01
Russia has re implemented some capital control measures to prevent the depreciation of the ruble
On Wednesday, Russia announced the re implementation of some capital control measures, including requiring the country's 43 largest exporters to sell their overseas sales revenue domestically in exchange for rubles to ensure foreign exchange supply.
Despite continuous interest rate hikes by the Russian central bank in the past few months, it has still failed to prevent the depreciation of the Russian ruble.
Currently, the Russian ruble is one of the worst performing currencies this year.
02
Southeast Asia is considering adopting loose AI rules, which contradicts the willingness of the European Union
Southeast Asian countries are adopting a more friendly approach to artificial intelligence (AI) regulation, which is in contrast to the EU's efforts to promote globally unified rules consistent with its strict framework.
Reuters has reviewed the confidential draft of the "AI Ethics and Governance Guidelines" for the 10 ASEAN member countries, which have not been previously reported.
Three sources told Reuters that the draft is currently seeking feedback from technology companies and is expected to be finalized at the ASEAN Digital Ministers' Meeting at the end of January 2024.
The companies that have received the draft include Meta, IBM, and Google.
EU officials visited Asian countries earlier this year to persuade governments in the region to adopt new AI rules targeting technology companies, including copyright and AI generated content disclosure.
Contrary to the EU's AI Act, according to the current version under review, ASEAN's "AI Guidelines" require companies to consider cultural differences across countries and do not specify unacceptable risk categories.
Like all ASEAN policies, it is voluntary and aims to guide domestic regulations.
Due to the fact that Southeast Asian countries have a population of nearly 700 million, over a thousand ethnic groups and cultures, their regulations on censorship, false information, public content, and hate speech vary greatly, which may affect AI regulation.
For example, Thailand has laws opposing criticism of its monarchy.
Technology executives have stated that ASEAN's relatively relaxed approach is more conducive to business as it reduces the compliance burden in areas where existing local laws are already complex and allows for more innovation.
Stephen Braim, Vice President of Asian Government Affairs at IBM, stated that we are also pleased to see this guide closely aligned with other leading AI frameworks, such as the National Institute of Standards and Technology (NIST) AI risk management framework.
Meta and Google did not respond to Reuters' request for comment.
03
Ireland formulates a 100 billion euro sovereign wealth fund plan
Ireland proposed in its budget on Tuesday a plan to transform one of Europe's healthiest public finances into a 100 billion euro sovereign wealth fund, while also announcing a series of measures to alleviate current cost of living pressures.
Due to the increase in European spending during the COVID-19 pandemic, budget surpluses are rare in Europe. However, the sharp increase in Irish corporate taxes paid by a small number of foreign companies made Dublin quickly recover to a surplus equivalent to 2.9% of gross national income last year.
Due to the expected high level of surplus, Irish Finance Minister Michael McGrath stated that he will introduce laws from 2024 to 2035 requiring the government to invest 0.8% of nominal GDP, equivalent to 4.3 billion euros, into this new fund on that day.
His department estimates that assuming a return rate of approximately 4%, the Irish Fund may grow to approximately 100 billion euros by 2035 and contribute to reducing future pension and climate costs in five years.
In his first budget speech as Treasury Secretary, McGrath told Congress that this is a realistic, feasible, and achievable plan for Ireland. The window of opportunity will not always remain open, and we must seize it now.
The government will also establish a small-scale 14 billion euro infrastructure and climate fund to achieve the goal of reducing greenhouse gas emissions and serve as a buffer for capital expenditure cuts in future economic downturns.
Finance Minister McGrath stated that the recent two consecutive declines in Irish corporate tax returns were the first substantial decline in this volatility category in many years, emphasizing the need for action now.
Despite signs of rapid economic growth slowing down last year, the Ministry of Finance's growth forecast for this year remained largely unchanged at 2.2%, while lowering the 2024 growth forecast from the previous 2.5% to 2.2%.
04
Persistent inflationary pressure in the United States, party struggles make it difficult to reduce the deficit
According to data released by the US Department of Labor on the 11th, the US producer price index rose 2.2% year-on-year in September, marking the third consecutive month of increase. Among them, energy prices increased by 3.3%, food prices increased by 0.9%, and the core producer price index excluding food and energy increased by 2.7% year-on-year.
US media believe that high prices indicate that domestic inflation in the United States will remain high. Industry insiders predict that the annualized growth rate of the US core consumer price index will remain high in the next six months. On the other hand, the media also pointed out that the high budget deficit in the United States also affects inflation levels, and fierce party debates have prevented the US government from taking measures to reduce the budget deficit.
05
The IMF sounded an alarm about the huge debt of the United States: the fiscal situation is the "most worrying" in the world
The International Monetary Fund (IMF) has warned that the US debt situation looks increasingly unstable. With high interest rates, corporate default rates are rising.
IMF Chief Economist Pierre Olivier Gurincha stated at a press conference on Tuesday that the US fiscal situation is the "most worrying" among all countries in the world.
This is mainly due to the rapid growth of government expenditure. According to a recent estimate by the Brookings Institution, the United States has accumulated a deficit of $1.5 trillion in the first 11 months of this fiscal year.
In an interview on Wednesday, IMF Financial Affairs Director Victor Gasper also stated that the US deficit level is high and looks set to continue.
With unchanged policies, the debt dynamics of the United States are very unfavorable, "he said, adding that" the continuation of current policies means an unsustainable fiscal path
In September this year, for the first time in history, the size of US treasury bond bonds exceeded $33 trillion. Researchers from the Wharton School of Business at the University of Pennsylvania have warned that this is equivalent to around 121% of the US GDP in 2022, and it is expected that this number will further surge in the coming years, increasing the risk of a US debt default within 20 years.
The rise in interest rates has exacerbated the debt crisis facing the United States. In order to curb inflation, the Federal Reserve has raised interest rates to their highest level since 2001. Goldman Sachs strategists said that by 2025, this could push the borrowing cost of US debt to a record level.
At the same time, higher interest rates also pose difficulties for corporate bond issuers. In the United States alone, over $2 trillion in corporate debt will mature by 2024. Enterprises often repay their debts through refinancing, which means borrowing new to repay old. The significant interest rate hike by the Federal Reserve has significantly increased the cost of refinancing, making companies unable to repay low-cost debt when it matures, leading to default or even bankruptcy.
The increase in debt costs is an expected result of tightening monetary policy to curb inflation. However, the risk is that borrowers may already be in a financially unstable position, and higher interest rates may amplify these vulnerabilities, leading to a surge in defaults, "the IMF warned in a blog post on Tuesday.
Fitch Ratings estimates that the default rate of US high-yield bonds is expected to reach 4.5% -5% this year, more than six times the default rate of 0.7% in 2021.
06
AMD acquires artificial intelligence software startup to catch up with NVIDIA
AMD announced on Tuesday that it plans to acquire an artificial intelligence startup called Nod.ai as part of enhancing its software capabilities.
In order to catch up with its competitor chip manufacturer NVIDIA, AMD plans to invest heavily in software crucial to the company's advanced AI chips.
Through over a decade of effort, NVIDIA has established a strong advantage in the AI chip market through its software and software developer ecosystem.
AMD promises to invest in and establish a unified software set to support the various chips produced by the company.
AMD President Victor Peng said in an interview with Reuters that we are implementing this strategy.
We are doing this both through internal investment and external acquisitions.
The acquisition of Nod.ai is in line with this strategy as its technology makes it easier for the company to deploy AI models optimized for AMD chips.
Nod.ai sells its technology to customers such as large data center operators.
AMD did not disclose the specific terms of this transaction.
According to PitchBook data, Nod.ai, located in Santa Clara, California, has raised approximately $36.5 million.
Victor Peng said that earlier this year, AMD created an AI group that will accommodate Nod.ai's acquisition.
The team has approximately 1500 engineers, the vast majority of whom are related to software. AMD plans to continue expanding the team this year, adding 300 new employees, and there will be more in 2024.
Vamsi Boppana, Senior Vice President of AMD Artificial Intelligence Group, said, 'We have been growing rapidly and have plans for next year.'.
Victor Peng said that Nod.ai's acquisition is the company's second acquisition in the past few months.