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Local government authorities in China’s Sichuan province have issued a notice, seeking to “ban” crypto mining activities in the region.The post Local Chinese government seeks to 'ban' crypto mining activities, sources say it doesn't mean much appeared first on The Block.

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Top news and what to watch in the markets on Friday, May 22, 2020.

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(Bloomberg) — Speculation that the U.K. could be the next major nation with negative interest rates is hurting the pound and driving a record rally in the country’s haven bonds.Sterling tumbled against a stronger dollar and gilt yields touched fresh all-time lows after Bank of England Deputy Governor Dave Ramsden became the latest policy maker to signal that interest rates below 0% could be a possibility. Traders in money markets are betting the U.K. could see sub-zero interest rates by year-end.Ramsden’s comments “are broadly in line with other Monetary Policy Committee members this week which have signaled that the BOE is giving serious consideration to putting in place negative rates,” said Lee Hardman, a foreign-exchange strategist at MUFG. “I don’t think it would surprising to see the pound fall back towards the March lows if negative rates were put in place.”The pound slid 0.4% to $1.2176, taking its losses this quarter to 1.9%, making it the worst performer among Group-of-10 major peers. It fell to a 35-year low of $1.1412 in March as London, the world’s largest foreign-exchange trading hub, headed for a lockdown as the coronavirus spread.Data out Friday showed a record U.K. budget deficit of 62.1 billion pounds ($76 billion) in April. Retail sales data collapsed by almost a fifth in the same month.The BOE’s forecasts expect an economic contraction of 14% this year. The pound is also being weighed down by a lack of progress on Brexit trade talks, which could see a so-called cliff-edge exit from a transitional period with the European Union at the end of the year.BOE Governor Andrew Bailey hinted at his own change of heart on negative rates when giving testimony to parliamentary lawmakers earlier this week. That took two-year gilt yields, which are most sensitive to interest-rate expectations, to a record low below 0%.The yields fell further Friday in the wake of Ramsden’s comments to a new record at -0.07%, down by as many as three basis points. While the U.K. is boosting debt supply to fund its crisis response, the BOE is soaking up much of that through its asset-purchase program, leading investors to keep buying gilts.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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(Bloomberg) — Deutsche Lufthansa AG is close to a multibillion euro bailout deal that would see the state become its biggest shareholder after the coronavirus punctured a decades-long boom in air travel.The shares gained as much as 8.3% Thursday after Europe’s largest carrier confirmed it’s in advanced talks with Germany’s WSF Economic Stabilization Fund for as much as 9 billion euros ($9.9 billion) in aid. The package would include a 3 billion-euro loan, a so-called silent participation and a 20% direct stake through the sale of new shares, Lufthansa said.The government would also receive a convertible bond equivalent to 5% plus one share. Under German law, the 25% plus one share total stake would enable the state to block motions at annual general meetings, giving it a veto over hostile takeover attempts.“A decision can be expected shortly,” German Chancellor Angela Merkel said late Wednesday in Berlin, adding that “intensive talks” were ongoing with the company and the European Commission, which would need to approve a deal.If agreed, the compromise deal would bring the curtain down on weeks of tense negotiations between the company and state officials. At issue was the question of how involved the state should be in the affairs of a company that’s long been a symbol of German industrial might and its identity as exporter to the world. Like other airlines across the globe, Lufthansa has been battered by a near-halt to air travel that’s ruined the finances of previously healthy carriers and forced them to seek state bailouts.Under the plan, Germany would also receive two seats on Lufthansa’s supervisory board. The company didn’t say whether these would be political or independent figures, a matter under discussion in negotiations.The seats should be occupied by experts who won’t influence business decisions, said Carsten Linnemann, a legislator in Merkel’s CDU-led conservative caucus group. “The goal is an early exit of the state, so that Lufthansa will be able to stand on its own feet again.”Lufthansa advanced 5.6% to 8.36 euros as of 1:43 p.m. Thursday in Frankfurt. The stock has lost about half its value this year.EU DecisionAn accord could be completed rapidly once the European Commission grants its approval.The commission declined to comment Thursday on specific cases. It said in an email that it’s aware of the difficulties in the aviation sector and European Union state-aid rules “enable member states to support companies affected by the outbreak.”It would also set the scene for a dramatic extraordinary general meeting at which shareholders would vote on whether to accept a package that would dilute their own stakes.Lufthansa would issue the shares to the government for the nominal price of 2.56 euros, a steep discount that would allow the state to profit from any upside to the price. The parties are also discussing a capital-cut option that would see Lufthansa issue shares below that price, the statement said.Lufthansa units in Switzerland, Austria and Belgium, stand to receive some 2 billion euros in additional funds from those countries. The Swiss deal totaling 1.28 billion francs ($1.3 billion) is in place, while the Austrian and Belgian ageements are likely to follow Germany’s.Grand CompromiseFinal details of the German deal are still being worked out, according to a government spokeswoman.The contours of a deal come after the airline warned in a letter that cash reserves continued to shrink while it negotiates the rescue package. Lufthansa’s board said it hoped the government would find the “political will” for a deal that would keep the carrier competitive against international airlines.The German government and Lufthansa have been locked in intense negotiations for weeks over the rescue plan. While the Economy Ministry and Finance Ministry internally agreed on taking a stake of 25% plus one share, the company had opposed the move, people familiar with the matter said earlier.Lufthansa executives had raised concerns that the terms on offer would hamstring it against international competitors who’ve received less stringent bailout conditions, a point the management board repeated in the letter to employees.Christian Democrats had also voiced concern that the running of Lufthansa risks becoming politicized. The party is trying to prevent Ulrich Nussbaum, the deputy to Economy Minister Peter Altmaier, from taking one of the board seats. They feel Nussbaum betrayed his boss by forcing his own agenda in the talks.“The two seats in the supervisory board must now be occupied by experts, who will aim for the economic recovery of Lufthansa and who won’t follow a political agenda,” CDU legislator Linnemann said.Lufthansa is burning through 800 million euros each month after the coronavirus grounded most of its fleet. Chief Executive Officer Carsten Spohr said on May 5 that the company had about 4 billion euros in cash remaining.(Updates with legislator, European Commission comment from seventh paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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A pile of problems.

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