Sat. May 28th, 2022


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Today’s European Commission survey shows more than half of EU manufacturers suffering from shortages of materials and equipment follow a week of corporate warnings about supply chain problems, and in particular the shortage of semiconductors.

The increase in demand for chips has contributed to rising inflation in the US and Europe. Wider supply restrictions were also cited this morning as a reason for this. Germany’s economy shrinks in the last quarter of last year.

The slide shortage has been a recurring theme in the current earnings season. appealwhich reported yesterday is one of the few large companies to have apparently navigated around the issue, with iPad sales being the only key segment affected, although supply chain problems the company still cost more than $ 6 billion in revenue from the fourth quarter.

GIVE said Tuesday semiconductor shortages are a key factor in declining revenues, the same day a U.S. Department of Commerce report found that demand for chips from U.S. manufacturers rose 17 percent between 2019 and 2021, leaving companies with only has. five days stock instead of the pre-pandemic norm of 40.

Tesla Wednesday warned of the impact of stock chain disruptions on this year’s results, even though it reported a record net profit of $ 2.3 billion in the fourth quarter of last year.

The slide crisis is also affecting the automotive industry across the Atlantic. New operating data showed this week British car production dropped by 6.7 percent from 2020 last year, leaving it a third lower than pre-pandemic levels.

For companies like Samsung times are good though. The world’s largest maker of computer chips and smartphones reported its highest operating profit in the fourth quarter in four years yesterday.

Innovation editor John Thornhill describes the search for semiconductors as ours industrial ‘Big Game’ such as Samsung, Taiwan Semiconductor and Intelwhich announced last week that it was spending $ 20 billion on two chip factories in Ohio, increased investment.

Cristiano Amon, CEO of US chip designer Qualcomm, compared the technological rivalry to gladiator fights in ancient Rome. “You go in, you prepare, you go to the Colosseum. “If you win, all you have achieved is the right to go to the Colosseum one more time,” he told the FT.

Latest news

For the latest news updates, visit us live blog

Must know: the economy

U.S. labor costs rose sharply in the fourth quarter while separate data today showed that the Federal Reserve’s preferred measure of inflation increased by 4.9 per cent in December from the year before, giving extra impetus to the central bank’s efforts to accelerate the withdrawal of its pandemic stimulus program. Fed Chairman Jay Powell Wednesday seen a stricter attitudewhich causes a stock market sale.

Data shown yesterday US economic growth hit better than expected 6.9 percent at the end of the year before Omicron struck.

Germany’s economy 0.7 percent shrunk in the last quarter of last year when consumer spending fell and supply constraints hit manufacturing. In contrast, France grew by 0.7 per cent, taking the increase for the year to seven per cent, the fastest expansion for 52 years and good news for President Emmanuel Macron’s re-election prospects.

Line chart of GDP index rebased, Q4 2019 = 100 showing that France's economy has risen above its pre-pandemic levels

Latest for UK and Europe

The British government comes under increasing pressure to postpone the upcoming rise National insurance to alleviate the growing cost of living crisis, a problem highlighted by a debate on how inflation affects low-income families. A parliamentary report said Chancellor Rishi Sunak’s October budget helped drive inflationwhich also pushes more UK companies insolvency.

The Turkish lira stabilized thereafter government intervention – described by one consultant as “electroshock therapy” – including new government-backed savings schemes and a multi-billion dollar intervention by the central bank.

Worldwide latest

A Japanese business group warned that the country’s strict border restrictions could foreign investment deter and destroys Tokyo’s attempt to compete as a global financial center. The government has reintroduced the measures at the end of November and it will remain in place until at least the end of February. Japan reported record numbers of new infections this week.

South Africa interest rates rise again to reach 4 per cent in response to rising inflation. The country’s central bank has also warned that investors could start withdrawing money from emerging markets if faster rate hikes in the US and other major economies make investing at home more attractive.

Must know: business

Chevron became the latest oil chief to report benefits rising crude and natural gas prices. Net income for the fourth quarter was $ 5.1 billion, higher than a loss of $ 665 million in the same period a year earlier. Brent crude exceeded $ 90 a barrel this week for the first time since 2014.

LVMHowner of brands such as Moët and Louis Vuitton, reports new records for profits and sales thanks to strong demand in the US and China. The company’s editor, Tom Braithwaite, thinks of the company’s unstoppable rise: “We have become accustomed to so many oddities over the past two years that it is worth underlining: the current luxury tree is not normal, ”he writes.

It’s also a good time to have a management consultant in technology as companies shift more of their operations online. Read more in our special report and browse through us fifth annual list of the UK consulting firms most recommended by clients and peers.

British Airways she reveals post-pandemic strategy with a promise to restore its reputation for premium service to set it apart from its “no-bikes” competitors. One of those, easyJetsaid it is confident of a pickup in summer ticket sales. American carrier Southwest was similarly optimistic about full-year profits for 2022, but loss predicted for the first quarter thanks to Omicron and staff shortages.

Rising payroll costs and declining trading revenues add to profits The Deutsche Bank investment banking business almost halved in the fourth quarter. Overall profit for the full year, however, quadrupled to € 2.5 billion, the highest level since 2011.

Round off science

Pandemic Management: A study by Imperial College London expressed concern that increasing infections among school children could cause a revival in Omicron infections in older people.

A study of data from a symptom tracing app on Monday suggested that British cases 10 percent increase over the previous week.

The Omicron subvariant BA. 2 is “probably more contagious”As the original, according to British scientists.

Denmark became the youngest European country to abolish almost everyone pandemic restrictionsfollowing the UK, Ireland and the Netherlands.

Our Big Read examines the poor performance of the US public health bodies and their failure to bring Omicron under control.

Vaccines: UK data showed double vaccination cuts the risk of long Covid by 40 percent.

BioNTech / Pfizer has the first clinical trials of a specific Omicron vaccine. Modern is also ready for Omicron-focused trials.

Treatments: U.S. regulators say Regeneron and Eli Lilly’s treatments were “highly unlikely”To work against Omicron.

Covid cases and vaccinations

Total global cases: 358.4m

Total doses given: 10.0 billion

Get the latest global picture with us vaccine tracker

And finally …

One month in, how are you New Year’s resolutions sail? The Secret Economist Tim Harford Dives Into Behavioral Science for the Best Way to fasten them.

© Anna Wray

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