GERMANY
Output falls most since 2009
Industrial output suffered its biggest fall in December last year since the recession-hit year of 2009, a shock drop highlighting the weakness in manufacturing that risks dragging Europe’s largest economy into contraction again. Industrial production tumbled by 3.5 percent monthly, undershooting expectations for a 0.2 percent fall, Statistics Office data showed. That was the biggest drop since January 2009 and came after an upwardly revised 1.2 percent increase in November. The country’s export-dependent manufacturers are struggling with sluggish demand from abroad, as well as business uncertainty linked to trade disputes and Britain’s decision to leave the EU. The services sector is in better shape. The the Munich-based Ifo Institute for Economic Research on Thursday said that the 2019 novel coronavirus could also cost the country growth. The output figures came a day after the release of data showing industrial orders unexpectedly plunged in December on weaker demand from other eurozone countries, suggesting that there is no let-up in sight for the manufacturing sector.
SELF-DRIVING CARS
US grants Nuro approval
In a first-of-its-kind approval by regulators, a federal agency on Thursday gave permission for autonomous vehicle start-up Nuro Inc over the next two years to deploy up to 5,000 low-speed electric delivery vehicles without human controls such as mirrors and steering wheels. The rollout of the R2 vehicle would take place in Houston, Texas, with plans for it to deliver items such as pizza and groceries. It is about half the width of a regular car, has no steering wheel or seating positions and boasts gull-wing cargo doors reminiscent of the time-traveling car in the Back to the Future films. Nuro, a privately held robotics company based in Mountain View, California, called the regulatory approval by the National Highway Traffic Safety Administration “a milestone for the industry.”
CASINOS
Melco drops Crown buy-in
Melco Resorts & Entertainment Ltd has pulled the plug on a stake purchase in Australia’s Crown Resorts Ltd citing plunging traveler numbers and casino closures brought about by the 2019 novel coronavirus outbreak. The US-listed casino operator dropped the second tranche of a 19.99 percent buy-in of Crown from billionaire James Packer, which was earlier valued at A$1.76 billion (US$1.18 billion). The deal has been far from plain sailing with concerns raised by regulators from the outset over links with Stanley Ho (何鴻燊), Lawrence Ho’s (何猷龍) father, who was previously under investigation by authorities in Australia and the US.
AUSTRALIA
Central bank skirts rate cut
Reserve Bank of Australia Governor Philip Lowe signaled that his board is firmly on hold, saying that further cuts to the nation’s historically low interest rate risk doing more long-term damage to the economy than the short-term benefit they would create. “While it’s plausible that we can move toward our goals, at least right at the moment the risks have slightly tilted to outweigh the benefits,” Lowe told a parliamentary panel in Canberra yesterday. He warned of “significant areas of uncertainty,” including the viral outbreak in China, the nation’s largest trading partner. The bank kept the cash rate unchanged at a record low 0.75 percent as the labor market holds up and amid resurgent property prices.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure