UNITED STATES
Data point to Harvey shock
Retail sales unexpectedly fell last month as Hurricane Harvey disrupted activity, suggesting the storm could dent economic growth in the third quarter. The US Department of Commerce said retail sales dropped 0.2 percent last month from the previous month, the biggest decline in six months, as motor vehicle sales tumbled 1.6 percent. Sales of building materials, electronics and appliances as well as clothing also fell. Overall retail sales increased 3.2 percent on a year-on-year basis. In a separate report on Friday, the US Federal Reserve said industrial production declined 0.9 percent last month in the biggest drop since May 2009, following six straight monthly gains.
RUSSIA
Central bank cuts rate again
The Central Bank of the Russian Federation on Friday cut its key interest rate to 8.5 percent, the fourth reduction this year, as inflation hit a record low. The bank said it took the decision to slice 50 points off the rate after “inflation expectations resumed their decline.” In a statement, the bank said it would “continue to conduct a moderately tight monetary policy” in order to maintain inflation close to 4 percent. However, it also said that “during the next two quarters, the Bank of Russia deems it possible to cut the key rate further.” GDP is expected to grow by 1.7 percent to 2.2 percent after two years of recession, it said.
CHINA
Mortgages drive credit growth
Chinese bank loans rebounded last month to hit 1.09 trillion yuan (US$166 billion), beating analysts’ expectations as demand was buoyed by home buyers. The figure was up from 825.5 billion yuan in July, the People’s Bank of China said. It exceeded forecasts from analysts surveyed by Bloomberg, although it remains far below the 1.54 trillion yuan loaned by banks in in June. However, the broad M2 measure of money supply rose 8.9 percent from a year earlier, down from 9.2 percent recorded a month ago.
GREECE
Quick review of loans urged
Greece wants the next review of its European loan program to wrap up by the end of the year to pave the way for additional money to be disbursed next year, a senior member of Greek Prime Minister Alexis Tsipras’ government said. Greek Minister of Digital Policy, Telecommunications and Media Nikos Pappas, an economist who is considered a close adviser to Tsipras, said the Greek economy is rebounding, with output set to expand 2 percent this year and unemployment falling. “We hope to conclude before the end of the year. There is absolutely no reason to have any delays,” Pappas said on Friday. “If there are delays, it is not going to be because of Greece.”
ACCOUNTANCY
KPMG S Africa head quits
KPMG LLP on Friday said the head of its South African office and seven other senior executives quit, after an internal investigation found that work done for the politically connected Gupta family fell “considerably short” of the auditing firm’s standards. It is to give the equivalent of US$3 million, the fees it made from its work with the family since 2002, to education and anti-corruption charities. KPMG South Africa chief executive officer Trevor Hoole, chairman Ahmed Jaffer and chief operating officer Steven Louw were among those to have resigned, KPMG said.
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
RIDING AI WAVE: : Most of its NT$15bn capital budget would be spent on packaging technologies used in AI and HPC chips and advanced testing technology, it said Chip testing and packaging service provider Powertech Technology Inc (PTI, 力成科技) plans to increase this year’s capital expenditure by 50 percent to expand capacity to meet growing demand for advanced memorychips used in artificial intelligence (AI) products. The company proposed to spend NT$15 billion (US$460.94 million) to expand advanced capacity and equipment, compared with a budget of NT$10 billion it planned three months ago. “We are seeing a recovery in market demand as well as new business opportunities. We will spend heavily on advanced packaging” equipment, Powertech chief executive officer Boris Hsieh (謝永達) told investors on Tuesday. “We will focus on ramping
INFLATION WATCH: A rate hike in March would help keep inflation at 2.16 percent this year, although a weak currency and higher electricity rates are an issue, S&P said Moody’s Ratings and S&P Global Ratings have reaffirmed Taiwan’s sovereign credit ratings at “As3” and “AA+” respectively with a stable outlook on the back of high income and wealth levels, a strong institutional framework and robust external positions. The affirmations came as Taiwan’s economy is gaining momentum after quarters of slowdown induced by stubborn global inflation and monetary tightening. Taiwan’s strong fiscal and external buffers have improved relative to peers as evidenced by recent shocks linked to the COVID-19 pandemic and the ongoing US-China technology dispute, the two ratings firms said. “Taiwan stands as the epicenter of the global semiconductor supply chain, accounting