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FirstFT: China preps for permanent zero-Covid

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China is building hundreds of thousands of permanent coronavirus testing facilities and expanding quarantine centers in many of its largest cities as part of its zero-covid policy, despite the economic and human toll on the world’s most populous country.

Shanghai residents woke up yesterday to the announcement that lockdown measures and mass testing would be implemented for at least two days in the Minhang district, which is home to more than 2 million people. The directive was issued just a week after President Xi Jinping’s government declared victory in the city’s defense against the pandemic after serving a two-month sentence.

Severe restrictions in many cities have pushed the country to the brink of recession for the second time in three decades. But while measures have been relaxed in many areas, experts believe the government’s virus infrastructure program is designed to support mass testing and quarantine policies through 2023.

Yanzhong Huang, a senior fellow for Global Health at the Council for Foreign Relations think tank, said such measures demonstrate Beijing’s commitment to zero-Covid “despite the growing social, economic costs associated with this approach.”

“The government thinks they can avoid the virus. But we know that for the Omicron variant this is not realistic. And for an even more portable variant, that makes it even less feasible,” he said.

Share your feedback about this newsletter by emailing firstft@ft.com† Here’s the rest of the day’s news – Emily

The latest on the war in Ukraine

1. ECB takes aggressive turn to fight record high inflation ECB President Christine Lagarde yesterday announced plans to raise interest rates above zero in September for the first time in ten years. The ECB surprised markets by indicating that it was likely to raise interest rates by half a percentage point in September, in addition to a planned increase of a quarter point in July – a larger than expected increase.

2. State Street Clears Up Rumors of Credit Suisse Acquisition The US custodian bank denied it was in talks to acquire Credit Suisse, denying a report that it was pursuing the troubled Zurich lender. State Street on Wednesday had initially declined to comment on a Swiss blog report that it was preparing a bid, exacerbating sharp moves in the shares of both lenders.

3. Apple goes in-house for lending service Apple is making its biggest move into finance by offering loans directly to consumers for its new “buy now, pay later” product, and is taking on a role in its other lending services through banking partners such as Goldman Sachs.

4. Runs on Chinese local banks Thousands of desperate savers in China have been fighting for nearly two months to get their savings back after a bank run that has raised concerns about the financial health of the country’s smaller lenders. Analysts said an economic slowdown caused by President Xi Jinping’s zero-covid policy is also exacerbating the problem.

5. Iran removes 27 cameras from nuclear facilities Iran has warned the UN nuclear watchdog it is removing 27 cameras used to monitor nuclear activity from its facilities, in an escalation of the Islamic republic’s confrontation with the west.

the next day

Inflation figures China and the US will release data on the consumer price index on Friday. US stocks and government bonds fell Thursday ahead of release. China will also release producer price index figures. See how your country compares to rising prices with our inflation tracker.

Philippines Independence Day The country will have a public holiday on Sunday to commemorate the country’s independence from Spain in 1898.

G7 Science Ministers Meeting Officials will meet in Frankfurt on Sunday to discuss: opportunities to collaborate on the study of long-term Covid, carbon capture and removal and research “values,” said Bettina Stark-Watzinger, Germany’s minister of education and research. (Science matters)

Join us from June 16-17 for the FT Future of Finance, streamed live from the heart of The Next Web (TNW) technology festival. Register here

What else do we read

Singapore’s rich are chasing luxury cars despite inflation The price of food, energy and other necessities is rising worldwide. But in Singapore, the rich still want luxury cars. People in the city-state are paying the highest amount in decades alone for the right to own a premium car, official data showed on Wednesday.

The global race for supercomputing power From modeling climate change to developing products, the capabilities of machines are accelerating as the US, China and Japan push for computational speed. China, in particular, has shown explosive growth in supercomputing since the late 2000s.

The LME debacle raises serious questions for the City of London This episode threatens to undermine the Square Mile’s claim to level the playing field, writes Gillian Tett. LME’s reforms are sensible, albeit woefully late. But they may not be enough to restore confidence.

‘The product is dead. There is no more Spatter’ Rising interest rates, a weakening stock market and warnings of a regulatory crackdown have fueled disillusionment with a previous frenzy of deals for special corporate acquisitions. With some banks taking a much more cautious approach, the focus is beginning to shift to what the future holds for the once-popular asset class.

Who wants to own a hotel now? It’s still a grim time to be in the hospitality industry after strict lockdowns and international travel bans have reduced demand. But Sonesta, a little-known but fast-growing hotel company, thinks so cracked the code for travel after a pandemic


FT Weekend editor Alec Russell recently visited Athens to see 3,000 years of history – on a tight timeline: just three days. Here’s what was on his itinerary.

© Alamy

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