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Asian shares slip on Fed officials’ hawkish policy stance

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Asian shares took a beating on Friday after a fresh salvo of hawkish remarks from Federal Reserve officials solidified expectations that U.S. interest rates could rise as soon as March, leaving markets braced for tighter monetary conditions.

Fed Governor Lael Brainard became the latest and most senior U.S. central banker on Thursday to signal that rates will rise in March to combat inflation.

Equity markets turned deeply red, with MSCI’s broadest index of Asia-Pacific shares outside Japan shedding 0.9 percent in mid-afternoon trade, while Australia lost 1.1 percent and Japan’s Nikkei gave up 1.3 percent.

South Korean shares dropped 1.4 percent after the country’s central bank raised its benchmark rate 25 basis points to 1.25 percent on Friday, as expected, taking it back to where it was before the pandemic as it seeks to restrain consumer price rises.

China’s blue-chip index declined 0.5 percent and Hong Kong’s Hang Seng index was off 0.9 percent.

“Everyone is really nervous right now. It’s because everything is potentially going to come under pressure from aggressive Fed policy,” said Kyle Rodda, a market analyst at IG in Melbourne.

“There’s the hope that it’ll be a slow and painless handoff to normal policy,” he added. “But that’s not necessarily assured with the Fed taking inflation so seriously.”

Fed Governor Christopher Waller, who has repeatedly called for a more aggressive response to high inflation, later on Thursday said a rapid-fire series of four or five U.S. rate hikes could be warranted if inflation doesn’t recede.

U.S. inflation as measured by the consumer price index surged 7.0 percent in December, posting its biggest year-on-year increase in nearly four decades, data on Wednesday showed.

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In the bond market, yields on 10-year U.S. Treasury notes were at 1.720 percent, settling well off Monday’s two-year highs, signaling investors’ preference for the safety of government debt over volatile technology and growth stocks.

A Reuters report that Bank of Japan policymakers are debating how soon they can start an eventual interest rate hike helped drive up the yen and Japanese government bond (JGB) yields.

The five-year JGB yield hit -0.015 percent, its highest since January 2016, when the BOJ adopted negative rates.

The yen, which traditionally has drawn demand from flights to safety, last traded at 113.70 after hitting its strongest against the greenback in 3-1/2 weeks.

Separate data showed Japan’s wholesale inflation rose 8.5 percent year-on-year in December, accelerating at the second fastest pace on record, a sign higher raw material and fuel costs are squeezing corporate margins.

IG’s Rodda said markets were facing a more persistent risk of growing demand for safe-havens, especially around key events involving U.S. central bank policy and U.S. data.

“This is a problem because every asset has arguably been inflated by loose monetary policy,” he added.

“Every asset will have to correct to reflect higher or tighter monetary policy.”

The dollar index was down 0.1 percent at 94.638 after hitting a two-month low, pushed down by strength in the euro, which made a new two-month high at $1.1482.

In commodity markets, gold was 0.3 percent firmer at $1,827 an ounce but still below its January peak at $1,831.

Oil futures remained soft on expectations that Washington may soon act to cool prices that remain above $80 per barrel, while movement curbs in China to rein in COVID-19 outbreaks weighed on fuel demand. [O/R]

Brent was nearly flat at $84.49 a barrel, while U.S. crude lost 18 cents to $81.95.

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OneWeb, Hughes to provide satellite broadband connections in India

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Satellite communication companies, OneWeb and Hughes, offered high-speed, low Earth orbit (LEO) satellite broadband connectivity across India.  

The agreement between OneWeb and Hughes Communications India Private Ltd. (HCIPL), a joint venture between Hughes and Bharti Airtel Limited, follows the Memorandum of Understanding (MoU) signed by the companies in September 2021.  

“OneWeb’s constellation will cover the length and breadth of India, from Ladakh to Kanyakumari and from Gujarat to the Northeast and bring secure solutions to enterprises, governments, telcos, airline companies, and maritime customers,” said Neil Masterson, CEO, OneWeb.  

Through its parent company EchoStar, Hughes is a well-established and supportive OneWeb shareholder. It is also an ecosystem partner to OneWeb, creating gateway electronics – including those in Gujarat and Tamil Nadu – and the core module that will power every user terminal for the system.  

The main contractor also agrees with the U.S. Air Force Research Lab to integrate and demonstrate managed LEO SATCOM using OneWeb capacity in the Arctic region.  

“This announcement marks a turning point for Digital India. Enterprise and government customers, including telecom service providers, banks, factories, schools, defense organizations, domestic airlines, and offshore vessel operators,” Partho Banerjee, president and managing director, HCIPL, said.  

“They are eagerly anticipating the arrival of new high performing satcom services. We look forward to bringing them high-speed, low-latency services from HCIPL using OneWeb capacity—and catapulting India to the cutting edge of connectivity,” he added.  

Neil Masterson, CEO, OneWeb, commented: “OneWeb is delighted to partner with Hughes to offer high-speed, low-latency satellite broadband solutions and contribute to the Digital India vision. OneWeb’s constellation will cover the length and breadth of India, from Ladakh to Kanyakumari, from Gujarat to the Northeast, and bring secure solutions to enterprises, governments, telcos, airline companies, and maritime customers. OneWeb will invest in setting up enabling infrastructure such as Gateways and PoPs in India to light up the services.”  

OneWeb’s latest satellite launch on 27 December 2021 brought its total in-orbit satellites to 394, over 60 percent of the planned 648 LEO satellite fleet.  

It plans to begin global service by the end of 2022 as demand continues from telecommunications providers, aviation and maritime markets, ISPs, and governments worldwide for its low-latency, high-speed connectivity services. 

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Yemen’s internet service returns after four-day outage following air strike

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Internet services were largely restored in Yemen on Tuesday, residents said, after a four-day outage https://www.reuters.com/world/middle-east/yemenis-struggle-without-internet-third-day-after-air-strikes-2022-01-23 following air strikes by a Saudi-led coalition on the Red Sea city of Hodeidah, which damaged telecoms infrastructure.

The Iran-aligned Houthi group’s deputy foreign minister, Hussein al-Ezzi, in a Twitter post praised efforts to repair the damage and restore services.

“To all friends and loved ones: We missed you,” he said.

Internet blockage observatory NetBlocks said at 1000 p.m. GMT Monday that services were starting to be restored.

Seven years of conflict have divided Yemen between an internationally recognised government based in the southern city of Aden, and the Houthi group that largely controls the north.

The coalition had said its strikes on Friday were aimed at Houthi military capabilities in Hodeidah, the main landing point for the country’s undersea web connection.

The outage hindered money transfers by Yemenis outside the country. The war and ensuing economic collapse has pushed millions into poverty and parts of Yemen to the brink of famine.

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Thailand to introduce data center campus by Etix

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A new data center is expected to be rolled out by IT service management company ETIX Everywhere, which has acquired a 67 percent interest in Genesis data center in Bang Chalong, 30 km from Bangkok’s historical center.   

This data center will create a new data center campus, which will be jointly developed with its local partner Interlink Telecom.  

As such, Louis Blanchot, Group CEO ETIX Everywhere, said: “We are very excited to announce our expansion into Asia starting with this acquisition in Bangkok, one of the most dynamic markets in the zone. This first step in Asia is a major milestone in ETIX’s strategy to support our global customers providing them our best-in-class colocation services wherever they need”.  

According to a press release, the Genesis data center – renamed ETIX Bangkok #1 – began working with 2.4 MW of IT power. The future development of the campus will offer significant additional capacity.   

In addition, this data center campus is the first of its kind in the market, offering such a high level of severance with four diverse routes for fiber access and power supply coming from two separate substations.  

On his part, Nuttanai Anuntarumporn, CEO of Interlink Telecom PLC, said: “We are very pleased to have a strong partner like ETIX Everywhere with experience in this industry. We believe that our partnership will support the booming Southeast Asia data center and cloud industry and lead us to common success.”  

Thailand has a large population, and remarkable internet penetration is an important growth market for the public cloud and OTT service providers.  

They need to bring their data as close as possible to the end-users to deliver better service, driving demand for colocation services.  

“Telehouse Bangkok will be the first data center of its kind in Bangkok and will come at a time when we expect the data center market in the country to see robust growth owing to the boom in the digital economy,” said Kenichi Miyashita, managing director, Telehouse Thailand.   

“It aims to provide the best environment for all the Internet-related customers, such as cloud service providers, content providers, telecoms and ISPs, to connect with one another with minimal latency.”  

The company, established in 1988 and owned by Japanese telco KDDI, has operations in 15 cities globally, including the U.S., UK, France, Germany, China, Singapore, Vietnam, and Japan. 

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