AUSTRALIA
Interest rate kept unchanged
The Reserve Bank of Australia yesterday left the key interest rate unchanged at a record low after the key unemployment metric edged higher. Bank Governor Philip Lowe kept the cash rate at 1.5 percent, where it has stood since 2016, as expected by all economists. The jobless rate hit 5.6 percent in April, moving further away from the bank’s estimated level of full employment. The global picture has also become more clouded amid an emerging-market rout, populism in Europe and US trade tariffs. The central bank has fashioned itself as an anchor of stability in the nation’s economy, making clear that it is unlikely to tighten policy until unemployment falls toward 5 percent and inflation is nearer the midpoint of its 2 to 3 percent target range.
BANKING
Societe Generale settles probe
Societe Generale SA is to pay about US$1.3 billion to resolve a probe into the bribery of Libyan officials and settle a US investigation into interest-rate manipulation, drawing a line under two of the French bank’s biggest legal headaches. The bank is to pay US$585 million to resolve charges with US and French law enforcement agencies related to the Libya investigation and US$275 million for violations arising from helping rig benchmark interest rates. The bank will also pay about US$475 million to the US Commodity Futures Trading Commission to settle the Libor probe, the commission said in a statement on Monday. Legg Mason Inc, a Maryland-based investment management firm, on Monday was also penalized for having a role in the Libyan bribery matter, agreeing to pay US$64 million in a resolution with the US Department of Justice.
FOOD PRODUCERS
Mars to go green for profits
Mars Inc, the maker of its namesake chocolate bar and Wrigley’s chewing gum, is spending US$1 billion on sustainability with a strategy to make greener practices increase profits. The company generated US$35 billion in revenue in 2016. “There is a very concrete business case to this,” Barry Parkin, chief procurement and sustainability officer at Mars, said in a telephone interview. “We’re going to get a payback on that billion several times over.” Parkin is allocating about a third of the funds to making operations more water and energy efficient. Another third is going to simplify supply chains by buying directly from farmers. The remainder would be used to recreate recipes without artificial ingredients. Mars is working to reduce its exposure to environmental, social and governance risks, because it is next to impossible to track exactly where the huge amounts of raw materials that it uses are from, Parkin said.
GREECE
Recovery stays on target
The economy has grown for a fifth consecutive quarter, keeping the nation’s recovery on target as eight years of international bailout programs are due to end in August. The economy grew 2.3 percent in the first quarter compared with the same period a year earlier, the Greek Statistical Authority said on Monday. The growth from the previous quarter was 0.8 percent. The government is negotiating the terms of its bailout exit with eurozone rescue lenders, and parliament is expected to approve a final major round of administrative and cost cutting reforms next week. The government hopes to make a full return to bond markets after August, but the head of the central bank has renewed support for a more gradual approach with a precautionary credit line from bailout lenders.
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