Know someone who would like this newsletter? Forward it to them.
The World
Rishi Sunak has hailed a “new chapter” in the UK’s relationship with the EU as he secured a deal to end the long-running dispute over the post-Brexit Northern Ireland protocol. The deal, labelled the “Windsor framework”, goes further than previously expected by giving the UK government an “emergency brake” on new EU laws applied in Northern Ireland if politicians in the province object to them. Von der Leyen stressed this was an “emergency mechanism” and the European court of justice would have the final say on single market issues. The agreement will create a new green lane for traders, scrapping all trade restrictions between Great Britain and Northern Ireland and new freedoms for medicines, chilled meats and pets to move over the Irish Sea. It also re-writes parts of the existing protocol to allow Westminster to set VAT rates in Northern Ireland. (The Guardian)
U.S. Treasury Secretary Janet Yellen paid a surprise visit to Kyiv to reaffirm U.S. support for Ukraine in its struggle against Russia's invasion and promote U.S. economic aid that is bolstering Ukraine's war effort. Yellen met with President Volodymyr Zelenskiy, Finance Minister Serhiy Marchenko and other key government officials just days into the war's second year. (Reuters)
Communist party members at EY China in Beijing have been asked to wear their party badges to show their political loyalty while they are at work. The committee sent a message from its EY email account to all party members at the Big Four accounting firm’s Beijing office on February 23, according to two people who received the directive. (Financial Times)
China must be more honest about the origins of the COVID-19 pandemic, the U.S. ambassador to China said on Monday, after reports that the U.S. Energy Department concluded the pandemic likely arose from a Chinese laboratory leak. (Reuters)
Hongkongers have reason to smile as city to scrap indoor, outdoor Covid mask rules from Wednesday after 3 years. The announcement comes one day after neighboring Macau lifted its general outdoor mask-wearing requirements. (South China Morning Post)
Early results in Nigeria’s presidential and parliamentary elections have put the ruling party’s candidate well ahead, but also revealed a surprise victory for the outsider Peter Obi in Lagos, the country’s biggest city and commercial powerhouse. Analysts speak of a “bellwether” election that could be a crucial turning point for Nigeria after several years of worsening insecurity and acute economic troubles. “What Obi has done is pretty mind-boggling. He has disrupted the duopoly of two behemoths, two very rich and very powerful parties,” said Prof Abiodun Adeniyi at Baze University, Abuja. (The Guardian)
Solar set to overtake other energy sources by 2027: Next year, solar photovoltaic capacity will leapfrog that of hydropower, according to the International Energy Agency. In three years, it will overtake gas-fired generation. And, in four years, it will push past coal — to boast the largest share of generation capacity of any power source. A buildout of solar installations — from Arizona in the US to Anhui, China — has been at the forefront of a renewable energy charge that has muscled-in on the old energy order. “There is a boom, there is exponential growth, there is acceleration,” says Heymi Bahar, senior analyst for renewable energy markets and policy at the IEA. (Financial Times)
Economy
The record-breaking global bond market rally since the start of this year has fizzled out as mounting signs of persistent inflation force investors to reverse their views on the likely future path of interest rate rises. But that gain has now disappeared after a scorching US labour market report earlier this month kicked off a run of better than expected economic data on both sides of the Atlantic, upending expectations that the Fed and the European Central Bank were close to winning their battle with inflation. (Financial Times)
US Pending Home Sales Surge 8.1%, Most Since June 2020: Contract signings rose in all four regions, led by West, South. Even with January increase, sales still down 22.4% from 2022. (Bloomberg)
Apartment rents fell in every major metropolitan area in the U.S. over the past six months through January, a trend that is poised to continue as the biggest delivery of new apartments in nearly four decades is slated for this year. Renters with new leases in January paid a median rent that was 3.5% lower than they would have paid last August, according to estimates from listing website Apartment List. It was the first time in five years that rent fell every month over a six-month period, according to the same estimates. (Wall Street Journal)
Higher rates will weaken the UK's economy via the housing market: After 10 consecutive interest rate hikes, the Bank of England is balancing the need to control inflation with the risk of increasing rates too far. The policy tightening is likely to weigh heavily on growth via the U.K. housing market, according to Goldman Sachs Research. Overall U.K. price inflation was 10.1% in January, according to official data, well above the 2% target. Quoted mortgage rates have risen substantially during the period of policy tightening, and the effect may be felt well beyond the property market. Our economists estimate that policy tightening could have a 2% effect on real GDP (adjusted for inflation) by the end of 2024 through housing-related effects alone. (Goldman Sachs)
The Federal Aviation Administration said it is awarding nearly $1 billion to 99 U.S. airport projects under a 2021 $1 trillion infrastructure law. The awards include $10.8 million to Des Moines International Airport in Iowa to replace the 1948 terminal that is operating above capacity and $29 million to Salt Lake City International Airport in Utah for a terminal and concourse redevelopment program. This is second phase of the funding -- FAA awarded nearly $1 billion for airport terminal projects announced for 85 airports last year. (Reuters)
Idaho, Utah Workers Led U.S. in Quitting Jobs, While New Yorkers Largely Stayed Put: People were confident enough to voluntarily leave their jobs more than 4 million times a month last year, up 20% from 2019. A robust labor market gave Americans confidence to quit their jobs last year, especially in some Western states. Workers voluntarily left their jobs 4.2 million times each month, on average, in 2022, up about 20% from 2019, before the pandemic took hold in the U.S. But workers weren’t equally confident about their prospects for quickly finding new employment across the country. In much of the West and South, people quit their jobs at higher rates than average late last year, according to Labor Department data. Meanwhile, employees in Northeast states such as New York and Massachusetts were more reluctant to turn in resignations. (Wall Street Journal)
Technology
Biden’s Semiconductor Plan Flexes the Power of the Federal Government: Semiconductor manufacturers seeking a slice of nearly $40 billion in new federal subsidies will need to ensure affordable child care for their workers, limit stock buybacks and share certain excess profits with the government, the Biden administration will announce on Tuesday. The new requirements represent an aggressive attempt by the federal government to bend the behavior of corporate America to accomplish its economic and national security objectives. As the Biden administration makes the nation’s first big foray into industrial policy in decades, officials are also using the opportunity to advance policies championed by liberals that seek to empower workers. While the moves would advance some of the left-behind portions of the president’s agenda, they could also set a fraught precedent for attaching policy strings to federal funding. (New York Times)
Sequoia and Andreessen Horowitz invested more in fintech than any other sector in 2022: Sequoia backed 25 companies in the financial services space last year. Its top three fintech targets, as identified by CB Insights, were capital markets, payments and payroll and benefits — with each category representing 16% of its investments. A16z backed 49 companies in the fintech space last year and its top three fintech targets were payments (28%), blockchain (22%) and digital lending (12%). (TechCrunch)
Mark Zuckerberg announces new team at Meta working on A.I. products for Instagram, WhatsApp. The move comes as big tech companies and well-capitalized startups alike race to tout advances in machine learning techniques and incorporate artificial intelligence models into their products. On Monday, Snap announced that it would integrate a ChatGPT bot into its Snapchat app. (CNBC)
It’s all reminiscent of last year’s blockchain hype cycle, when crypto was the carrot nearly every company dangled in front of customers. Companies like Meta and Twitter both once turned their attention to NFTs. Alphabet, by way of YouTube, once said it was looking into the digital artwork collectibles. The brands came rushing too, ranging from the NBA to Nickelodeon (recall that Nike even bought an NFT company). Nowadays, you don’t hear much about those projects. But AI? It’s the in thing. (The Information)
Amazon has filed the most patent applications for next-generation automotive technology among five major U.S. tech giants over the past two decades, Nikkei research found. The e-commerce giant, which has made a key acquisition in autonomous driving, has produced a surge in patent filings in the field, in which Google had taken an early lead. Competitiveness in next-generation driving technologies is determined by artificial intelligence and other intellectual properties, not the scale of production. The emergence of tech giants in the field will change the nature of competition and cooperation in the auto industry. (Nikkei Asia)
Smart Links
Four ways the Supreme Court could reshape the web (MIT Technology Review)
ESG ratings: Don’t throw the baby out with the bath water. (MIT News)
64% of women say they could do their boss’s job better than them, but they aren’t getting the chance. (CNBC)
A generation of high-profile women tech leaders have stepped aside. What’s next? (CNN)
Zoom shares jump on better-than-expected fourth-quarter results. (CNBC)