🇨🇳 Hello old f(r)iend

Inflation in France and Spain jump unexpectedly, increasing pressure on ECB, Belarus's Lukashenko lauds Xi ahead of Beijing visit, Microsoft adds new Bing to Windows computers


Good morning. It’s Wednesday, March 1st.

Elon Musk regained his status as the world’s richest person after a brief interruption of losing the top spot to France’s Bernard Arnault. What a relief to all (!). The billionaire’s wealth got hit last year by a 70% loss in Tesla’s stock price but it’s back up about 100% as investors come back with hopes of economic strength and slower interest rate increases by the Fed.

  • Say hello to your old friend darkness with this playlist, as we all say hello to the first day of spring, at least on paper.

—Özlem, with Tanem and Can


Inflation in France and Spain jumped unexpectedly in February, figures showed on Tuesday, pushing up ECB rate hike expectations and challenging the narrative of a rapid easing in price growth.

France Spain inflation

via Bloomberg

  • Zoom in: French consumer prices rose 7.2% year-on-year, from 7.0% in the month prior and higher than an expectation of 7.0%. In Spain, annual inflation jumped to 6.1% in February from 5.9% in the previous month and ahead of a 5.5% forecast.
  • Looking ahead… The data also raised doubts that the eurozone's combined figure, due on Thursday, will show a fall from last month’s 8.6% as expected, but economists say that the German number, due on Wednesday, will be more crucial than Tuesday's releases.

🪙 GDP round-up

  • The French economy expanded 0.1% quarter-on-quarter in the last three months of 2022, according to final figures released by INSEE on Tuesday, down from a 0.2% GDP growth in the previous quarter but matching preliminary estimates. In 2022, France's GDP grew 2.6% following a 6.8% increase in 2021.
  • The Swiss economy showed no growth in the final quarter of 2022, official figures revealed on Tuesday. The 0% growth rate missed forecasts of a 0.4% expansion and marked a slowdown from the 0.2% increase in Q3. GDP for 2022 as a whole increased by 2.1%, down from 3.9% in 2021.
  • Sweden’s economic output contracted by 0.9% on the final quarter of last year, according to Statistics Sweden. Analysts expected GDP would decline by 0.6%, as indicated by a flash estimate, while the Riksbank expected a 1.4% fall.
  • Finland entered a recession in the final quarter of 2022, official statistics showed Tuesday. The Finnish economy contracted by 0.6% quarter-on-quarter in Q4, the second consecutive quarter of negative growth — the technical definition of a recession. For the year as a whole, however, the Finnish economy grew last year by 2% compared to 2021.
  • Turkey’s economy grew a faster-than-expected 0.9% in the October-December period of 2022, as the government ramped up spending ahead of elections, though two devastating earthquakes this month have clouded the outlook. Growth for the whole year was 5.6%, TurkStat data showed on Tuesday.

US consumer confidence unexpectedly fell in February, especially among lower-middle-income households, according to a survey on Tuesday, though Americans grew more upbeat about the labor market. The Conference Board's consumer confidence index dropped to 102.9 from 106.0 in January. The survey also showed consumers apprehensive about buying big-ticket items like motor vehicles and household appliances over the next six months.

Industrial production in Japan decreased by 4.6% month-on-month in January 2023, falling at the steepest pace in eight months and exceeding forecasts for a 2.6% drop, preliminary data showed. On an annual basis, industrial production fell 3.1% in January, the third straight month of decline.


The German government is accelerating efforts to merge four high-voltage grid operators, reported Bloomberg on Tuesday, with the eventual goal of forming a single unit. Chancellor Olaf Scholz’s cabinet is in talks to buy out TenneT Holding, 50Hertz Transmission, TransnetBW, and Amprion as it believes combining the operators is the fastest way to modernize power lines for a coming influx of renewable energy.

Swedish payments group Klarna reported wider losses for 2022 at 10.5 billion crowns (€950mn) against 6.6 billion crowns in 2021, with an improving performance in the fourth quarter.


via CNBC

  • The big picture: The fast-growing, privately held fintech saw business conditions deteriorate last year as consumer confidence was hit by soaring inflation and the war in Ukraine.
  • On the other hand: Klarna’s chief executive Sebastian Siemiatkowski’s pay increased 35% to 13.2 million crowns despite widening losses.

Bayer forecast lower profit this year with core earnings per share of as much as €7.40 in 2023, lower than the €7.94 last year and below analysts’ estimates.

  • What happened: The crop science division, Bayer’s biggest growth motor last year, is set to slow as prices decline for glyphosate, the active ingredient in Roundup, a controversial weedkiller that it manufactures in Louisiana.

Spain's Santander Bank said it plans to return 50% of its profits to investors, up from 40%, as it announced ambitious profitability goals for the next years, joining the race among EU lenders to attract investors after years of lower returns. Spain's largest lender's shares rose almost 5% after the planned payouts were announced, and also after the bank said it aimed to have a return on tangible equity of 15-17% between 2023-2025, from 13.4% in 2022.


Ukraine's President Volodymyr Zelenskiy said on Tuesday the fighting in Bakhmut is getting "more and more challenging" while the military reported that Russia's mercenary Wagner group is throwing its "most trained" units into the battle. Meanwhile, Russia accused Ukraine of attempting drone attacks in its territory, with Moscow's Defense Ministry saying that two of the four drones were "neutralized" without causing any damage, and one crashed near a village in the Krasnodar region.

Ukraine servicemen

via Reuters

  • Precaution: Russia's President Vladimir Putin ordered officials to tighten control of the Ukraine border, following the defense ministry's announcement.
  • Another US visit: In her Monday visit to Ukraine, US Treasury Secretary Janet Yellen announced that Washington is sending an additional €1 billion to Kyiv, as the first portion of a further €10 billion aid that the White House is planning to send to Kyiv in the coming months.

China ordered schools to "oppose and resist Western erroneous views" in legal education, such as constitutional government, separation of powers, and judicial independence, and to rather put more emphasis on the dictates of the ruling Communist Party and leader Xi Jinping. The order came a week before China's ceremonial parliament is to begin its annual session, and similar directives have been issued in the past like students being encouraged to report on academics that speak positively about Western governance.

  • In other news: Belarusian President Alexander Lukashenko flew to Beijing for a three-day visit to meet with his counterpart Xi Jinping on Tuesday, saying that he is looking forward to seeing his "old friend."

British PM Rishi Sunak traveled to Northern Ireland to sell his newly-resolved trade agreement with the EU to the Democratic Unionist Party (DUP), who fear that post-Brexit trade rules are weakening N. Ireland's place in the UK. The deal, now named the "Windsor Framework", is to ease custom checks for goods moving to Belfast from the rest of the UK. DUP leader Jeffrey Donaldson said the party would "take our time" to discuss the details of the deal before giving a final answer.


The European Commission is continuing its investigation into how apps were allegedly prevented from telling iPhone and iPad users of cheaper ways to access music subscriptions outside of the App Store. However, the commission has also abandoned a charge that accused Apple of forcing developers to use its own in-app payment system.

Denmark's parliament urged politicians and staff to delete the TikTok app from their work phones as a cybersecurity measure, saying "there is an espionage risk."

  • Background: The China-based video-sharing app is facing scrutiny in Europe and the US over security and data privacy amid worries that it could be used to promote pro-China views or collect users’ information.
  • Furthermore: The White House is giving all federal agencies 30 days to delete TikTok from all government devices due to "the risks presented by the app to sensitive government data."

The US Department of Commerce said chipmakers cannot "expand semiconductor manufacturing capacity in foreign countries of concern" if they received money from the $39 billion federal fund, designed to build a leading US chip industry.

US commerce secretary Gina Raimondo

via FT

  • What it means: The US is preventing chipmakers from conducting business or research with China, as it aims to counter China’s dominance in the semiconductor industry with the Chips Act passed by Congress last year.

Microsoft started adding its recently upgraded Bing search engine to its Windows computer software on Tuesday, in a bid to put artificial intelligence at the fingertips of hundreds of millions of users. The Windows 11 update will include the new Bing in desktop computers' search box, which helps half a billion monthly users navigate their files and the internet, the company said.


📦 Analysis: Brexit slammed the UK economy. The new Northern Ireland deal gives it hope

📲 AP Interview: Father of cellphone sees dark side but also hope in new tech

⚕️ Biotech: Will CRISPR cure cancer?


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