The Korea Herald

Fed keeps policy on course

May 1, 2014

Shrugging off Q1 stall, U.S. central bank keeps tapering stimulus, says economy picking up
EU data fail to dispel deflation concerns

May 1, 2014

BRUSSELS (AFP) ― Eurozone inflation picked up in April but still fell short of forecasts against a background of concerns deflation could derail a very modest recovery, official data showed Wednesday.Consumer price inflation rose to a 0.7 percent rate in April, below analyst estimates for 0.8 percent while up from the 0.5 percent in March which was the lowest since October 2009.Analysts said the uptick in April was welcome but overall did little to calm nerves over the possible deflation threat.
48-hour tube strike forces Londoners overground

Apr 30, 2014

LONDON (AFP) ― Millions of Londoners were forced to walk, cycle or take packed buses to work on Tuesday as a 48-hour strike by Tube workers caused disruption across the capital.Services were operating on nine of the 11 Underground lines but at a much reduced frequency, causing queues outside stations and overcrowded trains at rush hour.More than 50 of the estimated 270 Tube stations were closed altogether, according to Transport for London, which runs public transport in the capital.An extra 266
GE offers $17 billion for Alstom

Apr 30, 2014

General Electric Co. made a 12.4 billion euro ($17 billion) offer for Alstom SA’s energy business to open up official negotiations and circumvent a potential counterbid from Siemens AG. Alstom’s board received a binding offer from Fairfield, Connecticut-based GE and has appointed a committee of independent directors to review the transaction by June 2, the two companies said Wednesday. If the review concludes positively, negotiations will then be on an exclusive basis, it said. Alstom gained as
BOJ keeps monetary policy on hold

Apr 30, 2014

TOKYO (AP) ― Japan’s central bank kept its ultra-loose monetary policy unchanged in a policy meeting Wednesday, despite data suggesting the economic recovery is weaker than expected. The Bank of Japan is still monitoring the impact of an April 1 tax hike that is expected to sap growth as consumers adjust to higher costs.But pressure for more action is building with signs the recovery is less robust than anticipated ahead of the tax hike.Prime Minister Shinzo Abe’s formula of strong government sp
S&P downgrades 15 European banks

Apr 30, 2014

Deutsche Bank AG, Germany’s largest lender, was among 15 European banks that had their outlooks cut to negative by Standard & Poor’s on the prospect that governments are less likely to provide aid. The outlooks were lowered from stable “to reflect our view that extraordinary government support is likely to diminish as regulators implement resolution frameworks,” the ratings firm said Tuesday in a statement. Financial overseers have been increasing regulations to limit a repeat of the bailouts th
Fischer gains support of Senate panel for Fed vice chairman

Apr 30, 2014

Stanley Fischer’s bid to be Federal Reserve vice chairman won support Tuesday from a Senate panel, sending the former Bank of Israel governor’s nomination to the full chamber for confirmation. The Senate Banking Committee approved Fischer in a voice vote. The panel also backed the nominations of Lael Brainard and Jerome Powell as Fed governors. Fischer, 70, would become Chair Janet Yellen’s top lieutenant as she presses on with tapering bond purchases that have expanded the Fed’s balance sheet t
IMF says Eastern Europe risks new funding shock on tapering

Apr 30, 2014

Eastern Europe’s vulnerability to sharp withdrawals of foreign capital has been heightened as the U.S. Federal Reserve scales back stimulus and the standoff over Ukraine escalates, the International Monetary Fund said. Developing nations in Europe are more exposed than other emerging markets to external funding risks, the IMF said in a report published Tuesday. Gross external liabilities, including foreign direct investment, cross-border lending and portfolio investments, were at about 90 percen
France meets Alstom bidders to protect jobs

Apr 29, 2014

PARIS (AFP) ― French President Francois Hollande vowed on Monday to safeguard jobs in takeover target Alstom, whose energy business is being eyed by U.S. giant General Electric and rival bidder Siemens.Germany meanwhile sought to boost Siemens’ case, saying a tie-up between the French and German giants offered a “big opportunity” for Europe’s two biggest economies.“The state will inevitably have a say” in the sale, Hollande declared, underscoring that the government placed several orders with Al
Driverless cars mastering city streets: Google

Apr 29, 2014

LOS ANGELES (AP) ― Google says that cars it is programming to drive themselves have started to master the navigation of city streets and the challenges they bring, from jaywalkers to weaving bicyclists ― a critical milestone for any commercially available self-driving car technology.Despite the progress over the past year, the cars have plenty of learning to do before 2017, when the Silicon Valley tech giant hopes to get “autonomous driving” technology to the public.None of the traditional autom
Slovakia signs deal to deliver gas to Ukraine

Apr 29, 2014

BRATISLAVA (AP) ― Slovakia signed a deal on Monday to deliver natural gas to Ukraine, which is facing the threat of a cut-off in supplies from Russia because of a massive debt.Under the agreement, Slovakia will send gas through a pipeline that was meant for transporting gas from Ukraine but is currently unused. To be able to send the gas, some technical changes are needed that might take several months.The signing of a memorandum of understanding between the Slovak pipeline operator Eustream and
China’s lending bubble a global threat

Apr 29, 2014

WASHINGTON (AP) ― Just as the global economy has all but recovered from debt-fueled crisis in the United States and Europe, economists have a new worry: China. They see a lending bubble there that threatens global growth unless Beijing defuses it. That’s the view that emerges from an Associated Press survey this month of 30 economists. Still, the economists remain optimistic that Beijing’s high-stakes drive to reform its economy ― the world’s second-largest ― will bolster Chinese banks, ease the
Energy giants’ ratings cut

Apr 29, 2014

The credit ratings for some of Russia’s largest energy and transportation companies were cut by Standard & Poor’s as sanctions against the Russian government over the Ukraine conflict threaten an already-weakened economy. Ratings for natural gas producer OAO Gazprom, oil explorer OAO Rosneft, pipeline operator OAO Transneft, power transmitter Federal Grid Co. and OAO Russian Railways and its JSC Federal Passenger subsidiary were lowered Monday, three days after the New York-based credit-rating s
U.S. economy returning to ‘old normal’: PIMCO

Apr 29, 2014

The “new normal” U.S. economy is starting to look more like a classic expansion. Signs of a quickening recovery are casting doubt on the notion that lasting stagnation has become the norm for the world’s largest economy, a view advanced by Pacific Investment Management Co.’s Bill Gross, Northwestern University’s Robert Gordon and former Treasury Secretary Lawrence Summers. Behind the improved outlook: Consumers spending more freely after working down their debts, less drag from government budget
Russia recession risk seen rising on sanctions: survey

Apr 29, 2014

Russia faces a fifty-fifty chance of recession, the highest since Bloomberg started to track the measure, as the crisis in Ukraine raises the risk of further sanctions, according to a survey of economists. The probability of a recession over the next 12 months rose to 50 percent, the highest since the first such Bloomberg survey in June 2012, according to the median estimate of eight economists surveyed before the U.S. and the European Union announced their latest salvo of sanctions Monday. The