The Bank of Russia unexpectedly maintained its key interest rate at a record-high 21% , defying analysts’ expectations of another significant hike as inflation remains stubbornly elevated. The decision marks a shift toward a more measured approach in balancing economic growth and price stability. Key Details Inflation Concerns: Annual inflation climbed to 8.9% in November, well above the central bank’s 4% target , with inflation expectations reaching 13.9% in December. Policy Rationale: The central bank cited the significant tightening of monetary conditions after October’s 200-basis point hike as sufficient to resume disinflationary processes. Governor Elvira Nabiullina emphasized avoiding both economic overheating and severe slowdowns. Economic Overheating: Elevated government spending on the war in Ukraine and social programs, coupled with labor shortages and rising wages, have fueled strong domestic demand, exacerbating price pressures...
Italian premium brake maker Brembo has posted moderate gains in first-half core earnings and revenue, thanks to strong performance in its Asian markets and robust business from maintaining older vehicles. This has helped counter a generally weak outlook for the automotive sector.
Resilience Amidst Industry Contraction
The automotive market faced a contraction in the first part of the year, with several major automakers, including Stellantis, Porsche, and Mercedes, reporting lower earnings. The recovery remains uncertain for the months ahead.
"The market is really struggling, including in its premium segment," said Executive Chairman Matteo Tiraboschi in a post-earnings interview with Reuters. "With this background, increasing revenue and preserving profitability was an achievement."
Financial Highlights
- EBITDA Growth: Brembo's earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased by 2.1% to €351.4 million ($381 million) for the six months ending June 30.
- Revenue Increase: Revenue rose by 2.8%, surpassing €2 billion for the first time, driven by a 7.2% growth in China and a 21.1% growth in India.
- EBITDA Margin: The EBITDA margin remained stable at 17.5%, compared to 17.6% a year earlier.
Regional Performance
"Asia is a key area for us, with prolonged growth, mainly with China but not only with China," Tiraboschi said. "India is very important too, especially for the motorbike segment."
Aftermarket Business
The aftermarket business also supported Brembo's results. "Car sales going down mean fewer people changing their cars and more of them doing maintenance," Tiraboschi explained. "So the aftermarket is bringing benefits."
Clientele and Future Outlook
Brembo's clients include prominent automakers such as Tesla, BMW, and Chinese EV giant BYD. The Bergamo-based group has reiterated its full-year forecasts for moderate revenue growth and stable margins.
Market Reaction
Brembo's shares rose 3.8% by 1515 GMT, reversing earlier losses, reflecting investor confidence in the company's performance and outlook.
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