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The impact of international students on the U.S. economy

Universities in the U.S. have a long tradition of welcoming international students. But this year will be different because of the coronavirus pandemic. According to a report by the Institute of International Education, the enrollment of foreign students at U.S. higher education institutions was down by almost half this fall. Some 90 percent of campuses reported that foreign students deferred attendance. Source: CGTN

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Japan factory output, retail sales seen up, virus resurgence clouds outlook: Reuters poll

Japan’s factory output probably grew for a fifth straight month in October and retail sales likely rebounded for the first time in eight months, a Reuters poll showed on Friday, offering further signs that the economy is gradually recovering from the COVID-19 pandemic. However, a recent sharp jump in coronavirus cases is clouding the outlook, and expected softness in the job market and declining housing starts indicate a weakening of household purchasing power amid the health crisis. “Although the economy is picking up, it remains way below the pre-pandemic level,” ...

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Hong Kong Policy Address Emphasises Integration with China

The initiatives to deepen integration with mainland China that were highlighted in the annual policy address to the legislature by Hong Kong’s Chief Executive Carrie Lam on 25 November underscore the territory’s ongoing efforts to take advantage of the growth and employment opportunities made possible by the mainland’s broadening economic recovery, says Fitch Ratings. However, they will also reinforce the territory’s sensitivity to developments in China’s creditworthiness. Fitch downgraded Hong Kong’s rating to ‘AA-’, from ‘AA’, in April 2020 and revised the Outlook to Stable from Negative, following an earlier ...

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ECB’s Villeroy says amount of stimulus not only question

The amount of monetary stimulus is not the only question facing the European Central Bank and it also needs to look at how it is transmitted to the economy, ECB policymaker Francois Villeroy de Galhau said on Friday. The ECB is preparing a new stimulus package to help cushion the impact of the coronavirus pandemic on the euro zone economy, which is expected to be decided next month. “In the face of prolonged uncertainty, out first objective must be keeping very favourable financing conditions as long as necessary,” Villeroy, who ...

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China’s central bank could intervene after ‘glaring’ state-firm bond defaults, analyst says

The People’s Bank of China (PBOC) could step in following a number of recent bond defaults by Chinese state-linked firms, according to Bank of Communications International’s Hao Hong. “In the past couple of weeks the default situation is somehow getting glaring,” Hong, managing director and head of research at the firm, told CNBC’s “Street Signs Asia” on Friday. “I wouldn’t be surprised to see the PBOC intervene from here,” he said. Earlier in November, state-owned coal miner Yongcheng Coal and Electricity defaulted on a 1 billion yuan (around $152.01 million) ...

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Euro zone banks fall short of ECB’s climate demands

Euro zone banks are failing to disclose even the most basic information about their exposure to climate change, the European Central Bank said on Friday, as it set out its expectations for banks on its watch. Banks will be expected to take climate change into account when making loans or investing, considering aspects such as the carbon footprint of a business and the risk that it is affected by extreme weather or changes in regulation. The ECB has given banks a year to gather the information and comply with its ...

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EU-UK trade talks stuck on three key issues: Barnier

Significant differences remain between the European Union and Britain on fisheries, state aid and future dispute resolution in talks on a trade agreement, the EU’s chief negotiator Michel Barnier said on Friday. The trade deal is to replace from Jan. 1, 2021 the current transition period after Britain left the European Union at the end of last January to avoid tariffs and quotas on goods. “Same significant divergences persist. Traveling to London this evening to continue EU-UK talks with (Britain’s chief negotiator) David Frost and his team,” Barnier said in ...

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China’s industrial profits grow at quickest monthly pace since early 2017

Profits at China’s industrial firms grew in October for a sixth consecutive month and at their quickest pace since early 2017, pointing to a steady recovery in the manufacturing sector after it was hard hit by the COVID-19 pandemic. Profits at Chinese industrial firms surged 28.2% year-on-year in October to 642.91 billion yuan ($97.79 billion), National Bureau of Statistics (NBS) data showed on Friday, after rising 10.1% in September versus the previous year. That was the biggest monthly profit growth since Jan-Feb 2017. The NBS combines the results for January ...

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Brexit goes down to the wire: EU and UK say big differences remain

The European Union and Britain said on Friday there were still substantial differences over a Brexit trade deal as the EU chief negotiator prepared to travel to London in a last-ditch attempt to avoid a tumultuous finale to the five-year Brexit crisis. With just five weeks left until the United Kingdom finally exits the EU’s orbit on Dec. 31, both sides are calling on the other to compromise on the three main issues of contention – fishing, state aid and how to resolve any future disputes. The two sides will ...

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India’s economy shrinks 7.5% in July-Sept quarter

Indian economy contracted 7.5% in the quarter to September, government data showed on Friday, showing some signs of a pick-up after the easing of pandemic restrictions that triggered a record contraction of 23.9% year-on-year in the previous quarter. The read-out for the September quarter was better than the 8.8% contraction forecast of analysts in a Reuters poll. Source: Reuters (Reporting by Manoj Kumar, Nidhi Verma; editing by John Stonestreet)

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Deutsche Bank bullish about the 2021 economic recovery — but there are two key risks

Deutsche Bank upgraded its global growth outlook for 2021 but cautioned that two key risks could still spoil the economic recovery from the coronavirus crisis. In the bank’s latest report out Wednesday — entitled “Hope on the horizon” — Deutsche Bank researchers updated their calls due to what it called “the incredibly positive” coronavirus vaccine news in recent weeks, with pharmaceutical giants Pfizer, Moderna and AstraZeneca all saying their vaccine candidates were highly effective at preventing Covid-19. “With efficacy rates at the upper end of expectations, this opens up the ...

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ECB must enable governments to spend their way out of pandemic: report

The European Central Bank must keep borrowing costs super low to enable governments to spend their way out of a pandemic-induced recession, which threatens to hollow out production capacity, ECB board member Fabio Panetta told a Portuguese newspaper. “Favourable financing conditions create the best environment for an effective fiscal policy, which in turn creates the conditions for the private sector to also take full advantage of the favourable financing conditions we ensure through our measures,” Expresso quoted Panetta as saying on Friday. The ECB has already flagged more policy easing ...

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Governments should strike a balance between encouraging philanthropy through tax support and ensuring effective public policy

Governments should continue providing support to the philanthropic sector while taking steps to safeguard tax systems and ensure that the activities of philanthropic organisations continue to align with the public interest, according to a new report from the OECD. Taxation and Philanthropy reviews the tax treatment of philanthropic entities and charitable donations in 40 countries worldwide. The report points out the significant impact of philanthropy – the non-profit sector represents as much as 5% of GDP in many countries – as well as the wide range of potential tax policy ...

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China braces for more defaults among state firms in 2021 — and that could be a good thing

Bond defaults by Chinese state-linked companies are set to continue into the new year, but analysts say that may be a good thing in the long run as “zombie” entities are weeded out. Investors usually consider government-backed companies a safe bet given the “implicit guarantee” that Chinese authorities would save those that run into trouble. However, a string of defaults in recent weeks — including by highly rated entities — have challenged that assumption. Some high-profile state-linked businesses that have recently defaulted on their debt repayments include miner Yongcheng Coal ...

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China Escalates Australia Trade Dispute With Wine Tariffs

China imposed anti-dumping tariffs on Australian wine, escalating a monthslong trade dispute and forcing local vintners to seek other markets for millions of bottles during a pandemic. China’s Ministry of Commerce said the temporary duties of 107.1% to 212.1% will take effect Saturday. They follow an investigation begun in August that concluded Australian exporters dumped cheap wine into the Chinese market, hurting the domestic wine industry. Australia’s government rejected these preliminary findings. The idea that Australia subsidizes its wine industry to be able to sell below cost on international markets ...

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