KEY POINTS



<ul class="wp-block-list"><li>Nearly 2,500 global leaders from business, politics and civil society are expected to take part in a rare springtime version of Davos this week.</li><li>Organizers of the event had postponed the meeting from its traditional January slot over safety concerns amid the coronavirus pandemic. However, in a welcome boost to local residents, the forum’s first in-person event has now returned after a two-year hiatus.</li><li>That’s not to say everyone is happy to see the return of the world’s business and political elite to the Swiss Alps.</li></ul>



The World Economic Forum is trying to fix an image problem.



Nearly 2,500 global leaders from business, politics and civil society are expected to take part in a rare springtime version of Davos this week.



The annual meeting will see movers and shakers convene in Switzerland’s luxury Alpine ski resort of Davos for five days of conversation on issues including Covid-19, Russia’s war in Ukraine and the climate crisis.



Organizers of the event had&nbsp;<a href="https://www.cnbc.com/2021/12/20/davos-world-economic-forum-postpones-meeting-due-to-covid.html">postponed the meeting</a>&nbsp;from its traditional January slot over safety concerns amid the coronavirus pandemic. However, in a welcome boost to local residents, the forum’s first in-person event has now returned after a two-year hiatus.



The&nbsp;<a href="https://www.weforum.org/agenda/2022/05/davos-2022-whos-coming-and-everything-else-you-need-to-know/" target="_blank" rel="noreferrer noopener">theme</a>&nbsp;of this year’s event is “History at a Turning Point: Government Policies and Business Strategies.”



“It means a lot to us. It means a lot to the whole of Switzerland,” Samuel Rosenast, a spokesperson for the local tourism board, said in an interview with CNBC’s&nbsp;<a href="https://www.cnbc.com/tom-chitty/">Tom Chitty</a>.



Rosenast said the event was “unbelievably important” to those residing in Europe’s highest town, estimating that the resort could see a windfall of approximately 70 million Swiss francs ($72 million) in just this week alone.



“Every business is in contact with the World Economic Forum. The people know how important it is,” Rosenast said. “Most people here are looking forward to the World Economic Forum. They are happy that it takes place here again this year.”



<h2 class="wp-block-heading" id="h-a-symbol-of-a-failed-era"><a></a>‘A symbol of a failed era’</h2>



That’s not to say everyone is pleased to see the return of the world’s business and political elite to the Swiss Alps. The event has been sharply criticized in recent years for being&nbsp;<a href="https://fortune.com/2015/01/22/davos-out-of-touch/" target="_blank" rel="noreferrer noopener">out of touch</a>,&nbsp;<a href="https://www.cnbc.com/2018/01/18/is-davos-nothing-more-than-an-overpriced-ineffective-talking-shop.html">ineffective</a>&nbsp;and&nbsp;<a href="https://www.fnlondon.com/articles/davos-is-broadly-irrelevant-there-is-no-case-for-guzzling-jets-and-gallons-of-dom-perignon-20220516" target="_blank" rel="noreferrer noopener">irrelevant</a>.



Three years ago, Dutch historian Rutger Bregman went viral at a Davos panel&nbsp;<a href="https://www.cnbc.com/2019/03/19/rutger-bregman-historian-who-confronted-davos-elite-on-higher-taxes.html">when he called out billionaires for tax avoidance</a>. In a clip that has now been viewed nearly 11 million times, Bregman said that a global failure to effectively tackle tax avoidance was the primary cause of inequality.



“It feels like I’m at a firefighters conference and no one’s allowed to speak about water,” Bregman said at the time. “This is not rocket science … we have got to be talking about taxes. That’s it. Taxes, taxes, taxes.”



More recently, protestors, activists and people on the frontlines of inequality have sought to challenge the WEF over its “<a href="https://inequality.org/research/global-inequality-protest-davos/" target="_blank" rel="noreferrer noopener">empty rhetoric</a>,” accusing Davos of representing “a symbol of a failed era” that should be left behind.



A report published Monday by global charity Oxfam found that 573 people became new billionaires during the coronavirus pandemic — at a rate of one every 30 hours. The brief, entitled “Profiting from Pain,” expects that 263 million additional people will fall into extreme poverty this year at a rate of 1 million people every 33 hours.



“Billionaires are arriving in Davos to celebrate an incredible surge in their fortunes. The pandemic and now the steep increases in food and energy prices have, simply put, been a bonanza for them,” said Gabriela Bucher, executive director of Oxfam International.



“Meanwhile, decades of progress on extreme poverty are now in reverse and millions of people are facing impossible rises in the cost of simply staying alive.”



In his youth, Philipp Wilhelm was one of those protesting the annual gathering of billionaires and political leaders in the town where he was born. Now, however, Wilhelm is the mayor of Davos, and his goal is to deliver a successful meeting.



“I protested during the annual meeting because, for me, it was important to express that it’s really crucial that we solve this climate crisis. And we need to make the world a more just place,” Wilhelm said.



Wilhelm said that he had taken part in protests because he felt it was essential to ensure that everyone arriving in Davos “gets the message that it’s really important to solve these issues.”



Wilhelm said he — and WEF — had changed their positions since his protesting days, adding that he believes he can influence policy more effectively in his current role.



When asked whether it was a concern that criticism of WEF had become too closely associated with Davos given that the town itself has become largely interchangeable with the forum, Wilhelm replied: “No it doesn’t bother me at all.”



“I think it is interesting that people know Davos as a place where people meet and discuss — and I mean it should be controversial. There should be a discussion about what is the right way to improve the state of the world,” Wilhelm said.



<h2 class="wp-block-heading"><a></a>Davos 2022 is ‘one marker in time’</h2>



“The forum’s work is ongoing. The meeting is one marker in time,” said Saadia Zahidi, managing director at the World Economic Forum.



“What we’ve been doing over the last two and a half years — while it hasn’t been visible through a particular meeting — is a set of work that is trying to make a dent on inequality and at the same time also make changes towards addressing one of the biggest existential risks we all face which is climate change.”



When asked whether rising income inequality had become a particular problem for the forum, Zahidi replied: “Inequality is a problem for the world. I think we know that societies that do not combat inequality will have slower growth.”



“And so there has to be an effort that addresses inequality. Now, what does that? Better education, better skills, better jobs, addressing issues like taxation and changing the nature of our economies so that they actually work for people and not just for the few,” Zahidi said. “That is going to be front and center on next week’s agenda.”

Stefan Wermuth | Bloomberg | Getty Images

How Davos became the anti-establishment’s punching bag

KEY POINTS



<ul class="wp-block-list"><li>A document outlining the European Commission’s aims for the REPowerEU plan was published on Wednesday.</li><li>It highlighted the importance of energy savings, the diversification of energy imports and speeding up what it called “Europe’s clean energy transition.”</li><li>The EU’s desire to wean itself off Russian hydrocarbons means it will need to find oil and gas from other parts of the world to plug supply gaps.</li></ul>



The European Commission has fleshed out details of a plan to ramp up the EU’s renewable energy capacity and reduce its reliance on Russian fossil fuels, at the same time acknowledging that existing coal facilities may have to be used for “longer than initially expected.”



A document outlining the Commission’s aims for the REPowerEU plan was published on Wednesday, highlighting the importance of energy savings, the diversification of energy imports and speeding up what it called “Europe’s clean energy transition.”



In total, it envisages extra investment of 210 billion euros ($220.87 billion) between 2022 and 2027. When it comes to renewables’ share in the EU’s energy mix, the Commission has proposed that the current target of 40% by 2030 should be increased to 45%.



The Commission’s proposals came on the same day the governments of Denmark, Germany, the Netherlands and Belgium said they would aim for a combined target of at least 65 gigawatts of offshore wind capacity by 2030. By the middle of the century, they are aiming for 150 GW of capacity.



On the fossil fuel front, the situation is a challenging one. Russia was the biggest supplier of both petroleum oils and natural gas to the EU last year,&nbsp;<a href="https://ec.europa.eu/eurostat/statistics-explained/index.php?title=EU_imports_of_energy_products_-_recent_developments#:~:text=Russia%20was%20the%20largest%20supplier,and%2C%20at%20some%20distance%20Algeria" target="_blank" rel="noreferrer noopener">according to Eurostat</a>.



The EU’s desire to wean itself off Russian hydrocarbons&nbsp;following the latter’s invasion of Ukraine&nbsp;means it will need to find oil and gas from other parts of the world to plug supply gaps.



The Commission said as much as 1.5 to 2 billion euros of investment would be needed to secure oil supply. To import enough liquefied natural gas and pipeline gas from other sources, an estimated 10 billion euros will be needed by 2030.



All the above comes at a time when the EU has said it wants to be carbon neutral by 2050. In the medium term, it wants net greenhouse gas emissions to be cut by at least 55% by 2030, which the EU calls its “Fit for 55” plan.



The Commission said REPowerEU could not work without what it called “a fast implementation of all Fit for 55 proposals and higher targets for renewables and energy efficiency.”



In this new reality, gas consumption in the EU would “reduce at a faster pace, limiting the role of gas as a transitional fuel,” the Commission said.



“However, shifting away from Russian fossil fuels will also require targeted investments for security of supply in gas infrastructure and very limited changes to oil infrastructure alongside large-scale investments in the electricity grid and an EU-wide hydrogen backbone,” it added.



“In parallel, some of the existing coal capacities might also be used longer than initially expected, with a role for nuclear power and domestic gas resources too,” the Commission said.



During a press conference on Wednesday the EU’s climate chief, Frans Timmermans, admitted that using less natural gas in a transitional phase would mean “you might use coal a bit longer — that has a negative impact on your emissions.”



“But if at the same time, as we propose, you rapidly speed up the introduction of renewables — solar, wind, biomethane — you then have the opposite movement,” he said.



Timmermans, who is the European Commission’s executive vice president for the European Green Deal, went on to stress the importance of finding a middle ground.



“If we can actually do what I say — reduce our energy consumption in combination with a speedier introduction of renewables — we will bring down our emissions even quicker than before,” he said.



“And then, of course we will have slightly higher emissions if people stick a bit longer to coal, but we need to strike the balance so that, on balance, we do not increase our emissions — we hopefully even decrease them more.”



Coal has a substantial effect on the environment, with Greenpeace describing it as “the dirtiest, most polluting way of producing energy.”



Elsewhere, the U.S. Energy Information Administration lists a range of emissions from coal combustion, including carbon dioxide, sulfur dioxide, particulates and nitrogen oxides.



The European Commission announcement drew criticism from a number of environmental organizations.



“These plans are supposed to fast-track the clean energy transition — but the European Commission’s latest strategy gives with one hand and takes with the other,” Eilidh Robb, an anti-fossil fuels campaigner at Friends of the Earth Europe, said.



“So-called REPowerEU contains useful and necessary strides towards renewable solutions but it simultaneously enables almost 50 fossil fuel infrastructure projects and expansions,” Robb said.

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Europe admits it’ll have to burn more coal as it tries to wean itself off Russian energy

<ul class="wp-block-list"><li>China stocks firm on higher-than-expected borrowing rate cut</li></ul>



<ul class="wp-block-list"><li>Turkish consumer conf in May edges up from record low</li></ul>



<ul class="wp-block-list"><li>EM stocks, FX eye weekly gains of 3% and 1% respectively</li></ul>



By Anisha Sircar and Bansari Mayur Kamdar



May 20 (Reuters)&nbsp;&#8211;&nbsp;China stocks led emerging market stocks higher on Friday after Beijing&#8217;s larger-than-expected cut to a key borrowing rate, while a softer dollar sent an index of currencies to their highest level in two weeks.



China&#8217;s main share indexes&nbsp;.CSI300,&nbsp;.SSEC&nbsp;added 1.6% and 2% after Beijing lowered the five-year loan prime rate&nbsp;CNYLPR5Y=CFXS&nbsp;by 15 basis points (bps) to 4.45% to aid the ailing economy, more than the five or 10 bps tipped by analysts in a Reuters poll.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N2XC033&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



That boosted MSCI&#8217;s index of stocks&nbsp;.MSCIEF&nbsp;up 2% and more than 3% on the week to track its best weekly performance since mid-March. Most other EM Asian indexes gained between 1% and 2.2% while those in Turkey&nbsp;.XU100&nbsp;and South Africa&nbsp;.JTOPI&nbsp;gained 0.4% and 0.5%.



Still, stocks have clocked losses every month in 2022 and were eyeing their fifth in May as investors remain fearful over the impact of surging inflation, China&#8217;s COVID-19 lockdowns and monetary tightening in developed economies.



&#8220;I&#8217;m not looking at a strong recovery from here &#8211; some stability in (China&#8217;s) renminbi has provided some temporary support this week, but the fact is we&#8217;ve got the strong dollar and concerns over European and Chinese growth very much still with us,&#8221; said Chris Turner, global head of FX Strategy at ING.



Meanwhile, EM currencies&nbsp;.MIEM00000CUS&nbsp;looked set for their first weekly gain in seven, lifted by a glum week for the dollar&nbsp;=USD&nbsp;which lost steam after a breathless 14-week surge and amid a retreat in U.S. Treasury yields.&nbsp;FRX/



Mexico&#8217;s peso&nbsp;MXN=&nbsp;and South Africa&#8217;s rand&nbsp;ZAR=&nbsp;were 0.9% and 2% stronger on the week, with the rand helped by a 50 basis point lending rate hike by the central bank on Thursday.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL5N2XB4IH&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



Turkey&#8217;s lira&nbsp;TRY=&nbsp;was the outlier, slipping 0.3% and down 11 sessions out of the last 12, with some upbeat data doing little to boost the struggling currency. Turkish consumer confidence was seen rising to 67.6 points in May from a record low in April.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AAPN0KU2M1&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



&#8220;The strategy in place&#8230;is costing an arm to Turkey, which is why soft data like the consumer data isn&#8217;t fit to reverse the ugly mood or fears of seeing the lira crumble if the Turkish central bank were to let go,&#8221; said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.



Elsewhere, Russia&#8217;s rouble&nbsp;RUBUTSTN=MCX&nbsp;saw its fifth straight week in the black, boosted by capital controls and domestic tax payments that support demand for the currency, despite growing global sanctions after its invasion of Ukraine.&nbsp;RU/RUB



For GRAPHIC on emerging market FX performance in 2022, see&nbsp;<a href="http://tmsnrt.rs/2egbfVh" target="_blank" rel="noreferrer noopener">http://tmsnrt.rs/2egbfVh</a>



For GRAPHIC on MSCI emerging index performance in 2022, see&nbsp;<a href="https://tmsnrt.rs/2OusNdX" target="_blank" rel="noreferrer noopener">https://tmsnrt.rs/2OusNdX</a>



For TOP NEWS across emerging markets&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3ATOPEMRG&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



For CENTRAL EUROPE market report, see&nbsp;CEE/



For TURKISH market report, see&nbsp;.IS



For RUSSIAN market report, see&nbsp;RU/RUB



(Reporting by Anisha Sircar in Bengaluru; Editing by Kim Coghill)

P7D3GU2BGZNHDCNT6DEA6AP3D4

EMERGING MARKETS-China rate cut boosts EM stocks; currencies recover as greenback eases￼

NAIROBI, May 20 (Reuters)&nbsp;&#8211;&nbsp;The International Monetary Fund has extended its support for Somalia under its Extended Credit Facility to Aug. 17, the lender said on Friday.



Early this month, the Somali government had asked the fund for a three-month extension in its financial support.



In February, the IMF warned against the risk of automatic expiry this month of the three-year budget support programme worth nearly $400 million, after delayed legislative and presidential elections jeopardised its renewal.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N2US5NQ&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



(Reporting by Duncan Miriri; Writing by George Obulutsa; Editing by Clarence Fernandez)

IMF_logo

IMF extends financial support for Somalia to August

KHARTOUM, May 19 (Reuters)&nbsp;&#8211;&nbsp;A leading&nbsp;Sudanese&nbsp;politician was&nbsp;arrested&nbsp;on Thursday as&nbsp;protests&nbsp;raged in the capital&nbsp;Khartoum&nbsp;for the seventh month against military rule, with tear gas and heavy security force deployment.



A military coup in October effectively ended a 2019 power-sharing deal between generals who overthrew President Omar al-Bashir, andpolitical parties that opposed him.



One of those parties, the&nbsp;Sudanese&nbsp;Communist&nbsp;Party, said its&nbsp;leader&nbsp;Mohamed Mukhtar Al-Khatib had been&nbsp;arrested&nbsp;on Thursday, following a visit to Juba where he met with leading&nbsp;Sudanese&nbsp;rebel&nbsp;leaders.



The party, which has been the most hardline against the coup and any future deal, was pursuing a unified front against the coup, it said.



Sudan&#8217;s economy has spiralled as its government has gone without a prime minister since January. Businesses are stagnating while citizens face steep increases in the prices of food, electricity and fuel.



&#8220;The military has failed economically, politically and psychologically &#8211; in every way,&#8221; said a 30-year-old protester and unemployed engineer who declined to give his name for fear of retribution. &#8220;They are just being stubborn now, but we are more stubborn.&#8221;



The protesters marched under the harsh sun as security forces, including the U.S.-sanctioned Central Reserve Police,&nbsp;were deployed at key points along&nbsp;the protest route.



(Reporting by Khalid Abdelaziz and Nafisa Eltahir; Editing by Richard Chang)

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Sudanese communist leader arrested as protests rage in Khartoum￼

By Mohi Narayan and Scott DiSavino



May 20 (Reuters)&nbsp;&#8211;&nbsp;Oil&nbsp;prices fell on Friday as investors worried that weakening global economic growth and tighter central bank monetary policy could curb a recovery in&nbsp;fuel&nbsp;demand.



Brent&nbsp;LCOc1&nbsp;futures for July fell 59 cents, or 0.53%, to $111.45 a barrel by 0648 GMT, while U.S. West Texas Intermediate (WTI) crude for June&nbsp;CLc1&nbsp;fell 56 cents, or 0.5%, to $111.65 on its last day as the front-month.



The more actively traded WTI contract for July&nbsp;CLN2&nbsp;was down 0.8% at $109.01 a barrel.



The International Monetary Fund (IMF) urged Asian economies to be mindful of spillover&nbsp;risks from monetary tightening.



Asian economies faced a choice between supporting growth with more stimulus and withdrawing it to stabilise debt and inflation, IMF Deputy Managing Director Kenji Okamura said.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL3N2XB2VQ&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



While Bank of Japan policy runs counter to a global shift towards monetary tightening, central banks in the United States, Britain and Australia raised interest rates recently.



Crude gains have been limited this week, with Brent and WTI mostly trading in a range due to the uncertain path of&nbsp;demand. Investors, worried about rising inflation and more aggressive action from central banks, have been reducing exposure to riskier assets.



Open interest in WTI futures fell to 1.722 million contracts on May 18, the lowest since July 2016.



&#8220;If U.S. growth data continues to sour,&nbsp;oil&nbsp;prices could get caught up in the negative stock market feedback loop,&#8221; SPI Asset Management Managing Director Stephen Innes said in a client note.



In the United States, Americans were getting back behind the wheel, despite higher&nbsp;fuel&nbsp;prices, according to a report from the Federal Highway Administration on vehicle miles.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N2XB2RM&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



On the gasoline supply side, South Korea&#8217;s third-largest refiner S-Oil&nbsp;halted production at its No. 2 alkylation unit and related processes at its Onsan refinery due to a blast.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N2XB31C&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



The shutdown following Thursday night&#8217;s blast that killed one person is expected to affect already tight gasoline supplies in Asia.



Citi analysts expect S-Oil&#8217;s gasoline output to be &#8220;severely impacted&#8221; in the near term, although it could buy alkylate to maintain production.



Iran, meanwhile, is having a tougher time selling its crude now that more Russian barrels are available.



Iran&#8217;s crude exports to China have fallen sharply since the start of the Ukraine war as Beijing favoured heavily discounted Russian barrels, leaving almost 40 million barrels of Iranian&nbsp;oil&nbsp;stored on tankers at sea in Asia and seeking buyers.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N2XB1O9&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



(Reporting by Scott DiSavino; Editing by Kim Coghill and Frank Jack Daniel)

Oil falls on uncertainty over fuel demand recovery

LONDON, May 19 (Reuters)&nbsp;&#8211;&nbsp;A new study by the&nbsp;central&nbsp;bank&nbsp;to the world&#8217;s&nbsp;central&nbsp;banks, the&nbsp;Bank&nbsp;of International Settlements (BIS), has called for&nbsp;urgent&nbsp;action to tackle&nbsp;rising&nbsp;wealth&nbsp;inequality, warning the problem was feeding a dangerous loop of recessions and poverty.



While government policies have largely been blamed for the rise in&nbsp;inequality&nbsp;since the 1980s,&nbsp;central&nbsp;bankers have also come under fire in recent years for fuelling huge stock market gains with ultra-low interest rates and asset buying schemes.



The&nbsp;BIS, looking at 182 recessions across 70 countries, found that even six years after a downturn, the income share of the bottom 50% of earners in an impacted economy remained 0.3% below the pre-recession level on average, whereas for those in the top 10% bracket it was still 0.7% higher.



Economies that are more unequal go through deeper recessions which in turn further increases&nbsp;inequality, its analysis showed. Less progressive taxes and social support programme in many countries have made the problems worse as well.



&#8220;It is increasingly apparent that&nbsp;inequality&nbsp;has evolved from being an academic issue to an&nbsp;urgent&nbsp;policy&nbsp;matter,&#8221; the&nbsp;<a href="https://www.bis.org/" target="_blank" rel="noreferrer noopener">BIS&nbsp;paper</a>&nbsp;said, adding that one of key risks for&nbsp;central&nbsp;banks was that their policy tools become less effective.



The&nbsp;BIS&nbsp;study showed that low-paid workers in some countries were over three time more likely to have lost their jobs during the COVID-19 pandemic, while surging inflation was&nbsp;now&nbsp;hitting poorer households disproportionately hard.



&#8220;Once&nbsp;inequality&nbsp;is left to grow unchecked, deeper and deeper recessions demand additional policy support,&#8221; it said.



&#8220;But at the same time monetary stimulus loses traction, so that the&nbsp;central&nbsp;bank&nbsp;needs to deploy bolder and bolder instruments, which can in turn produce undesirable side effects in terms of wealth&nbsp;inequality&#8221;.



Instead it recommended keeping inflation in check and that governments use &#8220;stabilisation policies&#8221; such as subsidies or support payments that help poorer people.



(Reporting by Marc Jones; Editing by Jan Harvey)

people-black-poverty-guinea-african-bissau-940174-pxhere.com_

Rising inequality now an urgent matter, BIS central bank group warns

May 19 (Reuters) &#8211; Russia will send any oil rejected by European countries to Asia and other regions, Deputy Prime Minister Alexander Novak said on Thursday, adding that Europe would have to find substitute supplies that would be more expensive.



The European Commission on Wednesday unveiled a 210 billion euro ($220 billion) plan for Europe to end its reliance on Russian fossil fuels by 2027 and to use the pivot away from Moscow to quicken its transition to green energy. <a href="https://www.reuters.com/business/sustainable-business/eu-unveils-escape-route-russian-fossil-fuels-by-2027-2022-05-18/">read more</a>



Europe receives about 4 million barrels per day (bpd) of Russian oil, Novak said, adding that Russia was ready to reroute those supplies leaving Europe with more expensive crude from other origins.



Western sanctions imposed on Russia after its troops marched into Ukraine in February forced a number of oil buyers to delay or refuse cargoes, which in turn knocked Russian oil production.



Novak said Russian oil production was about 1 million bpd lower in April but had increased by 200,000-300,000 bpd in May with more volumes expected to be restored next month.



He said Russia&#8217;s oil exports were gradually recovering and the country would be able to find export markets because its energy resources were competitive.



($1 = 0.9537 euros)



RegisterReporting by Reuters; Editing by Edmund Blair



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106112608-1567659337821gettyimages-1149971899

Russia to send oil rejected by Europe to Asia, other regions, says Novak

<ul class="wp-block-list"><li>Digital rand at least a few years away, says deputy governor</li></ul>



<ul class="wp-block-list"><li>Cen bank digital currency likely only for wholesale purposes</li></ul>



<ul class="wp-block-list"><li>SARB hopes crypto assets could be regulated within 15 months</li></ul>



<ul class="wp-block-list"><li>Regulation to prevent theft, fraud, undermining SARB authority</li></ul>



By Rachel Savage and Promit Mukherjee



LONDON/JOHANNESBURG, May 18 (Reuters)&nbsp;&#8211;&nbsp;A digital rand in South Africa could cut the high cost of cross-border payments for banks but its introduction is still a few years away, a senior central bank official said.



However, regulation of crypto assets&nbsp;is in the offing and might come into force within nine to 15 months, South&nbsp;African&nbsp;Reserve Bank (SARB) Deputy Governor Kuben Naidoo told Reuters in an interview.



It costs 13% of a transaction to remit money from South Africa to another country, more than double the average of the Group of 20 (G20) leading global economies, according to a 2021&nbsp;<a href="https://remittanceprices.worldbank.org/sites/default/files/rpw_main_report_and_annex_q421.pdf" target="_blank" rel="noreferrer noopener">World Bank report</a>.



Sending money to South Africa costs 6.2%.



Some countries are planning to introduce e-versions of traditional currency, known as central bank digital currencies (CBDCs) and are studying how the underlying technology could be used.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL5N2X13EL&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a><a href="https://www.reutersconnect.com/all?search=all%3AL2N2W922S&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



China&#8217;s digital yuan project is the most advanced among large economies, though central banks from the&nbsp;euro zone&nbsp;to the United States are in varying stages of research into CBDCs.



Last year, Nigeria&#8217;s central bank introduced an eNaira for use by ordinary citizens.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N2RL4J4&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



South Africa has conducted small-scale experiments with a wholesale CBDC and participated in a cross-border pilot with the central banks of Malaysia, Australia and Singapore.



The next stage is for regulators to test the digital rand at a bigger scale and develop rules for its use.



&#8220;We&#8217;re still learning, we&#8217;re still experimenting,&#8221; Naidoo said.



Meanwhile, Naidoo said the South&nbsp;African&nbsp;Reserve Bank wants regulation of crypto assets to prevent theft, money laundering and undermining of monetary policy and hopes it will be in place in the next 15 months.



&#8220;If crypto assets were to become a very ubiquitous currency, you could undermine the authority of the central bank,&#8221; he said.



(Reporting by Rachel Savage and Promit Mukherjee; Editing by Lisa Shumaker)

South African Economy As Inflation Rate Rises For First Time In 2017

S.African central bank eyes digital rand to cut cross-border payment costs

<ul class="wp-block-list"><li>Stocks slide as inflation scare drives uncertainty</li><li>UK inflation hits 9%, in Canada rises to 6.8%</li><li>German 2-year yield hits 2011 high on ECB rate hike bets</li></ul>



NEW YORK, May 18 (Reuters) &#8211; Global stocks plunged and the dollar strengthened for the first time in four sessions on Wednesday as concerns about rising inflation on economic growth soured sentiment.



The mood was underscored by a 9% surge in British consumer prices and a faster-than-expected acceleration in inflation in Canada.



British inflation surged to its highest annual rate since 1982 as energy bills soared, while Canadian inflation rose to 6.8% last month, largely driven by rising food and shelter prices, Statistics Canada data showed. <a href="https://www.reuters.com/markets/uk-inflation-hits-9-highest-since-modern-records-started-2022-05-18/">read more</a>



British inflation is now the highest among major economies in Europe, but prices are rapidly rising worldwide, forcing central banks around the globe to hike interest rates and tamp down growth as suggested by a modest decline in U.S. homebuilding in April.&nbsp;<a href="https://www.reuters.com/business/us-building-permits-dive-april-housing-starts-fall-2022-05-18/">read more</a>



Soaring prices and material shortages have already hit homebuilding, the sector of the economy most sensitive to rates. But the U.S. Commerce Department report also showed a record backlog of houses to be built, indicating a decline in homebuilding potentially might be marginal.



Adding to the gloom caused by inflation were earnings results from Target Corp&nbsp;<a href="https://www.reuters.com/companies/TGT.N" target="_blank" rel="noreferrer noopener">(TGT.N)</a>, whose quarterly profit halved as it warned of a bigger margin hit this year due to rising fuel and freight costs.&nbsp;<a href="https://www.reuters.com/business/retail-consumer/target-profit-halves-rising-costs-warns-bigger-margin-hit-2022-05-18/">read more</a>



Target shares plummeted 24.88%, its biggest one-day percentage drop since the &#8220;Black Monday&#8221; stock market crash on Oct. 19, 1987, a day after Walmart Inc <a href="https://www.reuters.com/companies/WMT.N" target="_blank" rel="noreferrer noopener">(WMT.N)</a> warned of similar margin squeezes and saw its stock drop 11.4% for its biggest one-day percentage fall since Oct. 16, 1987.



&#8220;It was Walmart yesterday and everybody thought it was a one-off,&#8221; said Dennis Dick, head of markets structure and a proprietary trader at Bright Trading LLC in Las Vegas. &#8220;Now that Target misses earning a lot more than Walmart even did, they&#8217;re scared that consumer is not as strong as everybody think it is.&#8221;



MSCI&#8217;s gauge of stocks across the globe&nbsp;<a href="https://www.reuters.com/quote/.MIWD00000PUS" target="_blank" rel="noreferrer noopener">(.MIWD00000PUS)</a>&nbsp;shed 2.74%, while in Europe, the pan-regional STOXX 600 index&nbsp;<a href="https://www.reuters.com/quote/.STOXX" target="_blank" rel="noreferrer noopener">(.STOXX)</a>&nbsp;closed down 1.14%.



On Wall Street, the Dow Jones Industrial Average&nbsp;<a href="https://www.reuters.com/quote/.DJI" target="_blank" rel="noreferrer noopener">(.DJI)</a>&nbsp;fell 3.56%, the S&amp;P 500&nbsp;<a href="https://www.reuters.com/quote/.SPX" target="_blank" rel="noreferrer noopener">(.SPX)</a>&nbsp;lost 4.03% and the Nasdaq Composite&nbsp;<a href="https://www.reuters.com/quote/.IXIC" target="_blank" rel="noreferrer noopener">(.IXIC)</a>&nbsp;dropped 4.73%.



The declines for the S&amp;P 500 and Dow marked their biggest one-day percentage declines since June 11, 2020.



Few analysts are willing to predict the end to selling after a bruising first five months of the year for risk assets given the magnitude of macroeconomic uncertainty, with many anticipating market volatility will be the norm for some time.



The U.S. dollar gained ground as the sell-off in risk assets boosted the safe-haven appeal of the greenback, which was on pace to snap a three-session losing streak, a day after Fed Chair Jerome Powell pledged the U.S. central bank would ratchet up rates as high as needed to combat rising inflation.



The dollar index rose 0.581%, with the euro down 0.8% to $1.0463. The Japanese yen strengthened 0.92% to 128.23 per dollar.



Treasury yields fell, although a steep path for rates remained the prevailing market consensus as the benchmark 10-year note yield hit a one-week high of 3.015% after Powell&#8217;s hawkish comments.



The yield fell 8.1 basis points to 2.890% on Wednesday after a soft U.S. housing starts number.



The German two-year government bond yield shot to 0.444%, its highest since November 2011 after more hawkish central banker comments, and last was up 1.6 basis points at 0.386%. The European Central Bank&#8217;s Klaas Knot said on Tuesday that a 50-basis-point rate hike in July was possible if inflation broadens.



Gold prices were little changed despite the risk-off environment as looming U.S. interest rate hikes and a resurgent dollar dimmed the metal&#8217;s shine.



Spot gold was up 0.1% at $1,816.06 an ounce.



Oil prices dipped in volatile trade, reversing early gains as traders grew less worried about a supply crunch after government data showed U.S. refiners ramped up output.&nbsp;<a href="https://www.reuters.com/markets/europe/oil-prices-climb-hopes-china-demand-recovery-2022-05-18/">read more</a>



U.S. crude settled down 2.5% at $109.59 per barrel and Brent settled at $109.11, down 2.52% on the day.



Reporting by Herbert Lash and Chuck Mikolajczak; additional reporting by Devik Jain in Bengaluru; editing by Jonathan Oatis



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Trading Board Is Showing A Crash In Stok Exchange Market

Stocks pummeled by growth worries, U.S. dollar climbs

KEY POINTS



<ul class="wp-block-list"><li>Goldman Sachs analysts have cut their China GDP forecast to 4% from 4.5% after weak data in April.</li><li>The bank does not expect China will start fully easing Covid controls before the second quarter of 2023.</li><li>On Monday, Citi — which had one of the highest China GDP forecasts — cut its outlook for growth to 4.2% from 5.1%.</li></ul>



BEIJING — Goldman Sachs analysts on Wednesday cut their forecast for China’s GDP to 4% after&nbsp;<a href="https://www.cnbc.com/2022/05/16/china-economy-covid-lockdowns-weigh-on-retail-industrial-production-data.html">data for April showed a slump</a>&nbsp;in growth as Covid-19 controls restricted business activity.



The new forecast is even further below the&nbsp;<a href="https://www.cnbc.com/2022/03/05/china-on-deck-to-reveal-its-2022-gdp-target.html">“around 5.5%”</a>&nbsp;growth target the Chinese government announced for the year in March.



“Given the Q2 Covid-related damage to the economy, we now expect China’s growth to be 4% this year (vs. 4.5% previously),” Hui Shan and a team at Goldman wrote in a report Wednesday. That prediction assumes there will be significant government support, on top of measures to stabilize the property market and control Covid outbreaks.



Since March, mainland China has struggled to contain its worst Covid outbreak in two years. Notably, the metropolis of Shanghai only started this week to begin discussing the resumption of normal activity — with a goal of mid-June.



Among April’s weak data, the Goldman analysts pointed to a plunge in housing starts and sales, half the credit growth that markets expected and&nbsp;<a href="https://www.cnbc.com/2022/05/11/chinas-consumer-prices-climb-as-covid-prompts-food-stockpiling.html">a drop below 1% for the increase in consumer prices, excluding food and energy.</a>



Other data for April released Monday showed an <a href="https://www.cnbc.com/2022/05/16/china-economy-covid-lockdowns-weigh-on-retail-industrial-production-data.html">unexpected drop in industrial production</a> and a worse-than-expected 11.1% decline in retail sales from a year ago. Exports, a major driver of growth, rose <a href="https://www.cnbc.com/2022/05/09/china-economy-april-exports-slow-imports-unchanged-amid-virus-curbs.html">by 3.9% in April</a> from a year earlier, the slowest pace since a 0.18% increase in June 2020, according to official data accessed through Wind Information.



“The weak data highlight the tension between China’s growth target and zero-Covid policy which is at the core of China’s growth outlook,” the Goldman analysts said.



They noted how Chinese leaders have&nbsp;<a href="https://www.cnbc.com/2022/05/12/chinese-official-on-chinas-economy-amid-covid-pandemic.html">emphasized their “dynamic zero-Covid” policy,</a>&nbsp;and how news that China will not host the Asian Cup next summer due to Covid reflects Beijing’s conservative mindset.



“We now expect reopening does not start before 2023Q2 and the process to be more gradual and controlled than previously assumed,” the Goldman analysts said.



“This is why our 2023 GDP growth forecast only increases by a quarter point to 5.3% (vs. 5.0% previously) despite the half a point downward revision to 2022 full-year growth forecast.”



<h2 class="wp-block-heading" id="h-other-banks-cut-forecasts"><a></a>Other banks cut forecasts</h2>



On Monday, Citi — which&nbsp;<a href="https://www.cnbc.com/2022/04/26/investment-banks-slash-china-growth-outlook-one-puts-gdp-below-4percent.html">had one of the highest China GDP forecasts</a>&nbsp;— cut its outlook for growth to 4.2% from 5.1%.



A few days earlier, JPMorgan had reduced its estimate to 4.3% from 4.6%. Morgan Stanley cut its target in late April to 4.2% from 4.6%.

106910593-1626253221629-gettyimages-83781196-aa19b85a-38be-43ab-8727-5b1a7a5aae1e

Goldman Sachs cuts its China GDP forecast to 4% on Covid controls

LONDON, May 18 (Reuters)&nbsp;&#8211;&nbsp;Smoking rates have declined globally for the first time on record, according to a new report on tobacco use from a public health campaign group and U.S. academics.



However, the figures from the Tobacco Atlas report – described as a potential tipping point by the authors – also mask growing numbers of smokers in parts of the world, as well as increased tobacco use among young teenagers in almost half of the countries surveyed.



Globally, there are 1.1 billion smokers and 200 million more people who use other tobacco products, the report from Vital Strategies and the Tobacconomics team at the University of Illinois at Chicago found.



That represented a decline in smoking rates from 22.6 per cent of people in 2007 to 19.6 per cent in 2019, they said, the first since the report began in 2002.



However, population growth in Africa, the eastern Mediterranean and the Western Pacific regions meant there were still increasing numbers of smokers in a number of areas, the report said. Moreover, prevalence is rising among adults in at least 10 countries in Africa, as well as among young people.



&#8220;The industry is still preying on emerging economies in ways that will lock in harms for a generation or more,&#8221; said Jeffrey Drope, public health professor at the University of Illinois and a report author.



Children were also being targeted in a number of countries, resulting in a rise in smoking among teenagers aged 13-15 in 63 of 135 countries surveyed, he said. Around 50 million in this age group, both boys and girls, now used tobacco products, he said, and the impact of new products like e-cigarettes and flavoured products was not yet fully understood.



Falling prevalence globally was a sign of the effectiveness of strong tobacco control measures, such as increased taxes, Drope added, but many lower-income countries did not have tough enough restrictions in place.



The data also shows tobacco use caused almost 8.7 million deaths worldwide in 2019, and approximately $2 trillion in economic damage. While more than half of the deaths are currently in high-income countries, this is expected to change if cigarette use continues to rise in lower-income areas.



The report also suggests that the tobacco industry is targeting black people in the United States with menthol cigarette promotion. The authors backed the U.S. Food and Drug Administration&#8217;s plan to ban their sale.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N2WQ34R&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>.



(Reporting by Jennifer Rigby; Editing by Bradley Perrett)

smoking health-5317401_960_720_Pixaby

Global smoking rates fall for first time, but rise for kids, Africa – report

May 17 (Reuters)&nbsp;&#8211;&nbsp;Worsening outdoor air pollution and toxic lead poisoning have kept global deaths from environmental contamination at an estimated 9 million per year since 2015 – countering modest progress made in tackling pollution elsewhere, a team of scientists reported Tuesday.



Air pollution from industry processes along with urbanization drove a 7% increase in pollution-related deaths from 2015 to 2019, according to the&nbsp;<a href="http://www.thelancet.com/journals/lan???/article/PII???????????????/fulltext" target="_blank" rel="noreferrer noopener">scientists’ analysis of data</a>&nbsp;on global mortality and pollution levels.



&#8220;We&#8217;re sitting in the stew pot and slowly burning,&#8221; said Richard Fuller, a study co-author and head of the global nonprofit Pure Earth. But unlike climate change, malaria, or HIV, &#8220;we haven&#8217;t given (environmental pollution) much focus.&#8221;



An earlier version of the work published in 2017 also estimated the death toll from pollution at roughly 9 million per year — or about one of every six deaths worldwide — and the cost to the global economy at up to $4.6 trillion per year. That puts pollution on par with smoking in terms of global deaths.&nbsp;COVID-19, by comparison, has killed about&nbsp;6.7 million&nbsp;people globally since the pandemic began.



For their most recent study, published in the online journal Lancet Planetary Health, the authors analyzed 2019 data from the Global Burden of Disease, an ongoing study by the University of Washington that assesses overall pollution exposure and calculates mortality risk.



The new analysis looks more specifically at the causes of pollution – separating traditional contaminants such as indoor smoke or sewage from more modern pollutants, like industrial air pollution and toxic chemicals. Here are some of the key takeaways:



WATER AND INDOOR AIR



Deaths from traditional pollutants are declining globally. But they remain a major problem in Africa and some other developing countries. Tainted water and soil and dirty indoor air put Chad, the Central African Republic and Niger as the three countries with the most pollution-related deaths, according to data adjusted for population.



State programs to cut indoor air pollution and improvements in sanitation have helped to curb death tolls in some places. In Ethiopia and Nigeria, these efforts brought related deaths to drop by two-thirds between 2000 and 2019. Meanwhile, the Indian government in 2016 began offering to replace wood-burning stoves with gas stove connections.



MODERN POLLUTANTS



Deaths caused by exposure to modern pollutants such as heavy metals, agrochemicals and fossil fuel emissions are &#8220;just skyrocketing&#8221;, rising 66% since 2000, said co-author Rachael Kupka, executive director of the New York-based Global Alliance on Health and Pollution.



When it comes to outdoor air pollution, some major capital cities have seen some success, including in Bangkok, China, and Mexico City, the authors said. But in smaller cities, pollution levels continue to climb.



HIGHEST POLLUTION-RELATED DEATHS



The study offered a list of the 10 countries most affected by pollution-related deaths, based on their findings on mortality adjusted for population.



1. Chad; 2. Central African Republic; 3. Niger; 4. Solomon Islands; 5. Somalia; 6. South Africa; 7. North Korea; 8. Lesotho; 9. Bulgaria; 10. Burkina Faso



(Reporting by Gloria Dickie; Editing by Katy Daigle and Lisa Shumaker)

power-station-pollution-energy-electricity

Pollution killing 9 million people a year, Africa hardest hit – study

ABUJA, May 17 (Reuters)&nbsp;&#8211;&nbsp;Nigeria is monitoring Meta Platforms Inc&#8217;s&nbsp;FB.O&nbsp;Facebook and other platforms to ensure they comply with demands to curtail hate speech on their sites, as it steps up its campaign for responsible use of social media, Information Minister Lai Mohammed said on Tuesday.



Mohammed&#8217;s comments came after meeting with Facebook&#8217;s team in Nigeria&#8217;s capital, Abuja. He said Facebook had done nothing to curtail the activities of separatist group Indigenous People of Biafra (IPOB) on their platform despite several complaints.



Nnamdi Kanu, IPOB&#8217;s leader, is standing trial on charges that include terrorism and broadcasting falsehoods. A judge will decide on Wednesday on whether Kanu should be granted bail.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL5N2W62BC&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a><a href="https://www.reutersconnect.com/all?search=all%3AL5N2W55OW&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



Mohammed said the separatist group has been classified as a terrorist organisation and that &#8220;Facebook has no justification for yielding its platform to the organisation to further its campaign of hate and destabilisation of the country&#8221;.



Nigeria is facing secessionist agitation which has given rise to regional calls for power-sharing between southern and northern Nigeria.



The country is also dealing with insecurity, banditry, kidnapping, a weak currency amid double-digit inflation and slow growth.



Mohammed said the Facebook meeting was called to discuss the increasing use of the social media platform by separatists based outside Nigeria to instigate violence and ethnic hatred in the country in English and local language.



He said the government has no intention of preventing Nigerians from using social media but is advocating responsible use.



Nigeria lifted a six-months ban on Twitter&nbsp;TWTR.N&nbsp;in January after the social media company removed a post from President Muhammadu Buhari that threatened to punish regional secessionists. Telecoms companies subsequently blocked access to users in Nigeria.<a href="https://www.reutersconnect.com/all?search=all%3AL2N2NM1P8&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



(Writing by Chijioke Ohuocha)

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Nigeria asks Facebook, other platforms to curtail hate speech￼

KEY POINTS



<ul class="wp-block-list"><li>Fed Chair Jerome Powell said he will back interest rate increases until prices start falling back toward a healthy level.</li><li>“If that involves moving past broadly understood levels of neutral we won’t hesitate to do that,” the central bank leader told the Wall Street Journal</li></ul>



Federal Reserve Chair&nbsp;<a href="https://www.cnbc.com/jay-powell/">Jerome Powell</a>&nbsp;emphasized his resolve to get inflation down, saying Tuesday he will back interest rate increases until prices start falling back toward a healthy level.



“If that involves moving past broadly understood levels of neutral we won’t hesitate to do that,” the central bank leader told The Wall Street Journal&nbsp;<a href="https://www.wsj.com/articles/feds-powell-to-take-wsj-questions-on-inflation-and-economic-outlook-11652779802" target="_blank" rel="noreferrer noopener">in a livestreamed interview</a>. “We will go until we feel we’re at a place where we can say financial conditions are in an appropriate place, we see inflation coming down.



“We’ll go to that point. There won’t be any hesitation about that,” he added.



Earlier this month, <a href="https://www.cnbc.com/2022/05/04/fed-raises-rates-by-half-a-percentage-point-the-biggest-hike-in-two-decades-to-fight-inflation.html">the Fed raised benchmark borrowing rates</a> by half a percentage point, the second increase of 2022 as inflation runs around a 40-year high.



Powell said following that increase that similar 50 basis point moves were likely to come at ensuing meetings so long as&nbsp;<a href="https://www.cnbc.com/2022/05/17/retail-sales-april-2022-up-0point9percent-vs-1point0percent-estimate.html">economic conditions</a>&nbsp;remained similar to where they are now.



On Tuesday, he repeated his commitment to getting inflation closer to the Fed’s 2% target, and cautioned that it might not be easy and could come at the expense of&nbsp;<a href="https://www.cnbc.com/2022/05/06/job-growth-accelerated-by-428000-in-april-more-than-expected-as-jobs-picture-stays-strong.html">a 3.6% unemployment rate</a>&nbsp;that is just above the lowest level since the late 1960s.



“You’d still have a strong labor market if unemployment were to move up a few ticks,” he said. “I would say there are a number of plausible paths to have a soft as I said softish landing. Our job isn’t to handicap the odds, it’s to try to achieve that.”



The U.S. economy saw growth contract at a 1.4% pace in the first quarter of 2022, due largely to ongoing supply side constraints, spread of the omicron Covid variant and the <a href="https://www.cnbc.com/2022/05/17/russia-ukraine-live-updates.html">war in Ukraine</a>.



However, tighter monetary policy has added to concerns about a steeper downturn and has sparked an aggressive sell-off on Wall Street. In addition to the 75 basis points in interest rate hikes, the Fed also has halted its monthly bond-buying program, which is also known as quantitative easing, and will begin shedding some of the $9 trillion in assets it has acquired starting next month.



Powell said he still hopes the Fed can achieve its inflation goals without tanking the economy.



“You’d still have a strong labor market if unemployment were to move up a few ticks. I would say there are a number of plausible paths to have a soft as I said softish landing. Our job isn’t to handicap the odds, it’s to try to achieve that,” he said.



He added that “there could be some pain involved to restoring price stability” but said the labor market should remain strong, with low unemployment and higher wages.

Federal Reserve Chairman Jerome Powell Photo: via Flickr

Powell says the Fed will not hesitate to keep raising rates until inflation comes down

WASHINGTON/MUMBAI, May 17 (Reuters)&nbsp;&#8211;&nbsp;Nofe Isah, a 25-year old based in Nigeria, has been investing in crypto since January. Last week, she lost all of her $5,000 in savings as cryptocurrency luna went into free fall.



Isah, a recently unemployed administrative officer, vowed she would never invest in crypto again.



&#8220;I can&#8217;t believe I fell for crypto,&#8221; she told Reuters by phone. &#8220;I&#8217;m just trying not to get myself depressed. Crypto has taken my money, fine. It shouldn&#8217;t take my head.”



The crypto market, known for its wild price swings, slumped last week as investors yanked money from riskier assets amid worries over soaring inflation and rising interest rates.



Bitcoin, the world&#8217;s largest cryptocurrency, fell as low as $25,401 on Thursday, its lowest since Dec. 2020. It hit a record high of $69,000 in November.



Small tokens were hit too, with ether, the second-largest token, dropping more than 15% to its lowest since June. Luna &#8211; a digital coin widely hyped on social media and backed by institutional crypto investors &#8211; shed nearly all of its value.



Small traders such as Isah have flocked to cryptocurrencies in the hope of quick returns, despite warnings from regulators that the emerging assets can be high risk.



Platforms such as Robinhood, which has 23 million customers across a variety of assets, have helped spur retail investing, including in crypto. Around a quarter of Robinhood&#8217;s transaction-based revenues came from cryptocurrencies in the first quarter of this year, Robinhood said in its latest earnings statement.



Overall user numbers at crypto platforms have ballooned. Binance, the world&#8217;s biggest crypto exchange, had some 118 million clients last month, up from 43.4 million in the first quarter of last year.



But after last week&#8217;s turmoil, online forums were awash with tales of woe, as retail investors expressed anguish about their losses.



&#8220;I&#8217;m 49, big mortgage, 3 kids etc. My retirement party is on ice for the foreseeable future!&#8221;, a user with the handle Boring-Fun-3646 said on Reddit.



Another user with the handle AdventurousAdagio830 posted on Reddit: &#8220;It doesn&#8217;t seem real that I lost $180,000.&#8221;



&#8216;DEATH SPIRAL&#8217;



Emblematic of crypto risks was the collapse last week of terraUSD, a stablecoin designed to keep a constant value via a complex algorithm that involved luna.



When the coins came under heavy selling pressure, the system broke down. TerraUSD &#8211; designed to keep a value of $1 &#8211; traded around 9 cents on Tuesday while luna plunged to near-zero, based on CoinGecko data.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N2X20JL&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



Tejan Shrivastava, a 31-year old graphic designer from Mumbai, who has been investing in cryptocurrencies for the last year, had his $250 investment wiped out by luna&#8217;s collapse.



&#8220;It was stuck in a death spiral. All the money was gone in 15 minutes,&#8221; he told Reuters.



&#8220;I don&#8217;t even know if I&#8217;ll invest in crypto in the future. I have a crypto portfolio, but I am planning to liquidate it once it reaches break even.&#8221;



Luna&#8217;s fall wiped out most of its market value which had been above $40 billion as recently as early April, CoinGecko data shows.



Retail investors&#8217; online frustration even spilled over into the real world.



Seoul police last week said they were seeking a suspect after an unidentified individual rang the doorbell of the apartment of Do Kwon, the founder of terraUSD, and ran away.



Police would investigate whether the suspect had invested in cryptocurrencies, a Seoul police officer told Reuters.



PATCHY REGULATION



Through its 13-year life, the crypto sector has been peppered by vertiginous climbs and sudden free falls. In November, for instance, bitcoin slumped by a fifth in just under two weeks after touching a record $69,000. Six months earlier, it had tumbled by almost 40% in just nine days.



Yet crypto&#8217;s latest crash &#8211; which pushed the sector&#8217;s combined value to $1.2 trillion, less than half of where it was last November &#8211; led to the crushing of luna, which on May 1 was the eighth-largest cryptocurrency by market capitalisation.



Cryptocurrencies are subject to patchy regulation across the world, with traders of bitcoin and the panapoly of smaller tokens typically unprotected against price slumps.



But it is difficult to gauge the scale of retail investors&#8217; pain from the crypto plunge and the repercussions on future appetite given the opaque nature of the market.



In Britain more than 4% of adults &#8211; some 2.3 million people &#8211; own cryptocurrencies, data published last year by the UK financial watchdog showed.



Britain&#8217;s watchdog said understanding of crypto was falling compared with a year earlier, &#8220;suggesting that some crypto users may not fully understand what they are buying&#8221;.



Still, some small investors are keeping the faith.



Eloisa Marchesoni, based near Tulum in Mexico and investing with a crypto syndicate, said she would not give up.



&#8220;I am looking to buy the dip &#8211; we are all waiting for bitcoin to go down to $22,000, which is not something too probable but not something that&#8217;s &#8216;not probable at all&#8217;.&#8221;



Marchesoni is also hedging her crypto bets with physical assets &#8212; &#8220;cars because you can lease them, watches, real estate&#8221;.



Bitcoin&nbsp;BTC=BTSP&nbsp;was hovering around $30,000 on Tuesday, having lost more than 20% so far this month.



Regulators remain on alert. The British government said last month it will regulate stablecoins.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL5N2W23WH&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



The U.S. Securities and Exchange Commission is toughening its stance. Gary Gensler, SEC chair, said this week investors in cryptocurrencies needed more protections.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N2X81YX&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



(Additional reporting by Alun John in Hong Kong and Soo-hyang Choi in Seoul; Writing by Carolyn Cohn, Elizabeth Howcroft and Tom Wilson in London. Editing by Jane Merriman)

106911087-16263029762021-07-12t182451z_1049474836_rc26jo9ua1af_rtrmadp_0_fintech-crypto-flows

Small players lose faith in crypto after sell-off￼

May 17 (Reuters)&nbsp;&#8211;&nbsp;Zimbabwe has lifted its ban on bank lending, the central bank announced on Tuesday, more than a week after the government froze loans in a move it said was meant to stop speculation against a rapidly devaluing local currency.



The government said at the time it had started investigating unnamed speculators of taking out Zimbabwe dollar bank loans to purchase foreign currency on the black market, driving the local currency&#8217;s value lower.



&#8220;The Bank wishes to advise the public that the temporary suspension of lending services by banks has been lifted with immediate effect,&#8221; the central bank said in a statement.



It added that only organisations being probed for abusing loan facilities would not be allowed to borrow from banks.



Business groups had warned that the lending freeze would hurt commerce and worsen Zimbabwe&#8217;s economic crisis. Last week, South Africa&#8217;s Tongaat Hulett suspended pre-payments to sugar cane farmers, saying it relied on bank loans to fund the payments.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL5N2X470V&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Read full story</a>



&#8220;We said (the lending freeze) was temporary. We have lived true to our word,&#8221; government spokesperson Nick Mangwana said on Twitter.



Zimbabwe reintroduced its currency in 2019, a decade after abandoning it in favour of foreign currencies, mainly the United States dollar. Since its return, the local currency&#8217;s value has declined from around 2.5 to the U.S dollar in 2019 to 285 against the greenbank on the interbank market.



It trades much weaker, around 400 to the U.S dollar on a thriving black market.



The lending freeze did slow the Zimbabwean dollar&#8217;s slide on the black market, although it had little impact on the official rate.



Zimbabwe, which experienced 500 billion percent hyperinflation in 2008, is currently experiencing another episode of high inflation, with year-on-year inflation rising to 96.4% in April from 72.7% in March, driven by the rapid devaluation of its currency.



(Reporting by Nelson BanyaEditing by Raissa Kasolowsky)

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How Davos became the anti-establishment’s punching bag

Europe admits it’ll have to burn more coal as it tries to wean itself off Russian energy

EMERGING MARKETS-China rate cut boosts EM stocks; currencies recover as greenback eases￼

IMF extends financial support for Somalia to August

Sudanese communist leader arrested as protests rage in Khartoum￼

Oil falls on uncertainty over fuel demand recovery

Rising inequality now an urgent matter, BIS central bank group warns

Russia to send oil rejected by Europe to Asia, other regions, says Novak

S.African central bank eyes digital rand to cut cross-border payment costs

Stocks pummeled by growth worries, U.S. dollar climbs

Goldman Sachs cuts its China GDP forecast to 4% on Covid controls

Global smoking rates fall for first time, but rise for kids, Africa – report

Pollution killing 9 million people a year, Africa hardest hit – study

Nigeria asks Facebook, other platforms to curtail hate speech￼

Powell says the Fed will not hesitate to keep raising rates until inflation comes down

Small players lose faith in crypto after sell-off￼

Zimbabwe lifts ban on bank lending it imposed to stop currency slide￼

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EMERGING MARKETS-China rate cut boosts EM stocks; currencies recover as greenback eases

Sudanese communist leader arrested as protests rage in Khartoum

Nigeria asks Facebook, other platforms to curtail hate speech

Small players lose faith in crypto after sell-off

Zimbabwe lifts ban on bank lending it imposed to stop currency slide