GULF STATES: ECONOMICS & FINANCE
Gold prices rise on course for best month in 3-years
Gold prices jumped on Friday, heading for their best month in three-years, as uncertainty loomed over whether highly anticipated trade talks between China and the United States would yield any progress in ending a year-long trade dispute.
In Dubai, 22k gold is priced at Dh159.50 and 24k can be bought at Dh169.75.
Spot gold was up 0.7% at $1,419.61 per ounce as of 0115 GMT. Gold has risen nearly 8.8% so far this month, on track for its biggest monthly percentage gain since June 2016.
With nearly 1.5% gained so far this week, bullion is also set to post its sixth consecutive weekly rise.
US gold futures climbed 0.7% to $1,422.20 an ounce.
The leaders of the Group of 20 countries meet on Friday and Saturday in Osaka, Japan, with a much-anticipated meeting between U.S. President Donald Trump and Chinese President Xi Jinping scheduled for Saturday.
The Wall Street Journal on Thursday reported that Xi plans to present Trump with a set of terms the United States should meet before Beijing would be ready to settle their trade dispute.
White House economic adviser, Larry Kudlow, however, said Trump has agreed to no preconditions for his high-stakes meeting with Xi and is maintaining his threat to impose new tariffs on Chinese goods.
“On going tensions around the trade talks between the U.S. and China helped gold with some safe-haven buying prior to the G20 summit meeting on Saturday,” ANZ analyst Daniel Hynes said.
“The emergence of a list of requirements from China has just reminded the market that it’s going to be a difficult process to get the trade talks going again,” he said.
How boeing 737 Max’s delay will affect UAE airlines
The return to flying by Boeing’s 737 Max jet will be delayed further with the US aviation regulator uncovering a possible new flaw in the jinxed aircraft that had been banned from flying after two fatal crashes.
The US Federal Aviation Administration (FAA) said it had identified the “potential risk” during simulator tests, but did not reveal details.
The new setback means that some of the carriers operating in the Gulf sector will continue to face challenges in swinging back to normal operation.
In the UAE, only flydubai had been operating Boeing’s top-selling narrow-body aircraft until it grounded all of them – 11 Boeing 737 Max 8 and two Boeing Max 9 – in March resulting in the cancellation of several flights. The budget carrier has on order 251 Max planes.
“On the most recent issue, the FAA’s process is designed to discover and highlight potential risks. The FAA recently found a potential risk that Boeing must mitigate,” the FAA said in a tweet.
In May, the FAA indicated that approval of Boeing’s changes to the 737 Max could come in late June, facilitating test flights by early July.
Boeing shares were down by 2.8 per cent in trading on Thursday. The stock had fallen as far as 6.9 per cent in pre-market trade from Wednesday’s close of $374.94 a share but regained some lost ground.
Aviation industry initially expected to have 737 Max back in the air during the summer, but that timetable was pushed back to December even before the latest turn of event when anew software problem has been found in Max that could push the plane’s nose down automatically.
Boeing said on Wednesday that the FAA “identified an additional requirement” for software changes that the aircraft manufacturer has been working on for eight months, since shortly after the first crash.
“Boeing agrees with the FAA’s decision and request, and is working on the required software to address the FAA’s request,” Boeing said in a statement.
In both Max crashes, the plane’s flight-control software pushed the nose down based on faulty readings from one sensor. Aviation sources said the latest setback is likely to delay the plane’s return to service by an extra one to three months.
In a statement, the FAA said it will lift its grounding of the plane only when it deems the jet safe; there is no set timeline. “On the most recent issue, the FAA’s process is designed to discover and highlight potential risks. The FAA recently found a potential risk that Boeing must mitigate,” the agency said.
India’s largest fitness chain cult.fit enters UAE
Integrated healthcare platform cure.fit launched its new fitness revolution centre, cult.fit in Dubai at Palm Strip Mall. Headquartered in Bengaluru India, the holistic healthcare company was founded in 2016 by Mukesh Bansal and Ankit Nagori with the aim to address preventive healthcare.
Funded by top investors like Accel Partners, Kalaari Capital, Chiratae Ventures, Ratan Tata, IDG Ventures, Pratithi Investment Trust among others, cure.fit has raised over $ 200 million in funding.
cult.fit has 160 centres spread across six cities in India and has grown through its acquisitions of Fitness First, cult and tribe. India’s most loved fitness brand will be accessible to consumers in 50 Indian cities across 800 centres by 2020.
UAE more affordable for residents
Dubai and Abu Dhabi’s ranking in the cost of living index went up in 2019 but actual cost of living – or inflation – declined due to fall in housing rentals and prices of commodities as the US dollar and the UAE dirham strengthened against the European and other free-floating currencies over the last 12 months.
According to Mercer’s 2019 Cost of Living survey of 500 cities released on Wednesday, Dubai’s ranking jumped from 26 to 21 while Abu Dhabi rose from 40 to 33.
Vladimir Vrzhovski, global mobility consultant for Mercer Mena, said the cost of living in Dubai went down while ranking moved higher because a lot of European cities saw their currencies depreciating against the dollar. Hence, the cost of living and ranking of those cities went down faster.
“The cost of living in Dubai and Abu Dhabi actually went down for residents. Their ranking went up because a lot of European cities dropped in ranking due to a weak euro. So when the European currency declined, it pushed Dubai’s ranking up,” he said.
“If we see from global perspective, it does look Dubai became more expensive; but when you’re living in the country, there has been a big decrease in prices for the last 12 months.
Statistically speaking, we are looking at 2.09 per cent deflation between April 2018 and 2019 and that is mostly driven by decline in housing rents. Imports of goods from China also became cheaper due to the strengthening of the dollar against the yuan. Overall, living is cheaper,” Vrzhovski told .
Construction begins on UK Pavilion at expo 2020 Dubai
Construction has officially begun on the UK Pavilion at Expo 2020 Dubai, with Dr Liam Fox, UK International Trade Secretary, breaking ground at the site.
Reem bint Ebrahim Al Hashimy, UAE Minister of State for International Cooperation and Director-General of the Expo 2020 Dubai Bureau, said: “The UAE and the UK have long enjoyed a robust, mutually-beneficial relationship that will continue to thrive as we forge partnerships across all sectors, from trade and tourism to art, technology and education. Expo 2020 Dubai will provide a strong platform to expand those partnerships, and we congratulate the UK as it begins the construction of this artistic and AI-inspired pavilion.”
Dr Fox said: “The Expo provides a global platform to showcase our ambition for the future, and our participation provides excellent opportunities for UK businesses. The United Kingdom hosted the first ever Expo, the Great Exhibition in 1851, so we really appreciate the value of Expos and what they can bring to the country that hosts them, and what they can also bring to the countries that participate.”
The long-standing relationship between the UAE and UK continues to strengthen, built on a thriving bilateral relationship that spans economic, strategic and cultural interests and enabling extensive cooperation in the region and around the world. The two countries agreed in 2015 to ramp up bilateral trade to Dh116 billion (£25 billion) by 2020, with latest figures for 2017 showing bilateral trade at more than Dh82 billion (£17.5 billion). In April 2019, the UK hosted the fifth UK-UAE Joint Economic Committee, where they set out a new economic partnership – a mutual approach to enhancing trade and investment between the two nations.
Future of UAE mobility: preparing infrastructure for next-gen vehicles
Dubai has one of the most progressive autonomous vehicles strategy in place. It aims to transform 25 per cent of total transportation in Dubai to autonomous mode by 2030. Expectations are that autonomous mobility will create a revenue of Dh22 billion as it will reduce transportation cost by 44 per cent, saving Dh99 million a year and reduce environmental pollution by 12 per cent with a saving of up to Dh1.5 billion a year. The strategy aims to reduce accidents by 12 per cent, which is equivalent to Dh2 billion every year.
Self-driving cars have the potential in the future to reduce deaths and injuries from car crashes, particularly those that result from driver distraction. It will reduce traffic congestion which will result in a reduction of CO2 emissions as well. Even a small percentage of autonomous vehicles (AVs) on the road can reduce the total fuel consumption by up to 40 per cent. AVs could potentially supplement public transport and cut travel time for commuters. It will also reduce demands for street and lot parking.
But what are the challenges in getting there? Even though autonomous driving offers a solution for many current traffic issues we need to resolve a lot of uncertainties. Introducing CAVs on our roads, where they will first coexist with human-driven vehicles, will potentially result in many traffic issues. It is important to establish scenarios and prepare infrastructure for autonomous cars and connected vehicles (CAVs), focusing on creating transport modelling software. Industry, governments and research are pushing the use of CAVs in real traffic to their full potential where benefits include, removing driver error to increase safety, smoothing vehicle flow to reduce emissions and reducing congestion across our road networks. The use of traffic modelling and simulation can assist decision makers by quantifying the impact of increasing levels of CAVs, helping to identify what effect this will have on future transport infrastructure.
Al Maya receives award from Mai Dubai
Bottled water company Mai Dubai celebrated its fifth anniversary and appreciated its partners for their support by giving away Partner’s Appreciation Awards.
Al Maya Group, a leading supermarket chain having over 50 supermarkets in the UAE, and other retailers received this prestigious award.
The award was given by Saeed Mohammed Al Tayer, managing director and CEO of the Dubai Electricity and Water Authority and chairman of Mai Dubai to Kamal Vachani, group director of Al Maya Group.
Vachani thanked Mai Dubai for honouring and recognising the contributions of Al Maya Group, which has been promoting Mai Dubai from the very beginning.
Vachani further added Al Maya is “very happy to be associated with Mai Dubai”.