1 Asia faces funds flight (Chia Yan Min in Straits Times) Asian currencies have weakened considerably against the surging greenback in the wake of the US Federal Reserve’s decision last week to raise a key interest rate for the first time in a year.
This is prompting investors to shift money out of emerging markets and into US dollar-denominated assets, putting pressure on Asian currencies and asset markets. The US central bank also signalled that interest rates will go up in the coming year faster than previously expected – a policy stance set to result in regional currencies staying soft against the US dollar.
Regional currencies have been depreciating sharply against the greenback on expectations that higher interest rates, as well as US President- elect Donald Trump’s policies to ramp up government spending, will trigger capital outflows from emerging-market economies, said United Overseas Bank currency strategist Peter Chia.
In addition, Mr Trump’s campaign promises to ramp up government spending – if translated into actual policies – are expected to increase inflation and boost growth in the US. This would put pressure on the Fed to hike interest rates more aggressively to keep prices under control.
2 Uber loses $800m in third quarter (Fortune) The finances of ride-hailing giant Uber improved after the sale of its China business to rival Didi Chuxing, but it still managed to lose a huge amount of money.
Uber lost more than $800 million in the third quarter, according to a report from tech news site The Information, citing anonymous sources. But Uber’s exit from China in the middle of the quarter slowed the growth rate of those losses to less than 25% year-over-year, down from a 34% year-over-year drop in the second quarter, when it lost $750 million, according to a Bloomberg report in August, while still operated in China.
In August, Uber announced that it would sell its Chinese business to Didi Chuxing, based in China, after aggressively competing against it for the last two years. Uber has admitted in the past that it spent $2 billion in total on its Chinese operations, yet was only able to capture a small fraction of the market.
But Uber’s net revenue, which excludes driver payments, actually grew steadily to $1.7 billion in the third quarter, a 240% bump from a year ago. In the second quarter, it had $1.1 billion in net revenue, or 190% more than the year-ago quarter.
In the US, Uber is still locked in a price war with rival Lyft, which costs both companies dearly. In the second quarter, Uber reportedly lost $100 million excluding certain costs, although that’s likely grown in subsequent quarters. Uber declined to comment about its finances.
3 Dubai opens world’s largest VIP terminal (Edward Clowes in Gulf News) The world’s largest VIP terminal has been officially opened at Al Maktoum International at Dubai South. Inaugurated by Shaikh Ahmad Bin Saeed Al Maktoum, Chairman of Dubai Civil Aviation Authority and Chairman and Chief Executive of Emirates Airline and Group, the 5,600-square metre standalone facility is intended to exclusively cater to private, business and government VIP travellers.
The first flight from the VIP terminal took place in April 2016, carrying 13 passengers on an Embraer Legacy aircraft that was headed to the Maldives. Since then, the terminal has witnessed 1,000 flight movements with the number anticipated to grow to 4,000 movements in 2017.
It is the largest of its kind in the world, hosting two Fixed Base Operators (FBOs), JetEx and Falcon Aviation, according to Khalifa Al Zaffin, Chairman of Dubai Aviation City. The terminal is part of Al Maktoum International, the planned largest airport in the world, which will involve the construction of five runways and increase in capacity to handle 160 million passengers a year once complete.