26-07-2018

ECONOMY & BUSINESS
BANGLADESHTODAY 10
THE
THURSDAY, JULY 26, 2018
Iran replaces central bank
chief as economy faces crisis
Branch Manager Conference-2018 of Federal Insurance Company Ltd. was held recently at the Samson H Chowdhury Centre,
Dhaka Club Ltd. A M M Mohiuddin Chowdhury, Managing Director of the company presided over the conference. Enamul
Hoq, Chairman of the company delivered speech as Chief Guest and expressed satisfaction over the performance of the company.
Claims Committee Chairman Alhaj Sabirul Haque, Audit Committee Chairman Md. Didarul Anwar, Directors Jainul
Abedin Jamal, Khadizaul Anwar, Morshedul Shafi, Jamal Abdul Naser Chowdhury, Md. Anisul Hoque, Rokan Uddin
Chowdhury and Adviser A K M Sarwardy Chowdhury delivered speech and advised employees to ensure better services to
insured and prepare themselves to achieve the target for the year 2018. Among others Additional Managing Director Md.
Mahabubul Alam, Deputy Manging Director Md. Abu Bakkar Siddique, Assistant Managing Director Md.Bahauddin, SVP S.M.
Md. Azimuddoula Khan, SAVP Md. Mamunur Rashid (Milton) delivered their speech regarding problems of the branch and
achievement of the Target-2018.
Photo: Courtesy
Iran replaced its central bank chief on
Wednesday, local media reported, amid the
fallout over banking scandals and the crisis
facing the country's economy.
Valiollah Seif, who had served as the bank's
governor since President Hassan Rouhani took
power in August 2013, was replaced by
Abdolnasser Hemati following a cabinet
meeting, according to the official IRNA news
agency.
Hemati, 61, previously served as head of
Central Insurance of Iran, as well as both Sina
Bank and Bank Melli. He had been slated to
become ambassador to China until he was
recalled at the last minute.
The head of Iran's Planning and Budget
Organisation, Mohammad-Bagher Nobakht,
who is also government spokesman, offered his
resignation at the cabinet meeting but it was
rejected by Rouhani.
The central bank has been criticised
particularly over its handling of a currency
crisis that has seen the rial lose more than half
its value against the dollar in the past year.
An attempt in April to enforce a fixed rate for
the rial sparked a boom in black market
exchanges, forcing the bank to backtrack as the
currency's street value crashed to record lows
in June. The crisis coincided with
Washington's announcement in May that it
was pulling out of the 2015 nuclear deal and
reimposing full sanctions on Tehran,
exacerbating the run on the rial.
The US also slapped individual sanctions on
Seif in May, accusing him of helping Iran's
Revolutionary Guard Corps transfer millions of
dollars to Lebanon's Hezbollah.
Rouhani thanked Seif for his "strong and
serious service", and said the cabinet had "full
confidence" in Hemati.
He said a key priority was tackling "illegal
credit institutions".
Bankruptcies at several unlicensed lenders -
which had offered high interest rates and cheap
loans with little capital to back them up - wiped
out the savings of millions of depositors and
has been a key driver of recent protests.
Rouhani vowed to crackdown on unlicenced
banks when he came to power.
His government has been pressured to repay
lost deposits, further straining government
resources.
Asian markets eke out gains
amid trade war fears
Asian stocks made modest gains
Wednesday, after a batch of generally solid
US earnings and news of China's stimulus
plans helped drive markets up.
Beijing on Tuesday signalled that it would
shift to a looser fiscal policy in a bid to protect
the world's second largest economy from the
impact of an escalating trade row with
Washington.
The announcement sent Shanghai's main
stock index up 1.6 percent on Tuesday, while
the yuan hit a 13-month low versus the US
dollar.
Shanghai's rally stalled Wednesday, with
the market edging down 0.1 percent. But
Hong Kong and Singapore jumped one
percent while Tokyo rose 0.5 percent.
European markets stabilised in opening
trade on Wednesday, with Paris adding 0.2
percent and London down 0.1 percent while
Frankfurt was flat.
The mixed movements in markets came as
analysts warned that investors were still
weighing the implications of the spat
between Washington and its main trading
partners including China and the European
Union.
In addition to slapping hefty import taxes
on steel and aluminium from the EU, Canada
and Mexico, Trump has imposed 25 percent
tariffs on $34 billion of Chinese products,
drawing a retaliatory response from Beijing.
Washington has since threatened tariffs on
another $200 billion of Chinese goods.
"While investors remain upbeat about
earnings and the US economy, it's
increasingly challenging to stay optimistic
given all the negative geopolitical news flows
all the while staring at the possibility of US
follow-through with another 200 billion (in)
tariffs late August," said Stephen Innes, head
Germany's biggest lender Deutsche
Bank said Wednesday a major
restructuring under its new chief
executive was in full swing, as it
confirmed second-quarter profits that
beat analysts' previous expectations.
Net profits reached 401 million
euros ($468 million) on the back of 6.6
billion euros in revenue, in line with
preliminary figures the lender released
earlier this month. Analysts surveyed
by data company Factset had earlier
forecast profits of around 120 million
euros.
But the result was still 14 percent lower
than last year's second-quarter earnings
of 466 million euros.
of Asia-Pacific trading at Oanda trading
group.
"The price of US soybeans, meanwhile, has
dropped roughly 20 per cent since Trump
announced his first round of tariffs in
March," Innes added.
In what appeared to be the first
acknowledgement that Trump's aggressive
trade strategy was hurting ordinary
Americans, the US government on Tuesday
announced $12 billion in aid for farmers who
have been the primary targets of retaliatory
measures.
But the US leader showed no sign of
backing down on his approach, tweeting:
"Tariffs are the greatest!"
European Commission President Jean-
Claude Juncker, who was on his way to
Washington on Wednesday to meet Trump
in a bid to prevent an escalation of tariffs, said
he was "not very optimistic" about the
outcome.
"I know Mr Trump pretty well. I have met
him frequently and know how to deal with
him and know how he deals with others. We
will negotiate as equals," Juncker told
German public broadcaster ZDF.
Oil prices rose in Asian trade Wednesday
following a report by the industry group
American Petroleum Institute (API) showing
a decline in US crude inventories.
"Crude oil prices scaled the charts as
markets reacted to a US inventory drawdown
in API reports," said Bemjamin Lu, a
Singapore-based commodities analyst with
Phillip Futures.
He cautioned however that "though oil
prices have recuperated in the coming term,
bearish signals continue to permeate chart
activities as the threat of rising supplies
looms large".
Trade fears weigh on German
business confidence
Confidence among German
business leaders fell slightly in
July, a closely-watched survey
showed Wednesday, as trade
war fears weighed on the
outlook for the future.
The Munich-based Ifo
institute's monthly
barometer, based on a survey
of 9,000 businesses, shed 0.1
points for a reading of 101.7
this month.
"Companies were slightly
more satisfied with their
current business situation,
but scaled back their business
expectations slightly," Ifo
president Clemens Fuest
noted in a statement.
Levels of German business
and investor confidence have
fallen back in recent months,
as companies weathered a
growth slowdown in the first
quarter and eyed an escalating
tit-for-tat trade war between
the European Union and the
United States.
Early indicators suggest
growth may have recovered
slightly between April and
June. But trade war fears
remain live, as European
Commission President Jean-
Claude Juncker travels to
Washington for last-ditch
talks with US President
Donald Trump.
Juncker said Wednesday he
was "not very optimistic" that
he could talk the US leader out
of border taxes on car imports
from the EU.
After Trump first hit steel
and aluminium with tariffs,
the EU reacted with levies of
its own on a selection of
American goods like
motorcycles, jeans and peanut
butter.
"Chances for a return to
powerful growth in the second
half of the year
look good, even if there are
two weighty risks with the
trade dispute between
the US and the rest of the
world as well as Brexit,"
economists at public
bank LBBW commented on
the Ifo result. UAE port
operator signs deal for
logistics hub in Mali.
Deutsche Bank says big-bang restructuring on track
"We accelerated the reshaping of our
bank significantly and proved the
resilience of our global business"
between April and June, said CEO
Christian Sewing, who took over from
crisis firefighter John Cryan in April with
promises of a far-reaching shakeup.
Deutsche highlighted some 239
million euros in costs for restructuring
and employee severance - twice as much
as the same quarter last year - as around
1,700 workers left.
It added that it was "on track" to slash
another 1,500 from its total headcount
to dip below 93,000 by the end of the
year, with a further ambition to shrink
"well below" 90,000 by the end of 2019.
EU's Juncker
says 'not very
optimistic'
about Trump
trade talks
European Commission chief
Jean-Claude Juncker
dampened expectations
ahead of talks Wednesday
with US President Donald
Trump that they would
resolve a bitter trade dispute
between the two giant
economies.
"I am not very optimistic. I
know Mr Trump pretty well. I
have met him frequently and
know how to deal with him
and know how he deals with
others. We will negotiate as
equals," Juncker told German
public broadcaster ZDF.
Juncker said that the EU is
"not in the dock - we don't
need to defend ourselves.
"We are here to explain
ourselves and explore ways
to avoid a trade war," he
said. Juncker renewed his
pledge of retaliatory
measures should Trump
make good on his threat to
slap new tariffs on EU car
imports.
"We are ready to do that,"
he said. "We are in a position
to respond appropriately
right away."
Brussels already retaliated
against steel and aluminium
tariffs levelled last month,
imposing punitive duties on
over $3 billion (2.5 billion
euros) of US goods,
including blue jeans,
bourbon and motorcycles, as
well as orange juice, rice and
corn.
Ryanair says
300 jobs under
threat in Dublin
overhaul
Irish no-frills airline Ryanair
warned Wednesday of
around 300 potential job
cuts for pilots and cabin
crew under plans to reduce
its Dublin-based aircraft
fleet.
Ryanair said in a
statement that it has issued
"protective notice" to the
staff under winter plans to
slash its Dublin fleet from 30
to around 24, and partly
blamed the impact of Irish
pilots' strikes. Iran replaces
central bank chief as
economy faces crisis.
Meanwhile it finished integrating of
subsidiary Postbank into its retail
banking division in May.
And in its investment banking
division, Deutsche reported
"substantial" reductions in "leveraged" -
or borrowing-fuelled - holdings of stocks
and bonds, accounting for most of an 85-
billion-euro reduction in such exposures
across the bank.
There was slower progress on cutting
costs, which fell 1.0 percent to 5.6 billion
euros in adjusted terms in the second
quarter. But executives said they
remained committed to reducing
outlays from last year's 23.8 billion euros
to 23 billion in 2018.
Chittagong South Zone of Islami Bank Bangladesh Limited organized Business Development
Conference on 20 July 2018 Friday at a Hotel of Cox's Bazar. Mohammed Monirul Moula, Additional
Managing Director of the Bank was present in the program as chief guest. Abu Reza Md. Yeahia,
Deputy Managing Director, M. Zubayer Azam Helali and Mohammed Shabbir, Senior Vice
Presidents were present as special guest. Md. Nizamul Haque, Executive Vice President & Head of
Chittagong South Zone presided over the function. Heads of nine branches of Cox's Bazar District
along with officials attended the function.
Photo: Courtesy
Trump to meet EU's Juncker in
bid to resolve trade dispute
US President Donald Trump is due to
meet Wednesday with European
Commission President Jean-Claude
Juncker in a bid to resolve a festering
trade dispute between the two key
economies.
Trump on Tuesday crowed that it was
his tough stance and threats of auto tariffs
that brought the European leader to the
bargaining table.
But at home, Trump is facing
increasing criticism as consumers,
farmers and businesses are taking a hit
from the retaliation to the raft of US
tariffs on steel, aluminum, and tens of
billions of dollars in products from China
that he has imposed in recent weeks.
"What the European Union is doing to
us is incredible," he said. "They sound
nice, but they're rough."
But when threatened with tariffs on
autos and auto parts, EU officials rushed
to come to Washington, Trump claimed.
"Countries that have treated us unfairly
on trade for years are all coming to
Washington to negotiate," he said in a
Lending to the private sector
picked up in the eurozone in
June as businesses borrowed
more, data from the European
Central Bank showed
Wednesday.
Adjusted for some purely
financial transactions, the
pace of growth in lending to
non-financial firms jumped
from 3.7 to 4.1 percent yearon-year.
With growth in lending to
households flat at 2.9 percent,
that meant businesses
accounted for all of a 0.2
percentage-point increase in
the pace of overall lending to
the private sector, which
reached 3.5 percent.
Economists watch loan
growth closely, as more cash
pre-dawn tweet. "Tariffs are the greatest!"
While Juncker is set to make a last
effort to talk Trump out of the auto tariffs,
which would hit Germany's dominant
carmakers hard, the EU has vowed a
withering response if the US goes ahead.
Brussels already retaliated against the
steel and aluminum tariffs, imposing
punitive duties on over $3 billion of US
goods, including blue jeans, bourbon and
motorcycles, as well as orange juice, rice
and corn.
White House economic advisor Larry
Kudlow said last week that Juncker could
be coming to Washington with a "very
important free trade offer," but the
Commission dismissed that idea.
French Finance Minister Bruno Le
Maire said over the weekend: "We refuse
to negotiate with a gun to the head." EU
Trade Commissioner Cecilia Malmstrom,
who will accompany Juncker, expressed
hope for a "de-escalation" of the tensions,
but said the EU is drawing up a list of
more US products that could be hit with
retaliatory duties if the trip fails.
Businesses drive faster eurozone
lending growth in June
flowing into the economy
points to an increase in activity.
The data is especially vital for
the ECB as it eyes the results of
its decision last month to
dismantle a key pillar of its
support to the eurozone by the
end of the year.
Aiming to boost growth and
stoke inflation to the target of
just below 2.0 percent, the
Frankfurt institution has set
interest rates at historic lows
and buys 30 billion euros ($35
billion) of government and
corporate bonds per month.
Both policies are designed to
pump cash through the
financial system and into the
real economy, where it can
power investments, hiring
and consumer spending.
But from October, the ECB
will reduce purchases to 15
billion euros per month before
ending them in December,
saying the move is justified as
inflation is on a solid path
towards its goal.
A quarterly survey
published yesterday by the
central bank showed that
between April and June,
demand for credit remained
strong among firms and
households and banks were
loosening conditions for
issuing and repayment of
loans. ECB policymakers
have nevertheless left their
options open to extend bondbuying
again if needed if the
economy shows signs of
weakening.
Canada, Mexico and China - the main
target of Trump's trade offensive -also
have hit back with steep duties on US
goods, and have filed complaints against
Washington at the World Trade
Organization.
While the US claims the retaliation is
"illegal," the Trump administration
recognized that it is doing damage to
American farmers. The Agriculture
Department announced it will provide up
to $12 billion in aid to farmers hurt by
trade tariffs.
In an ironic tweet, Trump mocked his
European trading partners.
"The European Union is coming to
Washington tomorrow to negotiate a deal
on Trade. I have an idea for them. Both
the U.S. and the E.U. drop all Tariffs,
Barriers and Subsidies!" he wrote.
"That would finally be called Free
Market and Fair Trade! Hope they do it,
we are ready - but they won't!"
But more voices even in Trump's own
Republican ParGerman post office
delivers electric car surprise.
European
stock markets
steady at open
European stock markets
stabilised in opening trade
on Wednesday, ahead of US-
EU trade talks to resolve a
festering dispute.
US President Donald Trump
will meet later with European
Commission President Jean-
Claude Juncker to address a
simmering row between the
two key economies.
In initial deals, London's
benchmark FTSE 100 index
was down 0.1 percent at
7,702.66 points, compared
with Tuesday's closing level.
In the eurozone,
Frankfurt's DAX 30 was
almost flat at 12,688.71
points and the Paris CAC 40
added 0.2 percent to
5,445.24EU's Juncker says
'not very optimistic' about
Trump trade talks.