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1. US hotel industry eagerly awaits interest rates cuts
The U.S. Federal Reserve is expected to start a series of gradual cuts to interest rates at its meeting this week, reports Hotel News Now’s Bryan Wroten, who added that while the markets likely are already taking cuts as a given, “it remains to be seen exactly how many and by how much.”
Aran Ryan, director of industry studies at Tourism Economics, a division of Oxford Economics, said he expects the Fed to cut interest rates by 25 basis points this week and continue with these cuts at every other meeting through 2025.
“The baseline forecast anticipates two cuts by the end of 2024, taking the rate down from 5.38% to 4.88%, with additional cuts amounting to 100 basis points by the end of 2025,” he said.
2. Russia raises interest rates for second consecutive time
Russia’s central bank has raised interest rates for the second consecutive time as worries mount of steadily growing inflation resulting from being in its third year of its invasion of Ukraine. The Wall Street Journal reports that the central bank wanted to “tame a pickup in inflation driven by the diversion of manpower and other resources to sustain the country’s conflict with Ukraine."
The Bank of Russia raised its key interest rate on Sept. 13 from 18% to 19%, which the WSJ added is “well above its mid-2023 low of 7.5% and close to the peak of 20% that immediately followed the February 2022 invasion of neighboring Ukraine.”
The bank said it would not rule out increasing the rate at its next meeting.
3. PwC suspended from China, accused of property giant Evergrande 'cover-up'
PwC, one of the world’s largest business advisory and audit firms, has been suspended from working in China for six months, with Chinese authorities alleging the company “helped cover up fraud” in relation to bankrupted hotel and real estate developer Evergrande, the BBC reports. It was also fined $62 million by the Chinese Ministry of Finance.
The BBC said the Chinese authorities said PwC had “seriously eroded the basis of law and good faith and damaged investors’ interest” and that in response, PwC said “it had taken a number of accountability and remedial actions," which included firing six partners and fining the responsible team leaders.
Several Chinese developers and property owners have suffered from a challenging economic environment of late, including Country Garden in the first half of last year, which reported a reported a loss of almost 51.5 billion yuan ($7.23 billion). In September 2023, several Evergrande executives were arrested by Chinese authorities over failure to pay investors.
4. Agatha Christie hotel ends sale plans following refinancing
A 25-room hotel in near Plymouth in Devon, England, that has associations with two novels by famed crime author Agatha Christie has ended its planned sale following a successful refinancing, according to The Telegraph. The property, Burgh Island Hotel — which can be accessed on foot only at low tide — was on the market for £15 million ($19.7 million).
Christie wrote parts of two novels, “Evil Under the Sun” and “And Then There Were None,” at the hotel. An article by newspaper Plymouth Herald in April said the hotel had “debts of more than £130 million.” The Telegraph added the owner “now plans to invest in the hotel after refinancing £5.4 million ($7.1 million) worth of loans and securing additional funding.”
5. Oberoi Hotels family legal case reaches Delhi high court
The family of Prithvi Raj Singh, former executive chairman of holding companies, EIH Ltd. and EIH Associated Hotels, the parent company of Oberoi Hotels & Resorts, have taken a dispute over his will and control of the hotel empire to the high court in India, which last week passed an interim order prohibiting the EIH companies from transferring shares, according to the Times of India. Prithvi Raj Singh died in November 2023 at the age of 94.
One side of the family has alleged that the other side were trying to stop the execution of their father's will in conspiracy with executors appointed by their father. There also is the issue of the entitlement and ownership of shares.