Overseas Headlines – November 28, 2017

Asia:

China to set up system to monitor its firms overseas

China’s state planner issued guidelines on Tuesday for monitoring the overseas activities of Chinese firms and individuals to prevent tax fraud, money laundering, illegal financing, and activities damaging to the country’s reputation. In a statement on its website, the National Development and Reform Commission (NDRC) warned that the government will record and tally instances of laws and regulations being broken in China or abroad, and offenders would be punished. The plan is part of efforts to regulate firms’ overseas investments and business activities as China’s influence in the global economy grows, especially through its Belt and Road initiative. In addition to illegal activities, the guidelines specifically say actions that “violate international conventions and United Nations resolutions, or that disrupt foreign economic cooperation, adversely impact the Belt and Road initiative, or harm China’s reputation”, will be recorded. The guidelines also focus on monitoring cross-border capital flows by insisting overseas deals are reasonable and disclosures are accurate. China clamped down on capital outflows last year after its foreign currency reserves fell by nearly $1 trillion and the authorities defended the yuan against depreciation.

https://www.reuters.com/article/us-china-investment-overseas/china-to-set-up-system-to-monitor-its-firms-overseas-idUSKBN1DS0NR

 

Europe:

ECB asks for views on new interest rate

The European Central Bank will hold a public consultation until Jan. 12 on the main features of its new unsecured overnight interest rate, expected to be launched by 2020, it said in a statement on Tuesday. The ECB unveiled plans in September to devise a new benchmark after industry players failed to revamp existing facilities hit by fraud and dwindling liquidity. “The interest rate would complement existing benchmark rates produced by the private sector and serve as a backstop reference rate,” the ECB said. “This consultation is a first step. A second consultation related to the methodology will follow later in the process.”

https://www.reuters.com/article/ecb-rates-reference/ecb-asks-for-views-on-new-interest-rate-idUSF9N1M801B

 

 U.S.:

Fed chair nominee Powell pledges ‘decisive’ response to any economic crisis

Jerome Powell, the nominee to chair the Federal Reserve, defended the Fed’s use of broad crisis-fighting powers in remarks prepared for his Tuesday Senate confirmation hearing, positioning himself as an extension of the central bank policies of current Chair Janet Yellen and her predecessor Ben Bernanke. In a brief opening statement released by the Fed on Monday, Powell, who is currently a member of the Fed’s Board of Governors, endorsed the core ideas that have defined U.S. central banking since the financial crisis of 2007 to 2009 – a willingness to move aggressively against a downturn, and an insistence on flexibility and independence from political influence in setting policy. “We must retain the flexibility to adjust our policies in response to economic developments,“ Powell said in the remarks. ”We must be prepared to respond decisively and with appropriate force to new and unexpected threats to our nation’s financial stability and economic prosperity. “I will do everything in my power to achieve those goals while preserving the Federal Reserve’s independent and nonpartisan status that is so vital to their pursuit,” Powell said, referring to the Fed’s Congressionally mandated goals of promoting both maximum employment and low and stable inflation.

https://www.reuters.com/article/us-usa-fed-powell/fed-chair-nominee-powell-pledges-decisive-response-to-any-economic-crisis-idUSKBN1DR2Q7

2017-11-28T18:42:27+00:00