The lowdown

Here’s what you missed while you were living your were out of pocket:

• 📉 Fed rate cut spooks markets, sparks selloff. The Federal Reserve cut rates by a quarter point but signaled slower easing ahead and raised its inflation outlook for 2025. Markets reacted sharply, with the Nasdaq dropping 3% and the Dow extending its longest losing streak in 50 years.

• 💳 Chime files for IPO, plans to go public in 2025. Digital-first banking platform Chime has confidentially filed for an IPO, aiming to capitalize on its 23 million customers and $1.3 billion in revenue from 2023. The company, once valued at $25 billion, is eyeing a revived IPO market with Morgan Stanley leading the charge.

• 💼 U.S. hits Nord Stream 2 pipeline with new sanctions. The latest sanctions aim to curb Russian energy exports, further straining geopolitical tensions in Europe.

Featured story

Brazil’s Real Faces Record Low Amid Economic Turmoil

The Brazilian real has plummeted to record lows, losing over 20% of its value this year to hit R$6.26 to the dollar, making it the worst-performing major currency of 2024. The sell-off has accelerated despite central bank interventions, and the Ibovespa stock index just experienced its steepest drop in two years. President Luiz Inácio Lula da Silva has resisted calls for deeper austerity measures, leaving markets worried about rising debt and a potential fiscal crisis.

Brazil’s central bank has raised interest rates to 12.25%, one of the highest globally, in an attempt to stem the panic. However, investors remain unconvinced, with bond yields spiking to levels not seen since 2016 and longer-dated swap rates taking a hit. Lula’s modest austerity measures have done little to calm fears, as the country grapples with a budget deficit equivalent to 10% of GDP—among the widest globally.

As Lula’s administration faces growing scrutiny from international investors, the question looms: can Brazil regain control of its finances, or is it headed for deeper economic instability?

The content we're consuming today

Here’s what we’re reading this week:

• Fortune: Sony is dropping $320 million for a stake in Kadokawa. The company is known for it’s blockbuster game Elden Ring.

• SmallBizTrends: TikTok is heading to the Supreme Court. The tech company is challenging a congressional ban that threatens its U.S. operations and millions of users.

• Business Insider: DoorDash has teamed up with Wing for drone deliveries. Look out below! Texans are spotting packages dropping from the sky near Dallas-Fort Worth.

Off-balance sheet items

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  Image Credit: Finway

The bottom line

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