MACROECONOMICS
Japan to continue stimulus
The Bank of Japan yesterday stuck by its view that the nation’s economy was recovering, despite a contraction in the second quarter that underlined the damage inflicted by an April sales tax hike. Policymakers held fire on expanding the bank’s vast stimulus program following a two-day policy meeting, although they flagged housing and factory output as weak spots, along with shaky demand for Japanese exports. The economy contracted by 1.7 percent in the April-to-June quarter, or a 6.8 percent contraction at an annualized rate, giving the clearest picture yet of the tax hike’s impact.
ARGENTINA
Bill to sidestep court rulings
Argentina’s Senate approved a bill early yesterday aimed at circumventing US court decisions regarding its defaulted debt by changing its payment jurisdiction, passing the proposal to the lower House of Representatives for debate. The House, like the Senate, is controlled by government allies who are expected to vote the bill into law. The Senate vote approving the measure was 39 to 27. Argintinian President Cristina Fernandez wants to resume servicing sovereign bonds that were restructured after Argentina’s previous default in 2002. Her government missed a coupon payment on its restructured bonds in July.
BRAZIL
Interest rate remains at 11%
With the country battling recession and inflation a month away from a presidential election, Brazil’s central bank on Wednesday kept its key interest rate on hold at 11 percent. Traders and analysts had forecast no change and the central bank’s monetary policy commission duly elected to leave well alone following its monthly two-day meeting. Brazil is in a fourth year of anemic growth and the 2014 forecast is for just a 0.52 percent rise in GDP.
AUTOMAKERS
US sales rise, excepting GM
Large automakers on Wednesday reported generally higher US sales last month on strong demand for trucks and sport utility vehicles, although market leader General Motors (GM) suffered a modest decline. Total light vehicle sales were 1.59 million last month, up 5.5 percent from the year-ago period, according to industry specialist AutoData. The strongest gains came at Chrysler, which notched a 20 percent annual increase in sales to 198,379 units. However, GM, the biggest US automaker, saw sales decline by 1.2 percent annually to 272,423 units.
RETAIL
CVS drops tobacco products
CVS, the leading US drug chain by sales, announced on Wednesday that it had stopped selling tobacco products and was changing its name to reflect a greater focus on health. CVS — which operates 7,700 pharmacies — ended the sale of cigarettes, pipe tobacco and other products a month earlier than expected.
BANKING
Kookmin CEO steps down
Kookmin Bank chief executive officer Lee Kun-ho resigned yesterday after being reprimanded by South Korea’s financial watchdog following a series of missteps at his bank and parent company KB Financial Group Inc. His resignation was immediate, according to an e-mail from the bank, the country’s largest lender. The South Korean Financial Supervisory Service issued a “disciplinary warning” against Lee and KB Financial chairman Lim Young-rok over issues relating to changes in the bank’s main computing system.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six