ePaper_2nd Edition_October 12, 2016

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14 WEDNESDAY, OCTOBER 12, 2016 DT Business German investor cheer could hit growth buffers • AFP, Frankfurt Sentiment among investors in Germany sharply improved this month from its post-Brexit doldrums, data showed yesterday, but analysts warned against overconfidence. The ZEW economic institute’s headline investor confidence index hit 6.2 points in October, an increase of 5.7 points over September and beating the 4 points analysts surveyed by Factset had predicted. Sentiment had hovered at low levels in August and September after a sharp dip in July following Britain’s June 23 vote to quit the European Union. Even with the October increase, the barometer remains well below its long-term average of 24.1 points. The result was “very positive, and points to a thoroughly robust development of the business cycle,” ZEW president Achim Wambach said in a statement. But Wambach warned of “a few political and economic risks” that could still weigh on the index, including “dangers for the German banking sector”. German and global investors have eyed Deutsche Bank, the country’s biggest lender, with concern in recent weeks as it negotiates with the US Department of Justice over a $14bn fine demand. But other banks in Europe’s largest economy are struggling too, complaining of the crowded sector’s intense competition and low interest rates set by the European Central Bank cutting into profits. Easing fears The latest ZEW reading follows a battery of positive indicators, including strong readings of exports, industrial orders, and industrial production in August and a resurgent business confidence index from the Munich-based Ifo institute in September. That was reflected in an increase in the ZEW “current situation” sub-index to its highest level since January. Analysts warned that expectations of the “golden autumn” pointed to by Ifo should be treated with care. “The improvement in current economic activity may have raised expectations for future growth” among investors, Berenberg bank’s Florian Hense said, but “expectations remain below the pre-Brexit vote averages.” “Easing fears about the effects of Brexit have more than offset concerns about the wider implications of Deutsche Bank’s troubles,” analyst Jennifer McKeown of Capital Economics said. While “broadly encouraging ... the index still points to a slowdown in German GDP growth” based on the ZEW’s past relationship to economic activity, she added. Beyond Germany, investors’ expectations for the economies of eurozone neighbours also saw a positive turn, gaining 6.9 points to stand at 12.3. ZEW questions analysts and institutional investors about their assessment of the current economic situation and the outlook for the coming months to compile its regular survey. • CORPORATE NEWS Worst 4 days since June push sterling below $1.23 • Reuters Sterling slid back below $1.23 yesterday as senior officials and investors pointed to the potential for more falls for a market still in shock after Friday’s 10% flash crash. The past four days for the pound are now its worst since the aftermath of the vote to leave the European Union in June and Bank of England policymaker Michael Saunders warned a “bumpy” Brexit could sharply reduce British economic growth. “Given the scale and persistence of the UK’s current account deficit, I would not be surprised if sterling falls further, but I am fairly agnostic as to whether any further depreciation is likely,” Saunders said. • Facebook launches intra-office ‘Workplace’ network • AFP, London Social network giant Facebook recently launched new global product Workplace, a platform that it hopes will replace intranet, mailbox and other internal communication tools used by businesses worldwide. The platform allows employees to collaborate in real-time and is intended to compete with similar office communication products including Microsoft’s Yammer, Salesforce’s Chatter and Slack. The Silicon Valley company developed the concept, hitherto called “Facebook at Work”, two years ago in its London office and has since tested the product on 1,000 companies worldwide. It is the first Facebook product launched outside the United States. “We combined the things that already exist into a single tool that will allow employees to display a wall of information, like on their private profiles,” Julien Codorniou, director of Workplace, told AFP. Workplace was developed outside of the Facebook ecosystem and remains completely separate from the social network - even using grey as the dominant colour, rather than Facebook’s distinct blue. It is accessible on a computer or phone without a Facebook account and employees can access the platform using their work email address. The service will only enable the transfer of intra-office data, which will remain fully owned by the business. “We’ve brought the best of Facebook to the workplace - whether it’s basic infrastructure such as News Feed, or the ability to create and share in Groups or via chat, or useful features such as Live, Reactions, Search and Trending posts,” said the company. “This means you can chat with a colleague across the world in real time, host a virtual brainstorm in a Group, or follow along with your CEO’s presentation on Facebook Live.” Subscribers will pay between one to three euros ($1.1- $3.3) per connected employee, depending on the size of the business, while NGOs and educational establishments will receive the service for free. • Southeast Bank Limited has recently opened a booth for collecting municipal tax at Feni Pourashava. Nizam Uddin Hajari, MP inaugurated the booth, said a press release. The bank’s managing director, Shahid Hossain was present on the occasion
Business 15 DT WEDNESDAY, OCTOBER 12, 2016 Employees walk in Hungarian oil and gas group MOL’s main Danube refinery in Szazhalombatta REUTERS Oil glut to last until mid-2017 unless Opec cuts output • AFP, Paris A massive oil glut may weigh on world markets deep into next year unless the Opec producer cartel makes good on its promise to cut output, the International Energy Agency (IEA) said yesterday. The oil price has recovered steadily since Opec said last month that it would reduce production, with details to be hammered out at the cartel’s November meeting, and such a deal would “speed up the process” of working off global oil inventories, the IEA said in its monthly report. “Even with tentative signs that bulging inventories are starting to decline, our supply-demand outlook suggests that the market - if left to its own devices - may remain in oversupply through the first half of next year,” the IEA said. “If Opec sticks to its new target, the market’s rebalancing could come faster,” it said. Initially greeted with scepticism among analysts, Opec’s agreement to cut output has gained traction in the oil market, with the IEA noting that the oil price has risen by 15% since the cartel’s announcement on September 28. Oil prices rose to their highest level in several months after Russian President Vladimir Putin said Monday that his country, not a member of the cartel, was ready to align with Opec’s push to limit oil output. In morning European trade yesterday, both WTI and Brent held well above the key $50 (45 euro) level per barrel, at $50.90 and $52.89, respectively. “The waiting game is over,” the IEA said. “OPEC has effectively abandoned its free market policy set in train nearly two years ago.” • German investor cheer could hit growth buffers • AFP, Frankfurt Sentiment among investors in Germany sharply improved this month from its post-Brexit doldrums, data showed yesterday, but analysts warned against overconfidence. The ZEW economic institute’s headline investor confidence index hit 6.2 points in October, an increase of 5.7 points over September and beating the 4 points analysts surveyed by Factset had predicted. Sentiment had hovered at low levels in August and September after a sharp dip in July following Britain’s June 23 vote to quit the European Union. Even with the October increase, the barometer remains well below its long-term average of 24.1 points. The result was “very positive, and points to a thoroughly robust development of the business cycle,” ZEW president Achim Wambach said in a statement. But Wambach warned of “a few political and economic risks” that could still weigh on the index, including “dangers for the German banking sector”. •
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Page 9 and 10: World Soldiers protest army cuts ou
Page 11 and 12: World EU sanctions against Russia o
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Page 17 and 18: Feature 17 WEDNESDAY, OCTOBER 12, 2
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Page 21 and 22: Opinion 21 Will a hard Brexit take
Page 23 and 24: Special 23 Act against militants or
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