AUSTRALIA
Interest rates unchanged
The central bank left interest rates on hold on Thursday, brushing off calls for a cut to protect the country’s 27-year recession-free run, with officials saying that the economy was still in “reasonable” shape, despite weak inflation and wage growth. Keeping the cash rate at a record low 1.5 percent, the Reserve Bank of Australia signaled that it could cut at upcoming meetings if the labor market does not improve. “A further improvement in the labor market was likely to be needed for inflation to be consistent with the target,” the bank said.
MALAYSIA
First rate cut since 2016
The central bank cut its benchmark interest rate for the first time since July 2016, seeking to support the economy as global risks mount. Bank Negara Malaysia reduced the overnight policy rate by a quarter percentage point to 3 percent as policymakers are bracing for slower growth while exports take a knock from weaker global demand and rising trade tensions. The central bank is forecasting expansion of 4.3 to 4.8 percent this year, lower than the government’s projection of 4.9 percent.
UNITED STATES
Rates ‘in right place’
Interest rates are “in the right place” and do not need to be lowered, although weak inflation merits close watching, Federal Reserve Bank of Dallas president Robert Kaplan said. Overall inflation pressures would remain muted and tweaking monetary policy would not affect that, Kaplan said in a Bloomberg TV interview in Beijing. He added that some of the cyclical pressures on prices are transitory, matching comments by Fed Chair Jerome Powell, while some pressures are structural.
TELECOMS
Niel’s firms selling towers
Billionaire Xavier Niel’s phone carriers are raising about 2.7 billion euros (US$3 billion) of cash through the sale of towers to Cellnex Telecom SA, as they prepare for a wave of investment to boost coverage. Niel’s Iliad SA and Salt Mobile SA are together selling about 10,700 telecommunications masts to the Spanish tower operator, in three separate deals in France, Italy and Switzerland, the companies said in statements yesterday.
AVIATION
Two firms scrub first class
The most exclusive airline seats are becoming harder to find, with two South Korean carriers becoming the latest to eliminate first class on some of their flights. Korean Air Lines Co is to do away with first-class seats on 27 routes starting on June 1, while Asiana Airlines Inc would no longer offer the products on any of its services starting on Sept. 1, according to separate statements from the two carriers yesterday. The carriers would allocate more capacity for business class on those flights, they said.
ENERGY
Anadarko weighing bids
Anadarko Petroleum Corp’s board has declared Occidental Petroleum Corp’s sweetened US$38 billion takeover “superior,” giving Chevron Corp four days to either boost its offer or walk away from the oil industry’s biggest deal in at least four years. The announcement by Anadarko came almost a month after it agreed to be purchased by Chevron for US$33 billion. Chevron has so far refused to increase its offer. If it decides not to raise the bid, Chevron can walk away with a US$1 billion breakup fee.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)