The head of the US Federal Reserve backed a stimulus plan for the flagging US economy, buoying stock markets despite gloomy unemployment figures and fears the rebound could be limited.
Asian markets tracked gains on Wall Street, where stocks soared after US Federal Reserve chief Ben Bernanke said US lawmakers should consider a second stimulus plan, warning the world’s largest economy risked a “protracted slowdown.”
His endorsement came after a forecast that the financial crisis could push worldwide unemployment to a record high and as new bank rescue efforts were unveiled in France and Sweden.
“With the economy likely to be weak for several quarters and with some risk of a protracted slowdown, consideration of a fiscal package by the Congress at this juncture seems appropriate,” he told the US House of Representatives budget committee.
Asked to say if the US economy was in recession, he replied only there was a “very serious slowdown in the economy, which has very serious consequences for the public.”
The fallout for workers was made clear in a report by the International Labor Organization, which warned that the number of unemployed worldwide would increase from 190 million last year to 210 million by late next year — a new record.
China’s weaker-than-expected economic growth figures released on Monday highlighted the extent to which the credit crunch has spread around the world.
But Australia’s central bank chief sounded a note of optimism, saying the danger of a “global catastrophe” stemming from the crisis that began last year with subprime US home loans had decreased thanks to government interventions.
“At moments like this, it is hazardous to make predictions,” Reserve Bank of Australia Governor Glenn Stevens told an audience in Sydney yesterday.
“However, the world is, it seems to me, getting on to a better path. As a result, the likelihood of a global catastrophe has in fact declined over the past couple of weeks,” he said.
Across Asia, stock markets were mainly up yesterday, with the Tokyo Stock Exchange’s benchmark Nikkei index up 3.34 percent at the close.
Sydney was up 3.9 percent, New Zealand shares rose 2.15 percent and Taipei was up 0.22 percent. Hong Kong shares were flat at midday, while Shanghai was up 0.42 percent. Seoul bucked the trend by finishing 0.95 percent lower.
The leading Wall Street index, the Dow Jones Industrial Average, soared 4.65 percent to 9,263.68 just after the closing bell Monday.
In Europe, the London FTSE 100 index of leading shares gained 5.41 percent on Monday, the CAC 40 in Paris jumped 3.56 percent, and the Frankfurt Dax added 1.12 percent.
The current financial crisis led to several spectacular bank failures and prompted governments around the world to put forward more than US$3 trillion to shore up banks, in addition to massive cash infusions into the banking system.
Sweden on Monday presented a plan worth more than US$206 billion to help its financial sector.
Pakistan, teetering on the edge of economic meltdown, was consulting with IMF representatives in Dubai.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS