UPS and Teamsters agree on new contract, averting costly strike that could have delayed deliveries for consumers and retailers. The International Brotherhood of Teamsters union and UPS have agreed on a new five-year contract that boosts wages and guarantees more air conditioning in drivers’ trucks. (The Conversation)

ECB hikes interest rates to highest in 22 years: Lagarde's dovish tone propels European stocks to levels unseen since 2007. The European Central Bank hiked its key interest rates by 25 basis points on Thursday, in a unanimous decision, delivering the ninth consecutive rate hike over the past year, a day after the Federal Reserve also hiked borrowing costs. (Markets Insider)

Lawyers blame ChatGPT for tricking them into citing bogus case law. Two lawyers face possible punishment over a filing in a lawsuit that included references to fake past court cases that were invented by the AI chatbot. (KGWB8)

Regulators unveil sweeping changes to capital rules for banks with $100 billion or more in assets. U.S. regulators on Thursday unveiled a sweeping set of proposed changes to banks’ capital requirements to address evolving international standards and the recent regional banking crisis. (CNBC)

US economy grew faster than expected in Q2. Data shows sustained strength in domestic demand while inflation subsided considerably last quarter. (Al Jazeera)

Bank of Japan loosens grip on market, lets yields jump to 9-year high. Analysts see move toward eventual rate increases, though BOJ Gov. Ueda says monetary easing remains in place. (WSJ)

Biden sends Sullivan to Saudi Arabia in possible push for major Israel deal. Sullivan's trip is aimed at continuing the talks over a possible deal on upgrading U.S.-Saudi relations that would also include a normalization agreement between Saudi Arabia and Israel, the two sources said. (Axios)

EU stress test shows three banks falling short. Three banks from the European Union failed to meet binding capital requirements in a stress test that saw a theoretical 496 billion euros ($546 billion) wiped from their buffers, the bloc's banking watchdog said on Friday. (Reuters)

Protesters, banks demand action after Iraqi dinar plunges post-US sanctions. Fourteen private banks have been banned from dealing with the U.S. dollar for reportedly siphoning funds to Iran and money laundering. (Al Jazeera)

Russia urged to renew Ukraine grain deal at Africa summit. Egypt's president has urged Vladimir Putin to renew the deal allowing Ukraine to export grain at a summit the Russian president is hosting. (BBC)

Argentina, IMF staff-level agreement set to combine reviews on $44 billion loan, sources say. Argentina's preliminary deal with the International Monetary Fund is set to combine reviews of its $44 billion loan programme, according to four sources, potentially paving the way for streamlining payments to the cash-strapped country. (Reuters)

Foodflation hits home: Cocoa prices surge to a 12-year high just after orange juice smashed records. Chocolate may have just become even more of a luxury item with cocoa futures prices surging to a 12-year high. (Markets Insider)

Europe’s recession may already be over. Solid economic growth in France and Spain, and a very modest recovery in Germany could be enough to confirm that the euro area has already exited a recession that started in the final quarter of 2022. (CNN Business)

Turkish Lira Plunges Despite New Central Bank Policies

Kendall Payton, editorial associate

Turkey has appointed three new governors for its central bank management, being the latest renovation after changes in its policy course since the elections in May. Turkey’s international government bonds united after the new appointments which gained 1.3 cents on the dollar. The lira was 26.9535 against the dollar, losing 30% of its value this year. Turkey’s central bank also hiked its key rate by 650 basis points to 15%, being the first rate hike since 2021, per Al Jazeera.

One of the biggest factors in the sharp rise of inflation in 2023 came from the lira’s significant decline, making import prices much higher. “Until a significant improvement in the inflation outlook is achieved, we will gradually strengthen monetary tightening as and when necessary," said Hafize Gaye Erkan, the central bank governor in an article from Bloomberg.

With Erkan’s new position, the central bank both tightened and reversed its policy within the last two months. The central bank raised its one-week repo rate by 9 percentage points to 17.5%—marking a complete reversal from its eased drive seeing the CBRT cut its borrowing costs since 2021. Turkey’s annual inflation was just shy of 40% last month after its 24-year high above 85% in October 2022.

The central bank’s policy shift “will be further strengthened as much as needed in a timely and gradual manner until a significant improvement in the inflation outlook is achieved,” according to the central bank’s committee. Justice Minister Yilmaz Tunc said Turkey is also prepared to extend a measure-limiting annual rent increase to a maximum of 25%.

Customers in Turkey have averaged 32.8 days beyond terms, with 29% of credit professionals saying payment delays have increased and 57% saying it stayed the same, per the FCIB Credit and Collections Survey. The most common cause for payment delays is billing disputes and cash flow issues (both 67%).

What Credit and Collections Survey respondents are saying:

• “Keep the momentum by issuing invoices on time and send statements of accounts after each payment received. Meet clients for payment follow ups and don’t rely on emails or phone calls.”
• “Trade through DC where possible and obtain financial statements on your customers and backstop sales with credit insurance.”
• “Do due diligence for all prospect customers, especially to those small-medium privately held companies with no financials or credit reports. Check the profile and validate like business address, company domain e-mail address, etc. and start with small, reasonable credit line and reasonable payment terms.”

The Credit and Collections Survey is now open. It covers France, India, Japan and South Korea. You will earn ICEU/Participation credit for your input. Be sure to share the link with your credit and collections network.

 

Week in Review Editorial Team:

Annacaroline Caruso, editor in chief

Jamilex Gotay, editorial associate

Kendall Payton, editorial associate