MACROECONOMICS
Fed sees rate hike coming
The US Federal Reserve was divided about whether the US economy is strong enough to withstand an interest rate increase, according to the minutes of its policy meeting released on Wednesday. Although policymakers at the US Federal Open Market Committee meeting on July 28 and July 29 viewed conditions getting closer to allowing the first rate hike in nearly nine years, they cited evidence that the time was not ripe. As expected, the committee left the benchmark federal funds rate unchanged at zero, but Fed Chair Janet Yellen has signaled that a hike is on track this year. The meeting record gave no clear indication of when the Fed would pull the rate trigger.
MACROECONOMICS
Norway’s growth slows
Norway’s economic growth slowed in the second quarter, as plunging crude prices sapped investments and drove up unemployment in western Europe’s biggest petroleum producer. Seasonally adjusted GDP, excluding oil, gas and shipping, grew 0.2 percent, after expanding a revised 0.3 percent in the first quarter, Oslo-based Statistics Norway said yesterday. The slump in oil prices is proving painful for the economy, with almost half of its exports related to petroleum. The nation’s central bank cut rates in June for a second time since the price of Brent crude started dropping. It also signaled a probability as high as 70 percent that it would cut rates again this fall.
AIRLINES
Qantas swings into profit
Qantas Airways Ltd yesterday posted a A$557 million (US$409 million) full-year profit in a dramatic turnaround since it recorded a US$2.6 billion loss in the previous year. Australia’s largest airline said in a statement that profit for the fiscal year through June reflected strong performances from all business segments, including its troubled international arm, which turned a A$408 million loss last year into a A$267 million profit. The company has not declared a dividend, but will return A$505 million to shareholders through a A$0.23 per share cash distribution in November. The airline’s underlying pre-tax profit for the year was A$975 million, better than analysts’ expectations of a A$960 million profit.
MANUFACTURING
Li & Fung profit falls 20%
Li & Fung Ltd (利豐), the world’s largest supplier of clothes and toys to retailers, yesterday reported that first-half core operating profit slumped 20 percent amid weak demand in the US and Europe. Core operating profit fell to US$182 million for the six months ended June from US$227 million a year earlier, the company said in a statement. “The oil price decline in the US did not help consumption this time around,” Deutsche Bank analyst Anne Ling (林建純) said in a note before the results were released.
ELECTRONICS
Apple ruling appealed
Samsung Electronics Co has filed a petition to the US Supreme Court in its long-running patent infringement case against Apple Inc, according to court documents. The petition was filed after an appeals court upheld part of a ruling by a California jury that found patent infringement by Samsung, ordering the company to pay about US$930 million in damages to its US rival. The petition “will present at least two substantial questions concerning design-patent liability and damages,” and be filed by November, the court documents filed on Wednesday showed.
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).
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
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