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World Business Quick Take

■ MANUFACTURING

Euro's rise seen as a threat

The chief executive of Airbus parent company EADS, Louis Gallois, warned in an interview published yesterday that the high value of the euro threatened European manufacturing. The high value of the euro against the dollar "is in the process of suffocating a good portion of European industry by eating away at its export markets," he told the daily Le Figaro. "If this continues export manufacturers will flee Europe," he said. The euro rose to US$1.5845 on Wednesday in New York, approaching its all-time high of US$1.5905 on March 17.



■ SOUTH KOREA

No interest in US Treasuries

South Korea's pension fund will no longer buy low-yield US Treasuries because it wants to diversify its portfolio and boost returns, an official said yesterday. The world's fifth-largest pension fund would consider buying European government debt or other higher-yielding assets, a manager at the National Pension Service's overseas investment team said. "The portion of our investment in US Treasuries is too high. We will diversify our portfolio," he said on condition of anonymity. The state-run fund, which manages about 220 trillion won (US$220.6 billion) in assets, holds US$14 billion of US government debt. The yield on US Treasuries has fallen after several rate cuts by the US Federal Reserve.



■ MARKETS

LSE forecasts good year

London Stock Exchange Group Plc (LSE) said yesterday it was confident of a good outcome for the financial year ending March 31. The LSE, which is set to announce its preliminary results on May 22, said it had delivered a strong overall trading performance for the first 11 months. It also said it had bought back nearly 2.9 million shares at a total cost of ?45 million (US$89.87 million) since mid-January. Trading at Borsa Italiana, which the LSE acquired in October, increased 23 percent to 288,000 trades per day in the same period, with the average daily value up 30 percent at 6.2 billion euros (US$9.79 billion).



■ BANKING

Lending reduced in UK

Britain's smaller mortgage banks and building societies are restricting lending and withdrawing products at an unprecedented rate as the credit crunch extends its grip, according to a study released on Wednesday. Moneyfacts.co.uk, an independent personal finance information provider, said smaller building societies, which use deposits to fund lending, are being hit by overwhelming demand as large banks, the first casualties of the current market turbulence, increase rates and become more reluctant to compete. In the last month alone more than 2,000 residential and buy-to-let mortgage products have been withdrawn, with the number of products on offer dropping to 5,700 from 7,726, Moneyfacts said.



■ OIL

Exxon, Malaysia ink deal

US oil giant ExxonMobil Corp said on Wednesday it had signed a new, 25-year production-sharing contract with the Malaysian national oil company Petronas. The financial terms of deal were not disclosed. The contract includes commitments to implement enhanced oil recovery activities and for investments to continue oil development in Malaysia, Exxon said. It's Malaysian subsidiary operates 43 energy platforms in 17 fields and is one of the country's major suppliers of crude oil and natural gas.
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