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Piastri’s stance has knock-on effects for other teams

LONDON, Aug 10 (Reuters) – Oscar Piastri’s rift with Alpine has also forced a change of plan at Williams and could have a knock-on effect around the Formula One paddock.

While the main focus has been on Renault-owned Alpine and McLaren, who both want the 21-year-old Australian to drive for them next season, tail-enders Williams have had to reassess their next step.

Alpine’s original plan was to loan their reserve, and last year’s Formula Two champion, to Williams for at least a year and possibly more until he returned as Fernando Alonso’s replacement.

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The principle was the same as when Mercedes placed George Russell for three seasons at Williams to learn the ropes before bringing him back as team mate to seven-times world champion Lewis Hamilton.

Talks were so far advanced that the Australian had a seat fitting at Williams and a contract for 2023 was drawn up between the two teams, with Alpine having already agreed on Piastri’s salary.

Then Alonso decided to race for Aston Martin next year and Piastri, offered the Alpine seat, said no — with a McLaren deal apparently more tempting. read more

Piastri would have replaced Canadian Nicholas Latifi at Williams, the only driver on the starting grid who has yet to score a point in 13 races this season, alongside British-born Thai Alexander Albon.

Latifi brings sponsorship and could potentially retain the seat, with many of the potential replacements lacking such financial clout.

With Alpine currently fourth in the championship and Williams last, the seat spurned by Piastri is the most attractive.

If Alpine do not take McLaren’s soon-to-be-discarded Australian Daniel Ricciardo, then they may be in the same market as Williams.

One possibility who stands out is current Formula E champion and 2019 Formula Two title-holder Nyck de Vries, a Mercedes F1 reserve who has already taken part in Friday first practice with Williams.

De Vries, 27, is also looking for a seat for 2023, with Mercedes pulling out of Formula E after selling their championship-leading team to McLaren.

Williams have 21-year-old American Logan Sargeant on their books, with team boss Jost Capito saying last month that he saw the F2 driver as a prospect for the future, but it may be too early for him. read more

The future of Mick Schumacher, currently with Ferrari-powered Haas, has yet to be determined while China’s former Alpine academy driver Guanyu Zhou is having a solid first season at Alfa Romeo.

Alfa, run by Swiss-based Sauber with former Renault team boss Fred Vasseur at the helm, have 18-year-old French F2 prospect Theo Pourchaire on their books as a talent for the future.

Beyond that there are racers looking for a way back into Formula One and others, such as India’s Jehan Daruvala, hoping for a door to open from the junior series.

“I’ve had all sorts of people (calling),” Alpine principal Otmar Szafnauer told Reuters this week. “Some of the guys in the junior formulas, some of the Formula E guys. Maybe eight or 10.”

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Reporting by Alan Baldwin, editing by Christian Radnedge

Our Standards: The Thomson Reuters Trust Principles.

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Business

Global cenbanks lift rates by nearly 1,200 bps in July

Plastic letters arranged to read “Inflation” are placed on Chinese Yuan banknote in this illustration taken, June 12, 2022. REUTERS/Dado Ruvic/Illustration

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LONDON, Aug 3 (Reuters) – Major developed and emerging market central banks around the globe delivered nearly 1,200 basis points in interest rate hikes in July alone, ramping up their fight against multi-decade high inflation with Canada surprising markets with an outsized move.

Central banks overseeing five of the 10 most heavily traded currencies delivered 325 basis points of rate hikes between them last month. This brings the total volume of rate hikes since the start of the year across G10 central banks to 1,100 basis points.

However, July’s tally was less than the 350 basis points seven central banks delivered in June.

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“We’ve reached peak hawkishness of the central banks,” Christian Kopf, head of fixed income portfolio management at Union Investment, told Reuters.

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“Central banks have made it clear that they will not overdo it with the rate hikes,” Kopf said, adding that it was also the message conveyed by US Federal Reserve chair Jerome Powell.

July was dotted with some eye catching moves. Canada emerged as the chief hawk, stunning markets by delivering the first 100-basis-point rate increase among the world’s advanced economies in the current cycle, lifting its key policy rate to 1.5%.

New Zealand delivered its sixth straight interest rate rise and signaled it remained comfortable with its planned aggressive tightening path to restrain runaway inflation. read more

And then of course the big one: The Fed delivered its second straight 75-basis-point rate hike, reinforcing its commitment to contain red-hot inflation running at 40-year highs. read more

There was no let up for policymakers in emerging markets, where inflation had been on a tear for much longer than in developed economies.

Nine out of 18 central banks delivered 850 bps of rate hikes in July. In total, emerging market central banks have raised interest rates by 5,265 bps year-to-date – nearly double the 2,745 bps for the whole of 2021, calculations show.

“Emerging market central banks remain more worried about inflation than growth,” BofA’s David Hauner said in a recent note to clients.

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Hungary moved twice in July, jacking up its base rate by 300 basis points to 10.75% with borrowing costs into double-digit territory for the first time since late 2008 – and flagging more hikes ahead. read more

Colombia and Chile piled in with a 150 bps and 75 bps hike respectively, though emerging market uber-hawk Brazil, which has lifted rates to 13.25 bps already in June, took a breather.

However, emerging markets have also seen cuts with Russia reducing interest rates ratcheted up to 20% in the wake of its Feb. 24 invasion of Ukraine, which sparked sweeping sanctions. read more

Inflation pressures would remain a headache for policy makers, said Tobias Adrian, director at the Monetary and Capital Markets Department at the International Monetary Fund (IMF).

“The magnitude of the inflation has been a surprise to central banks and markets, and there remains substantial uncertainty about the outlook for inflation,” Adrian wrote in a blog on Monday.

“Inflation risks appear strongly tilted to the upside,” Adrian said, adding there was a substantial risk that price pressures were becoming entrenched and expectations unanchored.

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Reporting by Karin Strohecker and Vincent Flasseur in London, Additional reporting by Dhara Ranasinghe; Editing by Jacqueline Wong

Our Standards: The Thomson Reuters Trust Principles.

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