8 TheEconomistOctober9th 2021
The world this week Business
Itwasanotherrollercoaster
week for energy prices. After
opecand its allies resisted
calls to increase output, the
price of Brent crudesurpassed
$80 per barrel and reached its
highest level in three years.
The cartel said it would stick to
the gradual increases in output
it agreed to over the summer.
The energy shortage rattled
other financial markets too, as
investors worried about the
fallout. In America and Europe
government bond yields
climbed. In Britain the yield on
tenyear gilts jumped to its
highest since May 2019.
In Europe the price of natural
gas frontmonth futures
jumped by more than 60% in
two days. But prices soon
reversed when Vladimir Putin,
the Russian president, hinted
that his country could supply
additional gas to Europe.
In Asia the coal shortage
dragged on. Power cuts have
been reported across China.
Authorities there have told
miners to increase production.
India is braced for power
shortages. Half of its coalfired
power plants are on alert for
blackouts.
In the euro area rising energy
prices contributed to high
inflation. In September the
euro area’s inflation rate rose
to 3.4%, the highest level in
years. In Germany consumer
prices rose by 4.1% in the same
month, a 29year high.
America’s trade deficitin
goods and services grew to a
record $73bn in August, up
4.3% from the previous
month. Imports rose by $4bn
from July, because of an in
crease in consumer demand.
But trade in vehicles and car
partsfell,asa resultofthe
semiconductorshortage.
Leaksandoutages
Facebookusersexperienceda
longoutagethisweek.The
socialmediaplatformandits
subsidiaries,WhatsAppand
Instagram,weredownfor
severalhours.Thefirm’sshare
pricefellby4.9%onMonday.
Itblamedaninternalmalfunc
tion and said there was no
evidence that users’ data had
been compromised.
Meanwhile, Frances Haugen,
a former Facebook employee
who is now a whistleblower,
testified before a Senate sub
committee. She claimed that
Facebook’s products “harm
children, stoke division [and]
weaken...democracy”, and that
documents she leaked to the
Wall Street Journal showed the
company is aware of this. In a
statement Mark Zuckerberg,
Facebook’s boss, said that the
firm’s work and motives have
been mischaracterised.
Tesco, Britain’s biggest food
retailer, announced a share
buyback worth £500m
($678m). Operating profits in
the first half of the year
reached £1.3bn, a 29% increase
on a year earlier. Last year the
covid19 pandemic hurt the
supermarket’swholesalearm,
whichsellstorestaurantsand
pubs,andaddedtocosts,such
asextracleaninginitsstores.
TheHongKongstockexchange
suspendedtradinginsharesof
Evergrande, anindebted
Chinesepropertydeveloper,
andHopsonDevelopment, a
rival.Chinesestatebacked
mediasuggestedthatHopson
isconsideringtakinga major
ity stake in Evergrande’s prop
ertyservices unit. Trading of
the subsidiary’s shares was
also suspended.
Volvo, a Swedish carmaker
owned by Geely, a Chinese
auto firm, said it will raise
$2.9bn through an initial
public offering on the Stock
holm stock exchange. The
listing will value the firm at
around $30bn. Volvo was sold
by Ford, a carmaker, to Geely in
2010. Since then it has raced
ahead in electrification.
The European Medicines
Agency, a regulator, endorsed
covid-19 booster shots. It said
that in most cases the Pfizer
BioNTech vaccine could be
given as a booster to those
aged 18 and over, at least six
months after their second
dose. In America Johnson &
Johnson, a pharmaceutical
firm, asked the Food and Drug
Administration,anotherreg
ulator,toauthoriseitsbooster.
Foxconn, theTaiwanesefirm
thatassemblesiPhones,
boughtanelectricvehicle
manufacturingplantfrom
LordstownMotors,anOhio
basedcarmaker.ItisFoxconn’s
firstsuchplantinAmericaand
it comesaspartofa dealthat
includesa minoritystakein
Lordstown.
Syniverse, a firm that process
es hundreds of billions of sms
text messages every year for
firms including Verizon, Voda
fone and China Mobile, re
vealed to American regulators
that hackers had access to its
systems for five years, begin
ning in 2016. It was not clear
whether the text messages
themselves had been compro
mised by the hack.
Cleaningthecesspool
Later in the week Twitch, an
online video platform owned
by Amazon, was hit by an
attack that leaked a full copy of
the site’s source code as well as
payment records for its broad
casters. The hacker claimed
that the aim of this act was to
inject more competition into
the online streaming industry,
which he described as a “dis
gusting toxic cesspool”.
Britain
Ten-year government-bond yield, %
Source: Refinitiv Datastream
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