According to Labour Department statistics, claims for unemployment compensations declined to 7-month low. Applications for jobless allowances slipped 5000 last week. On annual basis the jobless claims decreased by 628,000 in October. Decreased number of firings is a signal that companies are considering more employees cutting current employment rate at 9%.
On Thursday China's government disclosed details of testing program for new VAT in Shanghai aimed at boosting development in services sector. The VAT will also ease the pressure of tightening monetary policy on small firms. The new tax will come into effect in 1 January 2012 and it will replace current business tax for companies mainly involved in service industry.
According to Daily Telegraph, Germany is developing strategy how to stop UK referendum on overhaul of EU amid worries, British could disrupt Eurozone release package. German chancellor is expected to try to persuade Britain's premier David Cameron that UK does not need a poll on EU agreement changes. Nevertheless, representatives of Conservative party already are demanding to return more control rights to Britain.
Permal Group, the world leading hedge fund of funds, plans to increase investment in yuan assets. China's potential as profitable investment option is growing in the light of Europe's financial problems, fund official saidl. Despite anticipation of yuan decrease Permal strategy of exposure to yuan assets will prove to be viable as analysts predict that after slight fall yuan will appreciate by 30% in the
Mario Monti's government has won the confidence vote in parliament yesterday evening. He had 281 votes versus 25. Mario Monti's government strategy is to implement austerity measures in order to prevent debt crisis and boost economic growth. Today he faces vote in lower house. Meanwhile, students in many Italian cities organize protests against technocrats' government of Mario Monti.
Chinese banking regulator alerts lenders that several projects financed by local municipalities may experience problems with funding liquidity. Regulator also admitted that loans on real estate are expected to taint as sales decline. Last week China Banking Regulatory Commission advised banks to reduce high risk loans to local governments. In October property sales experienced drop of 25% compared to September.
Greenback declined against euro in Asia trading as global economic situation remains uncertain thus pushing investors' confidence down. The dollar index went down to 78.143 from 78.298. Australian dollar also suffers losses going below the US dollar first time since October as risk acceptance fell on the European woes.
At Association of Southeast Asian Nations summit Barack Obama and Indian PM discussed the prospects of further cooperation and Indian nuclear liability law. US consider new law too strict as it envisages operator of nuclear plant has a full legal responsibility in case of accident and US companies suppose the compensation sum may be enormous. New regulation makes US energy companies less competitive with French
On Thursday Occupy Wall Street protesters were attempting to interrupt the New York Stock Exchange. Nearly 1,000 activists sealed Financial District near Zuccotti Park and the NYSE to protest against income inequality. Police blocked streets by placing metal barricades and NYSE employees were required to show identification cards to enter. Despite demonstrations NYSE opened on time.
UBS AG the biggest bank in Switzerland said it will aim to reach return on equity between 12% and 17% starting from 2013. UBS AG also is planning to pay out cash dividends of 10 centimes per share. Bank is going to pay first dividends in five years and claimed that it is going shift more towards wealth management instead of investment banking. New CEO
Oil prices are again above USD 100 per barrel. Higher oil prices will lead to more expensive refined products - gasoline and heating oil. Prices for West Texas Intermediate crude oil were more than USD 102 barrel as traders were inspired by the news about new pipeline that will ease oil delivery.
US Labor Department today reported a decrease in jobless claims by 5,000 to 388,000 in the last week being seven-month low. Retail sales in US increased more than expected thus stimulating output. More output creates more demand for new employees. Decrease in layoffs might be a sign of US labor market recovery after severe downturn, said Omair Sharif, an economist at RBS Securities Inc.
Morgan Stanley reported today that gold futures are likely to be top gainer among all the commodities. As European turmoil continues investors tend to buy more yellow metal in order to save their wealth. There is a chance the gold price will set a historically high level in next years, said Peter Richardson, chief metals economist at Morgan Stanley Australia Ltd. Gold may achieve USD
Investments from US into China's economy continued to fall in October because of changes in manufacturing activity, increasing costs of labor in China and overall economic slowdown in US. However, overall October's FDI into China went up by 8.75% to USD 8.33 billion. Investments from the EU increased by 1.05%.
The perspectives for export in the next year are not optimistic, said Shen Danyang, spokesman of the Ministry of Commerce. Low demand of major China's export consumers and growing domestic production costs impact China's export-the major driver of economic growth. Exports increased only by 15.9% to USD 157.49 billion in October being the five-month lowest.
Spanish cost of borrowing hit 6.974% in November as compared to 5.433% in October. High unemployment and low growth rate undermined investors' confidence in country's ability to repay its debts. Continued worries about spreading Eurozone's debt crisis also impacted other economies. French short-term yields rose as well.
In US the Labor Department reported CPI went down by 0.1% in October. The rate of inflation slightly rose by 0.1% but it is the lowest monthly increase in 2011. The decline in CPI was mainly because of decrease of gasoline prices. Energy prices fell by 2.0% while food prices slightly increased by 0.1%. Lower CPI implies more cash for consumers thus more spending
The Office for National Statistics reported increase in UK retail sales by 0.6% contradicting to analysts' forecast of sales decline. Sales volumes grew by 5.3% in small shops being seven- year high increase. Analysts claim that increase was mainly due to higher demand in pre-Christmas time and aggressive price promotions.
New China's West-to-East pipeline is planned to be opened in the end of 2013. It will carry more than 30 billion cubic meters of natural gas annually and will decrease China's energy pressure. The National Development and Reform Commission reported the yearly increase in natural gas imports is 86.5%. About a half of necessary amount of natural gas China imports from Central Asia that will
Britain benchmark stock index dropped after Fitch Ratings announcement that US banks may be impacted by Eurozone debt crisis. The FTSE index fell by 1.1% in early trading. UK bank shares slipped; Lloyds Banking Group went down by 3.5%5 and Royal Bank of Scotland lost 2.4%. Other stock markets in Europe also decreased.
The People's Bank of China announced continuation of its prudent monetary policy aimed at slowing down exorbitant GDP growth and decreasing inflation rate. GDP in Q3 grew only by 9.1% as compared to more than 10% in previous years. CPI also went up only by 5.5% being the lowest since May. At the same the bank is ready to fine tune its monetary policy
In October consumer confidence in UK dropped reaching a 7-years low on citizens' concerns regarding surge in employment and deepening Euro debt crisis. The sentiment index fell 9 points reaching 36, the least since 2004. Consumer expectation measure lost 14 points to 48, a new record low. According to BOE Governor, Mervyn King, the downward pressure on sentiment index arises from weakened outlook for UK
Arab League announced it gives Syria's government 3 days to stop violence against protestors and accept international observers. If Syria resists, Arab League is going to implement economic sanctions. Arab League's proposal comes amid increasing global pressure on Syria's President Bashar al Assad to resign. Syria already has been excluded from Arab League's meetings until it removes tanks from towns and discharge arrested demonstrators.
In September China enhanced its long-maturity Treasury holdings as European debt crisis stimulated demand for safe foreign assets. According to Treasury statistics, the world's second largest economy purchased US notes and government bonds worth $20.7 bn boosting total long-maturity holdings to $1.14 trillion. The increase followed Federal Reserve decision to reduce borrowing fees by extending its bond portfolio's maturity.