTC [over-the-counter medicines] portfolio in the fourth quarter.
      Speaking of Deutsche Bank, it posted its own earnings this morning: third-quarter profits dropped by 8%, but that was better than expected by analysts.Shares in Deutsche, which has struggled in the long shadow of the financial crisis, are up 4.2% in early trading.Reuters reported:
      The bank was slightly more optimistic on its revenue outlook for the full year, forecasting it would reach €29bn ($30.73bn), the top end of its previous guidance range, as it upgraded the outlook for revenue at the retail division.
      Net profit attributable to shareholders at Germany’s largest bank was €1.031bn, better than analyst expectations for profit of around €937m.
      Though earnings dropped, it marked the 13th consecutive profitable quarter, a considerable streak in the black after years of hefty losses.
      Here are the opening snaps from across Europe’s stock market indices, via Reuters:
      EUROPE’S STOXX 600 DOWN 0.1%
      FRANCE’S CAC 40 DOWN 0.4%
      SPAIN’S IBEX DOWN 0.3%
      EURO STOXX INDEX DOWN 0.2%
      EURO ZONE BLUE CHIPS DOWN 0.3%
      European indices appeared to be taking their lead from the US, where Google owner Alphabet’s share price dropped in after-hours trading last night. That dragged down futures for US tech companies, even though another tech titan, Microsoft, pleased investors.Analysts led by Jim Reid at Deutsche Bank said:
      Microsoft saw its shares rise +3.95% in after-market trading as revenues of $56.52bn (+13% y/y) beat estimates of $54.54bn and EPS came in at $2.99 (v $2.65 expected). The beat comes on the back of recovering cloud-computing growth with corporate customers spending more than expected. The other megacap, Alphabet, missed on their cloud revenue estimates at $8.4bn (v $8.6bn) with the share price falling -5.93% after hours as operating income and margins both surprised slightly to the downside.
      You can read more about Google’s performance here:We’re off to the races on the London Stock Exchange this morning: and the FTSE 100 has dipped at the open.Shares on London’s blue-chip index are down by 0.15% in the early trades. Lloyds Banking Group shares initially moved higher, but now they are down 2.1% after they flagged increasing competition hitting net interest margins.Good morning, and welcome to our live, rolling coverage of business, economics and financial markets.The US has ordered the immediate halt of exports to China of hi-tech computer chips used for artificial intelligence, chipmaker Nvidia has said.Nvidia said the US had brought forward a ban which had given the company 30 days from 17 October to stop shipments. Instead of a grace period, the ban is “effective immediately”, the company said in a statement to US regulators.The company did not say why the ban had been brought forward so abruptly, but it comes amid a deep rivalry between the US and China over who will dominate the AI boom.Nvidia said that shipments of its A100, A800, H100, H800, and L40S chips would be affected. Those chips, which retail at several thousand dollars apiece, are specifically designed for use in datacentres to train AI and large language models.Demand for AI chips has soared as excitement has grown about the capabilities of generative AI, which can produce new text, images and video based on the inputs of huge volumes of data.Nvidia said it “does not anticipate that the accelerated timing of the licensing requirements will have a near-term meaningful impact on its financial results”.Lloyds profits up but competition squeezes marginsIn the UK, Lloyds Banking Group has reported a rise in profits even as it said competition was hitting its margins as mortgage rates fall back.Britain’s biggest bank said it made £1.9bn in profits from July to September, an increase compared to the £576m for the same period last year. The comparison has an important caveat, however: the bank has restated its financials to conform to new accounting rules.Net interest margin – the measure of the difference between the cost of borrowing and what it charges customers when it lends – was 3.08% in the third quarter, down 0.06 percentage points in the quarter “given the expected mortgage and deposit pricing headwinds”, it said.The bank did set aside £800m to deal with rising defaults from borrowers, but said that it was still seeing “broadly stable credit trends and resilient asset quality”.The agenda More

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      in US Politics

      ‘A dangerous game’: Republican chaos and indecision as crises shake the world

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      The US’s closest ally in the Middle East is reeling from what many call its “9/11” and now a humanitarian disaster looms in Gaza. Winter is approaching in Ukraine, which needs urgent supplies to maintain its counteroffensive against Russia. From China’s expansive ambitions, to coups in Africa, to the climate crisis, the world is crying out for leadership.But on Capitol Hill in Washington, Republicans can’t find one. Friday marked the 10th day of paralysis as the party struggles to elect a speaker of the House of Representatives to replace the ousted Kevin McCarthy. This after majority leader Steve Scalise won a closed-door vote but abandoned his run because he lacked enough support to win on the House floor.Such petty bickering, grievances and vendettas might typically fascinate seasoned Washington watchers and readers of political insider newsletters but be met by a shrug by many Americans and indifference overseas. This time, however, is different. The ripples of Republican dysfunction could soon be felt across a troubled world.“It’s a dangerous game that we’re playing,” Michael McCaul, chairman of the House foreign affairs committee, told reporters on Thursday. “It just proves our adversaries right that democracy doesn’t work. Our adversaries are watching us and Israel is watching. They need our help.”McCaul, a Republican congressman from Texas, has put forward a bipartisan resolution with Gregory Meeks of New York, the top Democrat on the committee, condemning Hamas and reaffirming support for Israel. But the House cannot vote on it until there is a speaker in the chair.McCaul added: “I’m going to remind my colleagues about how dangerous this is. If we don’t have a speaker, we can’t assist Israel in this great time of need after this terrorist attack. So I think we’re playing with fire and we need to stop playing games and politics with this and vote a speaker in.”The House speaker is the third-highest-ranking elected official in the country, second in line to the presidency. Without one, legislative business is at a standstill. The House is currently under the control of Representative Patrick McHenry of North Carolina, who was named as the temporary speaker after McCarthy’s departure, but his ability to move legislation is unclear.Joe Biden said on Tuesday that he would seek approval from Congress for additional funding for Israel in the wake of the devastating attack by Hamas. But the fight over the speakership puts a question mark over how soon such aid could be approved and sent.Biden has also requested $24bn in additional funding for Ukraine but this too hangs in limbo. Although the White House has claimed that the vast majority of House Republicans still support such assistance, there has been growing dissent in recent weeks and the issue was a factor in McCarthy’s downfall.Then there is the threat of a government shutdown that would further dent US credibility overseas. Congress has until a self-imposed deadline of 17 November to pass 12 new bills to fund the government for the rest of the year and into 2024. The leadership vacuum is sucking up precious time and energy and making a shutdown more likely.Biden had spent the first two years of his presidency seeking to restore order and rebuild alliances after the “America first” mayhem of the Donald Trump years. But when Republicans gained control of the House in January with a narrow majority that empowered the far right, that effort was always likely to suffer erosion.skip past newsletter promotionafter newsletter promotionKarine Jean-Pierre, the White House press secretary, told reporters: “What we’re seeing is certainly shambolic chaos over there on the other side of Pennsylvania Avenue, and they need to get their act together … We’ve never seen a conference behave this way or be this chaotic.”Biden’s speech on Tuesday was described as one of the most powerful statements of support for Israel ever given by a US president; he has previously spoken of his deep-rooted love for the country. Huge uncertainties remain: Israel has ordered a million people to evacuate northern Gaza ahead of an expected ground invasion; Hamas could still have more surprises in store; Hezbollah, an Iran-backed militia based in Lebanon, could still open a second front.But instead of addressing the crisis with one voice, Republicans are consumed with a bogus impeachment inquiry into Biden and the publicity-seeking antics of members such as Matt Gaetz, Marjorie Taylor Greene and Nancy Mace. And this week New York Republicans moved to expel accused fraudster George Santos.Kyle Herrig, executive director of the Congressional Integrity Project, said: “Since day one the Maga Republicans in the House majority have failed to work on real domestic priorities and instead focused on partisan stunts in their extreme efforts to return Donald Trump to the White House.“Their ongoing dysfunction, misplaced priorities and failures now impede the efforts of President Biden to come to the aid of key allies internationally. Chaos, not governance, defines the House Republican Caucus.” More