The US economy expanded at an annual pace of 3.9 percent in the first quarter of the year, sharply slower than earlier thought, new government data showed Friday. \nInflationary pressures were greater than had been believed, the Department of Commerce said. \nNevertheless, analysts said, the economy appeared strong enough to withstand a new era of rising interest rates to be ushered in next week by the Federal Reserve. \nUS economic growth braked from a 4.1-percent pace in the last quarter of last year, revised Commerce Department figures showed. \nPreviously, the data showed an acceleration to 4.4 percent growth. \n"It was a little weaker than expected but nothing too serious," said BMO Financial Group senior economist Sal Guatieri. \n"There still appears to be a lot of underlying strength in domestic demand," Guatieri said. \nThe news was released shortly before Federal Reserve chairman Alan Greenspan and fellow policymakers meet to raise key short-term rates for the first time in four years. \nThe Federal Open Market Committee is near certain to raise the federal funds target rate by a quarter of a percentage point, to 1.25 percent, when its next two-day meeting ends Wednesday. \nSuper-low interest rates have helped the economy shake off a series of shocks from the September 11 attacks to the Iraq war, stimulating activity in key areas of housing and big-ticket purchases such as cars. \nLatest data Friday showed housing still sizzling. \nExisting home sales leapt 2.6 percent from the previous month to a record seasonally adjusted annual rate of 6.80 million in May as people rushed to buy before rates go up, the National Association of Realtors (NAR) said. \nSales were up 15.8 percent from a year earlier. \n"Fundamentals are still very favorable for a vibrant market," said association chief economist David Lereah. \n"In part, the record results from a natural `fence-jumping' by buyers getting into the market after mortgage interest rates began to rise at a sharper clip in April," he said. \n"This may be the last peak in home sales for a while and existing-home sales are likely to be slower during the second half of the year. Even so, they will remain at strong levels and 2004 is on track to be a record." \nOn Thursday, government figures showed sales of new homes also hit a record last month, jumping by an 11-year record of 14.8 percent to hit an unprecedented annual rate of 1.37 million. \nNew home sales were up 25.3 percent from a year earlier. \nThe revised economic growth report showed inflationary pressures -- the arch foe of the Federal Reserve -- gaining strength. \nA measure of prices paid by consumers -- the so-called personal consumption expenditure index -- rose 3.2 percent in the quarter. \nThat was barely faster than the 3.1 percent increase in prices earlier estimated, but sharply up from the 1.0 percent consumer price inflation in the previous quarter. \nStripping out food and energy, core prices paid by consumers rose 2.0 percent, compared with an increase of 1.2 percent in the previous quarter. \n"It reinforces the expectations of a hike by the Fed," said Moody's Investors Service chief US economist John Lonski. \nThe Federal Reserve would keep on raising rates until monetary policy was less accommodative, he said. \nAmong the key revisions in the latest report: \nImports, which subtract from economic output, soared 10.4 percent, much faster than the earlier estimate of 5.9 percent growth. Imports had jumped 16.4 percent in the previous quarter. \nFinal sales, a guide to demand in the economy, increased 3.2 percent, slower than the 3.7 percent previously estimated. Final sales had surged 3.8 percent in the fourth quarter. \nBusiness investment rose 5.3 percent, a little slower than the 5.8 percent earlier estimated. In the previous quarter, investment had jumped 10.9 percent. \nConsumer spending increased 3.8 percent, barely changed from the earlier estimate of 3.9 percent growth and still substantially higher than the fourth-quarter growth of 3.2 percent.
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E Ink Holdings Inc (元太科技), the world’s sole supplier of e-paper displays for e-readers and shelf labels, posted its best quarterly net profit for the first quarter in nine years amid increased demand during a traditionally slow season. Net profit soared 80 percent to NT$787 million (US$26.23 million) in the quarter ended March 31, compared with NT$438 million a year earlier. That translated into earnings per share of NT$0.69, up from NT$0.39. E Ink posted lower royalty income of NT$371.23 million last quarter from NT$448.74 million a year earlier, a company financial statement showed. E Ink said that it expects royalty income to
DIVERSIFICATION: Although COVID-19 would push more companies to produce in emerging markets, DBS said that it was unlikely that firms would totally leave China Geopolitical tensions and supply disruptions are expected to accelerate the migration of manufacturing out of China, as concerns about the risk of production concentrated in one country increase, S&P Global Ratings said. Although its economic expansion might be weaker than previous levels due to the accelerated relocation of manufacturing, China’s economic growth would still be stronger than that of most other economies, the ratings agency said. “While absolute growth rates will moderate, we believe China’s economic performance will continue to be a key sovereign credit support,” S&P Global Ratings credit analyst Tan Kim Eng (陳錦榮) said in a statement on Thursday. “Its growth