JAPAN
Prices down for 23rd month
Consumer prices last month went south for the 23rd straight month as deflation kept its hold on the world’s No. 3 economy, the government said yesterday. However, the pace of decline slowed for the fourth consecutive month because of the recent upward march of food and fuel prices worldwide. The core consumer price index (CPI), which excludes fresh food, slipped 0.2 percent from a year earlier, the government said. The result is a tad better than Kyodo news agency’s average market forecast of a 0.3 percent fall. The preliminary core CPI for the Tokyo area — considered an indicator of broader price trends for the country — fell 0.4 percent.
BANKING
Russia raises key rate
The Russian central bank yesterday said it was raising its main refinancing rate 0.25 basis points to 8 percent, its first hike in interest rates since the economic crisis in 2008. The Bank of Russia said in a statement that the rate hike, effective from Monday, was needed given expectations of higher domestic inflation and soaring global oil prices. “The decision was taken due to continued high inflation expectations and to create the conditions for the inflow of capital into Russia against the background of high oil prices,” it said in a statement.
INSURANCE
AIA net profit surges 50%
Asian insurance giant AIA yesterday said its net profit last year soared more than 50 percent to US$2.7 billion, several months after the firm raised US$20.5 billion in a massive Hong Kong share sale. New business growth, along with currency and investment gains, propelled the pan-Asian insurer’s results for the fiscal year ended Nov. 30 to 54 percent above its US$1.8 billion net profit in 2009, the company said. On Thursday, parent American International Group reported a net profit of US$7.8 billion last year, largely aided by asset sales, including the AIA offering, after reporting an almost US$11 billion net loss in 2009.
ELECTRONICS
NEC, Tianma team up
Japanese electronics maker NEC yesterday said it would form an LCD joint venture with China’s Tianma Micro-Electronics (天馬微電子). It will sell a 70 percent stake in its NEC LCD Technologies to the Avic International Group (中國航空工業國際控股) that owns LCD panel maker Tianma. The NEC subsidiary, based in Kawasaki near Tokyo, will be renamed and launched as a tie-up in July. NEC later yesterday revised down its earnings forecast for fiscal 2010, which ends in March, saying it now expects no net income as opposed to the ¥15 billion (US$183 million) expected earlier.
TELECOMS
Margins under pressure
Deutsche Telekom expects stagnant earnings this year as it joined the league of major European telecoms operators struggling to defend their dominance on their home turf. “We have battled through the headwind caused by the economic environment, special taxes in several countries and stiff competition,” chief executive Rene Obermann said in a statement yesterday. He echoed France Telecom’s chief financial officer Gervais Pellissier, who said on Thursday that competition in France was intensifying and that margins were under pressure. Smaller peer Telecom Italia, whose embattled mobile unit is closely watched, also said yesterday that core earnings and sales would likely stagnate, while Spanish rival Telefonica forecast a 2 percent gain in revenue this year.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts