Markets are keenly monitoring the US debt-ceiling discussions as investors around the world wait to see if the world's largest economy is able to reach an agreement before the deadline next week.
Global stock markets were muted on Friday as US President Joe Biden and House speaker Kevin McCarthy continued talks to reach an agreement that would raise the government's $31.4 trillion debt ceiling for two years.
Earlier on Thursday, Mr Biden maintained that the US would not default on its debt after a series of economic reports indicated growing concerns about the repercussions of not reaching a deal.
Mr Biden said he and Mr McCarthy have had “several productive conversations”.
Asia's stock markets were cautiously higher on Friday, with Japan leading the gains, while the dollar dipped slightly, although it remained close to a two-month high.
The US dollar index, which hit a three-month high of 104.31 overnight, was at 104.05 at 1pm UAE time.
“Anxiety over the debt ceiling” remains the driving force for markets and even as a deal may be forthcoming, a sell-off in Treasuries continued overnight, said Edward Bell, senior director of market economics at Emirates NBD.
“A resolution to the US debt ceiling impasse looks to be nearing with the outline of a deal emerging overnight,” he said.
“The ceiling could reportedly be raised for two years along with a cap on overall government spending. Defence spending would still be permitted to increase next year.
“However, a full deal has still not been reached, with Moody’s raising the pressure on the US, saying that if the government missed an interest payment in mid-June, then the US would be at risk of losing its 'AAA' rating.”
Earlier in the week, rating agency Fitch said it had put America's “AAA” rating, its highest rank, on negative credit watch because of increasing political disputes around the country's debt limit.
The rating watch “reflects increased political partisanship that is hindering efforts to reach a resolution to raise or suspend the debt limit” with increasing concerns over a default, it said.
“We believe risks have risen that the debt limit will not be raised or suspended before the x-date [when the US Treasury exhausts its cash position and capacity for extraordinary measures without incurring new debt] and, consequently, that the government could begin to miss payments on some of its obligations,” it said.
While the debt ceiling talks continued on Thursday, and there was, again, some optimism, “no deal has been reached and the clock is ticking louder into the June 1st deadline”, said Ipek Ozkardeskaya, an analyst at Swissquote Bank.
“The US Treasury’s cash balance fell below $50 billion on Wednesday and, as Janet Yellen warns so loudly, the US may not reach the mid-June safe zone, where the tax money will fall in, to avoid a default,” she said.
“If investors are not extremely worried about the debt ceiling talks, it’s because they know it’s just an unnecessary political theatre and that the debt ceiling will end up being raised, anyway,” Ms Ozkardeskaya said.
“But in the extreme event of a political accident, the consequences would be catastrophic. US and global stocks could dive more than 20 per cent and the US’s self-induced economic crisis would push the world economy into a deep recession by the end of the year.”
An actual breach of the US debt ceiling could cause “severe damage” to the US economy, research this month by the White House's Council of Economic Advisers found.
“If the US government were to default on its obligations – whether to creditors, contractors or citizens – the economy would quickly shift into reverse, with the depth of the losses a function of how long the breach lasted,” the council said.
“A protracted default would likely lead to severe damage to the economy, with job growth swinging from its current pace of robust gains to losses numbering in the millions.”
Meanwhile, Brookings Institution analysts Wendy Edelberg and Louise Sheiner also said that “worsening expectations regarding a possible default would make significant disruptions in financial markets increasingly probable” and that “such financial market disruptions would very likely be coupled with declines in the price of equities, a loss of consumer and business confidence, and a contraction in access to private credit markets”.
360Vuz PROFILE
Date started: January 2017
Founder: Khaled Zaatarah
Based: Dubai and Los Angeles
Sector: Technology
Size: 21 employees
Funding: $7 million
Investors: Shorooq Partners, KBW Ventures, Vision Ventures, Hala Ventures, 500Startups, Plug and Play, Magnus Olsson, Samih Toukan, Jonathan Labin
ESSENTIALS
The flights
Emirates flies from Dubai to Phnom Penh via Yangon from Dh2,700 return including taxes. Cambodia Bayon Airlines and Cambodia Angkor Air offer return flights from Phnom Penh to Siem Reap from Dh250 return including taxes. The flight takes about 45 minutes.
The hotels
Rooms at the Raffles Le Royal in Phnom Penh cost from $225 (Dh826) per night including taxes. Rooms at the Grand Hotel d'Angkor cost from $261 (Dh960) per night including taxes.
The tours
A cyclo architecture tour of Phnom Penh costs from $20 (Dh75) per person for about three hours, with Khmer Architecture Tours. Tailor-made tours of all of Cambodia, or sites like Angkor alone, can be arranged by About Asia Travel. Emirates Holidays also offers packages.
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
Scores
Oman 109-3 in 18.4 overs (Aqib Ilyas 45 not out, Aamir Kaleem 27) beat UAE 108-9 in 20 overs (Usman 27, Mustafa 24, Fayyaz 3-16, Bilal 3-23)
PROFILE OF STARZPLAY
Date started: 2014
Founders: Maaz Sheikh, Danny Bates
Based: Dubai, UAE
Sector: Entertainment/Streaming Video On Demand
Number of employees: 125
Investors/Investment amount: $125 million. Major investors include Starz/Lionsgate, State Street, SEQ and Delta Partners
Match statistics
Dubai Sports City Eagles 8 Dubai Exiles 85
Eagles
Try: Bailey
Pen: Carey
Exiles
Tries: Botes 3, Sackmann 2, Fourie 2, Penalty, Walsh, Gairn, Crossley, Stubbs
Cons: Gerber 7
Pens: Gerber 3
Man of the match: Tomas Sackmann (Exiles)
Killing of Qassem Suleimani
Killing of Qassem Suleimani
What is Genes in Space?
Genes in Space is an annual competition first launched by the UAE Space Agency, The National and Boeing in 2015.
It challenges school pupils to design experiments to be conducted in space and it aims to encourage future talent for the UAE’s fledgling space industry. It is the first of its kind in the UAE and, as well as encouraging talent, it also aims to raise interest and awareness among the general population about space exploration.
ONCE UPON A TIME IN GAZA
Starring: Nader Abd Alhay, Majd Eid, Ramzi Maqdisi
Directors: Tarzan and Arab Nasser
Rating: 4.5/5
The specs: 2018 Nissan Altima
Price, base / as tested: Dh78,000 / Dh97,650
Engine: 2.5-litre in-line four-cylinder
Power: 182hp @ 6,000rpm
Torque: 244Nm @ 4,000rpm
Transmission: Continuously variable tranmission
Fuel consumption, combined: 7.6L / 100km
UAE currency: the story behind the money in your pockets
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
TOURNAMENT INFO
Fixtures
Sunday January 5 - Oman v UAE
Monday January 6 - UAE v Namibia
Wednesday January 8 - Oman v Namibia
Thursday January 9 - Oman v UAE
Saturday January 11 - UAE v Namibia
Sunday January 12 – Oman v Namibia
UAE squad
Ahmed Raza (captain), Rohan Mustafa, Mohammed Usman, CP Rizwan, Waheed Ahmed, Zawar Farid, Darius D’Silva, Karthik Meiyappan, Jonathan Figy, Vriitya Aravind, Zahoor Khan, Junaid Siddique, Basil Hameed, Chirag Suri
Seemar’s top six for the Dubai World Cup Carnival:
1. Reynaldothewizard
2. North America
3. Raven’s Corner
4. Hawkesbury
5. New Maharajah
6. Secret Ambition
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
World%20Food%20Day%20
%3Cp%3ECelebrated%20on%20October%2016%2C%20to%20coincide%20with%20the%20founding%20date%20of%20the%20United%20Nations%20Food%20and%20Agriculture%20Organisation%2C%20World%20Food%20Day%20aims%20to%20tackle%20issues%20such%20as%20hunger%2C%20food%20security%2C%20food%20waste%20and%20the%20environmental%20impact%20of%20food%20production.%20%0D%3C%2Fp%3E%0A
Three ways to boost your credit score
Marwan Lutfi says the core fundamentals that drive better payment behaviour and can improve your credit score are:
1. Make sure you make your payments on time;
2. Limit the number of products you borrow on: the more loans and credit cards you have, the more it will affect your credit score;
3. Don't max out all your debts: how much you maximise those credit facilities will have an impact. If you have five credit cards and utilise 90 per cent of that credit, it will negatively affect your score.
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
more from Janine di Giovanni
From Conquest to Deportation
Jeronim Perovic, Hurst
ELIO
Starring: Yonas Kibreab, Zoe Saldana, Brad Garrett
Directors: Madeline Sharafian, Domee Shi, Adrian Molina
Rating: 4/5
North Pole stats
Distance covered: 160km
Temperature: -40°C
Weight of equipment: 45kg
Altitude (metres above sea level): 0
Terrain: Ice rock
South Pole stats
Distance covered: 130km
Temperature: -50°C
Weight of equipment: 50kg
Altitude (metres above sea level): 3,300
Terrain: Flat ice
India Test squad
Kohli (c), Dhawan, Rahul, Vijay, Pujara, Rahane (vc), Karun, Karthik (wk), Rishabh Pant (wk), Ashwin, Jadeja, Kuldeep, Pandya, Ishant, Shami, Umesh, Bumrah, Thakur
