- UK Trade Agreement Approval From the EP
- Record Growth in the Chinese Economy
- JPMorgan Made the Biggest Sale in History
UK Trade Agreement Approval From the EP
The European Parliament’s committees on ties with the United Kingdom voted to approve the post-Brexit trade and cooperation agreement on Thursday, paving the way for its final ratification. The EP Foreign Relations and Trade Committees, meeting in Brussels, discussed the EU-UK trade and cooperation agreement.
Members of the committee accepted the agreement that will determine future relations between the EU and the UK with 108 “Yes,” 1 “No,” and 4 “Abstention” votes and recommended that the agreement be approved at the EP General Assembly.
In the United Kingdom, which consists of England, Wales, Northern Ireland, and Scotland, the Brexit decision was taken with 52 percent against 48 percent in the EU referendum held in June 2016.
Britain, which left the EU, carried out comprehensive negotiations with the Union on bilateral relations, especially trade.
The parties reached a consensus in December to continue trade without customs duties and quotas from January 1.
The agreement, which has not yet received EP approval, entered into force temporarily on January 1.
After this stage, EP must approve the agreement at the EP General Assembly session for the contract to come into effect fully.
However, the group heads of political parties in the EP do not put this on the General Assembly’s agenda because the British side does not fully implement the Brexit separation agreement.
The deal also needs to be approved by the entire house, and although it will receive majority support, it is unclear how lawmakers will vote.
Parliament has set an end-of-April deadline but has stated that it needs to see Britain move forward with the Northern Ireland Protocol implementation.
Record Growth in the Chinese Economy
China’s economy expanded at its fastest pace on record in the first quarter, data showed Friday, in a sharp turnaround from the historic contraction caused by the coronavirus outbreak.
China began the year with a record expansion, surpassing even the 1990s glory days when manufacturing and export stardom beckoned. As impressive as the headlines might be, the first-quarter results conceal flaws and weaknesses that will stifle the economy in the months ahead.
The Chinese economy grew 18.3 percent in the first quarter of 2021. Economists expected the country to grow 18.5 percent in the first quarter of the year. While industrial production in the country remained below expectations, retail sales showed a strong performance.
The Chinese economy was supported by the inclusion of consumer spending in strengthening production and investment activities in the first three months of 2021.
The Chinese economy grew by 18.3 percent in the first quarter of the year, showing the most successful performance in 29 years.
Although industrial production workers in the country continued to work without traveling during the Spring Festival in the country, it rose by 14.1 percent and remained below expectations of 18 percent.
Retail sales reached 34.2, exceeding expectations of 28 percent. Fixed asset investments increased by 25.6 percent in the first quarter compared to the previous year’s same period. The unemployment rate was 5.3 percent.
“The economy has shown that the steady recovery momentum continues in the first quarter. Long-term structural problems continue. Uncertainties and instability in the international environment are high,” said the Chinese National Statistics Bureau in its assessment.
JPMorgan Made the Biggest Sale in History
Globally low borrowing costs drive banks and companies to increase their bond issues. Big banks in the US sign record bond issues, Bloomberg reports.
JPMorgan made the most significant issue in its history with the sale of $13 billion worth of bonds, the largest deal ever by a bank, taking advantage of some of the cheapest borrowing costs in years to boost its capital after the Federal Reserve let pandemic relief measures lapse.
According to Bloomberg’s report, JPMorgan exports, which announced a record quarterly profit of $14.3 billion, received a demand of $26 billion. The yield on the 31-year bond, the longest-maturity tranche of the issue, was priced 107 basis points above the US Treasury bond. With this issue, the bank’s dollar-denominated bond issues reached $22 billion this year.
Rival bank Goldman Sachs Group also issued bonds of $6 billion in two tranches with 11 and 21 years of maturity.
Some measures, which the Fed brought during the pandemic period and included flexibility in calculating the capital ratio, ended two weeks ago, prompted banks to strengthen their capitals with bond issues.
On the other hand, companies from outside the USA are also signing significant issues in a cheap borrowing environment. China-based Tencent also issued $4.15 billion in bonds, making it one of Asia’s most critical issues this year.
According to Bloomberg-compiled results, JPMorgan also had the previous largest bond sale, a $10 billion offering in April 2020.
Besides, after the new US sanctions on Russian government debt securities, JPMorgan reported that Russian bonds could be removed from indices, including the emerging market local currency bond index GBI-EM.