Indonesia: Holds interest rate as inflation risk increases
Indonesia’s central bank held interest rates to support growth as a government plan to raise fuel prices and electricity tariffs revives inflation risk. Governor Darmin Nasution and his board kept the reference rate at 5.75%, Bank Indonesia said in a statement in Jakarta yesterday. A plan to raise prices of subsidized fuel threatens to reignite cost pressure in Indonesia and limits the scope for easing after an unexpected cut in the last meeting. (Bloomberg)
South Korea: Holds rate for ninth month as growth slows
The Bank of Korea held off altering borrowing costs for a ninth straight month as policy makers balance the risks from Europe’s debt crisis against rising oil costs that add to price pressures. Governor Kim Choong Soo and his board kept the benchmark seven-day repurchase rate unchanged at 3.25%, the central bank said in a statement in Seoul yesterday. Rising oil prices are one of the biggest concerns for South Korea, Vice Finance Minister Shin Je Yoon said yesterday.(Bloomberg)
Brazil: Accelerates interest rate cuts amid lacklustre growth
Brazil’s central bank surprised analysts by accelerating the pace of interest rate cuts, bringing borrowing costs below 10% for only the second time amid signs of lackluster growth in Latin America’s biggest economy. In a split vote yesterday, policy makers led by bank President Alexandre Tombini cut the Selic rate by 75bps to 9.75%t. Two dissenting members voted to lower the rate by a half point for a fifth straight meeting. (Bloomberg)
Greece: Swap deadline passes as investors signal agreement
The Greek government’s deadline for the biggest sovereign restructuring in history passed with a majority of investors signaling their readiness to participate in the debt swap. The euro and stocks gained before the offer’s close at 10 p.m. in Athens yesterday as Greek Prime Minister Lucas Papademos told his Cabinet ministers that Greece had made “an appropriate framework with significant incentives” for bondholders. Finance Minister Evangelos Venizelos told Parliament that “a historic process will be completed last night,” and the results announced today. (Bloomberg)
US: Jobless claims rose 8,000 last week to 362,000
The number of Americans filing claims for jobless benefits rose to 362,000 last week, a level consistent with an improving labor market. Applications for unemployment insurance payments increased by 8,000 in the week ended 3 March, Labor Department figures showed today. Economists forecast 352,000 claims, according to the median estimate in a Bloomberg News survey. The average over the past four weeks held close to a four-year low. The rate of firings indicates companies have grown more comfortable with headcounts and could take on additional employees when demand picks up. (Bloomberg)
US: Consumer confidence in rises to highest in four years
Household confidence improved last week to a four-year high as more Americans said the economy was improving and decided it was a good time to shop. The Bloomberg Consumer Comfort Index was minus 36.7 in the period ended 4 March, the highest since April 2008, up from minus 38.8 in the prior period. The gauge on the state of the economy reached a one-year high, while the buying-climate measure climbed to a level last exceeded in December 2009. For a fifth straight week, half of those surveyed also rated their personal finances as positive, bolstered by a resilient stock market, faster job growth and rising wages.(Bloomberg)
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