Every week we bring you the biggest business stories from around the world. This week: OPEC says oil will rise to $70 a barrel by 2020, commodity prices increase to boost the TSX and AUX, Zimbabwe goes on the yuan, British banks pay no taxes and Boxing Day is still Canada’s favourite shopping day.
OPEC: Oil prices will rise
OPEC expects oil prices will not rebound to $70 a barrel until 2020. Oil prices have fallen from over $110 in the summer of 2014 to under $37 per barrel due to oversupply and lessening demand from struggling economies. China’s slowdown and Europe’s perennial Greece crisis hurt demand. OPEC has also purposefully kept oil production high to force the price of oil down in an attempt to drive more expensive oil extraction methods, like shale and tar sands, out of business.
A Festivus miracle
The TSX ended a shortened 4 day trading week up 25 points heading into Christmas. The gains mark 2% growth since Monday and a second straight week of growth for the first time since April. Slowly rising oil prices boosted the markets as crude futures were up 53 cents, West Texas Intermediate rose $1.36 (nearly 4%) and Brent Crude rose 46 cents to $37.82.
Aussie stocks rally
Christmas came early in Australia where markets closed a shortened trading day on Christmas Eve with a 7th straight day of gains. The ASX 200 closed at 5 207 points, up 1.3%.
British banks profit
Despite making billions in profits five of Britain’s largest banks paid no taxes in 2014. According to Reuters; JP Morgan, Bank of America Merrill Lynch, Deutsche Bank, Nomura Holdings and Morgan Stanley did not pay any taxes by offsetting past losses against their 2013-2014 taxable income. The revelations come amidst ongoing austerity in Britain as social services continue to be cut or underfunded.
Boxing Day is still the biggest shopping day in Canada. Although Black Friday is becoming increasingly popular, December 26th remains Canadians top date for bargain hunting. Retailers are experiencing more and more online sales on both Black Friday and Boxing Day as consumers choose to shop online or on mobile apps.
Zimbabwe’s the yuan
Zimbabwe announced early in the week that it would adopt the renminbi (China’s currency, also called the yuan) as its official currency. The announcement came after China forgave US$40 million of Zimbabwe’s debt. China is also Zimbabwe’s biggest trade partner. Zimbabwe abandoned its own currency 6 years ago due to rampant inflation. The yuan has been gaining more international legitimacy of late and the IMF announced recently that it was to add the yuan to its basket of reserve currencies.
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