SOUTH KOREA
GDP grew 3.1% last year
The economy last year grew at its fastest pace in three years, the central bank said yesterday, thanks to robust exports of technology products, including semiconductors, and growing consumer spending. The economy expanded 3.1 percent, up from 2.8 percent in 2016 and the fastest since 2014’s 3.3 percent, the Bank of Korea said. Production in the country’s manufacturing sector expanded 4.2 percent last year, the highest since 2011, and investment in corporate infrastructure jumped 14.6 percent, the fastest since 2010. Consumer spending also rose 2.6 percent, the fastest pace since 2011.
MALAYSIA
Policy rate raised to 3.25%
The central bank raised its benchmark interest rate for the first time in more than three years, becoming the first in Southeast Asia to tighten monetary policy after years of low rates. Bank Negara Malaysia increased the overnight policy rate to 3.25 percent from 3 percent, it said in a statement yesterday, as predicted by 16 of the 20 economists in a Bloomberg survey. The central bank signaled in November last year that it might adjust its stance given the strength of the economy. The government is forecasting growth of as much as 5.5 percent this year, buoyed by a global trade recovery and rising domestic spending.
GERMANY
Consumer confidence rising
Consumer confidence is expected to inch up next month, a closely watched survey forecast yesterday, as political gears grinding in Berlin fail to slow the tempo of Europe’s biggest economy. Market research firm GfK said its forward-looking poll of about 2,000 people climbed 0.2 points to 11 for next month, slightly higher than analysts’ expectations. Consumers “clearly see the German economy in a boom” and expect it to benefit them personally, the firm said in a statement.
AUTOMAKERS
Ford says tough times ahead
Ford Motor Co said that its full-year earnings jumped 65 percent to US$7.6 billion last year due to tax and pension changes, but added that this year would be tougher. The adjusted earnings of US$1.78 per share fell just short of analysts’ predictions of earnings of US$1.79 per share, a FactSet poll showed. The company’s automotive revenue rose slightly to US$145.7 billion, although its global sales remained flat at 6.6 million cars and trucks. That was higher than the US$144 billion analysts had forecast. The automaker has said it expects to earn between US$1.45 and US$1.70 per share this year.
FINANCE
GE insurance unit probed
General Electric Co (GE) is being investigated by US federal regulators for a US$15 billion hit it took to cover miscalculations made by an insurance unit. The company revealed last week that it would take a US$6.2 billion charge in its fourth quarter after a subsidiary, North American Life & Health, underestimated how much it would cost to pay for the care of people who lived longer than projected. During a conference call on Wednesday to discuss its fourth-quarter earnings report, GE Transportation chief executive Jamie Miller said that the company had been notified that the US Securities and Exchange Commission is investigating the process that led to the mishap at the insurance unit.
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01
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