Business

China’s Yuan Jumps Worlds 5th Most Traded Currency

China's Yuan Becomes Worlds 5th Most Traded Currency

The Bank for International Settlements (BIS) reports the Chinese yuan has surpassed the Australian, Canadian, and Swiss currencies to become the world’s 5th most traded currency.

The Chinese yuan was involved in 7% of all trades in 2022, up from 4% three years ago, according to the Basel-based BIS’s triennial Central Bank Survey report released on Thursday. Over the period, total daily trades increased 14% to $7.5 trillion.

The US dollar maintained its decade-long dominance as the most transacted currency in the world, accounting for one side of 88% of all transactions. The euro, yen, and pound all remained in the top four.

As China opens its financial markets, the yuan becomes a more important global currency. This is evident in an increase in the Yuan cross-border settlements and a bigger proportion of yuan in global foreign-exchange reserves.

The BIS gathered information from over 1,200 banks and dealers in 52 jurisdictions. This year, Russia was excluded, accounting for less than 1% of the world total, and Dubai was included for the first time.

The survey also revealed that the UK’s dominance in global currency trading is eroding, allowing the US, Singapore, and other European financial centres to gain market share.

London’s global market share fell to 38% in 2019 from 43% in 2018. According to the survey, the United States ranks second at 19%, up from 17% earlier.

yuan

London is still the world’s currency center

Since the 1980s, London has been the world’s currency centre, with its significance expanding in tandem with the City’s prominence in global banking, thanks partly to its placement between Asian and US time zones.

However, after the UK’s vote to leave the European Union in 2016, banks have relocated trading floors to Paris and Frankfurt.

Germany and France have witnessed volume increases, with the former accounting for 1.9% of total daily commerce and the latter accounting for 2.2%. This process may speed up if EU regulators pressure lenders to increase the workforce within the EU.

Singapore, whose officials pushed to capture a larger portion of the market in 2019 by granting incentives and creating infrastructure, has seen its share increase from 7.7% to 9.4%. Hong Kong and Japan saw 7% and 4% declines in activity, respectively.

As Xi Jinping and Vladimir Putin prepare to meet at the APEC Summit in Bangkok, Thailand, one area where deeper economic relations are already seen is in currency.

Yuan value for Russia

The Chinese yuan is proving to be a valuable release valve for Russian enterprises restricted from trading in dollars due to sanctions.

Russian enterprises are settling more of their trade in yuan and increasing their borrowing in the Chinese currency. Moscow is likewise expanding its yuan holdings in its foreign exchange reserves.

Russia-China trade has increased dramatically since the February invasion of Ukraine. China is importing more oil from Russia than ever before, while its exports to Russia are increasing at a double-digit rate even as sales to many other countries stall.

Some Russian enterprises are also turning to Chinese currency bonds for funding. Rosneft PJSC, the Russian oil behemoth, is preparing the country’s largest yuan-denominated bond.

Polyus PJSC, Russia’s largest gold miner, upped the 5-year yuan bonds it sold from 3.5 billion yuan to 4.6 billion yuan ($660 million). In July, aluminum behemoth United Co. Rusal International issued yuan bonds.

According to Bloomberg News, Russia’s government is considering buying up to $70 billion in yuan and other currencies this year to moderate the ruble’s rise before changing to a longer-term policy of selling its holdings of the Yuan to fund investment.

Even before the conflict, Russia had become one of the world’s top holders of Chinese cash reserves.

yuan

IMF Strengthens Yuan

According to figures from the People’s Bank of China, the value of China’s commerce settled in renminbi hit a record high of 2.5 trillion yuan in the 2nd quarter, suggesting an exports boom that has only lately begun to slow.

At the same time, central banks are increasingly diversifying their holdings of dollars. According to the PBOC, the yuan’s proportion of official foreign exchange reserves increased to 2.88% in the 1st quarter of this year, up from 1.2% in 2017.

In May, the International Monetary Fund increased the yuan’s strength in the Special Drawing Rights currency level to 12.28% from 10.92%. Sales of government and corporate debt denominated in offshore yuan, known as Dim Sum bonds, reached a new high in the Hong Kong bond market.

The increase in bilateral trade with Russia may also be helping China’s cross-border interbank yuan payment system, which CIPS Co manages.

While CIPS has a fraction of the transaction volume of SWIFT, it is rapidly rising. Chief executive officer Xu Zaiyue said the daily value of transactions handled by the CIPS system in the 1st half of 2022 was 21 times that of 2016, and most overseas yuan settlement banks have already or will soon be connected to the CIPS.

According to Becky Liu, head of China macro strategy at Standard Chartered Plc, the yuan’s status will be bolstered by the sheer weight of China’s global economic influence, closer relations with the so-called BRICS countries of Brazil, Russia, India, and South Africa, and central bank diversification.

China has been promoting its central bank’s digital money to its population to broaden its reach.

Furthermore, economist John Hopkins argues that imposing sanctions on Russia may be detrimental to the West.

In a tweet, he stated that while weaponizing the SWIFT international payments system may cut Russia off, it also “risks undermining the dollar-dominated global financial system.”

It will lead to the developing of alternative systems by China and Russia.’

Business

PepsiCo Reduces Revenue Projections As North American Snacks And Key International Markets Underperform.

(VOR News) – In the third quarter of this year, Pepsi’s net income was $2.93 billion, which is equivalent to $2.13 per share. This was attributed to the company.

This is in stark contrast to net income of $3.09 billion, which is equivalent to $2.24 per share, during the same period in the previous year. The company’s earnings per share were $2.31 when expenses were excluded.

Net sales decreased by 0.6%, totaling $23.32 billion. Organic sales increased by 1.3% during the quarter when the effects of acquisitions, divestitures, and currency changes are excluded.

Pepsi’s beverage sales fell this quarter.

The most recent report indicates that the beverage and food sectors of the organization experienced a 2% decline in volume. Consumers of all income levels are demonstrating a change in their purchasing habits, as indicated by CEOs’ statements from the previous quarter.

Pepsi’s entire volume was adversely affected by the lackluster demand they encountered in North America. An increasing number of Americans are becoming more frugal, reducing the number of snacks they ingest, and reducing the number of times they purchase at convenience stores.

Furthermore, Laguarta observed that the increase in sales was partially attributed to the election that occurred in Mexico during the month of June.

The most significant decrease in volume was experienced by Quaker Foods North America, which was 13%. In December, the company announced its initial recall in response to a potential salmonella infection.

Due to the probability of an illness, the recall was extended in January. Pepsi officially closed a plant that was implicated in the recalls in June, despite the fact that manufacturing had already been halted.

Jamie Caulfield, the Chief Financial Officer of Pepsi and Laguarta, has indicated that the recalls are beginning to have a lessening effect.

Frito-Lay experienced a 1.5% decline in volume in North America. The company has been striving to improve the value it offers to consumers and the accessibility of its snack line, which includes SunChips, Cheetos, and Stacy’s pita chips, in the retail establishments where it is sold.

Despite the fact that the category as a whole has slowed down in comparison to the results of previous years, the level of activity within the division is progressively increasing.

Pepsi executives issued a statement in which they stated that “Salty and savory snacks have underperformed year-to-date after outperforming packaged food categories in previous years.”

Pepsi will spend more on Doritos and Tostitos in the fall and winter before football season.

The company is currently promoting incentive packets for Tostitos and Ruffles, which contain twenty percent more chips than the standard package.

Pepsi is expanding its product line in order to more effectively target individuals who are health-conscious. The business announced its intention to acquire Siete Foods for a total of $1.2 billion approximately one week ago. The restaurant serves Mexican-American cuisine, which is typically modified to meet the dietary needs of a diverse clientele.

The beverage segment of Pepsi in North America experienced a three percent decrease in volume. Despite the fact that the demand for energy drinks, such as Pepsi’s Rockstar, has decreased as a result of consumers visiting convenience stores, the sales of well-known brands such as Gatorade and Pepsi have seen an increase throughout the quarter.

Laguarta expressed his opinion to the analysts during the company’s conference call, asserting, “I am of the opinion that it is a component of the economic cycle that we are currently experiencing, and that it will reverse itself in the future, once consumers feel better.”

Additionally, it has been noted that the food and beverage markets of South Asia, the Middle East, Latin America, and Africa have experienced a decline in sales volume. The company cut its forecast for organic revenue for the entire year on Tuesday due to the business’s second consecutive quarter of lower-than-anticipated sales.

The company’s performance during the quarter was adversely affected by the Quaker Foods North America recalls, the decrease in demand in the United States, and the interruptions that occurred in specific international markets, as per the statements made by Chief Executive Officer Ramon Laguarta.

Pepsi has revised its forecast for organic sales in 2024, shifting from a 4% growth rate to a low single-digit growth rate. The company reiterated its expectation that the core constant currency profitability per share will increase by a minimum of 8% in comparison to the previous year.

The company’s shares declined by less than one percent during premarket trading. The following discrepancies between the company’s report and the projections of Wall Street were identified by LSEG in a survey of analysts:

SOURCE: CNBC

Business

Old National Bank And Infosys Broaden Their Strategic Partnership.

(VOR News) – Old National Bank, a commercial bank with its headquarters in the Midwest, and Infosys, a firm that specializes in information technology, have recently entered into a strategic expansion of their link, which has been in place for the past four years.

This expansion is more likely to take place sooner rather than later, with the likelihood being higher.

For the purpose of making it possible for Old National Bank to make use of the services, solutions, and platforms that are offered by Infosys, the objective of this expansion is to make it possible for the bank to transform its operations and processes through the application of automation and GenAI, as well as to change significant business areas.

This lets the bank leverage Infosys’ services, solutions, and platforms.

Old National Bank Chairman and CEO Jim Ryan said, “At Old National, we are committed to creating exceptional experiences for both our customers and our fellow employees.”

This statement is applicable to Old National Bank. Infosys is carefully managing the business process innovations that it is putting us through, putting a strong emphasis on efficiency and value growth throughout the process to ensure that it is carried out efficiently.

This is a routine occurrence throughout the entire operation. Because of Infosys’ dedication to our development and success, we are incredibly appreciative of the assistance they have provided.

Old National has been receiving assistance from Infosys in the process of updating its digital environment since the year 2020, according to the aforementioned company.

Ever since that time, the company has been providing assistance. The provision of this assistance has been accomplished through the utilization of a model that is not only powerful but also capable of functioning on its own power.

Infosys currently ranks Old National thirty-first out of the top thirty US banks.

This ranking is based on the fact that Old National is the nation’s largest banking corporation.

It is estimated that the total value of the company’s assets is approximately fifty-three billion dollars, while the assets that are currently being managed by the organization are valued at thirty billion dollars.

Dennis Gada, the Executive Vice President and Global Head of Banking and Financial Services, stated that “Old National Bank and Infosys possess a robust cultural and strategic alignment in the development, management, and enhancement of enterprise-scale solutions to transform the bank’s operations and facilitate growth.”

This remark referenced the exceptional cultural and strategic synergy between the two organizations. Dennis Gada is the one who asserted this claim. This was articulated explicitly concerning the exceptional cultural congruence and strategy alignment of the two organizations.

We are pleased to announce that the implementation of Infosys Topaz will substantially expedite the transformation of Old National Bank’s business processes and customer service protocols. We are exceedingly enthusiastic about this matter. We are quite thrilled about this specific component of the scenario.

Medium-sized banks operating regionally will continue to benefit from our substantial expertise in the sector, technology, and operations. This specific market segment of Infosys will persist in benefiting from our extensive experience. This phenomenon will enable this market sector to sustain substantial growth and efficiency benefits.

SOURCE: THBL

Business

American Water, The Largest Water Utility In US, Is Targeted By A Cyberattack

The largest regulated water and wastewater utility company in the United States stated Monday that it had been the target of a cyberattack, forcing the company to halt invoicing to consumers.

American Water, The Largest Water Utility In US, Is Targeted By A Cyberattack

American Water, based in New Jersey and serving over 14 million people in 14 states and 18 military facilities, said it learned of the unauthorized activity on Thursday and quickly took precautions, including shutting down certain systems. The business does not believe the attack had an impact on its facilities or operations and said employees were working “around the clock” to determine the origin and scale of the attack.

water

The corporation stated that it has alerted legal enforcement and is cooperating with them. It also stated that consumers will not be charged late fees while its systems are unavailable.

According to their website, American Water operates over 500 water and wastewater systems in around 1,700 communities across California, Georgia, Hawaii, Illinois, Indiana, Iowa, Kentucky, Maryland, Missouri, New Jersey, Pennsylvania, Tennessee, Virginia, and West Virginia.

SOURCE | AP