Friday PM reads
- BOJ raises rate to 0.75% in first hike since January, the new rate is at highest level in around three decades. The yen has weakened to an intraday low since the BOJ delivered a widely expected rate hike. Unless Governor Ueda sends some hawkish signals at a media briefing later – which is unlikely – the currency may extend the drop further into the London session. BB
- TikTok is being bought by a group of buyers led by Oracle Corp, with the company and ByteDance signing binding agreements to create a US joint venture. The US joint venture will operate as an independent entity controlling data protection, content moderation, and algorithm security, with a new seven-member majority-American board of directors. The deal is expected to close on Jan 22, 2026, but Chinese regulators have yet to say whether they'll approve the transaction. BB
- China’s semiconductor manufacturers are upgrading their advanced chipmaking equipment in ways that bypass global export controls, as the country seeks to rival the US in developing artificial intelligence. According to people familiar with the matter, Chinese fabrication plants producing advanced smartphone and AI chips have bolstered the performance of advanced deep ultraviolet lithography (DUV) machines made by Netherlands-based ASML. US and Dutch export controls prevent ASML from supplying its most advanced DUV machines to China, leaving many Chinese fabs to rely on older equipment — notably the Twinscan NXT:1980i system — to manufacture the seven-nanometre chips needed to develop AI systems. In industry parlance, “nanometres” denotes successive generations of chip, rather than physical dimensions. According to those familiar with the techniques, Chinese fabs have obtained components on the secondary market. This includes an upgraded “stage”, a mechanical platform for the silicon wafer, as well as lenses and sensors that help ensure that chip layers are aligned with greater precision. These improvements to ASML’s DUVs have enabled Chinese fabs to bolster their AI chip production. FT
- Nike has reported weakening sales in China in quarterly results that unnerved investors as the company attempts to pull out of a slump. Shares of the US sports shoe and apparel maker fell by more than 10 per cent in after-market trading on Thursday in response to its financial report for the quarter ended November 30. The company is in what chief executive Elliott Hill described as the “middle innings of our comeback” from a downturn that began about two years ago. Hill, a Nike veteran, was recruited out of retirement last year to attempt a turnaround. Nike has lost ground to newer brands such as running shoe makers On and Hoka. Hill has emphasised winning back the loyalty of athletes as a foundation of future success. FT
- When the European Union increased tariffs on Chinese battery electric vehicles (EVs) in 2024, the logic was straightforward: raise prices and imports will fall. A study published by the Kiel Institute, a think-tank, estimated that higher levies would cause Chinese car exports to plunge by 25%. After more than a year, that forecast is wrong. According to China’s customs agency, car exports to Europe rose to nearly 1.2m in the 12 months to November, up by 26% from a year earlier (see chart 1). The data suggest that Europe’s failure to stem the rise of Chinese-made vehicles has less to do with weak tariffs than Chinese carmakers’ talent for steering around them. Rather than retreat, Chinese carmakers changed lanes, pivoting from EVs to hybrids, which combine electric motors with petrol engines. This shift is evident in the data. Whereas monthly Chinese EV sales to Europe have grown by 12% in the past year, exports of hybrids have surged by 155%, albeit from a low base (see chart 2). “It was only a matter of time before the Chinese manufacturers changed their strategy,” Beatrix Keim of Germany’s Centre for Automotive Research recently told Handelsblatt, a German newspaper. Hybrids are now the fastest-growing segment of China’s car exports, overtaking fully electric models. Eco