Confidence growing: CBI
Companies have grown more optimistic about the economy in recent months as a recovery, increasingly aided by a central bank funding scheme, is gathering pace, a leading business lobby said yesterday. The Confederation of British Industry (CBI) said businesses’ view of the future had shifted slightly, although it kept its forecasts for the country’s economic growth unchanged from February at 1 percent this year and 2 percent next year. The confederation predicts that quarterly GDP growth will speed up from 0.3 percent in the first and second quarters of the year to 0.4 percent in the third and fourth and to between 0.5 percent and 0.6 percent next year.
Coal export plan scrapped
Glencore Xstrata PLC yesterday dumped plans for a new billion dollar coal export terminal in Queensland, citing poor current market conditions and concerns about the industry outlook. The decision to scrap the Balaclava Island Coal Export Terminal follows the merger of mining giant Xstrata with Swiss commodities trader Glencore. The proposed terminal would have allowed for the export of up to 35 million tonnes of coal per year from the Bowen and Surat basins to foreign markets.
KFC sales slump on H7N9
Sales of fast food giant KFC slumped an estimated 36 percent last month, said parent Yum Brands Inc, as consumers shunned chicken due to the H7N9 bird flu outbreak in humans. For Yum overall, which includes other restaurant chains such as Pizza Hut, same-store sales — a measure of turnover in established outlets — fell an estimated 29 percent last month, according to a stock exchange filing on Friday.
Shadow banking on the rise
The nation’s shadow banking activities have risen about 70 percent over the past two years and now total more than half the size of the world’s second-largest economy, ratings agency Moody’s said yesterday. Shadow banking includes private lending, off-balance-sheet vehicles and trusts, and allows borrowers to circumvent banks’ formal underwriting standards, as well as official regulation. Such lending has surged 67 percent since the end of 2010, Moody’s said in a report, reaching an estimated total of 29 trillion yuan (US$4.7 trillion) at the end of last year, or 55 percent of the nation’s GDP.
Lloyds boss to step down
Lloyds Banking Group PLC said yesterday that chairman Winfried Bischoff will retire from the post by the middle of next year after overseeing a partial turnaround of the state-rescued British bank. The group said in a statement the exact date will be subject to the appointment of his successor. Lloyds received a massive bailout after the 2008 financial crisis and is currently 39 percent owned by the British government.
FOOD AND BEVERAGE
Firm eyes baby-food growth
Groupe Danone SA, owner of the Evian water and Activia yogurt brands, agreed to buy Happy Family, a US maker of organic baby-food, to strengthen its fast-growing infant-nutrition division. Danone will acquire more than 90 percent of the New York-based company, according to a statement yesterday. The transaction is subject to the approval of the relevant authorities and is expected to be finalized in the next few months, the Paris-based company said. The companies did not disclose a price.