Ata mārie and welcome to your Tuesday summary of international business and political news.
We start with news that Nvidia will invest up to US$100 billion in OpenAI as the artificial intelligence firm aims to build data centres based around the chipmaker’s AI processors, CNBC reported.
OpenAI plans to build and deploy Nvidia systems that require 10 gigawatts of power. Nvidia chief executive Jensen Huang said 10 gigawatts was equal to between four million and five million graphics processing units.
“This is a giant project,” Huang said.
The first phase of the latest investment will come online in the second half of next year.
In the Middle East, Palestinians in East Jerusalem had mixed opinions about their future after several countries formally recognised a Palestinian state, CNN reported.
“It’s futile. On the ground, nothing is changing. It’s like they’re making a fool out of us. It has no benefit,” Kamal Abu Kweidar, a shopkeeper said.
“We hope that it will lead to something good, but it feels impossible.”
As Morning Brew reported yesterday, militant group Hamas said the Palestinian statehood recognition was an “important step” in affirming the Palestinian people’s right to their land and holy sites.
Meanwhile, Israel’s ground offensive in Gaza City shut two hospitals, according to officials, CNN reported.
The hospitals were forced to shut yesterday because of intense conflict. “There are no safe roads to all facilities and hospitals that enable patients and the wounded to reach them,” the Ministry of Health said.
Elsewhere, Hong Kong International Airport will halt flights starting Tuesday local time as the area braces for one of the strongest super typhoons in years, Bloomberg reported.
Cathay Pacific Airways said all flights arriving and departing from Hong Kong will be cancelled over about 36 hours, affecting more than 500 flights.
The carrier said it should have sufficient resources to resume operations once the storm clears.
In the US, the Federal Trade Commission’s trial against e-commerce giant Amazon starts this week over the company’s cancellation practices.
The lawsuit accuses Amazon of tricking millions of consumers into signing up for its Prime video subscription service through deceptive user interface designs and making it hard to cancel, CNN said.
“Specifically, Amazon used manipulative, coercive, or deceptive user-interface designs known as ‘dark patterns’ to trick consumers into enrolling in automatically renewing Prime subscriptions,” the FTC complaint said.
Staying in the US, Federal Reserve Bank of Cleveland President Beth Hammack said officials should be cautious about further interest rate cuts to avoid overstimulating the economy, Bloomberg reported.
Hammack noted signs of a robust labour market despite a recent slowdown in employment growth. She also said inflation may not return to the central bank’s 2% target for another couple of years.
“I think that we should be very cautious in removing monetary policy restriction,” Hammack said. “It worries me that if we remove that restriction from the economy, things could start overheating again.”
Last week, the Federal Reserve cut its key interest rate by 25 basis points and projected it will slash rates twice more this year.
Chair Jerome Powell said the next steps were not “incredibly obvious”, CNN reported last week.
“We have to live life looking through the windshield rather than the rearview mirror,” Powell said.
Federal Reserve chair Jerome Powell.
Over the Ditch, an Australian paper mill is suing the Victorian Government for more than A$400 million in damages amid accusations of not providing a steady supply of pulpwood, the ABC reported.
Paper Australia, trading as Opal, filed proceedings in the Supreme Court of Victoria, claiming the Government breached a contract to the Maryvale Mill.
The Maryvale Mill stopped white paper production two years ago but still produces other paper products in a smaller capacity.
In Europe, shares in sports car manufacturer Porsche slumped after it cut its profit outlook and delayed the launch of new electric models because of weak demand, CNBC reported.
“We are currently experiencing massive changes within the automotive environment. That's why we're realigning Porsche across the board,” chief executive Oliver Blume said.
“In doing so, we want to meet new market realities and changing customer demands, with fantastic products for our customers and robust financial results for our investors.”
As part of the new plan, existing combustion engine models will remain available for longer and the development of a new platform for EVs in the 2030s will be delayed.
