MNI EUROPEAN OPEN: Worries Over Evergrande Dent Risk In Holiday-Thinned Asia Trade

EXECUTIVE SUMMARY

• EVERGRANDE BOSSES FACE 'SEVERE PUNISHMENT' AFTER SECURING EARLY REDEMPTIONS (FT)
• EVERGRANDE MOMENT OF TRUTH ARRIVES WITH BOND PAYMENT DEADLINES (BBG)
• HONG KONG STOCKS SINK AS EVERGRANDE WOES SPREAD, PING AN TUMBLES
• S&P 500 E-MINIS TRADE BELOW 50- & 55-DMAS
• YELLEN: CONGRESS, RAISE THE DEBT LIMIT (WSJ)

Fig. 1: S&P 500 E-Mini Futures (Continuation Chart)

Source: MNI - Market News/Bloomberg

UK

CORONAVIRUS: The U.K. government eased coronavirus testing requirements for fully vaccinated people arriving in England, removing a significant barrier to travel and boosting airlines and tourism firms. Those who've had two shots will be exempt from a pre-departure test before flying from nations that aren't high risk, while screening after arrival will be downgraded to quicker and cheaper lateral-flow tests, the Department for Transport said Friday. A so-called traffic-light system used to categorize countries will also be replaced, with a single "red list" for locations where infection rates are high and "simplified measures for the rest of the world," Transport Secretary Grant Shapps said in a message on Twitter. (BBG)

CORONAVIRUS: Northern Ireland has indicated it will follow many of England's incoming COVID-19 rules on international travel, as holiday firms experience a surge in bookings. The country's traffic light system for international travel will change from 4 October with a single "red list" of destinations and a "simplified process" for travellers for the rest of the world. (Sky)

POLICY: A former Bank of England chief economist will lead Prime Minister Boris Johnson's bid to "level up" every part of the U.K. by raising living standards, improving public services and spreading opportunity. Andy Haldane, who left the bank earlier this year, was named the new head of the taskforce, the government said in a statement on Sunday. Haldane, who called the effort "one of the signature challenges of our time," will report to the prime minister and Michael Gove, the Secretary of State for Levelling Up. (BBG)

POLITICS: Liberal Democrat leader Sir Ed Davey has challenged his party to "tear down" the Conservatives' "blue wall" in order to help oust Boris Johnson from Downing Street. In his keynote address at the Liberal Democrat conference on Sunday, Sir Ed said the Tories would only lose power at the next election if his party took seats off them. "Make no mistake: the electoral arithmetic is clear," he said. "These Conservatives can't be defeated next time unless we Liberal Democrats win Tory seats." (Sky)

POLITICS: Opinium tweeted the following on Saturday: The @Conservatives hold a 3 point lead in the latest @OpiniumResearch/@ObserverUK poll. Latest numbers: Con 40% (+2) Lab 37% (-1) Lib Dem 7% (-1) Green 6% (NC)." (MNI)

ENERGY: The government is considering offering emergency state-backed loans to energy companies as firms battle to stay afloat amid surging gas prices. Smaller suppliers face ruin as price hikes have made their price promises to customers undeliverable. The process for dealing with failing firms is under pressure as adopting customers has become unattractive for surviving companies due to price rises. The loans are expected to be offered to encourage firms to take on customers. (BBC)

EUROPE

CORONAVIRUS: The European Medicines Agency will evaluate the possibility of giving Covid-19 vaccines to children aged 6 to 11 in November, Marco Cavaleri, head of biological health threats and vaccines strategy at the agency, said in an interview with La Repubblica on Saturday. "Pfizer will send us some data at the beginning of October, Moderna should follow early November. Our evaluation will take three to four weeks", Cavaleri told the Italian daily. (BBG)

GERMANY: Christian Democrat Armin Laschet was put on the defensive in Germany's third election debate as his two main rivals for the chancellery presented themselves as natural governing partners after Angela Merkel departs. In a 90-minute debate that was one of the last opportunities for Laschet to spark his flagging campaign, frontrunner Olaf Scholz of the Social Democrats and Green candidate Annalena Baerbock at times joined forces. Scholz made it clear that his party favors forming a coalition with the Greens after the Sept. 26 election. (BBG)

GERMANY: Chancellor Angela Merkel's conservatives narrowed the Social Democratic Party's lead by 1 percentage point in a weekly poll, though they remain in second place a week before Germany's federal election. Support for Merkel's Christian Democratic Union and its Bavarian affiliate, the Christian Social Union, increased to 21% and the SPD was unchanged at 26% in the Insa poll for Bild am Sonntag. (BBG)

GERMANY: Olaf Scholz, the German Social Democrat candidate looking to succeed Angela Merkel as chancellor after next week's election, said conditions for a potential coalition partner would include support for taxing the rich. He'd also require backing for raising the minimum wage to 12 euros ($14) next year, Scholz said in an interview with the Bild am Sonntag newspaper. "The pension level will remain stable and the retirement age will not rise any further," he said. (BBG)

GERMANY: Lufthansa is to raise more than €2.1bn by offering new shares to investors, the German carrier said on Sunday, and use the proceeds to repay the multibillion-euro bailout it received from Berlin in the summer of 2020. (FT)

FRANCE: France has given the first dose of the vaccine against Covid-19 to 50 million people, President Emmanuel Macron said in a Twitter post on Friday. The country initially aimed to reach this milestone at the end of August. (BBG)

ITALY: Italy's decision to make Covid-19 "passports" mandatory for all public and private sector workers from Oct. 15 is boosting the country's vaccination campaign, said Covid Emergency Czar Francesco Paolo Figliuolo. "This week we have seen a 20-40% increase in bookings for first vaccine doses, compared to last week," Figliuolo wrote late Saturday. Last week, Italy's government approved a measure requiring workers to demonstrate vaccination, a past Covid infection or a recent negative test before entering workplaces. Workers will face fines of as much as 1,500 euros ($1,763) if they don't comply, while employers who fail to check their workers may have to pay as much as 1,000 euros. (BBG)

BELGIUM: Belgium's regional governments agreed to divergent virus rules starting next month. An obligation to wear masks in bars, restaurants and stores will be abolished in Flanders, the wealthier Dutch-speaking region in the north, while the Brussels capital region and southern Wallonia will keep it mandatory. The Brussels government is also working on the use of a proof of vaccination, recovery or negative test to gain access to certain venues. In Belgium's capital, only 51% of the population is fully vaccinated. Flanders has a vaccination rate of 78%, Wallonia is at 67%. (BBG)

BELGIUM: Belgium will gradually phase out support for businesses affected by the pandemic by year-end, Finance Minister Vincent Van Peteghem said on Flemish TV show 'De Zevende Dag.' The government hasn't reached an agreement yet to extend any support measures beyond Sept. 30. A measure that will definitely lapse at the end of this month is the reduced VAT rate of 6% for bars and restaurants, Van Petegem said. Drinks will be subject to a 21% VAT rate again as of Oct. 1 and prepared food will be taxed at the usual 12%. (BBG)

SWEDEN: The Swedish economy is robust enough to withstand the effects of the energy crunch that has gripped Europe and filtered into Scandinavia, Swedish Prime Minister Stefan Lofven said. "We have a very, very strong economy," Lofven said in an interview in New York on Sunday. "If we have dramatically higher prices in the long term that will affect consumption, but I don't think we're there." Sweden's debt to gross domestic product ratio has held below 40% even during the Covid-19 crisis and remains one of the lowest in Europe. That measure is set to fall to about 35%, Lofven said. (BBG)

U.S.

FED: MNI: Fed Dots To Signal Faster Tightening Cycle - Ex-Officials

• The Federal Reserve on Wednesday is likely to signal a more aggressive approach to tightening monetary policy coming out of the pandemic, with a fresh dot plot that may show growing support for lifting interest rates next year and hikes once a quarter in 2024, former officials told MNI - on MNI MainWire and email now, for more details please contact sales@marketnews.com.

FED: Investors may need to hunker down for a slump in U.S. stocks if President Joe Biden opts for a surprise choice and doesn't renominate Jerome Powell as Federal Reserve chair. Nearly 90% of the economists surveyed by Bloomberg expect Biden to keep Powell in the job, an overwhelming number that's risen from June, while Fed Governor Lael Brainard, a Democrat, is seen as the likely choice by 9% of economists surveyed. Former Vice Chair Roger Ferguson was viewed as the pick by 2%. The poll of 52 economists was conducted Sept. 10-15. Market jitters are likely to follow a move that surprises investors. Nearly two-thirds of the economists predicted a near-term rally in stocks if Powell is renominated, while more than half predicted stocks would decline in the near term if Brainard were the pick. (BBG)

FISCAL: Treasury Secretary Janet Yellen renewed her call for Congress to raise or suspend the U.S. debt ceiling, saying the government will otherwise run out of money to pay its bills sometime in October. Writing in a Wall Street Journal op-ed, Yellen said "the overwhelming consensus among economists and Treasury officials of both parties is that failing to raise the debt limit would produce widespread economic catastrophe." The U.S. House will vote next week on raising the nation's $28 trillion debt ceiling amid a standoff between Democrats and Republicans that still threatens to send the country into a payments default next month. A U.S. default "would likely precipitate a historic financial crisis that would compound the damage of the continuing public health emergency," throw the U.S. into recession and leave it a "permanently weaker nation," she said. (BBG)

FISCAL: House Speaker Nancy Pelosi (D-Calif.) issued a "dear colleague" statement Sunday evening, calling on Congress to act in a bipartisan manner to raise the nation's debt ceiling. (Axios)

FISCAL: Sen. Joe Manchin (D-W.Va.) is privately saying he thinks Congress should take a "strategic pause" until 2022 before voting on President Biden's $3.5 trillion social-spending package, people familiar with the matter tell Axios' Hans Nichols. Manchin's new timeline — if he insists on it — would disrupt the plans by House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Chuck Schumer (D-N.Y.) to vote on the budget reconciliation package this month. (Axios)

FISCAL: House Democrats could initially hold off on sending a $550 billion infrastructure bill to President Joe Biden for signature to help keep the party united and his economic agenda on track, a senior lawmaker said. House Budget Committee Chair John Yarmuth suggested the maneuver could be part of Speaker Nancy Pelosi's balancing act between moderates, including backers of the Senate-passed infrastructure plan, and progressives who want to keep a bigger tax and social spending plan moving forward in tandem. Democrats are still planning for a House vote on the infrastructure bill on Sept. 27, though completion of both bills will probably be delayed until early October, Yarmuth said on "Fox News Sunday." (BBG)

FISCAL: Representative Alexandria Ocasio-Cortez indicated she's open to raising the limit on the federal deduction for state and local taxes, or SALT, but she opposes a full repeal. "We should not endorse a full 100% repeal of SALT caps," the New York progressive tweeted Friday. "I am open to taking a look at SALT and addressing concerns for families put under the squeeze in high cost of living areas." The deduction has emerged as a point of contention among Democrats as they work on a $3.5 trillion package that compromises much of President Joe Biden's economic agenda. (BBG)

CORONAVIRUS: The Covid-19 vaccine booster shot proposed by Pfizer Inc. and BioNTech SE should be given to a smaller group of people who are the most vulnerable to serious disease, a panel of expert advisers to the U.S. Food and Drug Administration said. The FDA and Pfizer had originally proposed approving a booster shot for everyone 16 and older. But the advisers rejected that idea out of concern that the data to support such a broad application was thin and there could be risks, especially for younger people. Instead, the panel voted 18-0 in favor of an emergency-use authorization -- a more limited clearance than a full approval -- for people 65 and older or individuals at high risk of severe Covid-19. The move is a setback to a sweeping plan from the Biden administration to roll out booster shots to a broad population. (BBG)

CORONAVIRUS: President Joe Biden's chief medical adviser said booster shots for more of the U.S. population remain a possibility soon, as additional data on the still-widening outbreak come in. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, spoke two days after an advisory panel to the U.S. Food and Drug Administration rejected a national rollout of boosters for all ages, approving them only for people 65 and older and those who are medically vulnerable. "The story is not over because more and more data is coming in and will be coming in," Fauci said Sunday on ABC's "This Week." (BBG)

EQUITIES: Apple, known among its Silicon Valley peers for a secretive corporate culture in which workers are expected to be in lock step with management, is suddenly facing an issue that would have been unthinkable a few years ago: employee unrest. On Friday, Tim Cook, Apple's chief executive, answered questions from workers in an all-staff meeting for the first time since the public surfacing of employee concerns over topics ranging from pay equity to whether the company should assert itself more on political matters like Texas' restrictive abortion law. (New York Times)

OTHER

GLOBAL TRADE: A record 60 container vessels are at anchor or adrift in the San Pedro Bay, waiting to be unloaded at the Port of Los Angeles/Long Beach seaports and another 20 are due to arrive in coming days, a port executive said on Wednesday. (RTRS)

GLOBAL TRADE: The U.S., Australia, Japan, and India this week will agree to promote the creation of a safe supply chain for semiconductors at the first in-person Quad summit, in Washington, an indication that the four-way alliance meant to counter China in the Indo-Pacific is broadening its scope. (Nikkei)

GLOBAL TRADE: Electronics makers grappling with an unprecedented global chip crunch are increasingly turning to unconventional supply channels to meet their needs -- and many are getting stuck with knock-off, substandard or reused semiconductors. (Nikkei)

GLOBAL TRADE: General Motors Co Chief Executive Mary Barra said Friday the largest U.S. automaker plans to make changes in its supply chain as it works to address the continuing semiconductor chip crisis that has forced significant production cuts. (RTRS)

GLOBAL TRADE: Honda Motor Co. said its production lines in Japan are operating at about 40% of its initial plan for the August-September period because of chip shortages and delays in parts shipments due to coronavirus outbreaks overseas. (BBG)

GLOBAL TRADE: Huawei Technologies will push ahead with developing 6G wireless technology in defiance of a U.S. crackdown on the Chinese tech giant, its founder and CEO has told employees, exhorting them to "break limits in the sky" and set global standards for the emerging industry. (Nikkei)

GLOBAL TRADE: Europe's trade negotiations with Australia are at risk of collapsing over France's fury at losing a multibillion-dollar submarine deal with Canberra. (POLITICO)

GLOBAL TRADE: Boris Johnson will challenge Amazon chief Jeff Bezos on his company's low tax payments in the UK as they meet in New York on Monday. (Telegraph)

GEOPOLITICS: France, still mad about the submarine deal Australia struck with the United States and the United Kingdom, has recalled its ambassadors from the U.S. and Australia. France's foreign minister said Friday that the country immediately recalled the ambassadors in protest of a trilateral security deal that included nuclear-powered submarines for Australia. (CNBC)

GEOPOLITICS: Australia's prime minister Scott Morrison defended his decision to renege on a submarine deal with the French government as acrimony continued over Canberra's decision to sign a new security pact with the US and UK. Morrison said he did "not regret the decision to put Australia's national interest first" in comments that came just hours after France, which is fuming over being left out of the pact, derided the UK's role. But in a sign that Washington is keen to de-escalate the worsening crisis, it emerged on Sunday that US President Joe Biden has asked for a call with President Emmanuel Macron of France to discuss the submarine deal. Meanwhile British officials insisted that Boris Johnson, who will meet Biden in Washington this week, had not wanted to "annoy the French" in signing the Australia/UK/US defence pact known as Aukus. However the anger in Paris was still raw, with Jean-Yves Le Drian ridiculing Britain's role the pact, accusing the UK of "permanent opportunism". (FT)

GEOPOLITICS: France has cancelled a meeting between Armed Forces Minister Florence Parly and her British counterpart planned for this week after Australia scrapped a submarine order with Paris in favour of a deal with Washington and London, two sources familiar with the matter said. Parly personally took the decision to drop the bilateral meeting with British Defence Secretary Ben Wallace, the sources said. (RTRS)

GEOPOLITICS: The United States has resumed discussions with Huawei Technologies Co. Ltd. and lawyers for Meng Wanzhou about a possible deferred prosecution agreement for the Chinese executive that could allow her to return to China, according to Canadian sources. The development could open the door for China to free Canadians Michael Kovrig and Michael Spavor. Canada has accused Beijing of holding them hostage in retaliation for the arrest of Ms. Meng, who is detained in Vancouver and fighting extradition to the United States. Two sources told The Globe and Mail the U.S. Department of Justice has been in talks for weeks with Huawei and lawyers for Ms. Meng, daughter of Ren Zhengfei, founder of the Chinese telecommunications giant. Those talks do not involve the fate of the two Canadians jailed in China. (Globe & Mail)

CORONAVIRUS: Researchers from Israel told a panel of U.S. vaccine experts weighing a potential Covid-19 booster dose from Pfizer Inc. and BioNTech SE that it's unclear how long the benefit of such a shot would last. A big part of the case for booster shots is data from Israel showing that, in the short term, a third dose of the vaccine dramatically lowered infections and severe illness in the short term in people over age 60 and older. However, it isn't yet clear whether the enhanced protection boosters could provide would be short-lived, or if the benefit would be lasting. (BBG)

CORONAVIRUS: The Biden administration is buying hundreds of millions more doses of the Pfizer-BioNTech coronavirus vaccine to donate to the world, according to two people familiar with the deal, as the United States looks to increase efforts to share vaccine with the global population. (Washington Post)

CORONAVIRUS: Pfizer Inc.'s vaccine declined in protection against hospitalization after four months, while Moderna Inc.'s remained stable, U.S. researchers found in an analysis of data from 21 US hospitals across 18 states. Two doses of either vaccine provided more protection against hospitalization than the one-dose Johnson & Johnson vaccine, the study found, though Pfizer's advantage over J&J narrowed over time, according to the study published Friday by the U.S. Centers for Disease Control and Prevention with collaborators across the country. All three vaccines provided substantial protection after four months -- Moderna's was 92% effective against hospitalization by then, with Pfizer's at 77% and J&J at 68%. (BBG)

JAPAN: Japan's vaccine czar, Taro Kono, is by far the most popular of four candidates set to run in the ruling Liberal Democratic Party's leadership election this month, a survey of party members and supporters found. Kono was favored among 49% of respondents in a Kyodo News poll taken Sept. 17-18. In second place was former foreign minister Fumio Kishida with 19%, followed by Sanae Takaichi with 16% and Seiko Noda with 3%. The four lawmakers will stand in the LDP leadership vote set for Sept. 29, which follows Yoshihide Suga's Sept. 3 announcement that he would step down as Japan's prime minister. The party leader is virtually assured of becoming premier because of the LDP's dominance in parliament. (BBG)

JAPAN: Japan's former Foreign Minister Fumio Kishida is the most popular of four candidates set to run in the ruling Liberal Democratic Party's leadership election this month, according to a Mainichi newspaper survey of LDP members of parliament. (BBG)

JAPAN: Japanese Prime Minister Yoshihide Suga is considering ending the state of emergency at the end of this month, broadcaster TBS reports, without attribution. (BBG)

AUSTRALIA: Reported cases in New South Wales dropped to 935 Monday, the first daily tally below 1,000 since Aug. 27. About 82% of eligible people in the state have had a first vaccine, and almost 53% of the population is now fully vaccinated. The rural town of Cowra will be locked down from 5 p.m. today after a confirmed local area. Victoria reported 567 new cases in 24 hours. The state is also rolling out hundreds of thousands of Moderna doses to be administered at pharmacies this week. (BBG)

AUSTRALIA: Melbourne will exit its sixth lockdown since the pandemic began once 70% of Australia's Victoria state is fully vaccinated, authorities said Sunday as they outlined plans to unwind virus measures next month. Limits on "reasons to leave your home and the curfew will no longer be in place" once that target is met around Oct. 26, Victoria's Premier Daniel Andrews told reporters. About 44% of Victoria state is already fully vaccinated, according to federal government data. (BBG)

NORTH KOREA: Recent satellite images shows North Korea is expanding a uranium enrichment plant at its main Yongbyon nuclear complex, a sign that it's intent on boosting the production of bomb materials, experts say. The assessment comes after North Korea recently raised tensions by performing its first missile tests in six months amid long-dormant nuclear disarmament diplomacy with the United States. (AP)

CANADA: On the final campaign day of a tight election battle, Canadian Prime Minister Justin Trudeau warned that his Conservative opponents would weaken the nation's battle against the pandemic and said Canadians need a government that follows science. Polls indicate Trudeau's Liberal Party is in a close race with the rival Conservatives and that it is unlikely on Monday to get the outright majority needed to govern without relying on an opposition party to remain in power. "We do not need a Conservative government that won't be able to show the leadership of vaccinations and on science that we need to end this," Trudeau said at a campaign stop in Montreal on Sunday. Conservative leader Erin O'Toole has refused to say how many of his party's candidates are unvaccinated and Trudeau has been reminding Canadians of that at every opportunity. (AP)

RUSSIA: President Vladimir Putin's ruling party won a decisive victory in legislative polls despite simmering discontent after sidelining political opponents, an exit poll showed. United Russia took a projected 45.2% of the party vote, according to a survey by pollster INSOMAR in 1,455 polling stations over three days of voting that ended Sunday, state television Rossiya 24 said. The Communist party was running second at 21%. While Putin personally retains broad support, according to polls, United Russia recorded some of the lowest ratings in nearly a decade earlier this year, scorned by voters angry about stagnant living standards and other policies that are unpopular. (BBG)

IRAN: Iran may hold talks on restoring the 2015 nuclear deal with world powers on the sidelines of the United Nations General Assembly next week, the country's foreign ministry spokesman, Saeed Khatibzadeh, said. Foreign Minister Hossein Amirabdollahian will leave for New York on Monday and will meet with representatives of the nuclear deal member-states "if such meetings will be useful," Khatibzadeh told reporters at a press conference. (BBG)

COMMODITIES: Chinese Premier Li Keqiang said the government will continue efforts to stabilize commodity prices using a variety of measures, state news agency Xinhua reported. The government will put special emphasis on the use of market instruments, Li said on a visit to Guangxi Province in southern China. Macro-level policies should be calibrated precisely to the requirements of local business, especially during times of economic uncertainty, he added. (BBG)

OIL: Less than a quarter of crude production remains offline in the US Gulf of Mexico — and about one-third of natural gas output — nearly three weeks after Hurricane Ida ravaged the Louisiana Gulf Coast. (Platts)

OIL: Iraq expects oil prices to be around $70 a barrel in the first quarter of next year, with the market kept in balance by steady supply increases from the OPEC+ cartel and demand continuing to recover from the coronavirus pandemic. "The world economy is in recovery status," Oil Minister Ihsan Abdul Jabbar said to reporters in Baghdad on Sunday. (BBG)

OIL: The long-serving head of Libya's state-run oil company will remain in his post, Prime Minister Abdul Hamid Dbeibah said in a decree, looking to end a feud between two key oil officials and bolster the stability of the OPEC nation's financial lifeline. Dbeibah's Sept. 14 decree, which was seen by Bloomberg, effectively nullifies an earlier decision by the oil minister, who sought to suspend the National Oil Corp.'s chairman, Mustafa Sanalla. (BBG)

CHINA

POLICY: China's top regulators defended their market-roiling crackdown on various industries in a meeting with Wall Street executives, while reassuring them the stricter rules aren't aimed at stifling technology companies or the private sector. China Securities Regulatory Commission Vice Chairman Fang Xinghai said recent actions were to strengthen regulations for companies with consumer-facing platforms, and improve data privacy and national security, according to a person familiar with the talks, who asked to not be identified because the meeting was private. Fang defended the moves such as those aimed at the education and gaming industries as meant to reduce social anxiety. (BBG)

CREDIT: Six senior Evergrande executives face "severe punishment" for securing early redemptions on investment products that the indebted Chinese property group subsequently told retail investors it could not repay on time, the company has said. The admission comes ahead of a critical fortnight for the developer, which is struggling to repay investors, banks and bondholders, as well as complete flats for homebuyers who paid for their new properties in advance. Last week hundreds of retail investors protested at Evergrande's headquarters in the southern city of Shenzhen, after executives said they needed more time to pay the interest and principal on high-yielding wealth management products issued by the group. They were joined by suppliers who said they had also not been paid. (FT)

CREDIT: China Evergrande Group bondholders are about to find out if the property giant's liquidity crisis is as dire as it appears. Interest payments on two Evergrande notes come due Thursday, a key test of whether the developer will continue meeting obligations to bondholders even as it falls behind on payments to banks, suppliers and holders of onshore investment products. Investors are pricing in a high likelihood of default, with one of the notes trading at less than 30% of face value. Concern over Evergrande's ability to make good on $300 billion of liabilities is spilling into China's financial markets. Shares of other real estate firms have plunged, while the yield on an index of dollar-denominated junk bonds has climbed to about 14%, the highest in nearly a decade. The People's Bank of China injected $14 billion of short-term cash into the financial system on Friday in a sign policymakers want to soothe nerves. (BBG)

CREDIT: Cash-strapped developer China Evergrande Group has begun repaying investors in its wealth management products with real estate, a unit of its main Hengda Real Estate Group Co Ltd unit said. (RTRS)

YUAN: China will "steadily and prudently" promote yuan internationalisation in 2021, and further develop offshore yuan markets, the central bank said on Saturday. Cross-border settlements in the local currency totalled 28.39 trillion yuan ($4.39 trillion)in 2020, up 44.3% from the previous year, the People's Bank of China said in its 2021 yuan internationalisation report. Cross-border yuan settlements accounted for 46.2% of the overall cross-border settlements, hitting a record high, the central bank said. (RTRS)

CORONAVIRUS: China's current outbreak remains confined to Fujian Province, which reported 28 new local infections Sunday. Children make up a higher proportion of the Fujian cases relative to other recent hot spots, Vice premier Sun Chunlan said Saturday during a visit, adding that pediatricians from elsewhere in China will be deployed to the province to assist. (BBG)

OVERNIGHT DATA

NEW ZEALAND AUG BNZ-BUSINESS NZ PSI 35.6; JUL 55.9

New Zealand's services sector fell back in contraction during August, according to the BNZ - BusinessNZ Performance of Services Index (PSI). The PSI for August was 35.6 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). This was the second lowest level of activity since the survey began, with the April 2020 result still the lowest during the national lockdown last year. BusinessNZ chief executive Kirk Hope said that like its sister survey the PMI, the national lockdown was the sole influencing factor causing service sector activity levels to plunge into contraction. Even for those outside Auckland moving down alert levels to resume business activity, there will be residual effects at least through September with both uncertainty and lower alert level restrictions playing their part. BNZ Senior Economist Craig Ebert said that "while the August result wasn't quite as bad as the 26.0 it plunged to in April 2020, the September 2021 result might be the better marker as the first half of August's trading would have been solid, if July's PSI result of 55.9 was any lead." (BNZ)

UK SEP RIGHTMOVE HOUSE PRICE INDEX +0.3% M/M; AUG -0.3%
UK SEP RIGHTMOVE HOUSE PRICE INDEX +5.8% Y/Y; AUG +5.6%

MARKETS

UP TODAY (Times GMT/Local)