Korea: May raise rates even as global risks dim outlook
The Bank of Korea may increase its benchmark interest rate to damp price pressures even as the risk of faltering world growth dims the nation’s export outlook. 10 of 14 economists surveyed predict Governor Kim Choong Soo will raise the seven-day repurchase rate 0.25 percentage points to 2.5% tomorrow. The rest expect no change after July’s quarter-point increase from a record-low 2%, the first advance since the global financial crisis. (Bloomberg)
China: Slowdown in output growth will deepen, ministry says
China’s slowdown in industrial output growth will deepen after the smallest increase in 11 months in July, a government forecast showed. Production will gain about 10% in the second half of 2010 from a year earlier, the Ministry of Industry and Information Technology said at a briefing in Beijing. That compares with July’s 13.4% and the 17.6% average for the first half of the year. The August data is due next week. (Bloomberg)
Australia: Extends rate pause on global growth concern
Australia’s central bank extended its pause in raising interest rates “for the time being” as concern that the global economic recovery may falter trumped evidence of an accelerating expansion at home. Governor Glenn Stevens kept the overnight cash rate target at 4.5% for a fourth month, matching all 25 economists’ forecasts, a Reserve Bank of Australia statement showed in Adelaide. (Bloomberg)
Australia: Gillard keeps power by ceding ground to Australia independents
Julia Gillard held on to power as Australia’s first female prime minister after two independent lawmakers agreed to prop up a minority Labor Party government to resolve the country’s closest election in 70 years. Gillard was forced to negotiate power-sharing agreements with the Greens Party and three independents after losing her party’s overall majority in the 21 Aug election. (Bloomberg)
Japan: Shirakawa says BOJ ready to take action if needed, watching Yen
Bank of Japan Governor Masaaki Shirakawa said the central bank is ready to take more action and is watching the effect of the strong yen on the nation’s economy, after the bank kept borrowing costs and the size of its liquidity injections unchanged. Shirakawa’s remarks suggest the BOJ could implement further monetary stimulus if the Yen, which is approaching a 15-year high against the dollar, threatens to derail the nation’s export-led expansion. (Bloomberg)
Germany: Factory orders unexpectedly declined in July
German factory orders unexpectedly fell in July as demand in the Euro region weakened, indicating the recovery in Europe’s largest economy is losing momentum. Orders, adjusted for seasonal swings and inflation, declined 2.2% from June, when they surged a revised 3.6%, the Economy Ministry in Berlin said. (Bloomberg)
EU: Seeks stronger Euro management amid German doubts
European Union governments sought to strengthen the management of the Euro region as Germany warned that the economic rebound is slowing its push for stiffer sanctions on high-deficit countries. EU finance ministers weighed ideas for improving national budget management, monitoring countries at risk and imposing sanctions on rule-breakers, EU President Herman Van Rompuy said in a statement after leading a brainstorming session in Brussels. (Bloomberg)
US: Unemployment may rise to 10% on ‘feeble’ growth
The jobless rate in the US is likely to approach 10% in coming months as the economy fails to grow enough to employ people rejoining the labor force, economists said. Private payrolls climbed 67,000 in August, after a gain of 107,000 the previous month, and the unemployment rate rose to 9.6%, the Labor Department reported. (Bloomberg)
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