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Argentina says to agree economic plan with IMF staff before sending it to congress

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Argentina says to agree economic plan with IMF staff before sending it to congress
© Reuters. FILE PHOTO: Argentina’s Economy Minister Martin Guzman poses for a picture before an interview with Reuters at the Economy Ministry, in Buenos Aires, Argentina December 10, 2020. Picture taken December 10, 2020. REUTERS/Agustin Marcarian

By Hugh Bronstein and Nicolás Misculin

BUENOS AIRES (Reuters) – Argentina’s government plans to agree on its new multiyear economic plan with International Monetary Fund staff before sending the proposal to Congress, Economy Minister Martin Guzman said on local radio on Friday.

“First, we will seek to reach an agreement with IMF staff, and then it will be sent to Congress for ratification,” the minister said in comments to local station Radio Con Vos.

Earlier in the day, a government source, who asked not to be named, outlined the same plans in an interview with Reuters. The IMF did not respond to a request for comment.

After getting walloped in a recent midterm congressional election, the administration of President Alberto Fernandez is facing political headwinds as average Argentines struggle with high poverty rates and inflation of more than 50% a year that has gutted their spending power.

Guzman told the radio interviewer that no abrupt devaluation of the local peso currency was being planned, despite rampant market speculation to the contrary as the local peso has weakened 20.4% over the last 12 months.

The Argentine government would also like to resolve the rollover of $45 billion in outstanding debt owed to the IMF this year, Guzman added.

President Fernandez, whose Peronist coalition needs to win back voters ahead of 2023 presidential elections, has vowed not to cut government spending in a way that would derail Argentina’s recovery from a long recession exacerbated last year by the COVID-19 pandemic.

After gaining IMF staff approval, the economic plan will be debated in a Congress with opposition parties emboldened by their strong showing in the midterm vote.

“The entire ruling coalition is aligned with a vision of how this problem is to be solved. We seek an agreement, but not just any agreement; an agreement that allows Argentina to continue on the path of recovery,” Guzman told Radio Con Vos.

The government forecasts growth of more than 9% this year after the economy shrank 9.9% in 2020.

The government, unable to make payments that next year total almost $19 billion, has been locked in talks with the IMF since last year to push back $45 billion left over from a failed loan agreement in 2018 under former President Mauricio Macri.

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Economy

Large US companies by market cap begin to think more about cutting investments and staff – survey

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biggest us companies by market cap

The chief executive officers (CEOs) of the largest US companies by market cap are revising downward their plans for hiring and investment amid a worsening outlook for the US economy, a quarterly Business Roundtable (BRT) survey showed.

That’s because of high inflation and rising costs, said the association, which includes dozens of major U.S. corporations. The S&P 500 and U.S. 100 indices are also declining amid the developments.

The index, which gauges the economic outlook, fell 11 points this quarter, to 73 points. The indicator is still above the 50-point mark, indicating that the economy is growing. However, it fell below the long-term average of 84 points for the first time since the third quarter of 2020.

The index of planned investments fell 7 points to 68 points and expected sales fell 8 points to 91 points, according to the BRT report.

What will the biggest U.S. companies do by market cap?

About 39% of CEOs plan to increase the number of employees at their companies in the next six months, while 28% of respondents intend to downsize. Last quarter, those numbers were 47% and 19%, respectively.

Nearly half (49%) said that labor costs are a major expense at their company. Twenty-one percent of CEOs plan to reduce capex in the next six months and 40% plan to increase it. In the third quarter these proportions were 18% and 43%, respectively.

U.S. CEOs on average forecast that U.S. GDP will increase by 1.2% in 2023. 142 CEOs participated in the BRT survey, which ran from October 31 to November 28.

Earlier, we reported that Saxo Bank presented “shocking predictions” for the next year.

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Economy

Saxo Bank predictions 2023: Saxo Bank presents “shocking predictions” for the next year

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Analysis Saxo Bank

Saxo Bank predictions 2023: The Danish Bank has published ten “shocking predictions” for 2023. They concern a series of unlikely and underestimated events because of which, however, “the world markets can be covered with a powerful shock wave”..

Saxo Bank analysis – what’s going to happen next year?

Against the backdrop of rising energy prices, leading U.S. technology companies and “billionaire technophiles” will create a multi-billion dollar project aimed at exploring new opportunities in the energy sector, the bank predicts. According to the bank, this project will be comparable to the “Manhattan Project” to study atomic energy and the creation of the nuclear bomb, and investments in the new project will be about $1 trillion.

Inflationary pressures and geopolitical instability will continue to affect not only the global economy but also the financial markets, says the Danish bank. Against this background, states will take a more conservative policy, reducing investments in more complex financial instruments, and investing in traditional assets such as gold. And traders at the same time are considering Gold Futures.

Increased demand for gold in 2023 will, according to Saxo Bank, cause its price to rise from the current $1,800 to $3,000 per ounce.

Earlier, we reported that Apple has postponed the release date of an unmanned electric car for a year.

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Economy

Apple postponed the release date of Apple’s electric car by a year

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Apple's electric car

U.S. Apple Inc. (NASDAQ:AAPL) has pushed back the release date of Apple’s unmanned electric car by a year to 2026 and somewhat tempered its ambitions about the extent of its self-driving capability, Bloomberg reported, citing sources.

Earlier, Apple announced electric cars. According to the sources, the Titan project has been in limbo for the past few months because top executives at Apple have concluded that their vision of a fully self-driving car with no steering wheel and no pedals can’t be realized with existing technology. The APPLE Price Chart showed a slight decline amid this news. 

In this regard, the company has decided to adjust the project and now plans to create a less autonomous car, with a steering wheel and pedals, with the possibility of fully unmanned driving on highways, sources said.

The driver of the car is expected to be able to do his or her own thing while driving on the highway, such as watching a movie or playing a game, and will receive advance notifications to switch to manual control when approaching city streets or deteriorating weather conditions.

Apple shares fell 2.5 percent in trading Tuesday. Since the beginning of this year, their value has fallen by 19.5%.

We previously reported on World Economic News now through the morning of Dec. 6.

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