EUROPE
EU formally bans Russian oil
The EU yesterday approved an embargo on Russian oil and other sanctions targeting major banks and broadcasters over Moscow’s war on Ukraine. The bloc said Russian crude oil would be phased out over six months and other refined petroleum products over eight months. It said that “a temporary exception is foreseen” for landlocked countries — such as Hungary, the Czech Republic and Slovakia —that “suffer from a specific dependence on Russian supplies and have no viable alternative options.” Bulgaria and Croatia would also get “temporary derogations” for certain kinds of oil. EU leaders said the move means that about 90 percent of Russia’s oil exports to Europe would be blocked by the end of this year. The EU imports around 25 percent of its oil from Russia.
AUTOMAKERS
City allows driverless taxis
General Motors Co’s Cruise on Thursday became the first company to secure a permit to charge for self-driving vehicle rides in San Francisco, after it overcame objections by city officials. Self-driving test vehicles with human safety drivers have become a constant sight in San Francisco, and completely driverless ones are also increasingly common. Turning them into a fledgling business in a major US city would mark a milestone in efforts toward driverless taxi service. The permit was Cruise’s final hurdle in California. Cruise said it would launch paid services within the next two weeks using up to 30 driverless Chevrolet Bolt electric vehicles. They would be limited to a geographic area that avoids downtown and operating hours of 10pm to 6am, it said.
TURKEY
Inflation highest since 1998
Inflation last month soared to the fastest since 1998 as the country came under more pressure from the rising cost of food and energy, while ultra-loose monetary policy contributed to currency weakness. Consumer prices rose an annual 73.5 percent, up from 70 percent in April, data released by the state statistics agency showed yesterday. The median forecast in a Bloomberg survey of 20 economists was 74.7 percent. Monthly inflation was almost 3 percent, compared with the median estimate of 4 percent in a separate survey. A core index that strips out the effects of volatile items such as food and energy reached 56 percent. The biggest drivers of the latest surge in inflation were food and energy, exacerbated by the global rally in commodities and the war in Ukraine. Turkey is a major importer of oil.
UNITED STATES
Rate hikes ‘reasonable’: Fed
Federal Reserve Vice Chair Lael Brainard said expectations for 0.5 percentage point increases in interest rates this month and next were reasonable, and saw no case for pausing the central bank’s tightening campaign afterward. “From where I sit today, market pricing for 50 basis points, potentially in June and July, from the data we have in hand today, seems like a reasonable path,” Brainard said on Thursday. “It’s very hard to see the case for a pause. We’ve still got a lot of work to do to get inflation down to our 2 percent target.” Her remarks were the latest from officials to reinforce the message that they are staying the course on raising rates, with Cleveland Fed President Loretta Mester later saying that the pace of increases could speed up or slow down in September, depending on what happens with inflation. The Fed last month suggested that the rapid pace of policy tightening would position officials to slow the cycle later this year.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his