FirstFT: China steps up defence of renminbi

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China’s central bank has stepped up the defence of its currency as concerns mount over the health of the world’s second-largest economy.

The efforts by the People’s Bank of China, which unexpectedly increased interest rates this week to arrest a slide in the renminbi, follow a series of gloomy economic data releases that showed weakening exports and waning consumer confidence.

Foreign exchange traders said state banks had been buying up renminbi and selling dollars in an apparent effort to slow the pace of depreciation. Read the full story on China’s move to support its currency.

Here’s what else I’m keeping tabs on today and over the weekend:

• Stock markets: US shares are set to open down after their fifth consecutive lower finish yesterday as better than expected data hits hopes for interest rate cuts.

• Earnings: Tractor maker Deere and cosmetics company Estée Lauder report results.

• Camp David: US president Joe Biden hosts his counterparts from Japan and South Korea to announce a landmark trilateral military agreement.

• Women’s World Cup: England meet Spain in the final on Sunday in Sydney.

How well did you keep up with the news this week? Take our quiz.

Five more top stories

1. Walmart said easing price pressures in the US and a strong labour market were supporting American shoppers after a “strong” quarter for the world’s largest retailer. Chief executive Doug McMillon highlighted rising energy prices, the resumption of student loan payments and higher borrowing costs as factors that were likely to crimp consumer spending for the rest of the year. Read more on the retailer’s results.

2. The Biden administration has dropped efforts to pressure Japan to include anti-whaling language in its signature Indo-Pacific trade pact after fierce opposition from Tokyo and concern from some US officials. The Financial Times reported last week that Tokyo had strenuously objected to including anti-whaling language in the trade deal. Demetri Sevastopulo has the full story on Washington’s climbdown.

3. Exclusive: UK investment firm Hayfin has raised more than €6bn for direct lending to European companies, making it one of the largest private credit funds to close in the region this year. The figure is about six times more than the $1bn raised by Europe-focused funds in the first quarter. Here’s what this means for the asset class once dominated by banks.

4. London-based Soho House is to team up with “junk bond king” Michael Milken and open a club at a complex close to the White House next year. Milken is teaming up with his friend, the American billionaire Ron Burkle, to renovate the former headquarters of a bank. Find out what the new venue has to offer.

5. Bitcoin fell by nearly 8 per cent during an hour of frenzied trading yesterday afternoon, extending a day of losses that have reversed most of the cryptocurrency’s gains since June. The whipsaw price action left the digital asset changing hands for 15 per cent less than the $31,814 high registered in July, echoing recent declines in stocks, bonds and other financial assets. Here’s more on the sell-off.

News in-depth

Donald Trump has exactly one week to turn himself in to the authorities in Georgia after being indicted this week on 13 criminal counts relating to his alleged effort to overturn the 2020 US presidential elections. But Trump is not the only one in Georgia prosecutors’ crosshairs. This is a guide to the 18 others charged under the state’s wide-ranging racketeering laws.

We’re also reading . . .

• Bootleg ‘Barbie’: Russians have been flocking to screenings of low-quality pirated copies of the film after its producer Warner Bros pulled out of the country.

• Generative AI: Interest in the technology has been huge, even by the breathless standards of previous tech hype cycles, but what if investors are wrong? asks John Thornhill.

• War in Ukraine: A negotiated outcome remains elusive, writes Domitilla Sagramoso of King’s College London, but this could change if neither side gains a military advantage and a cold winter stalemate sets in.

Chart of the day

As Europe’s tourism sector returns to near pre-pandemic levels of activity, visitors to the region’s vacation hotspots have faced sharp price increases from businesses passing on rising costs. With flights, hotel rooms and holidays all becoming more expensive, European Central Bank rate-setters are becoming concerned that a fresh wave of summer inflation spurred by tourism could complicate their efforts to keep prices under control.

Take a break from the news

Richard Ford, Sara Wheeler, Paul Theroux and other writers reflect on their favourite swimming spots, from an outdoor pool in Iceland built near a volcano to a hotel in West Hollywood.

Additional contributions by Tee Zhuo and Benjamin Wilhelm