China ‘prepared’ for ‘war’
A top Chinese banker said Beijing is “fully prepared” for a currency war, as he urged the world to abide by a consensus reached by the G20 to avert confrontation, Xinhua news agency reported yesterday. People’s Bank of China Deputy Governor Yi Gang (易鋼) issued the call after G20 finance ministers last month moved to calm fears of a looming war on the currency markets at a meeting in Moscow. Those fears have largely been fueled by the recent steep decline in the Japanese yen, which critics have accused Tokyo of manipulating to give its manufacturers a competitive edge in key export markets over Asian rivals. Yi said a currency war could be avoided if major countries observed the G20 consensus that monetary policy should primarily serve as a tool for domestic economy, Xinhua reported.
Yahoo cuts slow products
Yahoo Inc is shutting down seven products, including its mobile app for BlackBerry smartphones, as new CEO Marissa Mayer takes a page from Google Inc’s play book by eliminating unsuccessful products en masse. The product shutdowns, which Yahoo announced on its official company blog on Friday, are part of what the company said are regular efforts to evaluate and review its product line-up. The announcement represents Yahoo’s second group shutdown of products since Mayer, a former Google executive, became CEO of the struggling Web portal in July last year. The other products to be terminated are Yahoo Avatars, App Search, Sports IQ, Clues, Message Boards Web site and Updates API.
US manufacturing expands
US manufacturing expanded at a faster pace than forecast last month, reaching the highest level since June 2011 as factories boosted production. The Institute for Supply Management’s (ISM) factory index advanced to 54.2, from 53.1 in January, the Tempe, Arizona-based group said on Friday. The figures exceeded the most optimistic forecast in a Bloomberg survey in which the median projection was 52.5. A reading greater than 50 signals expansion. The production gains complement a rebound in the housing market and help underpin the economy amid budget disputes in Washington. Estimates from the 81 economists surveyed by Bloomberg ranged from 50.5 to 54. The gauge averaged 51.7 last year and 55.2 in 2011. The ISM report also showed a measure of US production increased to 57.6 from 53.6 in January. The new orders measure climbed to 57.8, the highest since April 2011, from 53.3.
Ernst & Young fined for fraud
Ernst & Young LLP will pay US$123 million to resolve a US tax-fraud probe as part of a non-prosecution agreement, according to a statement by the Manhattan US Attorney’s Office on Friday. The accounting firm “admitted wrongful conduct” by its partners and employees in connection with four tax shelters from 1999 to 2004, it said. About 200 Ernst & Young clients used the shelters to try to avoid more than US$2 billion in taxes, prosecutors said. In addition to the money and the admissions, Ernst & Young agreed to a series of permanent restrictions on its tax practice and would continue to cooperate with the government’s tax-shelter investigation.