Outlook worse than forecast
The nation’s economy will perform far worse than forecast over the next two decades, lagging global growth, business daily Vedomosti reported on Thursday, citing Russian Economy Ministry documents. It said the ministry’s strategy on economic development until 2030 warns that Russia will remain heavily dependent on oil and gas, face capital outflows, budget deficits and a growing wealth gap between its regions. According to the document, GDP will grow on average by 2.8 percent annually until 2030.
Jobless rate unchanged
Unemployment remained unchanged at 5.7 percent last month, despite the loss of nearly 28,000 full-time jobs as the mining investment boom unwinds. Economists had been expecting a figure of 5.8 percent, which would have matched the four-year high reached in August. The September number was revised upwards from 5.6 percent. While the rate was steady, a total of 27,900 full-time jobs were lost, largely offset by part-time employment increasing by 28,900.
Growth forecast cut
The central bank cut its growth forecast for this year and next year on Wednesday, citing weaker economic activity in the first half of the year in Latin America’s second-biggest economy. In an inflation report, the bank said it now expected the economy to expand between 0.9 percent and 1.4 percent this year, down from a previous outlook ranging between 2 percent and 3 percent. The forecast for next year was reduced to 3 percent to 4 percent from 3.2 percent to 4.2 percent. The bank said inflation would remain at about 3.5 percent through to next year.
Wells Fargo settles claims
Wells Fargo & Co said on Wednesday it had agreed to pay US$335 million to settle claims by Fannie Mae and Freddie Mac that it overstated the quality of mortgage securities it sold them. The US bank said the two state-controlled housing finance agencies had agreed to the sums having earlier pulled out of a class-action suit against it for overstating the quality of mortgage-backed securities it marketed in the run-up to the 2008-2009 financial crash.
ArcelorMittal losses shrink
ArcelorMittal SA, the world’s largest steelmaker, says its third quarter loss shrank as the company cut costs and the steel market is poised for recovery. The Luxembourg-based company yesterday posted a net loss of US$193 million, compared with a loss of US$642 million in the same period the previous year. Revenue fell 0.5 percent to US$19.6 billion, due to lower average selling prices. Volumes increased 1 percent to 21.1 million tonnes. Operating income recovered to US$477 million from US$55 million, with interest costs from the company’s US$17 billion debt burden the main reason for the net loss.
Strong euro hurts Adidas
Adidas said yesterday that the strong euro weighed on profits in the third quarter, but it is sticking to its full-year targets. “Our third-quarter performance was negatively impacted by severe currency headwinds,” among other factors, chief executive Herbert Hainer. In the third quarter, Adidas’ net profit fell by 8 percent to 316 million euros (US$427 million). Underlying or operating profit was down 6 percent at 463 million euros and revenue was down 7 percent at 3.879 billion euros.