14 November 2023 – US and Indonesia are working on a closer strategic partnership. And while the United States and Indonesia are considering more economic cooperation, the EU is only watching from the sidelines. US banks show strength and Goldman Sachs sees clear deficit in iron ore coming.
US and Indonesia work on strategic partnership
The United States and Indonesia are currently working on further expanding relations between the two countries. According to media reports, the planned strategic partnership would support the efforts of the United States to build and strengthen allies and partners in the Indo-Pacific region. The United States and Vietnam had already announced a similar upgrade to their joint relations in September.
Indonesia wants to sell its raw materials to the US
Of course, the US government’s efforts are not just about forming a counterweight to China, but also about important economic interests. Indonesia is rich in raw materials, such as nickel, and would like to sell these to America without a free trade agreement and without the burden of the US Inflation Reduction Act (IRA). It remains to be seen whether this can succeed, as the influence of Chinese companies in the Indonesian commodities sector is very high.
When two quarrel, the third is happy
But one thing should already be clear: When two people quarrel, the third is happy. This is because the United States appears to be more open to trade relations with Indonesia than, for example, the European Union, which has been involved in increasingly escalating trade disputes with Indonesia for years. Instead of looking for opportunities for more business, the uncompromising stance of the European Commission once again reveals its damaging ego.
US banks show strength
In the third quarter, the total profit of the four largest US banks was 23 percent higher than in the same quarter last year. By contrast, the profits of the other banks – there are a total of 4,400 financial institutions in the USA – fell by an average of 19 percent. The “Big Four” accounted for 45 percent of industry profits – six percentage points higher than the average of the past ten years.
The strength of the big banks is partly due to the fact that they have to work less hard to retain customer deposits. On average, they only paid interest on 60 percent of deposits – an average of two percent. Smaller banks, on the other hand, pay three percent on 70 percent of customer deposits. Deutsche Bank analysts assume that this dynamic will not be reversed in the medium term and are sticking with the big banks when it comes to US bank shares for the time being.
Goldman Sachs sees ‘clear deficit’ of iron ore for the rest of the year
The analysts at Goldman Sachs see clear signs of a continuing deficit in the availability of iron ore. They are referring to low inventories and a drop in production. Australia and Brazil in particular are clearly lagging behind in terms of production figures. According to Goldman Sachs, the latest financial incentives in China could also provide positive support for economic growth. In October, China announced its intention to invest USD 139 billion in infrastructure development and the expansion of disaster relief capabilities.
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