Fitch cuts Argentina’s rating
Bond rater Fitch chopped Argentina’s rating on Tuesday by five notches to “CC,” deep in junk territory, saying it expects Buenos Aires to default after a US court ordered it to repay old debt. The downgrade “reflects Fitch’s view that a default by Argentina is probable,” the agency said. Fitch said the downgrade reflects the “sustained deterioration” of Argentina’s finances. “The uncertainty related to the impact of the US court ruling is likely to further damage confidence and intensify political and social tensions in the country and undermine growth prospects,” it said.
Current account dips
The nation’s current account surplus narrowed slightly last month following a surge the previous month, as import growth outpaced exports, the Bank of Korea said yesterday. The surplus, the broadest measure of trade with the rest of the world, totaled US$5.82 billion last month, down from a revised US$5.91 billion in September. The current account has now been in the black for nine consecutive months, having last posted a deficit in January. For the first 10 months of the year, the surplus stood at US$34.1 billion, surpassing the central bank’s full-year forecast of US$34 billion.
Consumer confidence rises
US consumer confidence rose this month to its highest level since February 2008, the Conference Board said on Tuesday, as expectations of the future brightened despite the looming fiscal cliff. The monthly survey saw the consumer confidence index rise to 73.7, up from 73.1 last month, with those surveyed more optimistic about the short-term outlook. However, consumers showed only a little improvement in their view of the lackluster jobs market, and income expectations slipped. The survey came after the Nov. 6 presidential election and at the beginning of the holiday shopping season, which saw consumers open up their wallets in stores and online at a better-than-expected pace.
UK bank provides funding
British government-backed Green Investment Bank, designed to spur private funding for low-carbon energy initiatives, has provided ￡13 million (US$21 million) finance for two projects. The bank, headquartered in Edinburgh, Scotland, and capitalized with ￡3 billion of government money, received state aid approval from the European Commission last month. One of two projects that received funding yesterday was a group of six plants that will generate energy from waste in northeast England. They receiving ￡8 million. The other project, earmarked for a ￡5 million investment, will retrofit the British facilities of Irish construction company Kingspan with material to make them more energy efficient.
Chinese studios eye IPOs
Two big Chinese state-owned film studios are planning to sell shares on the Shanghai stock exchange in a sign of Beijing’s desire to build a film industry that can compete with Hollywood. China Film Co (中國電影公司) and Shanghai Film Group Co (上海電影集團) are on a list of companies preparing to go public in Shanghai. The list was posted this week on the Web site of the country’s securities regulator. No details were provided on how much money they plan to raise or timetables for their initial public offerings (IPOs).