The daily business briefing: March 16, 2023
Credit Suisse gets a lifeline from Switzerland's central bank, French workers continue pension-reform protests before key vote, and more
Credit Suisse gets $53.7 billion lifeline from central bank
Credit Suisse shares soared early Thursday after it said it would get up to $53.7 billion from the Swiss National Bank to shore up its finances. On Wednesday, Swiss regulators and the country's central bank said they would throw Credit Suisse a lifeline after it disclosed problems with its financial reporting. It is the first time a major bank has received such support since the 2008 financial crisis. Shares in Credit Suisse, the country's second-biggest bank, had plunged after Ammar Al Khudairy, chair of the Saudi National Bank, said his institution, Credit Suisse's largest shareholder, could not invest any more in the company. The bank's struggles have stoked fears about the stability of the global banking system.
French workers protest pension reform again before key vote
Opponents of the French government's proposed pension overhaul protested across the country on Wednesday ahead of lawmakers' final vote on the plan on Thursday. Hundreds of thousands of people protested in cities across France. Striking workers disrupted rail service and closed schools in the eighth national work stoppage and protest in two months. President Emmanuel Macron says the reforms, including raising the retirement age from 62 to 64, are necessary to keep the pension system financially sound. Protesters say Macron is taking away benefits people have earned. "Macron has not listened to us, and I'm no longer willing to listen to him," said Patrick Agman, 59, as he marched in Paris. "I don't see any other option than blocking the country now."
Retail sales, producer prices fell in February
The federal government reported Wednesday that retail sales and producer prices fell in February, signaling a cooling economy and giving the Federal Reserve "more room to potentially pause interest-rate hikes as they weigh the impact of a banking crisis against inflation risks," according to Bloomberg. Spending at retailers and restaurants declined by 0.4 percent in February, after surging in January. The producer-price index — a measure of wholesale costs that Fed Chair Jerome Powell has flagged as a key inflation indicator for the central bank's meeting next week — unexpectedly fell 0.1 percent in February, bringing the 12-month increase in producer prices to 4.6 percent last month, the slowest pace in nearly two years.
Honda recalls 500,000 vehicles over faulty seat belts
Honda is recalling 500,000 vehicles in the United States and Canada over faulty front seat belts. The vehicles recalled include the 2017 to 2020 CR-V, the 2018 and 2019 Accord, the 2018 through 2020 Odyssey, and the 2019 Insight, all popular vehicles. The recall also covers the Acura RDX 2019 and 2020 models. The Japanese automaker said in documents posted Wednesday by safety regulators that the surface coating on the channel in the buckle can deteriorate, which can prevent the buckle from properly latching. If that happens, a driver or passenger might not be restrained in a crash, increasing safety risk. Honda said it had received no reports of injuries attributed to the issue.
Report: Biden administration threatens TikTok ban if Chinese owners don't divest
The Biden administration has threatened to ban TikTok unless its Chinese owners sell their stakes in the video-sharing app, The Wall Street Journal reported Wednesday, citing people familiar with the matter. The demand by the Committee on Foreign Investment in the U.S., which oversees national security risks in cross-border investments, marked a shift for the administration as some Republicans accuse it of failing to adequately address the potential security threat posed by the Beijing-based ByteDance, which owns the popular platform. TikTok said a forced sale wouldn't resolve security concerns, and has said that it would spend $1.5 billion to protect U.S. data and content from access by the Chinese government.