S&P warns of rating risk
Standard & Poor’s rating agency says the country’s cherished “AAA” long-term credit rating will stay for now — but warned there was still a chance of a downgrade if the economy weakens. The move comes after fellow ratings agency Moody’s downgraded its “AAA” credit rating for the country one notch to “AA1” in February. S&P said on Friday it would leave the rating on a negative outlook because the agency views a one-in-three chance that it could cut ratings over the next two years if the country’s economy weakens beyond current expectations.
Social housing plan unveiled
The government said on Friday that it would invest 2.4 billion euros (US$3.12 billion) over the next three years to help the poor gain access to rental housing and renovate buildings to boost the stricken construction sector. Spain, the fourth-biggest eurozone economy, fell into crisis after a real-estate bubble burst in 2008, and since then, officials have carried out 252,826 expulsion orders, 61 percent of all issued so far.
Pay cuts ruled unlawful
The Constitutional Court has ruled that some of the unpopular pay cuts in this year’s state budget are unlawful, denying the government about 1.4 billion euros of predicted revenue. Among the reasons for the decision were that the measures neglected guarantees of equality. Private sector workers are not subject to the measures. The court’s decision on Friday delivers a setback to the austerity strategy agreed between the government and foreign creditors who lent Portugal 78 billion euros in a bailout two years ago.
Public investment on hold
The government announced that it will suspend 15 billion dirhams (US$1.75 billion) of public investment to help balance an overstretched budget during the country’s current economic crisis. The country’s economy grew only 2.4 percent last year due to a poor harvest and the effect of Europe’s economic crisis on the country’s two key trading partners, Spain and France. This year’s growth is forecast to be 4.3 percent.
Toyota settles with US county
Toyota has agreed to a US$16 million deal with a southern Californian county over charges the Japanese auto giant hid safety issues linked to unintended acceleration of cars, officials said on Friday. Toyota issued recalls in 2009 and 2010 affecting nearly 6 million vehicles in the US due to the risk caused by floor mats and “sticky” gas pedal issues. More than 200 US federal and about 100 state cases were filed.
Chernin bids for Hulu
Former News Corp chief operating officer Peter Chernin offered at least US$500 million for Hulu, the online TV service he helped found, two anonymous sources said. Chernin submitted the bid for Hulu last week, the sources said. The price does not include Hulu’s US$330 million in debt and would increase with additional content rights and longer contract terms, they said. Hulu’s controlling owners, News Corp and Walt Disney Co, are weighing whether to sell Hulu or buy each other out.