Economy

US SEC adopts new cyber rule, unveils brokerage AI proposal

Published

10 months ago

July 27, 2023

US SEC adopts new cyber rule, unveils brokerage AI proposal

© Reuters. FILE PHOTO: Signage is seen at the headquarters of the U.S. Securities and Exchange Commission (SEC) in Washington, D.C., U.S., May 12, 2021. Picture taken May 12, 2021. REUTERS/Andrew Kelly/File Photo

By Douglas Gillison

(Reuters) -Wall Street’s top regulator on Wednesday adopted new rules requiring publicly traded companies to disclose hacking incidents, a measure officials said was to help the investing public contend with the mounting cost and frequency of cyber attacks.

On a party-line vote, the five-member U.S. Securities and Exchange Commission also voted to propose requiring broker-dealers to address conflicts of interest in the use of artificial intelligence in trading, a reform partly influenced by the events of the 2021 “meme stock” rally when officials found robo-advisers and brokers used AI and game-like features to drive user behavior.

The new cybersecurity rule will require companies to disclose a cyber breach within four days after determining it is serious enough to be material to investors. The rule would allow delays if the Justice Department deems them necessary to protect national security or police investigations, the SEC said.

Companies will also have to periodically describe their efforts to identify and manage threats in cyberspace. The rule, first proposed in March 2022, forms part of a broader SEC effort to harden the financial system against data theft, systems failure and cyber-intrusions.

Republican commissioners dissented, saying the new rule was unnecessary given already existing requirements, unduly burdensome on companies and could offer hackers a roadmap to their targets’ vulnerabilities and the size of ransom to be demanded.

SEC officials said that in response to public comments they had trimmed certain parts of the proposal, removing a requirement for companies to disclose board members’ expertise in cybersecurity.

The AI proposal issued on Wednesday would require broker-dealers to “eliminate or neutralize” any conflict of interest that occurs if a trading platform’s predictive data analytics puts the broker’s financial interest ahead of that of the firm’s clients.

Republican commissioners again objected, claiming the proposal was unnecessary in light of brokerages’ disclosure requirements and could stifle the use of new technologies.

“The release does seem to suggest that investors when confronted with these technologies just melt into puddles of incompetence and so disclosure doesn’t work for them,” said Commissioner Hester Peirce.

William Birdthistle, the SEC’s director of investment management, said the proposal would not replace any disclosure requirements and that because the technologies are highly scalable, complex and frequently opaque, a special rule was necessary.

In a third vote also scheduled for Wednesday, the SEC is to decide whether to propose changing rules that exempt some online investment advisers from registering under the Investment Advisers Act of 1940.

Economy

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

Published

5 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

5 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

5 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.