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World Business Quick Take



Public debt to hit 83.7%

France’s public debt is expected to come to 83.7 percent of GDP this year, the government said on Tuesday, well beyond the 60 percent level prescribed by the eurozone. The government, in an upward revision of its previous forecast for this year of 83.2 percent, said that the public debt would expand to 87.5 percent of output in 2012. Earlier on Wednesday, the national statistics body INSEE said French public debt had risen sharply in the first quarter of the year to 80.3 percent of GDP. It said in a first estimate that at the end of March, the public sector debt rose by 46.5 billion euros (US$56.7 billion) from the figure for the previous quarter to 1.535 trillion euros.


Moody’s reviewing debt

Moody’s Investor Service on Wednesday placed Spain’s sovereign debt rating “on review for possible downgrade” because of the weak growth prospects of its fragile economy. The credit rating agency said it could lower Spain’s Aaa rating by “one, or at most two, notches” at the end of the three-month review period. The decision was prompted by “the deteriorating [short-term and long-term] economic growth prospects,” by “the challenges the government faces in achieving its fiscal targets” and by “concerns over the impact of rising funding costs over the medium term,” it said. The warning followed a decision by another ratings agency, Fitch, on May 29 to cut Spain’s credit rating one notch from the maximum AAA to AA+, arguing that the economic recovery would be more muted than that forecast by the government.


German sales rose in May

Retail sales in Germany rose in May as the economic recovery gathered pace and unemployment fell. Sales, adjusted for inflation and seasonal swings, increased 0.4 percent from April, when they dropped 0.5 percent, the Federal Statistics Office in Wiesbaden said yesterday. May’s gain was in line with the median estimate in a Bloomberg News survey of 17 economists. In the year, sales declined 2.4 percent. German companies are stepping up output and increasing their workforce as an Asian-led global recovery boosts export orders, in turn encouraging consumer demand.


Yahoo to buy back stock

Yahoo has set the stage to buy back US$3 billion worth of its stock in the coming three years, according to a filing on Wednesday with US securities regulators. The plan was approved by the Yahoo board of directors on June 24 and authorizes the pioneering Internet firm to repurchase as much as US$3 billion in common stock during the next three years. “The repurchases may take place in the open market or in privately negotiated transactions,” the Sunnyvale, California-based company said in a filing with the Securities and Exchange Commission.


Microsoft to kill Kin phones

Microsoft on Wednesday said it was killing the Kin line of mobile telephones it unveiled in April to win over young people enthralled by online social networking. “Microsoft has made the decision to focus on the Windows Phone 7 launch and will not ship Kin in Europe this fall as planned,” the US technology giant said in an e-mail response to a reporter’s inquiry. “Additionally, we are integrating our Kin team with the Windows Phone 7 team, incorporating valuable ideas and technologies from Kin into future Windows Phone releases.”

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