NEW ZEALAND
GDP misses forecasts
The farm-dependent economy is growing more slowly than expected, official figures showed yesterday, feeding expectations of further interest-rate cuts. Statistics New Zealand said the economy expanded 0.4 percent in the three months to June, below consensus forecasts of 0.6 percent. That pushed annual growth in GDP down to 2.4 percent from 3.3 percent last year, the lowest in two years with economists expecting it to fall further. The June quarter improved on the first three months — when dairy prices plunged — but still fell short of economists’ estimates. “The 0.4 percent rebound ... from the 0.2 percent rise in the first quarter, is disappointing and supports our view that the economy is weaker than the RBNZ [Royal Bank of New Zealand] believes,” said Paul Dale, lead Australia and New Zealand economist at Capital Economics.
SWITZERLAND
‘Subdued’ economy tipped
Economic growth will stay below its potential this year and next, the government said yesterday. Output will expand 0.9 percent this year and 1.5 percent next year, the State Secretariat for Economic Affairs said in Bern. Its previous prediction, issued in June, was for growth of 0.8 percent and 1.6 percent respectively. The government said it continued to “expect the economy to remain very subdued in the second half of the year and to only strengthen during the course of 2016,” according to a statement. “The strong downward momentum in prices should gradually ease as the effects of the appreciation in the Swiss franc fade away.”
SLOVENIA
IMF warns over deficits
The nation needs to reduce budget deficits to rein in growing debt after it more than quadrupled since the start of the financial crisis, the IMF said on Wednesday. The fiscal situation remains in “a troubled state” with persistent budget shortfalls and the public debt set to rise to about 90 percent of GDP by 2020, the Washington-based lender said in a report. The fiscal gap widened from near balance in 2007 to a deficit of almost 14 percent of GDP in 2013 after the failure of domestic banks required public support of about 10 percent of total output, it said.
AUTO RENTAL
Hertz sells CAR stake
Hertz Global Holdings Inc sold a US$100 million stake in China Auto Rental Holdings Inc (CAR, 神州租車控股), sending shares of the Chinese car-rental company that it invested in in April 2013 to slump as much as 7.3 percent in Hong Kong yesterday. Hertz had agreed to place 59.57 million shares to an undisclosed third party at HK$13.01 per share, representing a 5.6 percent discount to the closing price on Wednesday. Hertz still owns about 13.6 percent of the company after the sale. CAR, based in Beijing, held its initial share sale in Hong Kong in September last year.
TECHNOLOGY
Oracle revenue declines
Oracle Corp’s fiscal first-quarter revenue fell short of analysts’ projections, crimped by a slowdown in software license sales amid a shift to Web-delivered cloud products. Revenue in the period that ended Aug. 31 fell 1.7 percent to US$8.45 billion, and profit before certain costs was US$0.53 a share, the Redwood City, California-based company said on Wednesday. Analysts on average had forecast sales of US$8.53 billion and profit of US$0.52. Net income in the first quarter declined to US$1.75 billion, or US$0.4 a share, from US$2.18 billion, or US$0.48, a year earlier.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by