⛓️ SBF 4 Life?

• US consumer prices rose less than expected for a second straight month in November, indicating the worst of inflation has likely passed and clearing the way for the Fed to start scaling back the size of its interest rate hikes. The Fed is expected to lift its benchmark overnight interest rate by 50 basis points Wednesday, snapping a string of four straight 75-basis-point increases.

^{via Reuters}

• By the numbers: In November, CPI increased 0.1% month-on-month and 7.1% year-on-year. The so-called core CPI —which excludes volatile food and energy prices and is seen as a better indicator of underlying inflation— rose 0.2% from the prior month and was up 6% from a year earlier.

• German investor sentiment recovered for a third month in December, reaching its highest level since Russia’s invasion of Ukraine, as inflation expectations eased and Europe's biggest economy has so far avoided an acute shortage in energy supplies. The ZEW institute’s economic sentiment index rose to -23.3 from -36.7 in November, exceeding expectations of a reading of -26.4.

• In other news: Germany’s consumer prices, harmonized to compare with other European countries, were 11.3% higher year-on-year in November, the Federal Statistical Office said on Tuesday, confirming preliminary figures and remaining unchanged from the previous month.

• Britain's unemployment rate rose for a second month, data from the Office for National Statistics showed on Tuesday, signaling that some of the inflationary heat in the labor market is cooling as the economy stumbles. The unemployment rate increased to 3.7% in the three months to October from 3.6% in the three months to September.

• On a related note: Inflation-adjusted average pay for British public sector workers fell to a 19-year low in October, highlighting why so many are going on strike. Public sector pay is 6% lower in real terms than in October 2021.

• Italian industrial production fell more than expected in October for the second month in a row, figures from the national statistics bureau ISTAT showed on Tuesday, suggesting a bleak outlook for Q4-2022 and fueling recession fears.

^{via CEIC data}

• By the numbers: Industrial output in the euro zone's third-largest economy dropped 1.0% month-on-month, versus expectations of only a 0.4% decline. Compared to the same period last year, output was down 1.6% in October, following an unrevised 0.5% fall in September. However, in the three months to October, it was still up 0.3% compared with the May-to-July period, ISTAT said.

• KPMG reported revenues of $34.6 billion for its most recent financial year, growing more slowly than its Big Four rivals despite an 8% increase in sales, driven mainly by its advisory arm.

• By the numbers: Revenues in the advisory unit rose 13% year-on-year to $15.4 billion in the 12 months to the end of September, fuelled by work on deals and technology consulting, which increased by one-fifth as companies sought help with transforming their operations and using cloud computing.

• Looking ahead… Chief executive Bill Thomas rejected the idea of an EY-style break-up of KPMG’s audit and consulting businesses in a statement on Tuesday, saying that the firm’s performance "validates an unwavering commitment to deliver services . . . through a multidisciplinary approach."

• Pepco Group —the owner of European discount retailers PEPCO, Poundland and Dealz— reported a 14.3% rise in annual core earnings on Tuesday, helped by the opening of 516 new stores, and forecast more growth in its new financial year. "We are driven by maintaining and improving our price leadership position through which we can grow our market share," Pepco said.

• By the numbers: The group, which listed on the Warsaw stock market last year, said it made core earnings of €731 million in the year to Sept. 30, up from €647 million in the same period a year ago. Revenue rose 17.4% to €4.82 billion, with like-for-like sales up 5.2%.

• United Airlines said they are ordering 200 new planes —100 Boeing 787 Dreamliners and 100 737 MAXs— as the US airline aims for post-pandemic growth and replaces older aircraft. United’s order for 200 planes is worth about $43 billion at list prices and will boost the company after political and production issues took place this year.

• China has challenged a move by the US to block sales of advanced computer chips and chip-making equipment to Chinese companies by launching a trade dispute at the World Trade Organization, calling the measures "trade protectionism."

^{via CNN}

• Furthermore: China is working on a more than 1 trillion yuan (€135bn) support package, mainly as subsidies and tax credits, for its semiconductor industry in an effort towards self-sufficiency and countering US moves aimed at slowing its technological advances.
• On the other hand: Washington confirmed talks with Japan and the Netherlands, both major suppliers of chip-making equipment, about tightening exports of semiconductor manufacturing equipment to China.

• Dozens of countries and organizations gathered at an international donor conference in Paris to raise more than €1 billion in aid to keep Ukraine powered, fed, and warm throughout the winter as Russian troops continue targeting essential infrastructures.

^{via Euronews}

• What they're saying: French President Emmanuel Macron denounced Moscow's attacks as war crimes, while Ukraine's President Volodymyr Zelenskiy said that such aid could pressure Russia into pursuing peace.

• The European Parliament removed Eva Kaili as a vice president, who is one of four people arrested in Belgium over allegations of accepting bribes from Qatar. EU lawmakers went ahead to isolate the MEP from Greece rapidly, saying that "there will not be any sweeping under the carpet."

• Tax lawyer Hanno Berger was sentenced to eight years in prison after being convicted over the cum-ex dividend stripping scheme that is seen as one of Germany's biggest tax scams. Berger, who is seen as the mastermind behind the giant scheme that some estimate to have cost taxpayers around €10 billion, was also ordered to repay more than €13 million.

^{via Reuters}

• PM Rishi Sunak unveiled plans to tackle the UK’s swelling backlog of asylum claims, including making it harder for arrivals from Albania to stay in Britain. The UK has 143,377 people waiting for an initial decision on their application and unable to work. Refugee charities called the plans "cruel" and "ineffective."

^{via BBC}

• Zoom in: The plan includes the government establishing a new, permanent operation to clamp down on immigration across the English Channel and doubling the funding of the National Crime Agency. The UK will also embed border force officials in Albania and raise the threshold arrivals have to meet to be considered a victim of modern slavery.

• Hungary is expecting to sign an agreement within days for a new package of reforms planned to be submitted to the parliament by the end of March that will bring the country closer to accessing more than €12 billion in suspended EU funding, Hungary’s principal EU negotiator said.

• EU member states agreed to recommend Bosnia to be granted candidate member status as the war in Ukraine speeds up the bloc’s enlargement process, especially in Western Balkans. The decision needs to be formally approved by leaders in a summit set to gather on Thursday.

• FTX co-founder Sam Bankman-Fried was accused by US regulators of carrying out a multi-year scheme to defraud investors. The Securities and Exchange Commission said on Tuesday that Bankman-Fried, who was arrested on Monday in the Bahamas and is facing criminal charges in the US, raised more than $1.8 billion from investors while he concealed risks and FTX’s relationship with his trading firm Alameda Research, and used commingled customer funds.

^{via Bloomberg}

• The road ahead: The SEC is seeking to bar Bankman-Fried as an officer or director of a public company or from offering crypto or other securities. The agency is also seeking to force him to turn over his ill-gotten assets.
• The possible sentence: CNBC reported that legal experts think if the federal government pursues wire or bank fraud charges, Bankman-Fried could face life in prison without the possibility of supervised release.

• Binance, the world’s biggest crypto exchange, said on Tuesday it "temporarily paused" withdrawals of the major stablecoin USDC. Chief executive Changpeng Zhao said, "The banks are not open for another few hours. We expect the situation will be restored when the banks open."

• Zoom in: Binance has seen withdrawals of $1.9 billion in the last 24 hours, blockchain data firm Nansen said on Tuesday, marking the largest daily outflow over 24 hours since June 13. "Binance's withdrawals are increasing due to the growing uncertainty about its reserves report," a Nansen spokesperson said.

• US Department of Energy officials announced on Tuesday a landmark accomplishment in nuclear fusion, where scientists were able to produce more energy from fusion than they used to power the experiment. A so-called "net energy gain" is a major milestone in a decades-long attempt to source clean, limitless energy from the fusing together of two or more atoms.

^{Lawrence Livermore National Laboratory}

• Republican US Senator Marco Rubio unveiled bipartisan legislation to ban TikTok, increasing pressures on the social media app’s China-based owner ByteDance amid fears that the app could be used to spy on US citizens and censor content. The law would block all transactions from any social media company in or under the influence of China and Russia, Rubio’s office said. 

• Twitter dissolved its Trust and Safety Council, the advisory group of around 100 independent civil, human rights, and other organizations that the company formed in 2016 to address hate speech, child exploitation, suicide, self-harm, and other problems on the platform. Former Twitter employee Patricia Cartes, who formed the council in 2016, said the dissolution "means there are no more checks and balances."

• Tax break: The $5.7 billion of Tesla shares that Elon Musk donated to an unnamed organization at the end of 2021 went to his own charitable arm, instantly making it one of the largest foundations in the US. A large gift to charity would have helped reduce Musk’s $11-billion tax bill last year. The Musk Foundation held $9.4 billion in assets at the end of 2021 and sent about $160 million to nonprofits.

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