- Ukraine Deal Gives Little Relief as War Set to Rumble On. Within hours of Ukraine’s gas deal with Russia, fighting flared up in the country’s easternmost regions, highlighting the challenges in bringing peace to the country after a year of upheaval. While the pact brokered by the European Union is designed to keep homes warm through the winter, rebels still hold large chunks of the country’s east and are planning a controversial election for Nov. 2. Crimea remains under Russian control and the Kremlin, bristling at an EU agreement Ukraine signed this year, is testing NATO with daily airspace violations.
- Russia’s Surprise Rate Increase Fails to Stem Ruble Drop. The ruble headed for the biggest drop since 2009 after a larger-than-forecast increase of Russia’s key interest rate failed to ease concern that the economy will remain hobbled by sanctions and capital flight. The Bank of Russia raised its key rate to 9.5 percent percent from 8 percent, according to a website statement. That surprised all 31 economists surveyed by Bloomberg. The ruble stayed lower, extending its worst month in more than two years.
- Falling Bank Deposits Add to China Economy Warning Signs. Chinese bank deposits dropped following a crackdown on lenders manipulating their numbers and “illicit” means of attracting money, threatening to weigh on credit growth and hinder efforts to reignite the economy. Four of the five biggest banks, led by Industrial & Commercial Bank of China Ltd. (601398), posted a drop in deposits as they reported third-quarter earnings this week. Central bank data showed it was the first quarterly decline for the nation’s banking industry since at least 1999.
- WPP Revenue Growth Slows as U.S. Ad Business Slackens. WPP Plc (WPP) reported slowing sales growth at the world’s largest advertising company in the third quarter, and said the end of the year wouldn’t be much better as business in North America and the U.K. cools.
- European Stocks Rally After Bank of Japan Boosts Stimulus. (video) European stocks rose to a four-week high amid optimism the Bank of Japan’s stimulus will fill some of the gap left by the end of Federal Reserve bond buying. The Stoxx Europe 600 Index gained 1.8 percent to 336.8 at the close of trading, boosting its weekly advance to 2.9 percent, the most this year. Barclays Plc and BNP Paribas SA led lenders higher, as all 19 industry groups on the gauge climbed. The equity benchmark dropped 1.8 percent in October, the most since June 2013, amid concern the European Central Bank’s asset purchases won’t be enough to revive the region’s economy.
- Brent Set for Longest Run of Weekly Losses Since 2002. Brent crude headed for a sixth weekly loss, the longest losing streak since 2002, as OPEC boosted production to a 14-month high amid a global surplus. West Texas Intermediate was on track for its biggest monthly decline in more than two years.
- OPEC in ‘Price War’ as Iraq Says Members Fight for Market. Members of OPEC, the group that supplies 40 percent of the world’s oil, are engaged in an internal price war as they seek to preserve their share of an oversupplied market, Iraqi Oil Minister Adel Abdul Mahdi said. “There is a price war within OPEC,” Abdul Mahdi told an evening session of the parliament in Baghdad yesterday, which was broadcast on state-run television. “The market’s fundamentals have changed, with an extra 3 million barrels a day of crude entering the market at a time when growth in China and India has slowed.”
- Copper Declines After Freeport Workers Cancel Strike. Copper futures declined for the second straight day as workers called off a strike at Freeport-McMoRan Inc.’s site in Indonesia, the world’s second-largest mine for the metal.
- The Next Time The BIS Wants To Warn About Monetary Kool-Aid, Bubbles, Lack Of Liquidity Or Complacency...
- Whatever You Do, Ignore These Signs.
- Starting Off Strong: Goldman Slashes Q4 GDP Estimate From 3.0% To 2.2%.
- Despite Plunge In Spending, Consumer Confidence Jumps To 7-Year High. (graph)
- Chicago PMI Smashes Expectations, Jumps To 12-Month High. (graph)
- Where Is The "Low Gas Price Spending Spree": Consumer Spending Tumbles At Fastest Rate Since October 2009. (graph)
- Goldman On BOJ's Banzainomics: "We Highlight The Potential For Harsh Criticism Of Further Cost-Push Inflation".
Reuters:
- China growth to slow to 5 percent over next year or so: London consultancy. China’s economic growth will slow sharply to 5 percent over the next year or so rather than close to 7 percent suggested by forecasts based on official statistics, according to a new indicator of growth momentum published by Fathom, a London-based consultancy.“Before he became premier, Li Keqiang had described GDP figures as unreliable. He suggested some alternative indicators to gauge the true health of the overall economy,” wrote Yiannis Koutelidakis and Laura Eaton, analysts at Fathom. “We have taken him at his word and put together our own China Momentum Indicator (CMI). It does not look good. It has dropped sharply, suggesting that growth is heading towards 5 percent over the next year or so. Indeed, it may already be there.”
- NATO warns Russia over Ukraine rebel polls. NATO chief Jens Stoltenberg warned Russia on Friday (Oct 31) against recognising elections staged by pro-Kremlin rebels in eastern Ukraine, saying Moscow continues to destabilise the country instead of backing peace efforts.
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