20100614 1018 Global Economic News.

China: Reaches basic agreement with Taiwan on tariff reductions
China and Taiwan said they reached a basic agreement on tariff reductions in a third round of talks to boost economic and trade relations. An agreement would lower tariffs on more than 200 items exported from China to Taiwan including car parts, petrochemicals and machinery. (Bloomberg)

China: Economic data challenges its yuan stance
China’s gain in retail sales, consumer prices and industrial production countered the government’s assessment that the recovery isn’t “solid” and put more pressure on policy makers to let the yuan rise. Inflation accelerated to an annual 3.1% pace in May, surpassing officials’ target for the full year, while retail sales gains quickened to 18.7% and industrial production jumped 16.5%.(Bloomberg)

China: May foreign investment rises for 10th month
Foreign direct investment in China rose for a 10th month in May, adding to a evidence that the nation is weathering the European debt crisis. Investment jumped 27.5% to USD8.1bn in May, more than the 23.2% median forecast of 4 economists surveyed earlier. (Bloomberg)

India: Factory output grows 17.6%, more than forecast
India’s industrial production grew 17.6% in April, strengthening the case for an interest rate increase even as Europe’s debt woes threaten the global economy. Output at factories, utilities and mines rose after gaining a revised 13.9% in March from a year earlier. (Bloomberg)

US: Inventories rose 0.4% in April as sales climbed 0.6%
Inventories in the US rose 0.4% in April, less than the gain in sales, putting companies in a better position to weather a slowdown in demand last month. The increase in the value of stockpiles was smaller than the median forecast of economists and followed a 0.7% advance in the prior month. Sales climbed 0.6%. (Bloomberg)

US: Geithner says China’s yuan peg hurts global recovery
Treasury Secretary Timothy F. Geithner said China’s exchange rate policy prevents a balanced global recovery and urged a stronger yuan to help contain inflation in the world’s third largest economy. China’s commerce ministry said hours later that the yuan’s peg to the dollar remains unchanged and the country’s policy was made clear to the US in talks last month. (Bloomberg)