What’s Going On?                                                                        19 April 2024

A Knight Frank report indicated that, in Q1, there had been one hundred and five recorded sales of homes priced at more than US$ 10 million – 19% higher on the year, with Palm Jumeirah accounting for just over a third of transactions. Dubai’s prime residential market, which had grown by 44.4% in 2022 and 16.3% last year, has seen a twelve-month growth of 26.3%. No wonder that Dubai claims that this sector is the fastest growing in the world. The table below shows the value of all sales in Q1.

	Dubai’s Prime Residential Market Q1 2024 Sales Total Value of US$ 10 mil +
		US$ mil
	Palm Jumeirah		628.4
	Jumeirah Bay Island		191.5
	Dubai Hills Estate		121.0
	Al Wasl		112.0
	Palm Jebel Ali		110.1
	District One (MBR)		97.0
	Tilal Al Ghaf		95.0
	Business Bay		84.2
	Emirates Hills		56.3
	Downtown Dubai		53.0
	Al Quoz Second		50.3
	Palm Deira		45.5
	Al Jadaf		23.7
	World Islands		21.5

On the year, the total quarterly value came in 6% higher. Last year, the consultancy noted that Dubai’s luxury home market reached record levels, with sales of US$ 10 million-plus homes nearly doubling to US$ 7.6 billion and outstripping London and New York. The double whammy, of the emirate’s global connectivity and progressive government policies encouraging long-term residency, have played their parts. The inevitable end result is that the high demand is the cause of a steep decline in supply. Knight Frank commented that “the laser like focus of the global wealthy on Dubai is best reflected in the rapid deterioration in the volume of US$ 10 million-plus homes for sale, which has fallen by 59% across the city over the last twelve months to just eight hundred and sixty-four homes.” Dubai’s luxury home market sector is still one of the most affordable in the world, with US$ 1 million securing 980 sq mt, compared to 366 sq ft, 355 sq ft and just 172k sq ft in New York, London and Monaco.

Knight Frank predicts that Dubai’s prime market will see a more moderate increase of 5.0% this year, while the overall market is expected to grow by 3.5%. This forecast appears to be on the very conservative side, but the consultancy indicated several possible problems – “a global economic slowdown and the knock-on impact on the local economy, combined with the risk of an escalation in regional tensions are medium to high risks, with the latter potentially emerging as a key trigger for higher oil prices.” This in turn could fuel global inflation and higher interest rates, “which could drive up borrowing rates further and therefore dampen demand”.

The consultancy posted that one of the emirate’s fastest-growing prime areas for domestic buyers is Dubai Hills Estate, with prices 11% higher over the past twelve months – and, over the same time, the number of homes available for sale has fallen by 75% to just over 1k units, Some of its selling points include “its relative proximity to both Downtown and new Dubai, combined with access to international school, excellent neighbourhood facilities and amenities and, of course, its abundance of green space”.

Meanwhile, Espace Real Estate, which handled 20% of villa sales on Palm Jumeirah in 2023, said off-plan properties are largely responsible for the increase in sales in Q1 2024. It also indicated that Q1 2024 secondary market sales of properties, valued at more than US$ 10 million, numbering eighteen, were down on the twenty-one sales in Q1 2023, compared to  the off plan sector registering double the amount of transactions over the same period.

Preliminary data from the Airports Council sees Dubai International Airport retaining its position as the world’s busiest international hub for the tenth consecutive year; DXB does not have a domestic market and handled 86.9 million passengers in 2023 – up 31.7% on the year. Its 2024 forecast of 88.8 million, still lower than its record 2018 year of 89.1 million, and for 2025 93.8 million passengers, as EK start to take delivery of wide-body aircraft and as more foreign airlines launch flights from the Dubai hub.

According to the World Travel and Tourism Council, the country’s travel and tourism sector is projected to create 23.6k additional jobs, bringing the total number of jobs to 833k – 2.9% higher on the year, and up 14.7% from pre-pandemic 2019. Tourists are expected to increase their spending – during visits to the UAE – by 9.5% on the year to US$ 52.2 billion; it expects that domestic visitor spending will be 4.3% higher at US$ 15.8 billion. The sector will contribute US$ 644.1 billion to the national GDP, equating to 12% of the total economy – 7.6% higher on the year and up 23.0% compared to 2019’s return. According to Julia Simpson, the WTTC president and chief executive, five of this year’s drivers include the ease of travel through its airports, “sensible” visa policies, diverse tourism offerings, greater opportunities for business travel and the expected return of Chinese visitors to the country in larger numbers. In November 2022, the UAE announced an ambitious national tourism strategy that aimed to raise the sector’s contribution to the GDP to US$ 122.6 billion by 2031, to attract forty million hotel guests by then and to earn US$ 27.2 billion in tourism investment.

With the signing of a Comprehensive Economic Partnership Agreement with Costa Rica, it is expected that bilateral trade with the UAE will flourish and offer investors opportunities in priority sectors including logistics, energy, aviation, tourism and infrastructure development. President HH Sheikh Mohammed posted that “we look forward to the impact this agreement will have on trade and investment ties between the UAE and Costa Rica.” In 2023, non-oil trade between the two partners exceeded US$ 65 million – 7% higher on the year, and up 31% compared to 2021. Costa Rica President Rodrigo Chaves Robles said, “I firmly believe this economic partnership will unlock a myriad of trade and investment opportunities.” This is the latest in a string of Cepa signings by the UAE and follows the conclusion of negotiations for a deal with Kenya in February. The UAE is focused on boosting its non-oil trade with countries around the world as it seeks to diversify its economy and attract foreign investment. It expects to exceed its initial target of signing twenty-six Cepas because of its pace of work and interest from other countries and aims to conclude another seven to eight new Cepa deals in 2024.

A special edition of its Future of Trade by Dubai Multi Commodities Centre focused on Web3, examining the key drivers of growth, innovation and digital decentralisation in a number of technology trends. It noted that the UAE, continuing its efforts to attract further investment through accommodative regulatory stances, had secured US$ 25 billion of crypto transactions in 2022. It explores the market outlook and opportunities for Web3 trends rooted in a blockchain-based digital infrastructure, including cryptocurrency, decentralised finance (DeFi), and the metaverse. The report assesses recent challenges in these sectors and forecasts a period of maturity, with recommendations for industry and regulators to nurture and fast-track industry growth in the coming years.

A study by Business Name Generator, covering fifty-two nations, ranks the UAE in third position for the most preferred global hub for entrepreneurs to launch business in 2024, after Hungary and the Netherlands. It takes just four days to legally establish a business in the UAE thanks to a business-friendly regulatory environment. Some of the drivers behind the country’s success include a reasonable cost of living (US$ 984, without rent) environment, its extremely competitive 9% corporate tax regime, (the second-lowest figure in the study), 5% VAT, WiFi speeds, GDP growth predictions, and happiness scores. According to start-up experts, the latest ranking reinforces the UAE’s reputation as a magnet for start-ups, offering an environment conducive to innovation and growth. There is no doubt that the location of a business is of prime importance that can have a significant impact on its success, affecting access to resources, market demand, and competition.”

The market size for the metaverse is set to rise to US$ 3.4 trillion by 2027, supported by road-tested use cases and the rapid advancements of AI. The global DeFi market is expected to grow from US$ 13.6 billion in 2022 to US$ 600 billion by 2032, driven by the demand for fast and ‘feeless’ financial services. Meanwhile, the crypto market appears set to stabilise after a period of turbulence, with 2023’s Bitcoin revival casting a spotlight on renewed appetite among industry and institutions for durable and value-added services.

Emirates Islamic has announced the successful conclusion of its debut US$ 500 million syndicated three-year Financing Facility – the first of its kind raised by a Shariah-compliant financial institution. Structured as a Commodity Murabaha term financing facility, in compliance with Shariah principles, the proceeds will be used for Shariah-compliant general corporate funding purposes. At the same time, it will strengthen EIB’s balance sheet by increasing its ability to support its clients as well as its own strategic growth ambitions. Farid Al Mulla, Chief Executive Officer of Emirates Islamic, said, “as a prominent local Islamic bank, Emirates Islamic remains committed to contributing to the UAE’s progress by spearheading innovations in the Islamic banking sector and creating innovative Shariah-compliant products and services that adhere to the highest standards of ethical banking.” Last year, the bank issued a three-year AED 1 billion (US$ 272 million) public Sukuk which was oversubscribed 2.5 times, highlighting the strength of the Dirham Sukuk market, and emphasising confidence in the local currency market from global Shariah-compliant investors.

Before this week’s diabolical and damaging weather, Standard & Poor’s Global Ratings Agency said increased demand would likely result in total revenue growth of Gulf insurance companies, driven by economic growth in the region and rising prices. One analyst expects the growth to be in the region of 5% – 15% this year, with Saudi insurance companies expected to be the fastest-growing in the region. Demand for insurance will benefit from ongoing investments in infrastructure projects, population growth, and regulatory initiatives, such as expanding mandatory insurance coverage. Insurance companies will benefit from inflation declining, specifically in vehicle insurance claims and non-life insurance activities. S&P sees a rise in mergers and capital increases this year, driven by robust competition and stricter regulations, along with on-going stable credit conditions, supported by strong capital margins, growth prospects, and sufficient profits.

In January, the World Bank had raised its 2024 forecast for the UAE’s real GDP growth to 3.7%, amended this week to 3.9% in 2024, with its 2025 forecast up 0.3% to 4.1%. For the GCC economies, the annual growths have been amended to 2.8% and 4.7%, with the main drivers being higher oil output, due to the phasing out of oil production cuts, and robust growth in the non-oil sector, linked to diversification efforts and reforms. GCC GDP per capita growth in 2024 is projected to be 1.0% a major improvement on the 0.9% decline in GDP per capita last year.

With Dubai’s Virtual Assets Regulatory Authority granting of a full virtual asset service provider licence to allow Binance, the global cryptocurrency exchange, to operate in the emirate, it will allow it to extend its current services beyond spot trading and fiat services and expand its services to retail investors. Last June, the exchange was granted the operational minimum viable product licence which allowed it to provide exchange and broker-dealer services in Dubai. The decision will be critical to Binance’s strategy of growing its global user base, as it expects to cross the two hundred million user mark “quite shortly”; this would ensure it the title of the world’s biggest crypto exchange by number of users, almost double Coinbase’s one hundred and eight million. The firm noted that “we’re seeing much greater institutional adoption and institutional money coming into this space … [on] much greater regulatory clarity and a lot more jurisdictions approving [digital asset] products that bring in new investors classes.”

Founded in 1979 as a joint venture with BICC cables, Ducab is jointly owned by the Investment Corporation of Dubai and Abu Dhabi’s Senaat, with group companies including DMB, a leading metals group providing high-quality copper and aluminium industrial products, Ducab-HV, offering turnkey high voltage cable system solutions, and AEI, one of the world’s most respected cable suppliers. The leading cable supplier has operations in seventy-five countries, after its recent strategic expansion into twenty new markets, and has a product portfolio, featuring 85k cable variants from five distinct families, reflecting the company’s reputation of offering a broad selection of high-quality options to meet demand, whilst maintaining stringent international standards. Over the past forty years, it has recorded over 5k successful global projects and partnerships. Exports account for 60% of Ducab’s production, catering to a wide range of industries, including specialised solutions for nuclear energy, marine/offshore, and oil/gas sectors. Ducab’s interests extend to the research and development of new and more efficient energy solutions, particularly in the renewable energy sector.

Dubai Investments has announced the distribution of a 12.5% 2023 cash dividend. This comes on the back of a 30% decline in profit to US$ 308 million; however, the 2023 profit was inflated by US$ 137 million for the one-off gain on disposal of controlling interest and fair value gain on retained investment in Emirates District Cooling LLC. Last year’s profits are higher mainly due to the sale of real estate properties, increase in rental income, higher fair valuation gain on investment properties, fair valuation gain on investments and gain on sale of investments.

After a week’s break – because of the Eid Al Fitr holiday – the DFM opened the week on Monday 15 April, 18 points (0.5%) lower the previous fortnight, and shed 69 points (1.6%) to close the trading week on 4,175 by Friday 19 April 2024. Emaar Properties, US$ 0.09 higher the previous fortnight, shed US$ 0.06, closing on US$ 2.26 by the end of the week. DEWA, Emirates NBD, DIB and DFM started the previous week on US$ 0.65, US$ 4.78, US$ 1.57, and US$ 0.39 and closed on US$ 0.65, US$ 4.51, US$ 1.575 and US$ 0.38. On 19 April, trading was at 174 million shares, with a value of US$ 85 million, compared to 112 million shares, with a value of US$ 59 million, on 05 April 2024.   

By Friday, 19 April 2024, Brent, US$ 0.10 lighter (0.1%) the previous week, shed US$ 2.97 (3.3%) to close on US$ 87.77. Gold, US$ 491 (26.3%) higher the previous six weeks, gained US$ 58 (2.5%) to trade at US$ 2,414 on 19 April 2024.

As would be expected, oil prices dipped on Monday, following the Iranian weekend reprisal attack on Israel but still hovered around the US$ 90 a barrel level. Until there is greater clarity on the next move by Israel, prices will tend to move sidewards, with analysts saying Israel’s reaction to the attack would be key for global markets in the days ahead; its Defence Minister, Yoav Gallant, has said the confrontation with Iran is “not over yet”. In line with Brent, gold fell from Friday record highs of US$ 2,431 to US$ 2,333 by Monday.

Yet again, Tesla is asking shareholders to vote on its chief executive’s record-breaking pay of US$ 56.0 billion that was set in 2018; this had previously been rejected by a US judge in January who described it as “an unfathomable sum”. Board chair Robyn Denholm wrote in a letter included in the regulatory filing: “Elon has not been paid for any of his work for Tesla for the past six years… That strikes us, and the many stockholders from whom we already have heard, as fundamentally unfair.” The re-vote comes at a tricky time for the company which has seen the fewest deliveries of EVs since 2022, and at a time when plans were announced to cut more than 10% of its global workforce.

In a staff memo, Elon Musk announced a 10%+ cut in its global electric vehicle workforce of 14k, telling staff there was nothing he hated more, “but it must be done”, and “this will enable us to be lean, innovative and hungry for the next growth phase cycle.” There are reports that those sacked have been locked out of his emails. Tesla is set to report its quarterly earnings later this month which will include confirmation that there had been a decline in Q1 vehicle deliveries – its first in nearly four years and also below market expectations. Four drivers behind the disappointing results have been high interest rates, (having impacted on demand for its more expensive EVs), it has been slow to refresh its aging models, the global demand for EVs has slowed, and the fact that Chinese carmakers seem to be flooding the worldwide market, with inexpensive EVs.

Apple’s position as the world’s leading company for Global smartphone shipments did not last long; Q4 saw it superseding Samsung but with a 20.8% Q4 market share, the South Korean tech giant easily overtook Apple’s 17.3% in a market that grew 7.8%, to 289.4 million units, in the quarter. Xiaomi, one of China’s top smartphone makers,  came in third with  a market share of 14.1% over the period. In Q1, Samsung shipped sixty million of its newly released Galaxy S24, 8% higher compered to S23 sales a year earlier, with Apple’s 50.1 million iPhones, 9.6% lower than the return in Q1 2023. The US company posted a Q1 2.1% decline in smartphone shipments to China, (its third biggest market), partly down to Chinese companies and government agencies limiting employees’ use of Apple devices, a measure that mirrors US government restrictions on Chinese apps on security grounds. Q1 has not been kind to Apple which also lost the crown as the world’s most valuable company to Microsoft.

By the end of last week, S3 Partners estimated that short sellers betting against MicroStrategy had shed US$ 1.92 billion since March, highlighting the hit from a rally that has helped the stock outperform Bitcoin. (Short sellers sell borrowed shares and hope to buy them back at a lower price later, pocketing the difference). Over the same period, they have also lost US$ 594 million and US$ 106 million, betting against crypto exchange Coinbase and bitcoin miner, CleanSpark. Such firms have benefitted from the Securities and Exchange Commission’s approval of several spot bitcoin exchange-traded funds, bringing them to near mainstream category. By 31 December 2023, MicroStrategy held nearly 190k Bitcoins on its balance sheet and has posted it would continue increasing its exposure; last month, it sold convertible debt twice within a week to raise money to buy more Bitcoin. The SEC has yet to approve other similar products, like spot Ethereum ETFs, so the USP for MicroStrategy is that it gives investors, who may be unable to invest directly in Bitcoin or in ETFs, the chance to have exposure to Bitcoin who may be unable to invest directly in the cryptocurrency or in ETFs. Another positive is that the firm has been able to raise capital to purchase additional Bitcoin.

There are mumblings in London that Shell, the LSE’s largest market cap company, with its chief executive, Wael Sawan has indicated that he was exploring “other options” if the company’s valuation fails to improve by the summer of 2025, and that it could exercise an option to move its share listing to New York. He also noted that the London market was not performing as well as it should for Shell, and that similar energy companies, such as Chevron and Exxon Mobil, were having a better time of it in New York; Shell currently trades at eight times earnings in London, while its contemporaries, on the NYSE, trade at twelve times earnings. But in London, it sees its shares trading around record levels of US$ 36, (GBP 29), and annual profits of US$ 28 billion, whilst boosting Q4 dividends by 4%. The main driver behind this inter-exchange skew is that European fossil fuel energy giants have consistently traded at lower levels than their NY counterparts, but this gap has widened with Europe’s tougher investment rules on themselves regarding money and carbon emissions; this is becoming a major issue. Major European tech giants have reinvested profits into renewables at a faster rate than their US counterparts, much to the annoyance of those investors who were keen for big returns in a high oil-price environment.

The investment malaise afflicting London’s markets is hitting companies large and small. The list of delistings and firms shunning the bourse is growing longer than IPOs, with several companies having already moved over “The Pond”, including building materials group CRH going because it would “bring increased commercial, operational and acquisition opportunities” to the business and deliver “even higher levels of profitability, returns and cash” for shareholders; Tui has already delisted and moved entirely to Frankfurt’s  Deutsche Boerse last week with its market cap rising 2% on the day. Meanwhile, there are plans by Flutter, the owner of Paddy Power and Betfair, to de-list from the LSE continue at pace. For so many years, a London listing was a prerequisite for major miners – those glory days are long gone, with the latest departees being Glencore, which has just spun off its coal business to be listed in New York, and this week, the Australian hedge fund Tribeca urged its board to relocate the resource company’s primary listing to Sydney. Last year saw the biggest IPO in the US since 2021 – UK’s chip maker Arm Holdings decided to list on the NY Nasdaq not in London. Notwithstanding IPOs, with the number of leavers outpacing the number of new entrants on the London bourse – the outlook is not bright. The value of the nineteen initial public offerings on the LSE fell below US$ 1 billion, its lowest-ever level, equating the LSE’s share of the global IPO market was less than 1.0%. At the end of the last century, the London market accounted for up to 10% of the global total market cap – now, it is down to 4%. Last year, Apple’s stock market value was more than the top 100 companies in London (including Shell) put together; even if Shell were to move over, Shell would swap having the largest market cap in the UK to being outside the top thirty in the US.

Shares in Donald Trump’s social media company sank a further 14% in Monday’s trading, (to less than US$ 28 per share), with reports that Trump Media is eyeing plans to issue millions more shares. This latest news points to a step toward letting insiders, including Mr Trump, sell their holdings. Last month, the company debuted on the Nasdaq Stock Exchange when it flirted over the US$ 70 per share threshold. Trump Media said a potential 146.1 million shares could be sold, including 114.8 million shares owned by Mr Trump – these cannot be sold until September – whilst it also notified investors of plans to issue roughly 21.5 million additional shares in connection with warrants, which give the owner the right to shares at a certain price. If you think Donald Trump will return to the White House next January, then this one-trick pony will prove a fruitful investment.Its auditor has warned it is at risk of failure, after it reported less than US$ 5 million in sales and more than US$ 50 million in losses in 2023.

There are reports that Superdry is in the throes of finalising a formal restructuring plan which seems to point to steep rent cuts at most of its ninety-four retail outlets, with the scale of the proposed rent cuts being determined by each store’s financial performance, whilst suppliers may not be impacted as much. Landlords will have the option of terminating Superdry’s leases if they were dissatisfied with the terms of the deal. Earlier, it had been confirmed that talks about a takeover by its founder, Julian Dunkerton, (who has a stake of almost 30%), have been abandoned. The UK company has a market cap of under US$ 11 million – with shares trading, on Monday, at US$ 0.111.

Ajay Banga, who took over the helm of the World Bank last June,  has wasted no time in shaking up the global body, having reduced its average nineteen-month project approval time by about three months and would cut it by another three months by the end of H2 2025; he also has plans to improve the accountability of its 16k employees and attract private capital to projects. The former MasterCard CEO also wants to diversify to not only include expansion of its traditional development and anti-poverty mission but also to include fighting climate change and other global crises; this would require a major expansion of its lending capacity, which was $128.3 billion in the fiscal year ended 30 June 2023.. It has also adjusted its loan-to-equity ratio to unlock another US$ 40 billion of lending capacity over ten years, but this falls far short of the trillions of dollars needed annually to finance the global energy transition and climate mitigation. He said more steps were underway, including joint work with other multilateral development banks and credit ratings agencies to unlock the use of callable capital, the emergency capital pledged by governments but not paid in.

The IMF says that the forecasts it makes for growth the following year in most advanced economies, more often than not, have been within about 1.5 percentage points of what actually happens. That does not seem to be such a difficult exercise especially when dealing in a range of say 1.0% to 3.5%. It has downgraded its forecasts across Europe, with the UK’s 0.5% 2024 growth, the second weakest in the G& behind Germany; next year, growth is set to improve to 1.5%, with the UK among the top three best performers in the G7. However, the IMF said that interest rates in the UK will remain higher than other advanced nations, close to 4% until 2029, as UK also gets the mantle of having the highest inflation of any G7 economy this year and next.

Despite its continuing and worsening housing crisis, (as property investment fell 9.5%), China’s economy made a stronger-than-expected start to the year, growing 5.3% in Q1. However, Q1 sales growth slipped, with National Bureau of Statistics’ data posting a 3.1% decline. Last week, Fitch cut its outlook for China, citing increasing risks to the country’s finances as it faces economic challenges. In March, the annual gathering of China’s leaders confirmed that 2023 economic growth was at 5.2%; until recent years, it was a common sight to see Chinese annual growth with double digit numbers.

In January 2023, Rishi Sunak came up with his now infamous five pledges to the UK public and “I fully expect you to hold my government and I to account on delivering those goals.” The following is a brief summary of the latest results:

·       Halving Inflation by the end of 2023. Success. Inflation at the end of last year had fallen from 10.7% to 5.3%, (and currently at 3.1%)       

Growing the economy. Failure. Nobody actually publicly said what measures would be used to assess the result. One mentioned that it would be growth as long as the Q4 2023 result was bigger than that posted in Q3 then it would meet the PM’s pledge – however, the economy contracted 0.3% in Q4. Overall, the economy grew by only 0.1% in the whole of 2023. On 28 March 2024, Chancellor Jeremy Hunt was asked if the government had failed in its pledge to create growth. He said that the promise had been to halve inflation but that the prime minister: “then said we would grow the economy. I don’t think any of us were expecting the economy to actually

· Reducing debt. Failure. In December, the statistics regulator criticised the prime minister  for saying debt was falling when it was actually rising. Government debt, at the end of February, was 2.3% higher on the year to 97.1%, which the Office for National Statistics pointed out, “remains at levels last seen in the early 1960s”. However, his pledge was that debt would be forecast to come down in five years (2028-29) and whether this will occur is still problematic and would be reliant on public spending restraint.

·       Cutting NHS waiting lists. Failure. The PM had said “NHS waiting lists will fall and people will get the care they need more quickly,” but his pledge only impacts England since Scotland, Wales and Northern Ireland manage their own health systems. T of waits for non-emergency treatment in England was 7.5 million in February, 200k lower over the previous six months – but still about 600k higher than it was when Mr Sunak came to office. The prime minister was asked on 05 February 2024 whether his government had failed to achieve his pledge, Mr Sunak said: “Yes, we have.”

Stopping small boats. Part Failure. His pledge was to “stop the boats” which bring people across the English Channel, after 45.8k migrants crossed over from France that way in 2022. In the whole of 2023, 29.4k people were detected crossing the English Channel, which is down more than a third from the previous year. In Q1 2024, 5.4k people crossed the English Channel – a new record for arrivals between January and March. However, the original legislation, passed last July, was  blocked by the Supreme Court, with the new legislation, that passed through the House of Commons, still awaiting final approval by the vacillating Lords.

• Latest March figures from the RBA sees Australia’s headline unemployment rate increase by 0.1% on the month to 3.8%, with employment falling by 7k people and unemployment rising by 21k. However, for the fifth consecutive month, the ‘trend’ unemployment rate remained steady at 3.9% – an indicator that Australia’s labour market remains very tight, reflecting some underlying strength in the national economy. Some analysts see the labour market running “slightly hotter” than the RBA was forecasting a few months ago – and, that being the case, unemployment may have to increase faster in coming months for the RBA to meet its inflation target. The treble whammy of labour market tightness, high inflation and on-going cost-of-living pressures is bad news for many Australian businesses and the country’s economy. An illustration that the labour market has become increasingly competitive comes from Seek that indicates that “applicants per job ad are up by 67.7% over the year. Indeed, applications per job ad are a little over 50% higher than pre-pandemic levels.

Yesterday, the Australian Federal Police arrested five Australians, who are among thirty-seven individuals who have been arrested in relation to an alleged massive global phishing scam which involved 10k global cybercriminals who used the platform LabHost to con victims into providing their personal information. The AFP estimate that there were 94k Australians who fell for the scam. Police confirmed that “LabHost was marketed as a one-stop-shop for phishing,” and impersonated one hundred and seventy fraudulent websites, such as “reputable banks, government entities and other major organisations. Once armed with various personal details, including one-time pins, usernames, passwords, security questions and pass phrases, they used the information to access legitimate enterprises, such as financial institutions, where they could steal funds from victims’ bank accounts.” The scam originated in Canada, to initially target North America, but soon spread to the UK and Eire before going global. Police said Australian criminals were among its three top user countries.

As part of the deal offered to users, cybercriminals would sign up to the website at the cost of US$ 175 per month and would in return be given phishing kits, which included “the infrastructure to host phishing websites, email and text content generation and campaign overview services, enabling them to effectively exploit their victims”. The authorities have warned that “in addition to financial losses, victims of phishing attacks are subject to ongoing security risks and criminal offending, including identity takeovers, extortion and blackmail.”

You can tell it is an election year when the US President calls for a tripling of tariffs on some steel and aluminium from China; in November, he will be facing Donald Trump, known for his tough trade stance against that country. Joe Biden told a union meeting that Chinese prices were “unfairly low” due to the government subsidising companies “who don’t need to worry about making a profit”, and that tens of thousands of steelworker jobs had been lost in the early 2000s because of Chinese imports. China continues to deny claims of dumping steel and aluminium overseas, with its US embassy saying said it “firmly opposes” the measures proposed by Mr Biden.

Since last summer, the Federal Reserve has maintained rates between 5.25% to 5.50%, and on Tuesday, its Chairman, Jerome Powell, confirmed it is now considering the timing of cutting interest rates, indicating that he expects recent data to delay the timing. He added that “the recent data have clearly not given us greater confidence and instead indicate that it’s likely to take longer than expected to achieve that confidence.” It seems that if higher inflation does persist, the current level of restriction could continue, but it does seem probable that there will be at least one cut in Q3. However, another member of the Fed, Raphael Bostic, has commented that inflation is only coming down “very, very slowly” and “let’s not be in a hurry” on interest rate cuts; he added that US interest rates will have to be kept at a “restrictive level” and might only ease “at the end of 2024”.

It is somewhat ironic that the IMF has forecast Russia’s economy will grow faster – at 3.2% – than all of the world’s advanced economies, including the US, in 2024, mainly because oil exports have “held steady” and government spending has “remained high” contributing to growth; it  will  be lower next year but still higher than the IMF’s January’s expectation of 1.8% and all this  despite Putin and his cohorts being sanctioned over its invasion of Ukraine. Other factors in play for Russia’s gain is that investments from corporate and state-owned enterprises and “robustness in private consumption.” Russia is not only the second leading global oil producer, at over ten million bpd, but is one of the world’s biggest oil exporters and in February, the BBC revealed millions of barrels of fuel made from Russian oil were still being imported to the UK, despite sanctions.

Not before time, the government has decided to act to safeguard the game of football in the UK. The Department for Culture, Media and Sport is to initiate a new football watchdog which will have three primary objectives – promoting clubs’ financial sustainability, developing the financial resilience of English football as a whole, and safeguarding the heritage of clubs, including their badges and traditional playing colours, (whatever that means). It is expected that the search for the inaugural chair of this body will commence shortly, and the successful incumbent is expected to be paid a six-figure salary, for being responsible for overseeing a landmark period in the English game. Its establishment, through primary legislation, comes amid an ongoing impasse between the EPL and EFL about future financial distributions. The Independent Football Regulator, with growing hints of opposition to its establishment from the EPL, will also have the power to prevent clubs from joining breakaway competitions, inspired by the putative efforts of English football’s big six clubs to join a European Super League.

President HH Sheikh Mohamed has ordered a study of the country’s infrastructure, following unprecedented severe storms, that hit on Tuesday and continued for two days. He directed that the necessary support be provided to all families impacted by the severe weather, whilst emphasising that the safety of the people is their top priority.  Furthermore, Dubai’s Crown Prince, Sheikh Hamdan bin Mohammed, said that government officials had already met to “prepare comprehensive plans in response to natural crises’ such as the unexpected current weather conditions”, adding “that updates were closely monitored, and highlighted Dubai’s resilience. We continuously adapt, improve, and progress for the sake of our people’s safety”. Dubai’s Ruler, Sheikh Mohammed bin Rashid also issued a statement appreciating the efforts of the “dedicated teams of citizens and residents.”

In the worst weather conditions in seventy-five years, it appears that several areas were impacted more than others, with flooded roads adding to the problem. Social media has been full of comments and accounts of the damage wreaked by the devastating storm. The government had issued warnings prior to the event and had closed schools and advised people to stay indoors. As a result, the government has encouraged private sector entities to allow their employees to work from home. Some residents were unable to go out in their vehicles also because of submerged roads.

Public facilities, such as shopping malls, government offices and sports clubs did not escape the storm, with many flooded. DXB seems to have been badly affected, with a total of 1,244 flights being cancelled, and forty-one diverted to Dubai World Central (DWC) until Thursday morning due to runway flooding. By yesterday, the world’s busiest international airport resumed partial operations out of Terminal 1, with authorities posting that “we are collaborating with strategic partners and local authorities to mitigate the impact of this crisis and expedite the recovery of normal operations within the next twenty-four hours”; it added that flights continue to be delayed and disrupted. Passengers have been advised only to come to the airport if they have a confirmed flight booking.

It is too early to discuss the cost to Dubai’s economy, but it could run into billions of dollars when the damage to public infrastructure and private residences are taken into account, along with lost working time, especially coming after following the previous week’s Eid Al Fitr break. However, there is no doubt that Dubai is probably the best place in the world where the government will ensure that normality will return in no time at all and proactive measures taken to see that Dubai returns in a much better position than it was on 26 April 2024, the day my granddaughter was born in Dubai. She must have woken up at the hospital wondering What’s Going On?