DUBAI: The head of the United Arab Emirates’ General Civil Aviation Authority said on Sunday he was not optimistic that the Boeing 737 MAX would return to operations this year and that the first quarter of 2020 was more likely.
The 737 MAX has been grounded since March while Boeing updates flight control software at the center of two fatal crashes in Indonesia and Ethiopia that together killed 346 people within a span of five months.
Boeing is targeting regulatory approval for the fixes in October, though the US Federal Aviation Administration has said it does not have a firm time for the aircraft to be flying again.
The GCAA will conduct its own assessment to allow the MAX to return to UAE airspace, rather than follow the FAA, Director General Said Mohammed Al-Suwaidi told reporters in Dubai.
He said the GCAA would look at the FAA decision and that the UAE regulator had so far not seen details of Boeing’s fixes.
The FAA has traditionally taken the lead on certifying Boeing jets, though other regulators have indicated they would conduct their own analysis.
UAE airline flydubai is one of the largest MAX customers, having ordered 250 of the fast-selling narrow-body jets.
It has not said when it expects the aircraft to be operational again. American Airlines has canceled flights through Dec. 3, United Airlines until Dec. 19 and Southwest Airlines Co. into early January.
UAE regulator not optimistic on Boeing 737 MAX return this year
UAE regulator not optimistic on Boeing 737 MAX return this year
- The 737 MAX has been grounded since March while Boeing updates flight control software
- UAE airline flydubai is one of the largest MAX customers
Saudi EXIM exceeds annual credit facilities target by 33%
RIYADH: The total value of credit facilities implemented by the Saudi Export-Import Bank in 2023 reached SR16.5 billion ($4.39 billion), exceeding the annual target by 33 percent.
This figure represents 5.2 percent of the total financial arrangements for the Kingdom’s non-oil outbound trade, the Saudi Press Agency reported.
This falls in line with the institution’s aim to enhance confidence in regional exports and their entry into new markets, and aligns well with its goal of adding value to Saudi-made exports and imports.
“The results of the bank’s work during this year reflect the extent of the bank’s focus on its strategic objectives in building bridges of trade communication with the economies of countries around the world, in order to enable Saudi non-oil exports globally and achieve the objectives of the Kingdom’s Vision 2030,” CEO of Saudi EXIM Bank Saad Al-Khalb said.
“The bank has achieved remarkable excellence in key performance indicators, as well as focusing on integrated work with government institutions and the private sector to contribute to national initiatives and strategic plans aimed at supporting the process of sustainable development and economic diversification,” Al-Khalb added.
Dubai annual inflation eases to 3.36%
RIYADH: Annual inflation in Dubai experienced a modest decrease in February, marking a deceleration to 3.36 percent from January’s rate of 3.6 percent, according to official data.
This downturn is largely attributed to declines in the costs of transportation, as well as in the recreation, sports, culture, and tobacco sectors, a report by the Dubai Statistics Center highlighted.
Transportation saw a significant change during the month, going from -1.03 percent in January to -3.09 in February, a threefold deceleration.
The food and beverages sector, which holds a significant 11.6 percent weight in the overall index, also saw a reduction in its inflation rate, dropping to 3.08 percent from 3.69 percent in January.
This slowdown reflects a broader trend of easing price pressures in this vital category.
On the other hand, housing and water, as well as electricity, gas, and other fuels — sectors which hold above 40 percent influence on the overall index — witnessed a slight increase in their price growth rate, rising to 6.25 percent from 6.2 percent in January.
This increment, although marginal, indicates continued cost pressures in some of the core living expenses for residents in the emirate.
Furthermore, Dubai’s non-oil private sector maintained its growth momentum in February, with the emirate’s Purchasing Managers’ Index reaching 58.5, the highest since May 2019, a survey showed.
According to the PMI report by S&P Global, the significant growth in Dubai’s private sector was driven by an increased volume of new orders. This surge prompted companies to hire people at the fastest rate in the last eight years.
In January, Dubai’s PMI stood at 56.6, compared to 57.7 in December and 56.8 in November.
According to S&P Global, any PMI reading above 50 indicates growth in the non-oil sector, while readings below that figure signal contraction.
David Owen, senior economist at S&P Global Market Intelligence, said: “The Dubai PMI climbed to 58.5 in February, which is its joint-strongest reading since 2015 — matching May 2019 — and suggests that the Dubai non-oil economy is growing rapidly so far this year.”
He added: “The reading signals that the Dubai non-oil sector is one of the fastest growing worldwide according to global PMI data.”
The survey revealed that 36 percent of the respondents saw their output increase since the previous poll period, signaling the fastest upturn in 18 months.
Foreign investors will be treated as Saudis under Nitaqat
RIYADH: Foreign investors can now officially be classified as Saudis under the Nitaqat Saudization program, following the approval of the Ministry of Human Resources and Social Development.
This decision represents a provision within the classification system, wherein these individuals will be considered on par with citizens when calculating Saudization percentages, according to the Qiwa platform associated with the ministry, Saudi Gazette reported.
The system has outlined two categories of individuals treated as nationals within the Nitaqat program, including the children of local women married to non-Saudis and widows of residents who are not from the Kingdom.
Bank of Japan ends negative rates, farewells era of radical policy
TOKYO: The Bank of Japan ended eight years of negative interest rates and other remnants of its unorthodox policy on Tuesday, making a historic shift away from a focus of reflating growth with decades of massive monetary stimulus, according to Reuters.
While the move was Japan’s first interest rate hike in 17 years, it still keeps rates stuck around zero as a fragile economic recovery forces the central bank to go slow in any further rise in borrowing costs, analysts say.
The shift makes Japan the last central bank to exit negative rates and ends an era in which policymakers around the world sought to prop up growth through cheap money and unconventional monetary tools.
“The BOJ today took its first, tentative step toward policy normalization,” said Frederic Neumann, chief Asia economist at HSBC in Hong Kong, adding: “The elimination of negative interest rates in particular signals the BOJ’s confidence that Japan has emerged from the grip of deflation.”
In a widely expected decision, the BOJ ditched a policy put in place since 2016 that applied a 0.1 percent charge on some excess reserves financial institutions parked with the central bank.
The BOJ set the overnight call rate as its new policy rate and decided to guide it in a range of 0-0.1 percent partly by paying 0.1 percent interest to deposits at the central bank.
The central bank also abandoned yield curve control, a policy that had been in place since 2016 that capped long-term interest rates around zero.
But in a statement announcing the decision, the BOJ said it will keep buying “broadly the same amount” of government bonds as before and ramp up purchases in case yields rise rapidly.
The BOJ additionally decided to discontinue purchases of risky assets like exchange-traded funds and Japanese real estate investment trusts.
“We judged that sustainable, stable achievement of our price target came in sight,” the central bank said in a statement explaining the decision to dismantle former Governor Haruhiko Kuroda’s massive stimulus program.
With inflation having exceeded the BOJ’s 2 percent target for well over a year, many market players had projected an end to negative interest rates either in March or April.
In a sign any future rate hike will be moderate, the BOJ said in the statement that it expects “accommodative financial conditions will be maintained for the time being.”
The language compared with the more dovish guidance that was removed from the statement, in which the BOJ pledged to ramp up stimulus as needed, and keep increasing the pace of money printing until inflation stably exceeded 2 percent.
Japanese shares were volatile on Tuesday. The yen fell to almost 150 per dollar, as investors took the BOJ’s dovish guidance as a sign the interest rate differential between Japan and the US likely will not narrow much.
Markets are now focusing on Governor Kazuo Ueda’s post-meeting news conference for clues on the pace of further rate hikes.
The stakes are high. A spike in bond yields would boost the cost of funding Japan’s huge public debt which, at twice the size of its economy, is the largest among advanced economies.
An end to the world’s last remaining provider of cheap funds could also jolt global financial markets as Japanese investors, who amassed overseas investments in search of yields, shift money back to their home country.
Under previous Governor Kuroda, the BOJ deployed a huge asset-buying program in 2013, originally aimed at firing up inflation to a 2 percent target within roughly two years.
The central bank introduced negative rates and yield curve control in 2016 as tepid inflation forced it to tweak its stimulus program to a more sustainable one.
As the yen’s sharp falls pushed up the cost of imports and heightened public criticism over the demerits of Japan’s ultra-low interest rates, however, the BOJ last year tweaked yield curve control to relax its grip on long-term rates.
Oil Updates – prices slip as Russia lifts supplies, jet fuel demand stirs caution
SINGAPORE: Oil prices dipped on Tuesday due in part to the prospect of rising supply from Russia, slower-than-expected downstream demand in sectors such as jet fuel, and cautious trading ahead of the Fed’s decision on US interest rates, according to Reuters.
The Brent crude oil futures contract for May delivery slipped 15 cents to $86.74 a barrel as at 7:33 a.m. Saudi time, while US West Texas Intermediate prices fell 14 cents to $82.02. The WTI April contract, with expires tomorrow, fell 15 cents to $82.57.
Both benchmarks reached four-month highs in the previous session, buoyed by lower crude exports from Saudi Arabia and Iraq and signs of stronger demand and economic growth in China and the US.
Regarding Russia, supply concern stemming from increased exports following Ukrainian attacks on the country’s oil infrastructure continued to pressure prices downward.
“Attacks will likely reduce Russian crude runs by up to 300 kbd (thousand barrels per day), in addition to scheduled maintenance closures ... Lower primary runs, however, would lead to higher crude oil exports, helping Russia to simultaneously achieve output cuts while keeping exports flat,” JP Morgan analysts wrote in a client note.
Russia will increase oil exports through its western ports in March by almost 200,000 barrels per day against a monthly plan for 2.15 million bpd, while on a daily basis, shipments will increase by 10 percent compared to its initial plan for March, Reuters calculations showed.
Prices were weighed down by uncertainty about how US interest rates would pan out ahead of the Federal Reserve meeting on March 20 at 9:00 p.m. Saudi time.
“The market may be in consolidation mode awaiting signals on rate cuts from this week’s FOMC meeting,” said DBS Bank energy sector team lead Suvro Sarkar in an email, adding: “Oil prices are already up quite a bit over the last two weeks, factoring in higher geopolitical risk premium after the attacks on Russian refineries ... There could be some profit-taking at these levels as we doubt price movements above $85/bbl will be sustainable in near term for Brent.”
On the demand side, analysts were slightly cautious on demand growth coming from the jet fuel sector ahead of the summer traveling season in the third quarter of the year.
Global jet fuel prices are likely to be “higher by 5.4 percent over our previous forecast to $111/bbl as soft demand is expected to give way to peak summer travel and stronger prices,” BMI analysts wrote in a client note.
“However, a global economic slowdown will temper consumption of air travel and weigh on jet fuel prices limiting price upside,” they added.