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The London Inter-bank Offered Rate (LIBOR) is an interest rate benchmark that is used to set the interest rate on hundreds of trillions of dollars in debt around the world. The LIBOR rates are set via a consensus mechanism whereby the world’s leading banks submit the interest rate at which they believe they could borrow funds from another bank. The LIBOR rate is set for seven different maturities, ranging from one week to one year, with the most commonly quoted rate being the three-month U.S. dollar rate, which is known as the “current LIBOR rate”.

This consensus mechanism, which relied on honest responses from major banks, created major issues in the mid to late 2000s. In 2008, the LIBOR rate surged compared to less frequently used borrowing rates, which in turn sparked investor concern over a worsening global economy. A subsequent investigation into the surge determined that member banks were colluding to manipulate interest rates so that traders these banks could cash in on derivative positions that used the LIBOR rate as the underlying. Investigators furthered determined that this fraud had been occurring since at least 2005 and potentially as far back as 1991.

In the fallout of this scandal, regulators in the US and UK levied approximately $9 billion in fines on the banks involved and several individual traders were sent to prison. Additionally, supervision of LIBOR was transferred to UK regulators, however, this supervision is expected to expire at the end of 2021 at which time the global finance industry is expected to adopt a new benchmark.

Currently, the secured overnight financing rate (SOFR), a new borrowing benchmark designed by the Federal Reserve Bank of New York, is the leading candidate to replace LIBOR. The SOFR has been under scrutiny recently on account of its volatility. One of the key components of the SOFR is the ‘Repo Rate’, which is the rate that the central bank lends money overnight to commercial banks. The repo rate tends to be volatile around the end of months, quarters, and years, which is, in turn, creating volatility in the SOFR.

Low volatility was one of the biggest strengths of the LIBOR and if the SOFR continues to show volatility at period ends it may never take center stage as the most widely recognized debt benchmark in the world.

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The beauty industry is constantly changing, adapting to new consumer wants and developing innovative products. Demands in the industry are very volatile, affected by many factors on a daily basis. Below are some current trends:

Green Beauty: There has been a big emphasis on sustainability, both the packaging aspect and the ingredients used. Customers are demanding environment-friendly and recyclable packagings.  In addition, product ingredients have been in the spotlight as well. L'Oréal, a French personal care company, aims to reduce water as an ingredient used by 60% in the near future. The British-Dutch company, Unilever, has the same goal of lowering water-usage. In the upcoming years, expect to see more "dry" and solid products.

Inclusiveness: In the past several years, the beauty industry has moved towards more diversity and inclusiveness, both in marketing and the product itself. Advertisements are featuring people of all ethnicity, skin tones, and age. Makeup products like foundations are constantly expanding their shade range and undertones. Companies have also incorporated male makeup artists and celebrities in their campaigns in addition to developing male personal care items.

Customization: In today's data-driven world, companies have begun to analyze the individual needs of customers and creating products tailored to individual concerns and needs. Many new startups are allowing users to customize beauty products like shampoos, masks, and even skincare. With a few clicks of a mouse, customers become the designer of their own products.

Some of these trends have always been a part of the industry, and others are just being introduced to the world. Regardless of their history, these trends will all leave their footsteps and impact the industry in meaningful ways. Companies should be on the lookout for potential trends and be equipped with innovative thinkers and marketers.

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As climate change increasingly becomes a bigger issue, investors and companies are looking for ways to minimize their environmental impact with regards to greenhouse-gas emissions. Investors such as Aviva Investors and Aegon Asset Management are encouraging restaurants and food companies to reduce their carbon footprint and redefine their supply chain to be more environmentally friendly. Especially in the United States, this is a controversial period for this issue. Analysts are expecting climate change to be a key issue in the United States 2020 presidential election. It will be a tough negotiating point between all parties involved.

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Did you know that Venezuela’s inflation rate has reached a peak of 254%? Or that Andorra’s literacy rate for ages 15 and above is 100%? The Interactive Rankings page on globalEDGE is a tool that ranks countries or states according to the economy, trade and investment, energy, health, and government sectors. It has countless data on useful information that can be beneficial for students, professors, and professionals. Check out the links below to find out which country has the highest unemployment rate and which states have the highest high school graduation rates in the United States.

Unemployment Rate Rankings

High School Graduation Rankings

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Transportation has long been one of the most essential and transformative processes in society.  Today, e-commerce, fast-paced business environments, and a focus on improving logistics thrust transportation into the spotlight as a necessary day-to-day operation and the main form in which these actions are carried out is automation.  Cars have a wide variety of human uses, from picking up children from school, to moving perishable goods across land, to clearing snowy roads efficiently.  Because of this, the automotive industry continues to be one of the largest and most talked about markets on Earth.

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This past week, the Midwest United States was swept by a deadly winter storm. With wind chills, some areas' temperature reached a staggering negative 60 degrees Fahrenheit. Extreme weather, like this storm, impedes many industries and processes, creating inconveniences and delays. In response to weather, many factors change including demand, production, and delivery. As a result, the supply chains of numerous companies have been impacted in a negative way.

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This Sunday the New England Patriots will be facing the Los Angeles Rams in Superbowl LIII in Atlanta, GA. For the uninitiated, the Superbowl is the championship game of the National Football League (NFL), which is the highest level of professional American football in the United States. In addition to being the biggest day of the year for die-hard football fans, the Superbowl is also a peak time for advertisers around the globe.

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The globalEDGE team recently updated all of the country risk assessments, which can be found on our Country Insights pages. Using data provided by Coface, the country risk assessment pages display an index rating for each countries overall risk and business environment. In addition to these indices, strengths, weaknesses, and current trends that impact risk profile are presented for every country. Check out these updated pages today to see how every country's risk profile has changed over the past year.

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