Economy

Hit by war, Israelis defer loan repayments in October -banks regulator

Published

5 months ago

November 23, 2023

Hit by war, Israelis defer loan repayments in October -banks regulator

© Reuters. An explosion takes place during Israeli air strikes over Gaza, as seen from southern Israel, amid the ongoing conflict between Israel and the Palestinian group Hamas, November 22, 2023. REUTERS/Alexander Ermochenko

By Steven Scheer

JERUSALEM (Reuters) – Israelis deferred payment on nearly 3 billion shekels of loans in October as a result of Israel’s war with Hamas, the banking regulator said on Wednesday.

In all, some 117,000 loans were deferred, mostly in mortgages and other consumer credit, totalling 2.7 billion shekels ($727 million) last month, the Bank of Israel said.

Data gathered in November, it said, showed that one-third of those who deferred loan payments last month were customers who were directly impacted by damage from the war – those who live or own a business within 30 km from the Gaza border, people who were evacuated from their homes, people are were called up as reservists and those who are immediate relatives of those killed during the war, kidnapped or missing.

Following the attacks on Israel by Palestinian Hamas gunmen on Oct 7 and the subsequent war, the central bank’s banking supervisor told banks to allow for loan deferrals and ease fees for households and businesses affected by the conflict.

“Since the publication of the deferral program, we have seen tremendous interest among customers, and that the measure significantly helps those who need it to get through this challenging time,” Supervisor of Banks Daniel Hahiashvili said.

“It is important to emphasize to the public the significance of deferring loan repayments, and that borrowers should do so only if they really need to.”

Bank of Israel Governor Amir Yaron has suggested that he is opposed to lowering short-term interest rates during the war but that steps such as those by banks were “in practice, some monetary easing,” since they target those who need it most and without increasing the risk premium in financial markets.

($1 = 3.7154 shekels)

Economy

Russian central bank says it needs months to make sure CPI falling before rate cuts -RBC

Published

4 months ago

December 26, 2023

Russian central bank says it needs months to make sure CPI falling before rate cuts -RBC

MOSCOW (Reuters) – Russia’s central bank will need two to three months to make sure that inflation is steadily declining before taking any decision on interest rate cuts, the bank’s governor Elvira Nabiullina told RBC media on Sunday.

The central bank raised its key interest rate by 100 basis points to 16% earlier in December, hiking for the fifth consecutive meeting in response to stubborn inflation, and suggested that its tightening cycle was nearly over.

Nabiullina said it was not yet clear when exactly the regulator would start cutting rates, however.

“We really need to make sure that inflation is steadily decreasing, that these are not one-off factors that can affect the rate of price growth in a particular month,” she said.

Nabiullina said the bank was taking into account a wide range of indicators but primarily those that “characterize the stability of inflation”.

“This will take two or three months or more – it depends on how much the wide range of indicators that characterize sustainable inflation declines,” she said.

The bank will next convene to set its benchmark rate on Feb. 16.

The governor also said the bank should have started monetary policy tightening earlier than in July, when it embarked on the rate-hiking cycle.

Economy

China identifies second set of projects in $140 billion spending plan

Published

4 months ago

December 25, 2023

China identifies second set of projects in $140 billion spending plan

© Reuters. FILE PHOTO: Workers walk past an under-construction area with completed office towers in the background, in Shenzhen’s Qianhai new district, Guangdong province, China August 25, 2023. REUTERS/David Kirton/File Photo

SHANGHAI (Reuters) – China’s top planning body said on Saturday it had identified a second batch of public investment projects, including flood control and disaster relief programmes, under a bond issuance and investment plan announced in October to boost the economy.

With the latest tranche, China has now earmarked more than 800 billion yuan of its 1 trillion yuan ($140 billion) in additional government bond issuance in the fourth quarter, as it focuses on fiscal steps to shore up the flagging economy.

The National Development and Reform Commission (NDRC) said in a statement on Saturday it had identified 9,600 projects with planned investment of more than 560 billion yuan.

China’s economy, the world’s second largest, is struggling to regain its footing post-COVID-19 as policymakers grapple with tepid consumer demand, weak exports, falling foreign investment and a deepening real estate crisis.

The 1 trillion yuan in additional bond issuance will widen China’s 2023 budget deficit ratio to around 3.8 percent from 3 percent, the state-run Xinhua news agency has said.

“Construction of the projects will improve China’s flood control system, emergency response mechanism and disaster relief capabilities, and better protect people’s lives and property, so it is very significant,” the NDRC said.

The agency said it will coordinate with other government bodies to make sure that funds are allocated speedily for investment and that high standards of quality are maintained in project construction.

($1 = 7.1315 renminbi)

Economy

Russian central bank says it needs months to make sure CPI falling before rate cuts -RBC

Published

4 months ago

December 25, 2023

Nabiullina said it was not yet clear when exactly the regulator would start cutting rates, however.

“We really need to make sure that inflation is steadily decreasing, that these are not one-off factors that can affect the rate of price growth in a particular month,” she said.

Nabiullina said the bank was taking into account a wide range of indicators but primarily those that “characterize the stability of inflation”.

“This will take two or three months or more – it depends on how much the wide range of indicators that characterize sustainable inflation declines,” she said.

The bank will next convene to set its benchmark rate on Feb. 16.

The governor also said the bank should have started monetary policy tightening earlier than in July, when it embarked on the rate-hiking cycle.