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Liz Truss resigns as Prime Minister of the UK – Industry roundup: 20 October

Liz Truss resigns as Prime Minister of the UK

Liz Truss is now the shortest-serving Prime Minister of the UK, having held the office for a short but stressful 44 days. Her stint as PM saw the death of the longest-reigning British monarch, followed by 10 days of mourning during which government business was on pause, and then saw the tumultuous rise and fall of a highly controversial mini-budget, which was just this week reversed almost entirely by Finance Minister Jeremy Hunt (the second Finance Minister appointed since Truss took office).

While Truss reportedly wished to remain in office, she announced her resignation today after a meeting with Graham Brady, the chairman of the committee entrusted with submitting letters of no confidence in the Prime Minister. The Conversative Party will now be completing a leadership election in the coming week.

September inflation rates announced – 40-year high for the UK, unexpected rise for Canada

Inflation rates for September came in for the UK and Canada yesterday, and both topped the already high expectations. In the UK, the consumer price index rose by 10.1% (Reuters had estimated 10%), once again hitting July’s 40-year high after August’s unexpected drop to 9.9%.

The high inflation continues to fuel the cost-of-living crisis in the UK, with necessities such as food, transport, and energy leading the high rates. As residents and businesses anticipate a hard and expensive winter, the new British Finance Minister, Jeremy Hunt, stated that the nation would be prioritising “help for the most vulnerable” and “delivering wider economic stability and driving long-term growth that will help everyone.”

Canada’s September inflation, meanwhile, was 0.2 percentage points higher than expected at 6.9%, sparking recalculations for yields and for expected interest rate shifts. Markets are now predicting a 60% likelihood of interest rates hitting 4% (a 75-basis-point hike), setting it at its highest point since 2008. Yields for 2-, 5- and 10-year bonds also rose in response to the inflation announcement.

China suggests Asia-wide digital currency to lower USD dependence in the region

A think tank run by the Chinese state has proposed the idea of an “Asian yuan token”, an Asia-wide digital currency that could reduce dependence on the US dollar for Asian nations. Per the concept proposed by the researchers, the token would be built on distributed ledger technology (DLT) and would be pegged to a bundle of 13 currencies: those of China, Japan, South Korea and all 10 members of ASEAN.

CBDC plans and pilots, in which China has been proactive, have begun laying groundwork for digital currencies. While the Asian yuan would require significant international cooperation, the researchers suggest that East Asia’s deep economic integration has laid a good foundation for this level of coordination.

BP to acquire renewable natural gas business Archaea for US $4.1 billion

Major oil company BP announced earlier this week that it intends to acquire Texas-based Archaea Energy. Archaea Energy is a renewable natural gas (RNG) production business. RNG (sometimes called “biogas”) is collected from organic landfill waste, and Archaea operates 50 facilities for RNG, with over 80 projects in development. As a renewable energy source, this RNG acquisition would add diversification to BP’s energy portfolio.

BP’s CEO, Bernard Looney, has high expectations for RNG’s future and for Archaea in particular: “Archaea is a fantastic fast-growing business[…] It will accelerate our key bioenergy growth engine, creating a real leader in the biogas sector, and support our net-zero ambition.” Regarding biogas in general, Looney states, “There’s more demand for this product today than there is supply”, and he expects the sector’s growth to reach “25 fold by 2050.”

The deal, which is still pending regulatory approval, has been valued at US $4.1 billion, which reportedly makes it the largest RNG deal to date.

Moody’s report shows dramatic rise in cyberattacks in Europe

A recent report from Moody’s is showing heightened cyberattack activity in Europe this year. While 38% of attacks were noted as being related to the Russia-Ukraine conflict, the remaining cyberattacks that were not related to the conflict have already doubled 2021’s total numbers, with 2022 Q4 not even accounted for yet.

(Source: Factiva and Moody’s Investor Service)

On the other hand, the report noted a heightened awareness of cyber threats and more emphasis on cyber security. It found that many companies – especially in the financial sector – now employ a cyber manager, whose job description would include cyberattack preparedness.

Edenred acquires IPS to offer integrated AP solution

Edenred, a digital payments platform, announced in a press release on Monday that it has acquired IPS, an invoice automation provider, to expand the services offered by its corporate payment subsidiary, Edenred CSI. A long-time partner of Edenred’s, IPS will allow Edenred CSI to offer an end-to-end, integrated AP solution to its clients.

The press release states that Edenred CSI’s current functionality covers integration with 350 ERPs and all payment methods, and IPS’s functionality will add invoice automation, from capture to approval, with a reported 99.95% accuracy. Greg Bartels, Founder and President of IPS, stated in the release that “The integration of IPS and Edenred CSI will create a 100% end-to-end digital process that will reduce invoice exceptions while significantly increasing straight-through payment processing.”

Nubank plans “Nucoin” cryptocurrency launch for 2023

Brazilian digital bank Nubank, which boasts Warren Buffett’s Berkshire Hathaway as an investor, announced plans to launch its own cryptocurrency, “Nucoin”, sometime in the first half of 2023. The bank stated that 2,000 customers will be invited to participate in a forum to give input on Nucoin’s development.

The press release calls Nucoin “a new way to recognize customer loyalty and encourage engagement with Nubank products.” The bank also says discounts and perks will be offered for customers who adopt Nucoin.

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