Catch up on all the week’s biggest business news with Headlines! This week; England and Canada hold rates, a strike at Hyundai, the Brazil credit rating is downgraded, Japan’s Nikkei has a good day, Canadian’s are spending a big chunk of their yearly income on rent, and National Geographic is bought.
Bank of England holds rates
The Bank of England elected to hold interest rates at 0.5% with a vote of 8-1. Fears over China’s slowing growth and other vulnerable economies was a major factor in deciding to keep rates low. The bank also stated that once a decision to raise rates is made, they would be raised gradually.
And so does Canada
The Bank of Canada also decided to leave the interest rate unchanged at 0.5% amid fears of recession and the continuing low price of commodities.
Hyundai Motor’s Union workers, totalling 48 000 employees, voted to strike after failing to agree to a wage agreement. Workers want a 7.8% wage increase, guaranteed job security and bonuses amounting to 30% of the automakers profits last year. Although the union and management have agreed to return to the table, the strike could commence as early as Monday the 14th.
Standard and Poor’s has officially downgraded Brazil’s credit rating to “junk” status. South America’s largest economy had only received an investment grade rating less than 8 years ago in 2008 following a promising spell of economic success. Economic issues, political turmoil, high inflation and low commodity prices have all hit Brazil’s rating hard. Austerity measures implemented in order to keep the country attractive to investors have arguably hurt the economy even more. Brazil’s current recession is expected to last until 2017 and S&P’s downgrade could last just as long.
Nikkei has a strong day
Japan’s Nikkei hit a multi-year high on Wednesday closing up 7.71% at 18,770.51 points. The strong single day gains more than offset the 2.4% drop the Nikkei suffered the previous day. The losses were sparked by a large sell off in China which has hit Asian markets particularly hard. Following the news Prime Minister Abe hinted that corporate tax cuts were on their way in order to further boost economic and market performance.
Big chunk of yearly income on rent
40% of renting households in Canada are spending almost 33% of their yearly income on rent – a level that experts believe is unsustainable. Meanwhile 1 in 5 households spend fully 50% of their incomes on rent. Meanwhile a surge in condo demand has contributed to the highest development rate seen in Canada since 2012. In August of this year developers began 23,400 new projects – a 20% increase from July.
National Geographic bought
21st Century Fox bought a majority stake in National Geographic Magazine and other media assets. The nearly 130 year old non-profit National Geographic Society sold the majority stake for $725 million. Some commentators fear that the integrity of National Geographic Magazine could be at stake as other Fox owned media outlets have been accused of denying climate change and other highly politicized issues.
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